As filed with the Securities and Exchange Commission on June 2, 2025.
Registration No. 333-287354
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 1 to
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Voyager Technologies, Inc.
(Exact name of registrant as specified in its charter)
| | | | | | | | |
Delaware (State or other jurisdiction of incorporation or organization) | 3760 (Primary Standard Industrial Classification Code Number) | 84-2754888 (I.R.S. Employer Identification Number) |
1225 17th Street, Suite 1100
Denver, Colorado 80202
(303) 500-6985
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
Dylan Taylor
Chief Executive Officer
1225 17th Street, Suite 1100
Denver, Colorado 80202
(303) 500-6985
(Name, address, including zip code, and telephone number, including area code, of agent for service)
| | | | | | | | |
Michael Benjamin Lewis Kneib Latham & Watkins LLP 1271 Avenue of the Americas New York, New York 10020 Tel: (212) 906-1200 | With copies to: | Richard A. Fenyes John G. O’Connell Simpson Thacher & Bartlett LLP 425 Lexington Avenue New York, New York 10017 Tel: (212) 455-2000 |
Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date of this registration statement.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☐
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| | | | | | | | | | | |
Large accelerated filer | ☐ | Accelerated filer | ☐ |
Non-accelerated filer | ☒ | Smaller reporting company | ☐ |
| | Emerging growth company | ☒ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where such offer or sale is not permitted.
Subject to completion, dated June 2 , 2025
Preliminary Prospectus
11,000,000 shares
Voyager Technologies, Inc.
Class A common stock
This is the initial public offering of shares of Class A common stock of Voyager Technologies, Inc. We are offering 11,000,000 shares of our Class A common stock.
Prior to this offering, there has been no public market for our Class A common stock. We expect that the initial public offering price of our Class A common stock will be between $26.00 and $29.00 per share.
After pricing of this offering, we expect shares of our Class A common stock will trade on the New York Stock Exchange under the symbol “VOYG.”
Following this offering, we will have two series of authorized common stock, Class A common stock and Class B common stock. The rights of the holders of our Class A common stock and Class B common stock are identical, except with respect to voting, conversion and transfer rights. Each share of our Class A common stock is entitled to one vote per share. Each share of our Class B common stock is entitled to 15 votes per share and is convertible at any time, subject to the satisfaction of certain conditions as described herein, into one share of Class A common stock. Immediately following the completion of this offering, all outstanding shares of Class B common stock will be beneficially owned by Dylan Taylor, our Chairman and Chief Executive Officer, and assuming no exercise of the underwriters’ option to purchase additional shares to cover over-allotments, if any, and Mr. Taylor does not purchase any shares of Class A common stock pursuant to the directed share program, Mr. Taylor will own approximately 10.3% of our outstanding capital stock and control approximately 63.4% of the voting power of our outstanding capital stock. As a result, Mr. Taylor may have significant influence over the outcome of matters submitted to our stockholders for approval, including the election of our directors and the approval of any change of control transaction. We will be a “controlled company” within the meaning of the corporate governance standards of the New York Stock Exchange. Although we do not intend to utilize any exemptions from corporate governance standards upon completion of this offering, we may utilize any or all of these exemptions at any time at our discretion until we cease to be a “controlled company.” See “Management—Controlled Company Exception” and “Principal Stockholders.”
We are an “emerging growth company” as defined in Section 2(a)(19) of the Securities Act of 1933, as amended, or the Securities Act, and, as such, we have elected to comply with certain reduced public company reporting requirements for this prospectus and future filings. See “Summary—Implications of Being an Emerging Growth Company.”
Investing in our Class A common stock involves a high degree of risk. See “Risk Factors” beginning on page 42 to read about factors you should consider before buying shares of our Class A common stock. | | | | | | | | | | | |
| Per share |
| Total |
Initial public offering price | $ |
| $ |
Underwriting discounts and commissions(1) | $ | | $ |
Proceeds, before expenses, to us | $ | | $ |
________________
(1)See “Underwriting” for additional information regarding underwriting compensation. At our request, the underwriters have reserved up to $20 million of shares of Class A common stock (or up to 727,272 shares of Class A common stock assuming an initial public offering price of $27.50 per share, which is the midpoint of the price range set forth above) to be issued by us and offered by this prospectus for sale, at the initial public offering price, to certain of our employees and friends and family members of certain of our directors, officers and employees. The number of shares of Class A common stock available for sale to the general public will be reduced to the extent these individuals purchase such reserved shares. Any reserved shares that are not so purchased will be offered by the underwriters to the general public on the same basis as the other shares offered by this prospectus. Morgan Stanley & Co. LLC will administer our directed share program. See “Underwriting—Directed Share Program.”
We have granted the underwriters an option to purchase up to 1,650,000 additional shares of Class A common stock, solely to cover over-allotments, if any, from us at the initial public offering price, less the underwriting discounts and commissions, within 30 days from the date of this prospectus.
Janus Henderson Investors and Wellington Management (the “cornerstone investors”) have, severally and not jointly indicated an interest in purchasing up to an aggregate of $60 million in shares of Class A common stock in this offering at the initial public offering price. The shares of Class A common stock to be purchased by the cornerstone investors will not be subject to a lock-up agreement with the underwriters. Because this indication of interest is not a binding agreement or commitment to purchase, the cornerstone investors may determine to purchase more, less or no shares in this offering or the underwriters may determine to sell more, less or no shares to the cornerstone investors. The underwriters will receive the same underwriting discounts and commissions on any of our shares of Class A common stock purchased by the cornerstone investors as they will from any other shares of Class A common stock sold to the public in this offering.
Neither the Securities and Exchange Commission, any state securities commission nor any other regulatory body has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The underwriters expect to deliver the shares to purchasers on or about , 2025.
| | | | | | | | | | | | | | | | | | | | |
| MORGAN STANLEY | | | | J.P. MORGAN | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Barclays | | Jefferies | | BofA Securities | | KeyBanc Capital Markets | | Wolfe | Nomura Alliance |
Prospectus dated , 2025.
TABLE OF CONTENTS
Through and including , 2025 (the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.
You should rely only on the information contained in this prospectus, any amendment or supplement to this prospectus or any free writing prospectus we may authorize to be delivered or made available to you. We and the underwriters have not authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus, any amendment or supplement to this prospectus or any free writing prospectuses prepared by us or on our behalf. We and the underwriters take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus, any amendment or supplement to this prospectus or any applicable free writing prospectus is an offer to sell only the shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus, any amendment or supplement to this prospectus or any applicable free writing prospectus is accurate only as of its date, regardless of the time of delivery of this prospectus, any amendment or supplement to this prospectus or any applicable free writing prospectus or any sale of the shares. Our business, financial condition, results of operations and prospects may have changed since such date.
You should not consider any information in this prospectus, any amendment or supplement to this prospectus or any applicable free writing prospectus to be investment, legal or tax advice. You should consult your own counsel, accountant and other advisors for legal, tax, business, financial and related advice regarding the purchase of our Class A common stock. Neither we nor any underwriter (nor any of our or their affiliates) are making any representation to you regarding the legality of an investment in our Class A common stock by you under applicable investment or similar laws.
For investors outside the United States: Neither we nor the underwriters have done anything that would permit a public offering of the shares of our Class A common stock or possession or distribution of this prospectus, any amendment or supplement to this prospectus or any applicable free writing prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus, any amendment or supplement to this prospectus or any applicable free writing prospectus must inform themselves about, and observe any restrictions relating to, the offering of the shares of Class A common stock and the distribution of this prospectus, any amendment or supplement to this prospectus or any applicable free writing prospectus outside of the United States.
ABOUT THIS PROSPECTUS
Basis of Presentation
Certain Definitions
As used in this prospectus, unless the context otherwise requires, references to “we,” “us,” “our,” “our business,” the “Company,” “Voyager,” “Voyager Technologies,” and similar references refer to Voyager Technologies, Inc. and, where appropriate, Voyager Technologies, Inc. together with its consolidated subsidiaries. In addition, the terms below that are used frequently in this prospectus have the following meanings:
•“2020 Plan” means the Voyager Technologies, Inc. 2020 Incentive Plan, as amended.
•“2025 Plan” means the Voyager Technologies, Inc. 2025 Incentive Award Plan.
•“Airbus” means Airbus Space and Defence GmbH.
•“CDFF” means NASA’s Commercial Destinations Free Flyers.
•“Class A Preferred Stock” means our Class A preferred stock, $0.0001 par value per share.
•“Class A-1 Preferred Stock” means our Class A-1 redeemable preferred stock, $0.0001 par value per share.
•“Class B Preferred Stock” means our Class B convertible preferred stock, $0.0001 par value per share.
•“Class B Stock Exchange” means the exchange of an aggregate of 5,695,362 shares of Class A common stock beneficially owned by Mr. Taylor for an equivalent number of shares of our Class B common stock, to be effected in connection with the closing of this offering pursuant to the terms of an exchange and forfeiture agreement entered into with us.
•“Class C Preferred Stock” means our Class C convertible preferred stock, $0.0001 par value per share.
•“Code” means the U.S. Internal Revenue Code of 1986, as amended.
•“Common Stock Reclassification” means the reclassification of our outstanding common stock as Class A common stock.
•“Credit Agreement” means the $58.0 million Loan and Security Agreement, dated as of June 28, 2024, by and among the Company, the Company’s domestic subsidiaries, excluding Starlab, the lenders party thereto and Hercules Capital, Inc., as administrative agent and collateral agent.
•“DoD” means the U.S. Department of Defense.
•“ESA” means the European Space Agency.
•“ESPP” means the Voyager Technologies, Inc. 2025 Employee Stock Purchase Plan.
•“EU” means the European Union.
•“FAR” means the Federal Acquisition Regulation.
•“funded backlog” means the portion of definitized contracts with customers that contain remaining performance obligations.
•“GAAP” means accounting principles generally accepted in the United States.
•“GPU” means Graphics Processing Unit.
•“IDIQ” means indefinite delivery/indefinite quantity.
•“IPO Recapitalization Transactions” means, collectively, the Preferred Stock Recapitalization, the SMI Promissory Notes Conversion, the Common Stock Reclassification and the Class B Stock Exchange.
•“ISS” means the International Space Station.
•“JAXA” means Japan Aerospace Exploration Agency.
•“Joint Venture Agreement” means the limited liability company agreement governing Starlab JV.
•“LEO” means Low Earth Orbit.
•“MDA” means the U.S. Missile Defense Agency.
•“MDA Space” means MDA Space Ltd.
•“Mitsubishi” means Mitsubishi Corporation.
•“Nanoracks” means Nanoracks, LLC, a subsidiary of Voyager.
•“NASA” means National Aeronautics and Space Administration.
•“NGI” means Next Generation Interceptor.
•“Palantir” means Palantir Technologies.
•“Preferred Stock Recapitalization” means (i) the conversion of all outstanding shares of our Class A-1 Preferred Stock, Class B Preferred Stock and Class C Preferred Stock into an aggregate of 27,812,820 shares of common stock and the subsequent cancellation of such shares of Class A-1 Preferred Stock, Class B Preferred Stock and Class C Preferred Stock and (ii) the forfeiture and cancellation of our outstanding share of Class A Preferred Stock pursuant to the terms of an exchange and forfeiture agreement entered into with us, in each case, immediately prior to the completion of this offering.
•“RCS” means Roll Control System.
•“Revolving Credit Agreement” means the Credit Agreement, dated as of May 30, 2025, by and among the Company, the Company’s material domestic subsidiaries, excluding Starlab, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent.
•“Revolving Credit Facility” means the $200.0 million revolving credit facility pursuant to the Revolving Credit Agreement.
•“RF” means radio frequency.
•“SAA” means Space Act Agreement.
•“SAMS” means Space Acceleration Measurement System.
•“SEC” means Securities and Exchange Commission.
•“SMI Promissory Notes” means the $28.4 million aggregate amount of promissory notes issued to certain minority stockholders of SMI in exchange for additional shares of SMI.
•“SMI Promissory Notes Conversion” means the conversion of an aggregate principal amount of $25.3 million (plus accrued and unpaid interest) of SMI Promissory Notes into an aggregate of 921,306 shares of our common stock.
•“Starlab” means the commercial space station being designed and built, and expected to be operated by Starlab JV and expected to be the commercial replacement for the ISS when it will be decommissioned in 2030.
•“Starlab JV” means Starlab Space LLC.
•“Stock Split” means the 1.5-for-1 forward stock split of our common stock that occurred.
•“Term Loan” means our $58.0 million term loan pursuant to the Credit Agreement.
•“UK” means the United Kingdom.
•“unfunded backlog” means unexercised contract options and potential bookings under IDIQ contracts.
Presentation of Financial Information
Our audited consolidated financial statements as of and for the years ended December 31, 2024 and 2023 included in this prospectus have been prepared in accordance with GAAP. The selected historical consolidated financial data presented for the three months ended March 31, 2025 and 2024 have been derived from our unaudited consolidated financial statements included elsewhere in this prospectus.
We have made rounding adjustments to reach some of the figures included in this prospectus. As a result, numerical figures shown as totals in some tables may not be arithmetic aggregations of the figures that precede them.
Non-GAAP Financial Measures
We present EBITDA, Adjusted EBITDA and free cash flow in this prospectus because we believe such measures provide investors with additional information to measure our performance.
EBITDA, Adjusted EBITDA and free cash flow have limitations as analytical tools and should not be considered in isolation from, or as alternatives to, GAAP financial measures as indicators of our operating performance and should not be considered as measures of cash available to us to invest in the growth of our business or that will be available to us to meet our obligations. In addition, they should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. In evaluating EBITDA, Adjusted EBITDA and free cash flow, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of EBITDA, Adjusted EBITDA and free cash flow should not be construed to imply that our future results will be unaffected by any such adjustments. Management compensates for these limitations by primarily relying on our GAAP results in addition to using EBITDA, Adjusted EBITDA and free cash flow supplementally.
Please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Performance Indicators and Non-GAAP Financial Measures” for an explanation on why we use these non-GAAP financial measures, their definitions, their limitations and reconciliations to their nearest GAAP financial measures.
TRADEMARKS AND SERVICE MARKS
The Voyager Technologies, Inc. design logo and our other registered or common law trademarks, service marks or trade names appearing in this prospectus are our property. This prospectus may also contain trademarks, tradenames, and service marks of other companies that are the property of their respective owners. We do not intend our use or display of other companies’ trademarks, trade names or service marks to imply, and such use or display should not be construed to imply, relationships with, or endorsement or sponsorship of us by, these other companies. Solely for convenience, our trademarks, tradenames, and service marks referred to in this prospectus appear without the ®, TM, and SM symbols, but those references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensor to these trademarks, tradenames, and service marks.
MARKET, INDUSTRY AND OTHER DATA
The market data, industry data and other statistical information used throughout this prospectus are based on independent industry publications, reports by market research firms, other published independent sources or third-party reports commissioned by us. Industry publications generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of included information. Certain market, ranking and industry data included in this prospectus, including the size of certain markets, our size or position and the positions of our competitors within these markets, and our solutions relative to our competitors, are based on the estimates of our management. These estimates have been derived from our management’s knowledge and experience in the markets in which we operate, as well as information obtained from surveys, reports by market research firms, trade and business organizations and other contacts in the markets in which we operate. We believe these management estimates are reliable; however, no independent sources have verified such surveys and estimates. Unless otherwise noted, all of our market share and market position information presented in this prospectus is generally based on a number of sources and factors, including publicly available information and management’s experience in, and knowledge of, our industry and competitive landscape. In addition, the discussion herein regarding our various markets is based on how we define the markets for our solutions. Certain estimates of market opportunity, forecasts or market growth and other forward-looking information included elsewhere in this prospectus involve risks and uncertainties and are subject to change based on various factors, including those discussed under “Prospectus Summary,” “Risk Factors,” “Special Note Regarding Forward-Looking Statements” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
The third-party sources of certain industry and market share data in this prospectus include:
•Euroconsult, Space Economy Report 2023, 10th Edition, January 2024;
•European Space Agency, Annual Report 2014, November 2, 2016;
•NASA, FY 2026 Budget Request, May 30, 2025;
•Novaspace, Satellites to be Built & Launched; A complete analysis and 10-year forecast of the satellite manufacturing and launch service markets, 27th Edition, October 2024; and
•United States Department of Defense, Fiscal Year 2025 Budget Request, March 2024, Revised April 4, 2024.
PROSPECTUS SUMMARY
This summary highlights information contained in greater detail elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our Class A common stock, you should carefully read this entire prospectus, including our consolidated financial statements and the related notes included elsewhere in this prospectus, and the information set forth under “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
Our Company
We are an innovation-driven defense technology and space solutions company. Our company was purpose-built to address issues at the forefront of defense, national security and space industries and we have organized our business to reflect this goal. We strive to solve complex challenges to fortify national security, protect critical assets and unlock new frontiers for human progress and economic development. We are committed to developing and delivering an array of transformative, mission-critical solutions to customers enabled by our advanced technology, analytics and space infrastructure capabilities. Our solutions include communications and intelligence collection systems, defense systems, advanced space technology, in-space infrastructure and space mission services. Our business consists of diversified solutions across three business segments: Defense & National Security, Space Solutions and Starlab Space Stations. Since 2019, we have accomplished significant achievements in each of these segments, including the successful deployment of first-of-its-kind missile defense maneuvering capabilities, the development of groundbreaking space technology and the selection by NASA to develop a replacement for the ISS.
We operate a flexible business model that allows us to serve both as a “prime” contractor, providing fulsome and integrated solutions directly to customers, as well as a “merchant supplier,” or subcontractor, providing critical technologies to support several commercial and government programs across the space and national security sectors. Our key partners and customers include Palantir, NASA, Lockheed Martin, the U.S. Air Force and Sierra Space. Our ability to serve in both prime and merchant supplier capacities with these customers and partners allows us to selectively participate in a wide range of programs in whichever capacity is more attractive to us. Prime contractor roles allow us to lead the entirety of a program, managing the supply chain, technology integration and end customer relationship. Merchant Supplier roles are an opportunity for us to supply our differentiated technologies to a broader range of programs and support multiple prime competitors, on attractive terms. Our ability to serve in both capacities allows us to selectively participate in a wide range of programs in whichever capacity is best suited to our solution, financial contribution and probability of win.
Our growth strategy includes organic and inorganic expansion, leveraging our existing technologies and pairing out our software capabilities with our hardware, leading to the development of new solutions to meet customer needs. Since 2019, we have executed and successfully vertically and horizontally integrated seven acquisitions, and have grown our revenue to $144.2 million in 2024 and $34.5 million for the three months ended March 31, 2025. In addition, we received cash proceeds of $3.0 million in 2022, $62.0 million in 2023, $62.2 million in 2024 and $20.0 million during the three months ended March 31, 2025 (with $70.3 million of eligible proceeds remaining as of March 31, 2025) from our $217.5 million development grant with NASA to design Starlab, the commercial space station replacement for the ISS which is set to be decommissioned in 2030. We intend to operate Starlab through Starlab JV, a Voyager-led and majority-owned global joint venture, with international equity partners that include Airbus, Mitsubishi, MDA Space and Palantir. Our growth and increased size and scale are the result of investment and focus on our key technology offerings, as well as our ability to attract, cultivate and integrate accretive acquisitions. Additionally, the threat environment is driving investment in solutions that cross multiple domains, such as missile defense programs that require interoperability among space-, air- and ground-based systems. Our position and technology heritage across multiple domains and systems positions us well to support this trend towards increasing convergence.
Our business consists of diversified solutions across three business segments:
•Defense & National Security, which provides innovative mission-critical solutions to protect dynamic and contested domains. We pioneer communications technologies, guidance, navigation and controls, signals intelligence and defense systems.
•Space Solutions, which delivers space infrastructure, advanced space technology, science systems and mission services that power commercial, academic and government missions from low-Earth orbit to deep space.
•Starlab Space Stations, which is a commercial space station planned to succeed the ISS and provide continued permanent human presence in space. It is operated through our U.S.-led global joint venture with Airbus, Mitsubishi, MDA Space and Palantir, among others.
We operate in markets that have tailwinds supporting investment from both commercial and government clients worldwide. From a Defense & National Security perspective, we believe our solutions serve a total addressable market of $163 billion. Our serviceable addressable market is $11 billion. Our Space Solutions & Starlab Space Stations segments serve a total addressable market of $16 billion, of which we serve $1 billion. There are significant opportunities both in the U.S. as well as for allied international economics and governments.
Our business thrives through collaboration and synergies across our various business segments. Our ability to share technology, identify cross-selling opportunities and realize cost savings through improved organizational efficiency drives our growth and financial performance. For example, we are developing artificial intelligence powered edge computing units to operate across Earth and space, layered with Palantir’s operating system and our end-to-end intelligence analytics platform, to deliver real-time intelligence capabilities for defense and national security applications and for space exploration. Starlab’s technical design and business case benefit tremendously from our broader organization, aiding in our continued development of the project. We are distinctively positioned as a leader in space science and commercialization and we intend to bring the extensive business development, mission design, management and customer service experience of our Space Solutions segment to support the development and operations of our Starlab Space Stations segment.
We maintain long-term relationships with many of the industry’s largest and most important blue-chip customers, across both government agencies and commercial entities. Since our founding and through March 31, 2025, we have been awarded approximately $800 million in contracts and SAAs. Our largest customer is NASA, which represented 25.6% of our revenue for the year ended December 31, 2024 and 19.7% of our revenue for the three months ended March 31, 2025. Our close relationship with government customers highlights the public-private partnership model that has been a significant driver of growth in the national security and space industries and commercialization opportunities. For example, we attached the Bishop Airlock to the ISS in 2020, demonstrating the viability of the public-private partnership model for the development of critical commercial space infrastructure and paving the way for our partnership with NASA on Starlab. We expect this partnership model to continue to provide us with a significant opportunity to participate in critical national security and space technology development in the future. For example, in 2023, in addition to the $800 million in contracts and SAAs discussed above, we were awarded a $900 million ceiling IDIQ contract by the Air Force Life Cycle Management Center’s Architecture and Integration Directorate to deliver a cost-effective intelligence, surveillance and reconnaissance system. We believe we are well-positioned to benefit from this funding mechanism given our close relationships with government customers and our track record as a reliable technology and solutions provider. Although we see our relationship with the U.S. government as a positive, we do rely on this relationship for a substantial portion of our business. Changes to the U.S. government’s priorities and spending, or delays or reductions in spending, could have a material adverse effect on us.
We benefit from business segments that serve varied end markets as well as meaningful customer diversity. We believe that our revenue diversification provides significant resiliency and positions us well to capitalize on new business opportunities across markets and customers. The following charts summarize our revenue for the year ended December 31, 2024 by segment and customer:
We also receive meaningful cash proceeds from our development grants for research and development, providing further diversity for financing our initiatives. Development grants allow us to receive sizeable funding from our customers to develop what we believe are next-generation technologies without having significant cash constraints due to our size. We also work hand-in-hand with our customers to create solutions addressing directly their needs. In December 2021, our subsidiary Nanoracks was awarded a SAA, which was subsequently transferred to us, and which we subsequently transferred to Starlab JV, under Phase I of NASA’s CDFF program as part of the agency’s effort to foster a commercial space station to succeed the ISS. Through this SAA, we were initially awarded $160 million in development grants—the largest CDFF award from NASA—to pursue the design and development of Starlab through 2026. In 2023, Northrop Grumman, another CDFF SAA recipient, withdrew its space station program and joined our effort as a strategic supply chain partner to Starlab. Subsequently, we were awarded an additional $58 million in development grants under our CDFF SAA, bringing our total grant to $217.5
million. As we achieve certain program milestones, cash proceeds are paid to us from the $217.5 million total grant, including $3.0 million paid in 2022, $62.0 million paid in 2023, $62.2 million paid in 2024, and $20.0 million paid in the three months ended March 31, 2025. As of March 31, 2025, we have $70.3 million of our development grant remaining. On January 13, 2025, we achieved the first milestone by successfully completing the preliminary design review in collaboration with NASA, an important step toward full-scale production. The next milestone is detailed design and hardware development, leading to a Critical Design Review to confirm Starlab’s readiness. The U.S. government continues to support investment in these technologies. For example, NASA’s fiscal year 2026 budget request includes approximately $2.1 billion for commercial LEO development through 2030. Based on our previous success receiving grants, we believe we are well-positioned to win future development grants and contracts from NASA and other space agencies to aid in funding the development of Starlab. Additionally, in 2025, we received an award of $15 million by the Texas Space Commission as part of their Space Exploration and Aeronautics Research Fund grant program to help support Starlab and grow its ecosystem of suppliers and customers across Texas.
We are supported by a highly skilled workforce operating across our facility footprint. As of March 31, 2025, we employed approximately 514 people across 10 locations. We believe our footprint is well-aligned with our markets, enabling close collaboration with government and commercial customers, reliable manufacturing operations and access to the required testing environment for our technologies. In addition to our footprint, our Starlab Space Stations segment benefits from access to the existing facilities and operations of our equity and
strategic partners, lowering direct capital expenditure needs for Starlab development. These equity and strategic partners are also helping develop and deliver technologies, solutions and hardware for Starlab.
Our Platform and Journey
Voyager was Purpose-Built to Address the Underserved Needs of Defense, National Security and Space Customers
The U.S. and allied defense and national security supply chain is ill-equipped to provide critical technologies at scale in today’s rapidly evolving threat environment. This supply chain has been predominately served by traditional aerospace and defense industry players. However, with the increasing complexity of advanced technologies, traditional aerospace and defense industry players are unable to develop and deliver affordable, cutting-edge and disruptive technologies at the modern speed of warfare. The slow and bureaucratic nature of traditional defense procurement processes and its legacy contractor base burdened by large, complex cost structures hinders rapid innovation and the development and integration of emerging technologies.
Historically, space activities were driven by government-led, owned and operated programs that often executed slowly and inefficiently. To address these deficiencies, the space industry has shifted to a public-private partnership model in recent years, exemplified by NASA’s use of commercial launch providers such as SpaceX and Northrop Grumman. However, the space industry lacks sufficient well-operated companies with advanced technological capabilities at scale to address the complicated needs of the growing space economy. Additionally, demand for space activities has evolved to include the needs of commercial customers across industries such as healthcare, agriculture, energy and advanced manufacturing. With space destinations limited to the new Chinese government-owned Tiangong Station and the aging ISS, these customers are constrained in capacity and options necessary to pursue a rapidly expanding opportunity in the space economy. Though we were built to address this growing need, many of our competitors are substantially larger than we are and may be able to adapt more quickly to changing technology or market conditions or may be able to devote greater resources to the development, promotion and sale of their products, which may make it more difficult for us to execute on our business and growth strategies.
Voyager Is Addressing Attractive Growth Markets
The U.S. defense and national security industry continues to demonstrate a stable and long-term growth trajectory, driven by its vital role in ensuring national security and maintaining global stability. With sustained
government investment, a robust pipeline of advanced technological innovations and increasing focus on modernization to address evolving threats, the industry remains a cornerstone of the nation’s economy. As global security challenges intensify, we believe we are well-positioned to adapt, expand and deliver cutting-edge capabilities, reinforcing the resilience of the nation’s leadership position in a competitive global landscape. We expect that growth in national security spending will continue as militaries invest to maintain operational readiness and counter ever-evolving threats. In the United States, defense and national security spending has generally benefited from strong bi-partisan support, generating a stable and growing investment over time. The fiscal year 2025 request for the DoD budget was approximately $850 billion, compared to approximately $700 billion for fiscal year 2022. Furthermore, space is a growing priority for defense and national security investment, as space is increasingly contested, congested and competitive and space-based capabilities play a greater role for conventional warfighting forces on land, air and sea. In 2023, governments worldwide invested approximately $59 billion in space defense and security activities according to Euroconsult.
The space economy has experienced historic growth over the past decade, driven by advancements in satellite technology, reusable launch systems and increased commercial investment. According to Euroconsult, from telecommunications to Earth observation to emerging sectors such as resource exploration, the global space economy has expanded to exceed $508 billion in 2023, representing the value of all contracts in the industry, as well as non-contracted government activities. This growth trajectory is expected to accelerate with projections surpassing $820 billion by 2032 according to Euroconsult. Private enterprises are a major part of demand in the market, with commercial customers comprising approximately 85% of the total space economy in 2023 according to Euroconsult. We expect the commercial space economy will continue to grow and we believe we are well-positioned to meet the unique needs of commercial customers. As both national and private enterprises continue to innovate and collaborate, the space economy is poised to become a cornerstone of economic and technological progress, opening new frontiers for exploration, commerce and sustainability.
Voyager Is Driven By Innovation At Scale
Innovation is core to our identity. Through our strategic acquisitions, we leverage more than three decades of technology development and spaceflight heritage to offer reliable, differentiated solutions to our customers beginning when SAMS was developed in 1993 by ZIN Technologies, Inc. We operate an agile and entrepreneurial business model positioned to rapidly develop and iterate technologies to meet the evolving needs of our defense, national security and space customers. Including through our acquired business lines, we have executed over 1,000 customer space missions and supplied over 220 spacecraft subsystems, a track record that entrenches us with our commercial and government customers who continue to trust us to deliver solutions for many of their most important programs. We have the capability to support these programs at scale and meet the growing demand for critical technologies in our markets.
Since our founding in 2019, we have won and executed major roles on several marquee programs. For instance, in 2024, Lockheed Martin selected us to deliver the upper stage propulsion subsystem and optical guidance technology for MDA’s NGI program, a vital component in defending the United States against long-range ballistic missile threats from strategic adversaries. Our dual-use optical guidance technologies have played a critical role on a number of national security and space programs, including RTX Corporation’s missile defense initiatives and
Millennium Space Systems’ (a Boeing company) small satellite constellation programs, where they are vital to mission success.
| | | | | |
| The NGI program is a critical U.S. national security initiative designed to counter long-range ballistic missile threats. We are subcontracted by Lockheed Martin and provide advanced propulsion subsystems for the NGI program, including a RCS with thrust and control algorithms for precision orientation control and a stage separation propulsion system. Our controllable solid propulsion technology enhances interceptor reliability, accuracy, and affordability by mimicking liquid and cold-gas system performance. The RCS ensures stable and precise flight adjustments, while the stage separation system ensures optimal transitions between flight stages. In 2020, we became the first and only company to attach a permanently integrated, privately-owned commercial module to the ISS, the Bishop Airlock. The Bishop Airlock enables movement of equipment, supplies and payloads between the ISS and the open vacuum of space. The technology and expertise developed in the airlock program has been critical to our development of advanced space infrastructure and space stations. |
| | | | | |
| Our Bishop Airlock, the first permanent, commercial addition to the ISS, provides a versatile platform for deploying satellites, experiments and robotics. Leading robotics innovator, Gitai, leveraged the Bishop Airlock to successfully demonstrate its advanced robotic arm in space. Their robotic arms performed tasks such as tool operation, structure assembly and maintenance, showcasing the potential of robotics to reduce astronauts’ workload on routine tasks. This collaboration showed how robotics can enhance operational efficiency and free up crew time for critical activities. We believe the Bishop Airlock is advancing space technology and enabling sustainable human-robot collaboration for future space exploration. In 2021, NASA awarded Nanoracks, a prime contract, which was subsequently transferred to us, and which we subsequently transferred to Starlab JV, to develop Starlab, our commercial replacement for the ISS which is set to be decommissioned in 2030. We believe Starlab will be essential to ensuring continued permanent human presence in LEO by the United States and its allies. We believe that by continuing to pioneer with disruptive solutions and by continuing to execute reliably for our customers, we will continue to win highly attractive, important roles on marquee programs of the future. |
Experienced Leadership and Team
Our company culture, strategy and operational execution are driven by our visionary co-founders, Dylan Taylor and Matthew Kuta. Dylan Taylor, our Chairman and Chief Executive Officer, is a global business leader with experience as a Fortune 1000 executive in several industries. Matthew Kuta, our President, is a former private equity investor and distinguished F-15E fighter pilot for the U.S. Air Force. Their experience was paramount to our founding in 2019, assembling a world-class team of disruptors with a proven track record of forward-thinking and entrepreneurship. We also leverage the expertise of our Board of Directors, Defense & National Security Strategic Advisory Board and Space Strategic Advisory Board, all of which are comprised of industry experts with government and commercial industry experience, including former military generals, agency directors, NASA astronauts and administrators, CEOs and globally renowned scientists. To assist in our ability to launch and maintain a space station on our own we intend to, among other things, recruit and retain adequate numbers of effective sales and marketing personnel.
Our Segments
Defense & National Security Segment
| | | | | |
| Our Defense & National Security segment, which represented approximately 50.9% of our revenue for the year ended December 31, 2024 and approximately 66.1% of our revenue for the three months ended March 31, 2025, provides leading technology capabilities that support marquee programs with expertise in defense systems, signals intelligence, communications technologies and guidance, navigation and control systems. |
Defense Systems
| | | | | |
| We offer distinct, controllable solid propulsion technology, enabling missile programs critical to fortifying national defense systems. Our breakthrough solid fuel propulsion technology delivers precise thrust for orienting, positioning and steering missiles, including the extremely fast and accurate high thrust levels required for hypersonic applications. Controllable solid propulsion technology is of significant value to our customers compared to liquid and cold-gas systems, because solid systems are less expensive to produce and maintain and can be stored for decades without risk of fuel leaks. Currently, we have a $78 million contract (assuming receipt of maximum fees) to provide the advanced solid-propulsion subsystem for Lockheed Martin’s NGI contract with the U.S. Missile Defense Agency. We believe that our advanced technology will gain increased adoption on a broad range of existing and future advanced missile programs, including missile defense interceptors and kill vehicles, strategic, tactical and hypersonic missiles and reentry systems. Additionally, our technology is multi-use, with the potential for applications on civil, commercial and military space launch systems and payloads. |
Signal Intelligence Systems
| | | | | |
| We believe our end-to-end intelligence analytics platform provides considerable enhancement to how government agencies process and act on critical intelligence. Our advanced signal processing, geolocation technologies and artificial intelligence driven analytics enhance situational awareness, cutting through the noise to reveal mission-critical intelligence. By integrating our proprietary software solutions with Palantir’s operating system, we plan to transform multi-source, raw signals intelligence data into real-time, actionable insights for complex mission situations. With a decade-long track record as a trusted partner to national security agencies and defense primes, our solutions are vital for ensuring operational efficiency, security and mission success across the military and intelligence community. As the demand for cutting-edge intelligence capabilities accelerates, we believe our technology-first approach positions us at the forefront of the defense-tech revolution. |
Communication Technologies
| | | | | |
| We offer a broad range of space-qualified communications technologies, including radiation-hardened laser and RF communications systems and advanced electro-optical and digital systems. Our offerings include transceivers, mission-data transmitters and command and data handling systems that can sustain high-quality performance for extended periods of time. Our solutions have a long-standing heritage, enabling LEO and deep space missions since 2002, with a failure-free cumulative track record of over 275 flight years in space. As our industry continues to evolve, we expect our business will grow to serve new end markets, such as on-orbit edge computing and large-scale orbital infrastructure, including for our own Starlab Space Stations segment. |
Guidance, Navigation and Control Systems
| | | | | |
| We design, develop, and produce critical technologies for controlling and navigating spacecraft, rendezvous and proximity operations and non-GPS position, navigation and timing. Our solutions portfolio includes sun sensors, star trackers, and inertial measurement units that currently serve the growing satellite constellation market and other demanding and essential missions. Our technologies are multi-use, applicable to critical national security, commercial and civil programs. Our high-performance systems operate in space today, including on NASA’s Magnetospheric Multiscale Mission satellites, where they enable precise, closed control for the tight flight formation the mission requires. |
Artificial Intelligence Powered Edge Computing
| | | | | |
| We are developing artificial intelligence enabled edge computing in space, bringing intelligence processing directly to satellites to enhance security and accelerate decision-making. By processing data at the source, we plan to eliminate the need for transmission to ground stations, reducing vulnerabilities and enabling real-time insights in even the most contested environments. Our radiation hardened GPUs provide high-performance computing in space, while our integration of Palantir’s operating system and proprietary applications delivers what we believe are exceptional artificial intelligence driven analytics. This capability enables streamlined intelligence gathering and processing, enhancing operational efficiency and resilience for national security and defense applications as well as space exploration. |
Space Solutions Segment
| | | | | |
| Our Space Solutions segment, which represented approximately 49.1% of our revenue for the year ended December 31, 2024 and approximately 33.9% of our revenue for the three months ended March 31, 2025, is a provider of leading space technology solutions, operating at the forefront of space technology and specializing in mission operations, reliable hardware, software and engineering services for space missions. We are known for pushing innovation in space technology and commercial space exploration, providing reliable, high-performance systems and services that advance the capabilities of our customers in space. Our portfolio offering includes advanced space technology systems, space infrastructure and space science and mission management. |
Advanced Space Technology Systems
| | | | | |
| We offer a broad range of industry-defining solutions supporting ground and space flight systems for crewed and robotic applications. We have provided integrated hardware and software systems and engineering services to NASA, the DoD and commercial customers. Our solutions include in-space propulsion systems with applications for orbital servicing, manufacturing and deep space exploration. For example, we developed the power propulsion units used in the solar electric powered propulsion system on NASA’s Double Asteroid Redirect Test spacecraft that successfully collided with an asteroid in September 2022 to test defense against near-Earth objects. |
Space Infrastructure
| | | | | |
| We are a pioneer of commercial space infrastructure development. The Bishop Airlock is the first and only permanent, privately-owned module attached to the ISS. The Bishop Airlock allows for the movement of equipment, supplies and payloads between the ISS and the open vacuum of space, providing a significantly larger alternative to other airlocks on the ISS. To date, we have leveraged the Bishop Airlock to enable complex in-space robotics installation and testing, deploy waste from the ISS and move payloads around hosting sites on the outside of the ISS. We currently hold contracts with NASA, the ESA and commercial customers for the Bishop Airlock. The Bishop Airlock helped successfully demonstrate the viability of the public-private partnership model for the development of critical space infrastructure, and developed expertise that we believe positions us for success with Starlab. |
Space Science & Mission Management
| | | | | |
| We operate at the forefront of space commercialization with decades of experience offering science and mission management capabilities, and providing commercial mission management services on the ISS. To date, including through our acquired and developed technologies, we have deployed over 330 satellites for commercial and government programs, overseen more than 1,000 customer missions conducted by over 35 nations and territories and remain the largest commercial user of the ISS in the world. Our commercial space station services have enabled biopharma and agriculture research, DoD technology demonstrations, research, media programs, STEM education and materials research. We believe our leadership in space station services and existing diversified customer base will be a significant growth driver as we build out payload and research facilities for future customers on Starlab. However, we have never launched or maintained a space station before and may lack the necessary expertise, personnel and resources to successfully launch and maintain a space station on our own. A core example of our longstanding enablement of space science on the ISS includes the SAMS, which we built and is one of the longest-running systems on the ISS. SAMS measures and tracks tiny disturbances in an on-orbit microgravity environment and has collected data on every NASA crewed spacecraft over the past three decades. SAMS and its associated systems collect data 24/7, measuring over a trillion acceleration measurements on the ISS since 2001 and greatly informs our development of Starlab. |
Starlab Space Stations
| | | | | |
| Starlab JV is a Voyager-led and majority-owned global joint venture that is designing and building, and is expected to ultimately operate, Starlab. We expect that, once in operation, Starlab will be positioned to serve a global customer base of space agencies, researchers and private enterprises. Starlab is being designed to ensure a continued, permanent human presence in LEO and a seamless transition of microgravity science and research from the ISS into the new commercial space station era that we believe will enable sustainable, profit-generating activities in LEO and attract multiple new commercial and scientific organizations into the accelerating space economy. |
Today, NASA and its international partners allocate approximately $5 billion annually to support ISS related operations and initiatives according to NASA, JAXA and ESA. To date, there has not been a need to develop a commercial space station, given a commercially-funded space station could not compete with the government-funded ISS. However, given the station’s aging infrastructure, NASA has publicly declared plans to de-orbit the ISS
in 2030. NASA has stated it is awarding funding to private enterprises to develop commercial replacements for the ISS.
NASA has developed standards for processes such as safety and mission assurance, health and medical, design, and construction, as well as technical standards for areas such as rendezvous and docking, power, and life support that guide the development and operation of these systems. Starlab is leveraging these standards, as well as utilizing existing qualified commercial hardware that is derived from them to the full extent possible. Starlab is our solution for a commercially-led, owned and operated replacement, leveraging the public-private partnership model proven with NASA’s use of commercial launch providers, including SpaceX and Northrop Grumman. We have the space heritage to provide the right solution for a post-ISS space, with over 4 million hours of in-space experience. We have also achieved over 20 milestones related to Starlab on a path to derisking the technology.
NASA’s procurement to replace the ISS is being conducted in two phases. During Phase I, the current phase, NASA accepted three designs to preliminary design review for Critical Design Review. Critical Design Review is a key milestone that a program achieves before commencing major hardware construction. For Phase I, Starlab was given the highest funding award from NASA, and Starlab’s funding has grown and continues to outpace other competitors. Phase II will be the final competition phase where potential providers offer crew and cargo services to NASA, including launch, training, space station accommodations, science and research activities/experiments and return and recovery. While any competitor can bid on Phase II, only three potential bidders currently have funded contracts with NASA. Given the complexity of the space station system, we believe the funded providers have a better chance of winning one of two potential awards for crew and cargo services, as the funded providers have been working closely with NASA for at least three years and have an understanding of the process. We believe customers will view Starlab as a reliable provider in line with the highest industry standard.
Key to Starlab’s value proposition is a utilitarian design that we believe presents low technological risk relative to competing programs. Starlab utilizes a proven metallic habitat design and is designed to be deployed and achieve initial operational capability in a single launch on SpaceX’s Starship, removing the need for additional complex, expensive and operationally risky in-space assembly missions while maintaining all of the U.S. Lab (Destiny) research and development capacity and approximately 45% of the pressurized volume of the U.S. Segment (Non-Russian) of the ISS. Starlab is also being designed to support the attachment of additional modules that can serve specific use cases and end markets. This capability is designed to allow Starlab to meet current and potential future demand profiles, without the risk of overbuilding prior to future demands and use cases materializing. We envision the potential addition of dedicated modules or wholly new space stations for use cases such as on-orbit manufacturing and assembly, drug and biopharma development, semiconductor fabrication and material science.
Starlab is designed to reach orbit in a single launch. If that launch fails, the entire spacecraft could be destroyed. There are limited launch vehicles capable of lifting an object of Starlab’s mass into orbit and such vehicles do not have a proven track record of successful launches. If such launch vehicles are not operational by our planned launch date, we may experience delays in our ability to commence the Starlab business, and if our attempted launch fails, we may not be able to construct a replacement in a timely manner, or at all.
Our Starlab JV partners include Airbus, Mitsubishi, MDA Space and Palantir. In addition to these partners, Starlab has strategic partnerships with several organizations, including Hilton, Northrop Grumman and The Ohio State University. Starlab has also secured a launch contract with SpaceX for its Starship launch vehicle, leveraging its wider diameter rocket fairing. We believe our joint venture structure aligns our and each of our partners’ interests in the future success of Starlab, and each of our partners intends to contribute vital features to Starlab’s success:
•Airbus is providing technical design and engineering services, and has the responsibility for constructing Starlab’s habitat.
•Mitsubishi will contribute by leveraging its expertise in space research and development. MDA Space will provide the full range of external robotics, robotics interfaces and robotic mission operations to the station.
•Palantir will leverage data modeling through digital twins and artificial intelligence technologies to enhance Starlab’s operations.
This joint venture structure creates a strong international partnership among leading commercial participants that we believe will help capture our future anchor space agency customers and with expected operational and financial support from their respective sovereign agencies. It recreates the existing ISS international partnership structure of the United States, Europe, Japan and Canada on a commercial basis and enables technology collaboration, development funding and commercial contracts from international partners.
Starlab currently does not generate revenue and is not expected to in the near term. We currently estimate the cost to design, manufacture and launch Starlab to be approximately $2.8 to $3.3 billion. However, the benefits that we believe will result from the completion and commercialization of Starlab may not actually materialize. We expect Starlab to require significant funding to support operations prior to launch, which is currently anticipated to occur in 2029, before subsequently generating revenue, profitability and cash flows, which we expect Starlab to generate in its first full year of operation. With an estimated useful life of thirty years, we anticipate Starlab will have an infrastructure-like financial profile and will generate a significant portion of our revenue, profitability and cash flows once launched and fully operational.
Current funding for Starlab consists of the $217.5 million development grant Nanoracks was awarded by NASA under Phase I of their CDFF program, which was subsequently transferred to us, and which we subsequently transferred to Starlab JV, of which $70.3 million eligible proceeds remain as of March 31, 2025. We plan to compete for future funding from NASA and other space agencies to provide a considerable portion of the funding for this initiative. In particular, we plan to compete for Phase II funding from NASA’s commercial LEO development program, which we expect will include substantial funding to support the certification, development and services for the selected commercial space station providers. In addition to NASA funding, we also plan for Starlab to be funded through a combination of customer prebuys, the largest examples being other international space agencies, where prospective customers pay us in advance for usage of Starlab, as well as capital markets financing, including equity and project-based financing. Furthermore, although Voyager is not required under the terms of the Starlab JV to directly fund Starlab operations, we may choose to do so. While the Starlab JV is expected to fund a significant portion of the total cost to design, manufacture and launch Starlab through non-dilutive capital sources, including those described above, if we decide to directly fund Starlab operations, we may raise additional funds in the future through the issuance of equity securities, which may cause our stockholders to experience significant dilution. The actual cost to design, manufacture and launch Starlab may be materially different from the estimate set forth above, which is based on our current expectations and projections about future events and is subject to risks and uncertainties. In addition, there can be no assurance that we will obtain the necessary funding for Starlab, and we may not be able to obtain such funding or any portion thereof on terms that are favorable to us, if at all.
Joint Venture Agreement for Starlab JV
On December 23, 2023, we and Airbus entered into a limited liability company agreement (the “Joint Venture Agreement”) forming Starlab JV. Starlab JV, among other things, is focused on developing Starlab. Following the formation of Starlab JV, each of Mitsubishi, MDA Space and Palantir acquired minority interests in Starlab JV. As of March 31, 2025, we had an ownership interest of 67.0% in Starlab JV, Airbus had an ownership interest of 30.5%, and each of Mitsubishi, MDA Space and Palantir had an ownership interest of less than 1.0%.
Pursuant to the terms of the Joint Venture Agreement, we and our joint venture partners are obligated to provide cash and other services to Starlab JV. As of March 31, 2025, we have contributed to Starlab JV certain contracts (including the SAA), certain intellectual property, and $11.5 million in cash. Each of Airbus, Mitsubishi, Palantir, MDA Space and us has the unilateral obligation to fund up to $10.0 million if the cash balance of Starlab JV to support Starlab is less than $10.0 million at any time and the board of Starlab JV determines that third-party funding is not available. In addition, Airbus agreed to contribute to Starlab JV up to an aggregate amount of $80.0 million in funded grant programs awarded to Airbus or its affiliates specifically for use in connection with Starlab or the technologies to be deployed in connection therewith. To date, Airbus has not made any capital contributions to Starlab JV. In addition, each of Mitsubishi, MDA Space and Palantir have agreed to provide certain ongoing strategic collaboration services to Starlab JV.
Pursuant to the Joint Venture Agreement, we have also agreed to certain exclusivity provisions with Mitsubishi and Palantir. For more information regarding the Joint Venture Agreement, see “Business—Joint Venture Agreement for Starlab.”
Our Industry
Defense & National Security Industry
We operate in an industry that has experienced significant growth driven by the current geopolitical environment and growing defense and national security investment. Current events, including conflicts between Russia and Ukraine and the conflict in the Middle East, have resulted in increased defense and national security spending globally, while the potential for future engagements with China, Russia, Iran and North Korea have been a catalyst for defense modernization efforts across the United States and its allies. We expect that growth in national security spending will continue for decades to come as militaries invest to maintain operational readiness and counter ever-evolving threats, particularly driven by the rise of China as a near peer threat to the United States. In the United States, defense and national security spending benefits from strong bi-partisan support, which has resulted in a stable and growing investment over time. We believe any potential shifts in defense spending may likely benefit us and our key focus areas, which have historically aligned with top DoD priorities. The fiscal year 2025 request for the DoD budget was approximately $850 billion, compared to approximately $700 billion for fiscal year 2022. We believe our Defense & National Security segment serves a total addressable market of $163 billion, representing the fiscal year 2025 DoD budget request for research and development as well as procurement. Within our total addressable market, we believe we serve a serviceable addressable market of $11 billion, representing the portion of the fiscal year 2025 DoD budget request allocated to research development, test and evaluation and procurement for the following categories: classified; command, control, communications and computers; weapons; space; undersea and science and technology. Our serviceable addressable market is expected to grow steadily, increasing up to $12 billion in fiscal year 2029 based on DoD projections.
Missile and missile defense programs are a core investment priority for the United States and its allies and represent significant growth opportunities for our Defense & National Security segment. The technological requirements of missile and missile defense systems have increased rapidly. Advancing hypersonic capabilities is critical to ensuring national security, as Russia and China continue to develop and deploy hypersonic weapons. Furthermore, the contested domain is continuing to move higher and higher in altitude and many of the missile defense systems now must operate in a new environment, the vacuum of space. The United States is focused on addressing this critical need, with the fiscal year 2025 DoD budget request including $2 billion within our serviceable addressable market to enhance U.S. missile-defense capabilities to defend the homeland, U.S. deployed forces and its allies and partners.
The space domain is also a critical investment priority for the DoD and allies. The fiscal year 2026 budget request for space within our serviceable addressable market was approximately $2.1 billion. Intelligence, surveillance and reconnaissance, advanced missile tracking, communications and navigation are examples of essential capabilities that require space-based technologies for successful execution. Additionally, as our adversaries increase their ability and willingness to engage in offensive operations in the space domain, the DoD must invest in capabilities to protect, deter, detect and counter enemy attacks on our space infrastructure. Investment in both hardware and software are essential for mission success, including increasing utilization of artificial intelligence and machine learning to analyze signals and data.
Space Industry
We operate in the space industry, a market which is expected to grow from $508 billion in 2023 to $820 billion by 2032, according to Euroconsult. This expected growth is the product of several long-term trends, including the reduced cost orbital launch and increasingly capable satellite technology, which are expected to drive progress and create a unique set of space-based infrastructure and space-to-space economic opportunities. Government funding is a major part of the space industry demand. The fiscal year 2026 request for NASA’s budget is approximately $19 billion. We expect an increasingly large part of government funding, and industry spending broadly, will be captured by private enterprises, as governments continue to leverage the public-private partnership model that has been
successful on multiple space programs to date. Based on Novaspace, we believe our Space Solutions and Starlab Space Stations segments serve a total addressable market of $16 billion of which we serve $1 billion.
The space industry has experienced structural evolution over time, contributing to additional growth in our addressable markets. With launch costs decreasing by more than 95% since the first space shuttle launch, and launch cadence and reliability improving substantially, space has become more accessible to a wider audience to include commercial enterprises, academic institutions and research centers, in addition to governments and defense contractors. The result of increased demand and reduced costs of access has resulted in significantly increased hardware in orbit, which is expected to continue. According to Novaspace, approximately 37,000 satellites are expected to be launched from 2024 to 2033, a significant increase compared to the approximately 10,600 satellites launched from 2014 to 2023. Increased hardware in space requires technology solutions to launch, support and service these satellites’ missions, creating opportunity across the space technology ecosystem.
A large driver of space industry demand is the benefits that space technology enables here on Earth. As the space industry continues to expand at a rapid pace, data collected in space through satellite constellations and the research, development and manufacturing activities performed in space will have meaningful application to terrestrial industries, including healthcare, biotechnology, semiconductors, material science, telecommunications, disaster mitigation, defense and security, among many others. For example, advancements in robotic tools, originally designed for space applications, may progress development of surgery robotics. Water filtration and air purification systems, originally built for space, may be effectively deployed on Earth, addressing an increasingly complex problem of clean drinking water. Climate change and disaster response analysis can be aided through the increased Earth observations made from small satellites with rapid imagery. Additionally, the microgravity environment enables the production of advanced materials for industrial and biotechnology applications that are difficult or impossible to replicate on the Earth’s surface. We believe the potential to create immense value terrestrially will continue to increase the value and opportunities of the space industry.
Within the space industry, commercial space infrastructure is a significant end market for us. Every year, according to NASA, JAXA and ESA, approximately $5 billion is spent by the United States and partner nations, to support ISS related operations and initiatives. Maintaining constant U.S. and allied presence in LEO is not only critical to continuing important scientific research conducted onboard, but also as a symbol of national sovereignty and soft power. The only other space station in Earth’s orbit is the Tiangong Space Station, owned and operated by China operating as an extension of their Belt and Road initiative. The United States will not be dependent on China for American and allied human spaceflight and human supported research and development, driving the need for a U.S.-led space station replacement upon retirement of the ISS. With the ISS set to de-orbit in 2030, we expect the capital spent on the ISS today to be allocated to one or more commercially led space stations, including Starlab.
Beyond the activities conducted on the ISS today, we expect on-orbit activities to increase over time, driven by demand growth from industries such as healthcare, agriculture, energy and manufacturing, as they look to deploy on-orbit capabilities such as research and development, manufacturing and assembly. We believe a transition to commercial-led space station ownership will help accelerate commercial demand for on-orbit activities, as companies will value the increased privacy and security afforded to them by a dedicated commercial module or space station.
Our Competitive Strengths
We believe the following strengths are key differentiators for our business model, enable us to provide innovative and mission-critical solutions to our customers and drive profitable growth in our business.
Leading Defense and Space Technology Company Providing Critical Solutions in the Large, Growing and Stable National Security and Space Economies
Our focus is on delivering innovative solutions to the defense, national security and space end markets, which we believe are highly attractive. Our markets are large and growing meaningfully, driven by strong demand from both government and commercial customers. U.S. government spending is an important driver of demand and it benefits from broad support across the political spectrum, evidenced by the consistent focus on national security and space programs through various administrations. In addition to overall growth in the national security and defense
markets, our strategy is aligned with specific high-growth tailwinds, which include the requirement for hypersonic and other next-generation missile defense capabilities, demand for high-speed and high-throughput space communications technology and the requirement for a continued, defensible and resilient U.S. and allied presence in LEO. Our broad offering of both national security and space solutions provides us with a diversity of end market exposure, which we believe will result in stable overall demand in our business and meaningful upside from multiple high growth vectors.
We believe that our solutions offerings are well-positioned to serve customers in these attractive end markets. We have developed fit-for-purpose solutions to address our customers’ needs across diverse applications, including, among others, defense systems, satellite subsystems, advanced space technology and space infrastructure. We believe our solutions compare favorably relative to our competitors, providing leading performance, proven in-space heritage and value underpinned by differentiated technology solutions that establish a competitive moat for our business.
Longstanding Relationship with a Broad Base of Blue-Chip Customers Who Rely on Our Solutions for Mission-Critical Applications
We maintain close relationships with a broad base of blue-chip customers, including over 20 government space and defense agencies and multiple commercial players. We serve key agencies including NASA, our largest customer, as well as multiple components of the DoD, including the MDA, U.S. Air Force and U.S. Space Force. We have supported several programs for international space agencies including the Canadian Space Agency, ESA, Italian Space Agency, Germany Aerospace Center, Japanese Aerospace Exploration Agency, UAE Space Agency, the Saudi Space Commission and others. Many of our commercial customers are industry leaders and include major defense primes such as Lockheed Martin, Northrop Grumman and RTX Corporation, as well as space companies including Blue Origin and Maxar, and commercial companies such as Madison Square Garden. Our customer relationships have been fostered over many years, with multiple examples of reoccurring business, demonstrating the value we provide to our partners. During the year ended December 31, 2024 and the three months ended March 31, 2025, 95% and 99%, respectively of our net sales were generated from customers we also transacted with in the prior year.
Our customers rely on us to deliver technological solutions that are highly complex and mission-critical to their programs. We have built trust with our customers through our long track record by executing over 1,000 customer space missions, which includes over 330 customer satellites deployed and experiments conducted for customers in over 35 nations and territories. Our reputation as a reliable partner underpins the trust customers have in us to address new challenges, resulting in a “flywheel” that continues to drive growth as we continue to execute for customers. For example, for over ten years, our Space Science & Mission Management business has enabled domestic and foreign government agencies and commercial participants to access the ISS, providing services and solutions that have accelerated the accessibility of space for both space and non-space players. For example, for Madison Square Garden’s Sphere Studios, we are collaborating across three ISS missions to launch, operate, and validate custom camera technology being developed for their state-of-the-art MSG Sphere venues. This ongoing experience was critical to acquiring and maintaining support for the Bishop Airlock project. Subsequently, having proven expertise in space infrastructure, we competed for and won a commercial prime contract to develop Starlab,
which we are continuing to develop with NASA today. We expect that our close customer relationships and reputation for quality execution will continue to position us well for future growth opportunities.
Flexible Multi-Use Technology Solutions Allow Voyager to Serve Diverse Applications Across Our Civil, Commercial and National Security Customers
We operate a flexible business, with technology solutions that offer critical capabilities across our civil, commercial and national security end markets. Furthermore, many of our solutions are multi-use, meaning they have important applications in multiple different end markets. For example, our laser and RF communications technologies are designed to support a wide range of customers, including aerospace and defense primes, civil and defense government agencies, commercial entities and “new space” ventures. Additionally, we are developing artificial intelligence powered edge computing units to operate across Earth and space, delivering versatile, real-time intelligence capabilities for defense and national security applications as well as commercial. By supporting multiple end markets and use cases, our solutions benefit from diversified demand drivers that result in stronger growth and stable performance. Additionally, by serving multiple customers with varying performance requirements, we benefit from diverse customer feedback and participate in joint-development that drives additional improvement to our technology, further differentiating our solutions offerings. Our nimbleness allows us to pivot to the needs of our customers and end-markets faster.
Adaptive Business Model Provides Optionality to Effectively Serve U.S. And Allied Agencies Directly, as Well as Act as a “Merchant Supplier” or Subcontractor to Large Contractors
We operate an agile business model that allows us to serve in both a prime contractor and merchant supplier capacity. Examples of our prime contracts include our Starlab program as well as our HUNCH program with NASA, where we engage in project-based learning programs with high school students to further space education. In addition to prime contractor capabilities, we often act as a subcontractor on programs across the space and national security industries. When we act as a merchant supplier, we are able to deliver our technology solutions to a wide range of programs and support multiple prime competitors. Merchant supplier roles often offer very attractive terms that enhance our financial performance. Examples of our merchant supplier programs include providing star trackers to Millennium Space Systems for their small satellite constellations programs and providing Airbus software-defined radios for their international LEO satellite constellation. By maintaining a flexible business model, we are able to participate on a wide breadth of marquee programs for many of the most important public and private sector
customers in the industry. We can also pivot and focus on programs and contracts with the highest return on investment.
Backlog Driving Revenue Visibility, Robust Opportunities Pipeline and Significant Grant Funding
We have a track record of successfully executing on both organic and inorganic growth opportunities, leveraging our broad portfolio of market leading technology solutions. As of December 31, 2024, we had backlog (including unfunded contract options) of approximately $200 million, of which approximately 67% was attributable to our Defense & National Security segment and approximately 33% was attributable to our Space Solutions segment. As of March 31, 2025, we have remaining backlog from Hypersonic Interceptor DACS, Next Generation Interceptor and Trident II D5 Life Extension II, which provides meaningful visibility to our near- and medium-term revenues over the next several years. Additionally, as of March 31, 2025, we had a pipeline of identified projects, such as Navy / Airforce Exo-ACS, Golden Dome (f/k/a Iron Dome America): Enhanced Capability SM3 / THAAD / PAC 3 and SM-3 Block IIA / Block IB TDACS that we are pursuing of approximately $3.6 billion of potential revenue, supporting our future growth initiatives. Of such pipeline, approximately 75% was attributable to our Defense & National Security segment (including approximately $1 billion attributable to contracts we are pursuing for follow-on production on the NGI program) and approximately 25% was attributable to our Space Solutions segment. In addition, approximately 75% of our Defense & National Security segment pipeline was attributable to key missile programs. Based on U.S. missile defense and strategic deterrence priorities to overmatch peer, near peer, and rogue nations weapon systems capabilities, we expect each of these projects may extend to or beyond 2040.
Our Starlab Space Stations segment provides upside potential to our business and is well-positioned to deliver revenue in the future. In addition to the revenue we generated in fiscal year 2024 and the three months ended March 31, 2025, we received $62.2 million and $20.0 million, respectively, of cash proceeds from our $217.5 million CDFF development grant with NASA, with $70.3 million eligible proceeds remaining as of March 31, 2025. We believe we are well-positioned to win future awards from U.S. and allied agencies for continued Starlab development ahead of launching Starlab prior to the ISS decommissioning. Post-launch, we believe Starlab will have the opportunity to generate consistent revenues, similar to the financial profile of today’s terrestrial infrastructure projects.
Experienced Leadership Team with Deep Experience in Defense and Space Technology, with a Track Record of Success
Our experienced leadership team, led by our founders Dylan Taylor and Matthew Kuta, has extensive entrepreneurial, operational and financial experience. Their vision was integral in founding Voyager in 2019, assembling a world-class team of disruptors. Since inception, our founders, management team, Board of Directors and Strategic Advisory Boards have been critical to our technology development, contract wins, significant partnerships and successful acquisitions. Our leadership and advisors include former generals, NASA administrators, astronauts and proven public and private sector experts across national security and space. We believe our leadership team’s breadth of industry experience, culture of innovation and reliable execution and track record of operational success position us for significant further earnings growth. In addition, our management team’s incentives are well-aligned with the success of Voyager and its stockholders. Members of the management team and our Board of Directors are expected to hold approximately 11.0% of the shares of our Class A common stock and Class B common stock outstanding as of March 31, 2025, after giving effect to the sale of shares of Class A common stock by us in this offering.
Although we believe these competitive strengths will contribute to the growth and success of our company, our business is subject to risks that may prevent us from achieving our business objectives or otherwise adversely affect our business, results of operations or financial condition. For a description of the competitive challenges we face and the limitations of our business and operations see “Risk Factors.”
Our Growth Strategy
We intend to pursue the following strategies in order to continue realizing meaningful growth across our business.
Leverage Core Technologies and Expertise in the Defense & National Security and Space Solutions Segments to Grow with Customers and Win New Business
We plan to continue to grow our business by leveraging our existing portfolio of highly differentiated technology solutions. We believe that many of our current programs in which we participate are poised for significant growth. For example, we expect that our work with Lockheed Martin for their NGI program will lead to a production contract, with regular and reoccurring revenues. Beyond our current programs, we plan to utilize our current technologies to compete for new programs and applications. For example, we believe our technology-validated propulsion technologies can add value to a wide range of end use applications, including strategic, ballistic and hypersonic missiles. Furthermore, because our technologies are multi-use, we plan to identify cross-selling opportunities across our segments, such as capitalizing on opportunities to deploy propulsion technology in solutions for commercial space launch and on-orbit thrust and propulsion, dual-use of guidance, navigation and controls technology for both commercial and defense customers and artificial intelligence powered edge computing and advanced analytics for both intelligence and space exploration to drive mission-critical insights and optimized decision-making.
Develop Advanced Technologies to Expand Solutions and Attract a Broader Customer Set
We intend to continue purposeful development of what we believe is cutting-edge national security and space technology solutions, leveraging our technological expertise and our strategic partnership with artificial intelligence leader Palantir. Our research and development expertise and close customer collaboration enables rapid product development and improvement and the ability to modify our offerings for market demand. We have multiple development programs in process to augment existing offerings or to create innovative, novel technologies, such as the ongoing refinement of our high-performance satellite and spacecraft communications systems and components.
Integrate Software Capabilities with Hardware Solutions to Create Software Enabled Offerings
We have developed various advanced software solutions around signals intelligence, communication technologies, guidance, navigation and control systems. We intend to further integrate our hardware solutions with our software programs to offer fully-enabled solutions that we believe will address all customer and end-market needs. We also plan to team with industry-leading technology firms such as Palantir, to expand our capability set and offer trusted analytical services with mission operations.
Continue to Successfully Develop the Next Generation of Space Station Infrastructure
We intend to continue development of Starlab to meet the demand for an ISS replacement following its planned de-orbit. In the near-term, we plan to continue pursuing achievement of milestone payments under our current $217.5 million SAA with NASA under Phase I of their CDFF program, with numerous milestones expected to be achieved in the next year, which awards will be used to fund a portion of the research and development associated with Starlab. We believe our current development program with NASA will position us for future collaboration, and as such we expect to win additional follow-on awards from NASA and allied agencies for Starlab development. Following the deployment of Starlab as an anticipated ISS replacement, we intend to explore expansion of our business through either the deployment of additional Starlab attachment modules or the launch of additional space stations in order to meet further demand from government and private sector customers.
Drive Additional Value Creation Through Acquisition Opportunities
Since 2020, we have completed and integrated seven acquisitions. We intend to continuously evaluate acquisition opportunities, leveraging sector connectivity and a proven corporate development function. We plan to maintain a disciplined and selective focus on complementary companies which meet a defined customer need, demonstrate strategic excellence, and offer the opportunity for significant growth and synergy realization. We look for what we believe are unique assets that are early-stage innovations and bring them onto our platform to accelerate development into next-generation solutions. We plan to continue effectively integrating future acquisitions and using such acquisitions to expand our technology portfolio and drive financial performance to realize meaningful value creation.
We specialize in identifying inorganic opportunities that add synergistic technologies to our portfolio, building the capabilities necessary to tackle further attractive growth opportunities. For example, today we are contracted to supply multiple solutions to Lockheed Martin’s NGI program, both propulsion technology and guidance technology. Our diversified position on the NGI program would not be possible without the strategic acquisitions of Valley Tech Systems in 2021 and Space Micro in 2022.
Expand Profitability Through Opportunity Selection, Operational Excellence and Scale
We plan to broaden our mix of contracts over time that we believe will increase profitability. Today, a meaningful portion of our revenue is derived from service contracts and cost-plus contracts, which have typically yielded lower margins relative to the rest of our business. As those contracts are completed, we are focused on entering into higher-margin contracts delivering our advanced hardware, software and mission management solutions. Furthermore, we intend to continue driving operational and financial excellence across the business to drive margin expansion through improved operations and the realization of cost efficiencies and synergies. We have established a scalable corporate structure designed to efficiently support current business operations and adapt seamlessly to growth. We utilize customer-funded R&D opportunities to help offset the cost of development to provide solutions while maintaining our financial efficiency. This structure enables us to meet evolving business needs and capitalize on opportunities for significant revenue growth without requiring substantial expansions in headcount or organizational complexity. As we continue to realize growth from our organic and inorganic initiatives, we expect to achieve increased operating leverage in our business to further drive margin and cash flow improvement.
Although we believe these growth strategies will contribute to the success of our company, our business is subject to risks that may prevent us from achieving our business objectives or otherwise adversely affect our business, results of operations or financial condition. For a description of the strategic challenges we face and the limitations of our business and operations see “Risk Factors.”
Recent Developments
On May 30, 2025, we entered into the Revolving Credit Agreement among us, the lenders party thereto from time to time and JPMorgan Chase Bank, N.A., as the administrative agent, which provides for a (i) $200.0 million senior secured revolving credit facility and an uncommitted incremental facility that permits us to request an increase in the size of the revolving credit facility of up to $150.0 million, subject to certain conditions and lender approvals, (ii) a $25.0 million letter of credit subfacility, and (iii) a $10.0 million swingline loan subfacility. Commitments under the Revolving Credit Facility will become effective upon the consummation of this offering and satisfaction of certain other conditions set forth in the Revolving Credit Agreement.
We currently have no indebtedness outstanding under the Revolving Credit Facility. However, we intend to partially draw on the Revolving Credit Facility to repay in full the Term Loan on or around July 1, 2025. The foregoing is based on information available as of the date of this prospectus and is subject to change. There can be no assurance that we will partially draw on the Revolving Credit Facility to repay in full the Term Loan on or around July 1, 2025 or at all.
See “Description of Certain Other Indebtedness” for a description of the Revolving Credit Agreement.
Summary Risk Factors
Investing in our Class A common stock involves a high degree of risk. You should carefully consider these risks before investing in our Class A common stock, including the risks related to our business and industry described under “Risk Factors” elsewhere in this prospectus. In particular, the following considerations, among others, may offset our competitive strengths or have a negative effect on our business strategy, which could cause a decline in the price of our Class A common stock and result in a loss of all or a portion of your investment:
Risks Related to Our Business and Industry
•We may not be able to generate, sustain and manage our growth due to a variety of external factors. We have a limited operating history in an evolving industry, which makes it difficult to forecast our revenue, plan our expenses, and evaluate our business and future prospects;
•We have a history of losses, we anticipate increasing operating expenses in the future, and we may not be able to achieve and, if achieved, maintain profitability;
•We depend heavily on a single customer, the U.S. government, for a substantial portion of our business. Changes in this customer’s priorities and spending, or delays or reductions in spending, could have a material adverse effect on us;
•Starlab will require significant additional capital expenditures for which we have not yet secured and may be unable to secure financing;
•Any technology intended for use in outer space may be delayed, damaged or destroyed during pre-launch operations, launch failures or during the execution of the operation, which can materially and adversely affect our operations;
•We have never launched or maintained a space station before and may lack the necessary expertise, personnel and resources to successfully launch and maintain a space station on our own;
•Our current and future acquisitions, dispositions, or strategic transactions may fail to successfully integrate with our business activities or fail to deliver the expected return on investment, and could have a material adverse effect on us;
Legal and Regulatory Risks
•Our business is subject to various regulatory risks that could have a material adverse effect on us;
•There is significant uncertainty surrounding U.S. “mission authorization” regulations that may apply to Starlab. Any final regulations may impose significant, unexpected compliance costs on the project; and
•Other factors set forth under “Risk Factors” in this prospectus.
Our Structure
The following chart illustrates our simplified structure of the issuer. The chart is provided for illustrative purposes only and does not represent all legal entities affiliated with us, or all of our obligations. Ownership percentages in our company are presented based on the assumption that the underwriters’ option to purchase
additional shares is not exercised and the other assumptions regarding the number of shares of our Class A common stock and Class B common stock to be outstanding after this offering described under the heading “The Offering.”
Corporate Information
Voyager Technologies, Inc. was incorporated in Delaware on August 15, 2019. Our principal executive offices are located at 1225 17th Street, Suite 1100, Denver, Colorado 80202. Our telephone number is (303) 500-6985. Our website address is www.voyagertechnologies.com. Information contained on, or that can be accessed through, our website does not constitute part of this prospectus, and inclusions of our website address in this prospectus are inactive textual references only.
Implications of Being an Emerging Growth Company
We qualify as an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. For so long as we remain an emerging growth company, we are permitted and currently intend to rely on the following provisions of the JOBS Act that contain exceptions from disclosure and other requirements that otherwise are applicable to companies that conduct initial public offerings and file periodic reports with the SEC. These provisions include, but are not limited to:
•being permitted to present only two years of audited financial statements in this prospectus and only two years of related “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our periodic reports and registration statements, including this prospectus;
•not being required to comply with the auditor attestation requirements of Section 404 of the SOX;
•reduced disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements, including in this prospectus; and
•exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
We will remain an emerging growth company until:
•the first to occur of the last day of the fiscal year (i) that follows the fifth anniversary of the completion of this offering, (ii) in which we have total annual gross revenue of at least $1.235 billion or (iii) in which we are deemed to be a “large accelerated filer,” as defined in the Exchange Act; or
•if it occurs before any of the foregoing dates, the date on which we have issued more than $1 billion in nonconvertible debt over a three-year period.
We have elected to take advantage of certain of the reduced disclosure obligations in this prospectus and may elect to take advantage of other reduced reporting requirements in our future filings with the SEC. As a result, the information that we provide to our stockholders may be different than what you might receive from other public reporting companies in which you hold equity interests.
We have elected to avail ourselves of the provision of the JOBS Act that permits emerging growth companies to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies. As a result, we will not be subject to new or revised accounting standards at the same time as other public companies that are not emerging growth companies.
For additional information, see the section titled “Risk Factors—Risks Related to this Offering and Ownership of Our Class A common stock—We are an “emerging growth company” and we cannot be certain if the reduced disclosure requirements applicable to “emerging growth companies” will make our Class A common stock less attractive to investors.”
THE OFFERING
| | | | | | | | |
Issuer | | Voyager Technologies, Inc. |
| | |
Class A common stock offered by us | | 11,000,000 shares (or 12,650,000 shares if the underwriters exercise their option to purchase additional shares in full). |
| | |
Underwriters’ option to purchase additional shares of Class A common stock | | We have granted to the underwriters a 30-day option to purchase up to 1,650,000 additional shares of our Class A common stock, solely to cover over-allotments, if any, from us at the initial public offering price less the underwriting discounts and commissions. |
| | |
Class A common stock to be outstanding immediately after this offering | | 49,348,800 shares (or 50,998,800 shares if the underwriters exercise in full their option to purchase additional shares). |
| | |
Class B common stock to be outstanding immediately after this offering | | 5,695,362 shares. |
| | |
Total Class A and Class B common stock to be outstanding immediately after this offering | | 55,044,162 shares (or 56,694,162 shares if the underwriters exercise in full their option to purchase additional shares). |
| | |
Use of proceeds | | We estimate that the net proceeds from this offering will be approximately $274.2 million (or approximately $316.4 million if the underwriters exercise their option to purchase additional shares of our Class A common stock in full), after deducting underwriting discounts and commissions and estimated offering expenses that remain payable by us, based on an assumed initial public offering price of $27.50 per share, which is the midpoint of the price range set forth on the front cover of this prospectus. We intend to use the net proceeds received by us from this offering primarily to fund strategic growth initiatives, including investment in research and development programs and the acquisition of capital assets necessary to support our long-term innovation roadmap and growth strategies. Additionally, a portion of the proceeds may be allocated to pursue potential mergers and acquisitions aligned with our core business areas; however, we do not have agreements or commitments for any material acquisitions or investments at this time. Remaining proceeds will be used for general working capital and corporate purposes, including repayment of indebtedness outstanding, administrative expenses, systems improvements, and other operational needs. See “Use of Proceeds.” |
| | | | | | | | |
Voting rights | | Upon completion of this offering, we will have two classes of common stock outstanding: Class A common stock and Class B common stock. The rights of the holders of our Class A common stock and Class B common stock are identical, except with respect to voting, conversion and transfer rights. Each share of our Class A common stock is entitled to one vote per share. Each share of our Class B common stock is entitled to 15 votes per share. Holders of shares of our Class A common stock and Class B common stock will generally vote together as a single class, unless otherwise required by law or our amended and restated certificate of incorporation that becomes effective immediately prior to the completion of this offering. Each share of our Class B common stock is convertible into one share of our Class A common stock at any time at the election of the holder and will convert automatically upon any transfer, except for permitted transfers, described in our amended and restated certificate of incorporation, including transfers to immediate family members (including upon Mr. Taylor’s death), trusts (including grantor retained annuity trusts) for which the stockholder or their immediate family member serves as trustee, and partnerships, corporations, and other entities exclusively owned by Mr. Taylor or his immediate family, and upon the earlier to occur of (i) a date that is fixed by our board of directors that is no less than 61 days and no more than 180 days following the date Mr. Taylor is no longer providing services to us as an executive officer or member of our board of directors, (ii) a date that is fixed by our board of directors that is no less than 61 days and no more than 180 days following the death or incapacity of Mr. Taylor, (iii) the first trading day following the seventh anniversary of this offering and (iv) the date on which the number of shares of Class A and Class B common stock beneficially owned by Mr. Taylor and Mr. Taylor’s permitted transferees (including shares underlying outstanding options) represents less than 50% of the shares of Class A and Class B common stock beneficially owned by Mr. Taylor on the closing date of this offering. Immediately following the completion of this offering, and assuming no exercise of the underwriters’ option to purchase additional shares to cover over-allotments, if any, and assuming Mr. Taylor does not purchase any shares of Class A common stock pursuant to the directed share program, Mr. Taylor will control approximately 63.4% of the voting power of our outstanding capital stock. As a result, we will be a “controlled company” within the meaning of the corporate governance standards of the New York Stock Exchange, and although we do not intend to utilize any exemptions from corporate governance standards upon completion of this offering, we may utilize any or all of these exemptions at our discretion until we cease to be a “controlled company,” and Mr. Taylor will have significant influence over the outcome of matters submitted to our stockholders for approval, including the election of our directors and the approval of any change of control transaction. These risks are more fully described in the section titled “Risk Factors.” Additional information can be found in the sections titled “Management—Controlled Company Exception,” “Principal Stockholders” and “Description of Capital Stock.” |
| | |
| | | | | | | | |
Dividend policy | | We currently do not anticipate paying any dividends to holders of our common stock in the foreseeable future. Any determination to pay dividends in the future will be at the discretion of our board of directors, subject to applicable laws. See “Dividend Policy.” |
| | |
Directed Share Program | | At our request, the underwriters have reserved up to $20 million of shares of Class A common stock (or up to 727,272 shares of Class A common stock assuming an initial public offering price of $27.50 per share, which is the midpoint of the price range set forth on the cover page of this prospectus) to be issued by us and offered by this prospectus for sale, at the initial public offering price, to certain of our employees and friends and family members of certain of our directors, officers and employees. The number of shares of Class A common stock available for sale to the general public will be reduced to the extent these individuals purchase such reserved shares. Any reserved shares that are not so purchased will be offered by the underwriters to the general public on the same basis as the other shares offered by this prospectus. Morgan Stanley & Co. LLC will administer our directed share program. See “Underwriting—Directed Share Program.” |
| | |
Indication of Interest | | The cornerstone investors have, severally and not jointly, indicated an interest in purchasing up to an aggregate of $60 million in shares of Class A common stock in this offering at the initial public offering price. The shares of Class A common stock to be purchased by the cornerstone investors will not be subject to a lock-up agreement with the underwriters. Because this indication of interest is not a binding agreement or commitment to purchase, the cornerstone investors may determine to purchase more, less or no shares in this offering or the underwriters may determine to sell more, less or no shares to the cornerstone investors. The underwriters will receive the same underwriting discounts and commissions on any of our shares of Class A common stock purchased by the cornerstone investors as they will from any other shares of Class A common stock sold to the public in this offering. |
| | |
Risk factors | | Investing in shares of our Class A common stock involves a high degree of risk. See “Risk Factors” for a discussion of the risks you should carefully consider before investing in shares of our Class A common stock. |
| | |
Listing | | After pricing of this offering, we expect that shares of our Class A common stock will trade on the New York Stock Exchange under the symbol “VOYG”. |
Unless otherwise stated, the number of shares of Class A and Class B common stock to be issued and outstanding after this offering is based on 38,348,800 shares of Class A common stock and 5,695,362 shares of Class B common stock outstanding as of May 30, 2025, after giving effect to the Stock Split and the IPO Recapitalization Transactions. The number of shares of our Class A common stock to be outstanding after this offering does not include:
•3,920,816 shares of Class A common stock issuable upon the exercise of options outstanding as of May 30, 2025 under the 2020 Plan, with a weighted-average exercise price of $13.87;
•549,693 shares of Class B common stock issuable upon exercise of stock options outstanding as of May 30, 2025 under the 2020 Plan, at a weighted average exercise price of $15.17 per share;
•1,176,956 shares of Class A common stock issuable upon the exercise of warrants outstanding as of May 30, 2025, with a weighted-average exercise price of $24.89;
•762,750 shares of Class A common stock issuable upon the vesting of restricted stock awards to be granted under our 2025 Plan (as defined below) immediately following the effectiveness of the applicable Form S-8 registration statement;
•45,000 shares of Class B common stock issuable upon the vesting of restricted stock awards to be granted under our 2025 Plan immediately following the effectiveness of the applicable Form S-8 registration statement;
•4,611,577 remaining shares of Class A common stock or Class B common stock reserved for future issuance under the 2025 Plan, that will become effective in connection with this offering (after giving effect to the issuance of the stock awards described above); and
•1,100,883 shares of Class A common stock reserved for issuance under the ESPP that will become effective in connection with this offering.
The 2025 Plan and the ESPP also provide for automatic annual increases in the number of shares reserved thereunder. See “Executive Compensation—Equity Incentive Plan” for more information.
Unless otherwise indicated, the information presented in this prospectus assumes:
•the 1.5-for-1 forward stock split of our common stock that occurred (the “Stock Split”);
•the (i) conversion of all outstanding shares of our Class A-1 Preferred Stock, Class B Preferred Stock and Class C Preferred Stock into an aggregate of 27,812,820 shares of common stock and the subsequent cancellation of such shares of Class A-1 Preferred Stock, Class B Preferred Stock and Class C Preferred Stock and (ii) forfeiture and cancellation of our outstanding share of our Class A Preferred Stock pursuant to the terms of an exchange and forfeiture agreement entered into with us, in each case, to be effected prior to the completion of this offering (the “Preferred Stock Recapitalization”);
•the conversion of an aggregate principal amount of $25.3 million (plus accrued and unpaid interest) of SMI Promissory Notes into an aggregate of 921,306 shares of our common stock prior to the completion of this offering (the “SMI Promissory Notes Conversion”);
•the filing and effectiveness of our amended and restated certificate of incorporation, pursuant to which we will reclassify our outstanding common stock into Class A common stock (the “Common Stock Reclassification”), and the adoption of our amended and restated bylaws, each of which will occur prior to the completion of this offering;
•the exchange of an aggregate of 5,695,362 shares of Class A common stock beneficially owned by Mr. Taylor for an equivalent number of shares of our Class B common stock, to be effected prior to the completion of this offering pursuant to the terms of an exchange and forfeiture agreement entered into with us (the “Class B Stock Exchange” and, together with the Preferred Stock Recapitalization, the SMI Promissory Notes Conversion and the Common Stock Reclassification, the “IPO Recapitalization Transactions”);
•an initial public offering price of $27.50 per share of our Class A common stock, which is the midpoint of the price range set forth on the front cover of this prospectus;
•no exercise of outstanding options or warrants, except as described above; and
•no exercise of the underwriters’ option to purchase additional shares of our Class A common stock from us.
SUMMARY CONSOLIDATED FINANCIAL AND OTHER DATA
The following tables set forth our summary consolidated financial and other information as of and for the years ended December 31, 2024 and 2023 and for the three months ended March 31, 2025 and 2024.
The summary consolidated statements of operations data and statements of cash flow data presented below for the years ended December 31, 2024 and 2023 and the consolidated balance sheet data as of December 31, 2024 have been derived from our audited consolidated financial statements included elsewhere in this prospectus. The selected summary consolidated financial data presented for the three months ended March 31, 2025 and 2024 have been derived from our unaudited consolidated financial statements included elsewhere in this prospectus. The consolidated financial data included below and set forth elsewhere in this prospectus are not necessarily indicative of our future performance, and results for any interim period are not necessarily indicative of the results for any full year.
You should read the following summary consolidated financial and other data together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Capitalization” and our consolidated financial statements and the accompanying notes included elsewhere in this prospectus.
Statement of Operations Data:
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Three Months Ended March 31, |
(dollars in thousands) | 2024 | | 2023 | | 2025 | | 2024 |
| Net sales | $ | 144,180 | | | $ | 136,062 | | | $ | 34,507 | | | $ | 30,216 | |
| Cost of sales | 109,265 | | | 108,277 | | | 28,922 | | | 24,035 | |
| Selling, general, and administrative | 62,570 | | | 54,043 | | | 26,286 | | | 15,590 | |
| Research and development | 7,611 | | | (18,542) | | | 4,040 | | | 767 | |
| Impairment losses | 3,594 | | | — | | | — | | | — | |
| Amortization of acquired intangible assets | 9,582 | | | 6,457 | | | 1,548 | | | 1,744 | |
| Loss from operations | $ | (48,442) | | | $ | (14,173) | | | $ | (26,289) | | | $ | (11,920) | |
| Other income (expense): | | | | | | | |
| Change in fair value of embedded derivatives | $ | 387 | | | $ | — | | | $ | — | | | $ | — | |
| Loss on debt extinguishment | (9,392) | | | (1,287) | | | — | | | — | |
| Finance and interest expense | (12,016) | | | (10,590) | | | (2,729) | | | (2,994) | |
| Other income, net | 2,127 | | | 1,193 | | | 1,137 | | | 210 | |
| Loss before income taxes | (67,336) | | | (24,857) | | | (27,881) | | | (14,704) | |
| Income tax (benefit) expense | (1,708) | | | 341 | | | 48 | | | 248 | |
| Net loss | (65,628) | | | (25,198) | | | (27,929) | | | (14,952) | |
| Net (loss) income attributable to noncontrolling interests | (3,556) | | | 240 | | | (991) | | | (129) | |
| Net loss attributable to Voyager Technologies, Inc. | $ | (62,072) | | | $ | (25,438) | | | $ | (26,938) | | | $ | (14,823) | |
Per Share Information:
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Three Months Ended March 31, |
| 2024 | | 2023 | | 2025 | | 2024 |
Net loss per share attributable to common stockholders | $ | (6.59) | | | $ | (3.50) | | | $ | (3.45) | | | $ | (2.38) | |
Weighted-average common shares outstanding | 12,736 | | | 12,362 | | | 9,560 | | | 8,332 | |
Pro forma adjusted net loss per share, basic(1) | $ | (2.11) | | | | | $ | (0.58) | | | |
Pro forma adjusted weighted-average common shares outstanding, basic(1) | 36,566 | | | | | 42,729 | | | |
Pro forma adjusted net loss per share, diluted(1) | $ | (2.26) | | | | | $ | (0.58) | | | |
Pro forma adjusted weighted-average common shares outstanding, diluted(1) | 36,574 | | | | | 42,729 | | | |
________________
(1)See Note 19 to our audited consolidated financial statements and Note 12 to our unaudited interim condensed consolidated financial statements included elsewhere in this prospectus for an explanation of the calculations of our basic and diluted net loss per share attributable to common stockholders and the weighted-average shares used in computing the per share amounts.
The following table sets forth the computation of our unaudited pro forma net loss per share, basic and diluted:
| | | | | | | | | | | |
| Year Ended December 31, | | Three Months Ended March 31, |
| (amounts in thousands, except per share data) | 2024 | | 2025 |
| Numerator | | | |
| Net loss attributable to Voyager Technologies, Inc. | $ | (62,072) | | | $ | (26,938) | |
| Less: accrued preferred stock dividends | 21,816 | | | 6,001 | |
| Net loss attributable to common stockholders, basic | $ | (83,888) | | | $ | (32,939) | |
| Pro forma adjustment to reverse impact of accrued preferred stock dividends for the period, assuming preferred stock converted to common stock on January 1, 2024 | 21,816 | | | 6,001 | |
| Pro forma adjustment to adjust stock-based compensation expense associated with options that contain a performance-based vesting condition that was satisfied upon the effectiveness of the registration statement of which this prospectus forms a part, assuming the effectiveness of the offering occurred on January 1, 2024 | (11,483) | | | 1,058 | |
| Pro forma adjustment to reverse noncash interest expense for the SMI promissory note, assuming the note converted into shares of common stock on January 1, 2024 | 1,814 | | | 406 | |
| Pro forma adjustment to reverse historical interest expense and record a loss on extinguishment for the Term Loan, assuming the Term Loan was extinguished upon issuance during June 2024 | 335 | | | 2,076 | |
| Pro forma adjustment to adjust stock-based compensation expense associated with restricted stock awards to be awarded upon the effectiveness of the registration statement of which this prospectus forms a part, assuming the effectiveness of the offering occurred on January 1, 2024 | (5,849) | | | (1,462) | |
| Pro forma net loss attributable to common stockholders, basic | $ | (77,255) | | | $ | (24,860) | |
| Accretion and fair value adjustment on ZIN earnout | (5,411) | | | — | |
| Pro forma net loss attributable to common stockholders, diluted | $ | (82,666) | | | $ | (24,860) | |
| | | |
| Denominator | | | |
| Adjusted weighted-average common shares outstanding | 12,737 | | | 14,340 | |
| Pro forma adjustment to reflect the conversion of all convertible preferred stock into shares of Class A common stock at the applicable conversion prices had the conversion occurred on January 1, 2024 | 21,659 | | | 25,133 | |
| Pro forma adjustment to reflect the conversion of the SMI convertible note, had the conversion occurred on January 1, 2024 | 1,084 | | | 1,084 | |
| Pro forma adjustment to reflect the extinguishment of the Term Loan had the conversion occurred on June 28, 2024 | 1,086 | | | 2,172 | |
| Pro forma adjusted weighted-average common shares outstanding | 36,566 | | | 42,729 | |
| Shares issuable assuming ZIN earnout | 8 | | | — | |
| Pro forma adjusted weighted-average common shares outstanding, diluted | 36,574 | | | 42,729 | |
| Pro forma adjusted net loss per share attributable to common stockholders | | | |
| Basic | $ | (2.11) | | | $ | (0.58) | |
| Diluted | $ | (2.26) | | | $ | (0.58) | |
The computations of our unaudited pro forma adjusted net loss per share attributable to common stockholders are illustrative, and assume that the events described above occurred as of January 1, 2024. Our actual net loss per share computations will reflect the effect of the events when they occur, and accordingly, the impact of the above events will differ from the pro forma amounts presented above.
Consolidated Statement of Cash Flows:
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Three Months Ended March 31, |
(dollars in thousands) | 2024 | | 2023 | | 2025 | | 2024 |
Cash used in operating activities | $ | (25,502) | | | $ | (15,381) | | | $ | (14,354) | | | $ | (7,906) | |
Cash (used in) provided by investing activities | (27,773) | | | 11,598 | | | (8,970) | | | (5,400) | |
Cash provided by financing activities | $ | 78,957 | | | $ | 1,931 | | | $ | 142,854 | | | $ | 24,540 | |
Consolidated Balance Sheet:
| | | | | | | | | | | | | | | | | |
| As of March 31, 2025 |
| (dollars in thousands) | Actual | | Pro Forma(1) | | Pro Forma as Adjusted(2) |
| Cash and cash equivalents | $ | 175,488 | | | $ | 116,328 | | | $ | 390,562 | |
| Total assets | 365,462 | | | 306,302 | | | 578,356 | |
| Total liabilities | 190,685 | | | 108,053 | | | 108,053 | |
| Class A-1 redeemable preferred stock | 97,349 | | | — | | | — | |
| Class A preferred stock | — | | | — | | | — | |
| Class B convertible preferred stock | 134,982 | | | — | | | — | |
| Class C preferred stock | 158,311 | | | — | | | — | |
| Common stock | 1 | | | — | | | — | |
| Class A common stock | — | | | 3 | | | 4 | |
| Class B common stock | — | | | 1 | | | 1 | |
| Total deficit | $ | 49,833 | | | $ | 170,654 | | | $ | 442,708 | |
________________
(1)The pro forma column in the balance sheet data table above gives effect to (i) the Preferred Stock Recapitalization, (ii) the SMI Promissory Notes Conversion, (iii) the filing and effectiveness of our amended and restated certificate of incorporation that will become effective immediately prior to the completion of this offering (including the Common Stock Reclassification pursuant thereto), (iv) the Class B Stock Exchange, (v) repayment of the Term Loan, and (vi) stock-based compensation expense of $10.2 million associated with options that contain a performance-based vesting condition that was satisfied upon the effectiveness of the registration statement of which this prospectus forms a part, as if each of the foregoing had occurred on March 31, 2025.
(2)The pro forma as adjusted column in the balance sheet data table above gives effect to (i) the pro forma adjustments set forth above, and (ii) the issuance of 11,000,000 shares in this offering at an initial public offering price of $27.50 per share, which is the midpoint of the price range set forth on the front cover of this prospectus, and the application of the net proceeds therefrom as set forth under “Use of Proceeds,” after deducting underwriting discounts, commissions and estimated offering expenses that remain payable by us of $28.3 million, which is net of $2.1 million of offering costs paid as of March 31, 2025 as if each had occurred on March 31, 2025. See “Use of Proceeds” and “Capitalization.”
Key Performance Indicators and Non-GAAP Financial Measures:
| | | | | | | | | | | | | | | | | |
| December 31, | | March 31, |
| (dollars in thousands) | 2024 | | 2023 | | 2025 |
Backlog (as of period end)(1) | | | | | |
| Defense & National Security | $ | 59,234 | | | $ | 33,016 | | | $ | 54,464 | |
| Space Solutions | 42,499 | | | 53,483 | | | 38,664 | |
| Starlab Space Stations | — | | | — | | | — | |
| Total backlog | 101,733 | | | 86,499 | | | 93,128 | |
Unfunded contract options(2) | 98,349 | | | 93,069 | | | 86,043 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Three Months Ended March 31, |
| (dollars in thousands) | 2024 | | 2023 | | 2025 | | 2024 |
Bookings(3) | 159,415 | | | 102,148 | | | 25,939 | | | 25,374 | |
| Net sales | 144,180 | | | 136,062 | | | 34,507 | | | 30,216 | |
| Gross profit | 34,915 | | | 27,785 | | | 5,585 | | | 6,181 | |
| Net loss | (62,072) | | | (25,438) | | | (26,938) | | | (14,823) | |
Adjusted EBITDA(4) | (29,983) | | | 1,421 | | | (21,356) | | | (7,179) | |
| Cash flow used in operating activities | (25,502) | | | (15,381) | | | (14,354) | | | (7,906) | |
Free cash flow(5) | (53,275) | | | (5,733) | | | (23,324) | | | (13,306) | |
________________
(1)Backlog is comprised of projects for which we have received a written contract or purchase order, either executed or awaiting execution, excluding any unfunded contract options. Our backlog may also include, as of any date of estimation, change orders for any project that have been confirmed, either in writing or verbally, or formally contracted.
(2)Unfunded contract options represent customer options for future products or services that have not yet been exercised and potential bookings under IDIQ contracts. As of March 31, 2025, unfunded contract options were primarily comprised of customer options for future products or services that have not yet been exercised in the Defense & National Security segment.
(3)Bookings represent funded contracts awarded to us during the fiscal period. Funded contracts represent definitized contracts for performance obligations from customers that contain the right to receive consideration in exchange for goods transferred to the customer.
(4)See “Non-GAAP Financial Measures” below for a discussion of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net loss attributable to Voyager Technologies, Inc., the most directly comparable GAAP measure to Adjusted EBITDA.
(5)See “Non-GAAP Financial Measures” below for a discussion of free cash flow and a reconciliation of free cash flow to net cash provided by operating activities, the most directly comparable GAAP measure to free cash flow.
We present EBITDA, Adjusted EBITDA and free cash flow in this prospectus because we believe such measures provide investors with additional information to measure our performance. However, EBITDA and Adjusted EBITDA have limitations as analytical tools and should not be considered in isolation from, or as alternatives to, GAAP financial measures as indicators of our operating performance and should not be considered as measures of cash available to us to invest in the growth of our business or that will be available to us to meet our obligations. In addition, they should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. In evaluating EBITDA and Adjusted EBITDA, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of EBITDA and Adjusted EBITDA should not be construed to imply that our future results will be unaffected by any such adjustments. Management compensates for these limitations by primarily relying on our GAAP results in addition to using EBITDA and Adjusted EBITDA supplementally.
We calculate EBITDA as net loss attributable to Voyager Technologies, Inc. plus (less) finance and interest expense, provision for income tax expense (benefit), depreciation and amortization. We calculate Adjusted EBITDA as EBITDA adjusted for change due to stock-based compensation, business acquisition costs, restructuring charges, income (loss) attributable to noncontrolling interests, and other items we do not believe are indicative of our core
operating performance, including incremental organizational costs attributable to this offering, changes in the fair value of earnout liabilities, impairment, and foreign exchange gain/loss. We believe that the presentation of Adjusted EBITDA provides a measurement of our operations that is meaningful to investors because it excludes the effects of certain items that are otherwise included in EBITDA but which we do not believe are indicative of our core business operations. Our calculation of Adjusted EBITDA may not be comparable to the calculation of similarly titled measures reported by other companies. We believe EBITDA and Adjusted EBITDA provide useful measures for period-to-period comparisons of our business, as they remove the impact of our capital structure and other items not indicative of our core operating performance from operating results.
For further information, see the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Performance Indicators and Non-GAAP Financial Measures—Adjusted EBITDA.”
The table below reconciles net loss attributable to Voyager Technologies, Inc., which is the most directly comparable financial measure calculated in accordance with GAAP, to EBITDA and Adjusted EBITDA.
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Three Months Ended March 31, | | | | |
| 2024 | | 2023 | | 2025 | | 2024 | | | | |
| Net loss attributable to Voyager Technologies, Inc. | $ | (62,072) | | | $ | (25,438) | | | $ | (26,938) | | | $ | (14,823) | | | | | |
| Finance and interest expense | 12,016 | | | 10,590 | | | 2,729 | | | 2,994 | | | | | |
| Depreciation and amortization | 13,595 | | | 10,294 | | | 2,602 | | | 2,713 | | | | | |
| Taxes | (1,708) | | | 341 | | | 48 | | | 248 | | | | | |
| EBITDA | $ | (38,169) | | | $ | (4,213) | | | $ | (21,559) | | | $ | (8,868) | | | | | |
| Stock-based compensation | 3,761 | | | 2,707 | | | 1,723 | | | 730 | | | | | |
Business acquisition costs(1) | 282 | | | 644 | | | 156 | | | 230 | | | | | |
Restructuring(2) | 2,295 | | | 3,562 | | | 418 | | | 1,113 | | | | | |
| Impairment losses | 3,594 | | | — | | | — | | | — | | | | | |
| Net (loss) income attributable to noncontrolling interests | (3,556) | | | 240 | | | (991) | | | (129) | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
Other(3) | 1,810 | | | (1,519) | | | (1,103) | | | (255) | | | | | |
Adjusted EBITDA(4) | $ | (29,983) | | | $ | 1,421 | | | $ | (21,356) | | | $ | (7,179) | | | | | |
________________
(1)Business acquisition costs includes legal costs and incremental transaction costs associated with an acquisition.
(2)Restructuring includes costs for retention and severance payments related to management’s decision to undertake certain actions to realign our cost structure through workforce reductions and the closure of certain facilities, businesses and product lines.
(3)Other includes capital market and advisory fees related to advisors assisting with transitional activities associated with becoming a public company, changes in fair value of earn out liabilities, and foreign exchange gain/loss that are all individually insignificant for the period.
(4)See “Non-GAAP Financial Measures” below for a discussion of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net loss attributable to Voyager Technologies, Inc., the most directly comparable GAAP measure to Adjusted EBITDA.
We consider free cash flow to be a useful, supplemental measure of our ability to generate cash on a normalized basis. We use free cash flow to supplement GAAP measures in evaluating our flexibility to allocate capital and pursue opportunities that may enhance shareholder value and the effectiveness of our strategies, to make budgeting decisions and to compare our performance against that of our peer companies, many of which present similar non-GAAP financial measures. We believe that while expenditures and dispositions of property, plant and equipment will fluctuate period to period, we seek to ensure that we have adequate capital on hand to maintain ongoing operations and enable growth of the business. Additionally, free cash flow is of limited usefulness, in that it does not represent residual cash flows available for discretionary expenditures, due to the fact the measures do not deduct the payments required for debt service and other contractual obligations or payments. Our presentation of free cash flow should not be construed to imply that our future results will be unaffected by any such adjustments. Management compensates for these limitations by primarily relying on our GAAP results in addition to using free cash flow
supplementally. For further information, see the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Performance Indicators and Non-GAAP Financial Measures—Free Cash Flow.”
The table below reconciles net cash (used in) provided by operating activities, which is the most directly comparable financial measure calculated in accordance with GAAP, to free cash flow.
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Three Months Ended March 31, |
| 2024 | | 2023 | | 2025 | | 2024 |
| Cash used in operating activities | $ | (25,502) | | | $ | (15,381) | | | $ | (14,354) | | | $ | (7,906) | |
| Purchases of property and equipment | (82,703) | | | (17,210) | | | (26,970) | | | (16,050) | |
| Grant funding for property and equipment | 54,930 | | | 26,858 | | | $ | 18,000 | | | $ | 10,650 | |
| Free cash flow | $ | (53,275) | | | $ | (5,733) | | | $ | (23,324) | | | $ | (13,306) | |
The reconciliation between total Voyager capital expenditures, Starlab Space Stations capital expenditures and capital expenditures excluding Starlab is shown below:
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Three Months Ended March 31, | | | | |
| (dollars in thousands) | 2024 | | 2023 | | 2025 | | 2024 | | | | |
| Total Voyager capital expenditures | $ | 82,703 | | | $ | 17,210 | | | $ | 26,970 | | | $ | 16,050 | | | | | |
| Less: Starlab Space Stations capital expenditures | 79,381 | | | 15,691 | | | 25,894 | | | 15,190 | | | | | |
| Capital expenditures excluding Starlab Space Stations | $ | 3,322 | | | $ | 1,519 | | | $ | 1,076 | | | $ | 860 | | | | | |
RISK FACTORS
Investing in our Class A common stock involves a high degree of risk. Before making your decision to invest in shares of our Class A common stock, you should carefully consider and read carefully all of the risks described below, together with the other information contained in this prospectus, including our financial statements and the related notes and the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this prospectus. We cannot assure you that any of the events discussed below will not occur. If any of the risks discussed in this prospectus were to occur, our business, financial condition, results of operations, cash flow, liquidity, reputation and prospects and our ability to service our debt could be materially and adversely affected (which we refer to collectively as “materially and adversely affecting us” or having “a material adverse effect on us” and comparable phrases), the market price of our Class A common stock could decline significantly and you could lose all or part of your investment in our Class A common stock. Additional risks and uncertainties not presently known to us or not believed by us to be material may also negatively impact us.
Risks Related to Our Business and Industry
We may not be able to generate, sustain and manage our growth due to a variety of external factors. We have a limited operating history in an evolving industry, which makes it difficult to forecast our revenue, plan our expenses, and evaluate our business and future prospects.
Our ability to generate and sustain revenue growth may be impacted by a variety of external factors. During the years ended December 31, 2024 and 2023, our revenue was $144.2 and $136.1 million, respectively. During the three months ended March 31, 2025 and 2024, our revenue was $34.5 and $30.2 million, respectively. We have a limited operating history in a rapidly evolving industry, and while our business has grown rapidly, and much of that growth has occurred in recent periods through acquisitions, the space industry may not continue to develop in a manner that we expect or that otherwise would be favorable to our business. As a result, our ability to forecast our future results of operations and future growth is limited and subject to a number of uncertainties.
If our operations continue to grow as planned, we will need to expand our sales and marketing, research and development, customer and commercial strategy, products and services, supply, and manufacturing and distribution functions. We will also need to continue to leverage our operational systems and processes and there is no guarantee that we will be able to continue to grow as planned or scale the business and the manufacture of products as currently planned or within the planned timeframe. The continued expansion of our business may also require additional manufacturing and operational facilities, as well as space for administrative support, and there is no guarantee that we will be able to find suitable locations or partners for the manufacture and operation of our products and systems.
Our continued growth could increase the strain on our resources and we could experience operating difficulties, including difficulties in hiring, training and managing an increasing number of employees, finding manufacturing capacity to produce our equipment and delays in production. These difficulties may result in the erosion of our brand image, divert the attention of management and key employees and impact financial and operational results. In addition, in order to continue to expand our operations in space, we expect to incur substantial expenses as we continue to attempt to streamline our manufacturing process, hire more employees and continue research and development efforts relating to new products and technologies and expand internationally. If we are unable to drive commensurate growth, these costs, which include lease commitments, headcount and capital assets, could result in decreased margins, which could have a material adverse effect on us.
We have encountered and expect to continue to encounter risks and uncertainties frequently experienced by growing companies in rapidly evolving industries, such as the risks and uncertainties described in this prospectus. Accordingly, we may be unable to prepare accurate internal financial forecasts or correctly anticipated revenue, and our results of operations in future reporting periods may be below the expectations of investors or analysts. If we do not address these risks successfully, our results of operations could differ materially from our estimates and forecasts or the expectations of investors or analysts, causing our business to suffer and our Class A common stock price to decline.
Our success and revenue growth depend on several factors, many of which are out of our control.
We believe our success and revenue growth depends on several factors, many of which are out of our control, including, but not limited to, our ability to:
•negotiate and execute contracts with private and public sector partners;
•identify and complete acquisitions and integrate acquired companies;
•successfully build, test, and launch Starlab within the anticipated timeframe;
•scale our revenue and achieve the operating efficiencies necessary to achieve and maintain profitability;
•anticipate and respond to changing customer preferences;
•anticipate and respond to macroeconomic changes generally, including changes in the markets for items related to our services and products such as launch services, mission services, satellites, and satellite components;
•improve and expand our operations and information systems;
•successfully compete against established companies and new market entrants;
•manage and improve our business processes in response to changing business needs;
•effectively scale our operations while maintaining high customer satisfaction;
•hire and retain talented employees at all levels of our business;
•avoid or manage interruptions in our business from information technology downtime, cybersecurity breaches, and other factors affecting our physical and digital infrastructure;
•comply with regulations applicable to our business.
If we are unable to accomplish any of these tasks, our revenue growth will be harmed. We also expect our operating expenses to increase in future periods, and if our revenue growth does not increase to offset these anticipated increases in our operating expenses, our business, results of operations, and financial condition will be harmed, and we may not be able to achieve or maintain profitability.
Our future revenue and operating results are dependent on our ability to generate a sustainable order rate for our products and services and develop new technologies to meet the needs of our customers or potential new customers.
Our financial performance is dependent on our ability to generate sustainable demand for our products and services. This can be challenging and may fluctuate on an annual basis as the number of contracts awarded varies. For example, under any IDIQ contracts, we are required to compete for each delivery order and task order, rather than having a more predictable stream of activity during the term of a multi-year contract. Accordingly, we may spend considerable cost and management time and effort to prepare bids and proposals for contracts, delivery orders, or task orders that we may not win. In addition, our customers’ requirements change and evolve rapidly. If we are unable to win new awards or execute existing contracts as expected, our business, results of operations and financial position could be further adversely affected.
Our products and services embody complex technology and may not always be compatible with current and evolving technical standards and systems developed by others. Failure or delays to meet the requisite and evolving industry or user standards could have a material adverse effect on us. For example, artificial intelligence technologies have rapidly developed and our business may be adversely affected if we cannot successfully integrate the technology into our internal business processes and product and service offerings in a timely, cost-effective, compliant and responsible manner. In addition, our competitors may develop technology that better meets the needs
of our potential customers. Moreover, if we were to use artificial intelligence and the content, analyses, or recommendations that artificial intelligence applications assist in producing are or are alleged to be deficient, inaccurate, or biased, our business, financial condition and results of operations may be adversely affected. The rapid evolution of artificial intelligence, including potential government regulation of artificial intelligence, will require significant resources to develop, test and maintain our platform, offerings, services, and features to help us implement artificial intelligence ethically to minimize unintended, harmful impact.
To advance our innovation and position us to meet our customers’ requirements, we invest in emerging technologies that we believe are needed to keep pace with rapid industry innovation and we collaborate with commercial entities that we believe have complementary technologies to ours. We may not be successful in identifying or developing emerging technologies and may spend significant resources on projects that ultimately are unsuccessful or yield a lower return on the amount invested than anticipated.
Our development contracts may be difficult for us to comply with and may expose us to third-party claims for damages, and we may experience losses from fixed-price contracts.
We are party to government and commercial contracts involving the development of new products. We derived approximately 14.6% of our total revenues for the year ended December 31, 2024 and approximately 17.5% of our total revenues for the three months ended March 31, 2025 from such development contracts. These contracts typically contain strict performance obligations and project milestones. We cannot assure you that we will be able to comply with these performance obligations or meet these project milestones in the future. If we are unable to comply with these performance obligations or meet these milestones, or if we do not meet contract deadlines or specifications, we may need to renegotiate contracts on less favorable terms or be forced to pay penalties or liquidated damages. In addition, we may suffer major losses if any customer exercises its right to terminate. If other parties elect to terminate their contracts or seek damages from us, it could materially and adversely affect us.
In addition, several of our existing contracts with the U.S. government are fixed-price contracts. Under firm, fixed-price contracts, work performed and products shipped are priced at a fixed amount without adjustment for actual costs incurred in connection with the contract. These contracts carry the risk of potential cost overruns because we assume all of the cost burden. As a result, we assume greater financial risk on fixed-price contracts than on other types of contracts because if we do not estimate costs accurately or control costs during performance of a fixed-price contract, it may significantly reduce our net profit or cause a loss on the contract. In the past, we have experienced certain cost overruns and losses on fixed-price contracts. Because many of these contracts involve new technologies and can last for years, unforeseen events, such as technological difficulties, fluctuations in the price of raw materials, a significant increases in or sustained periods of increased inflation, or problems with our suppliers and cost overruns, can result in the contractual price becoming less favorable or even unprofitable to us over time (which, especially in the case of sharp increases in or significant sustained inflation, could happen quickly and have long-lasting impacts). Although we attempt to accurately estimate costs for fixed-price contracts, we cannot assure you that our estimates will be adequate or that substantial losses on fixed-price contracts will not occur in the future. In addition, changes in contract financing policy for fixed-price contracts, such as changes in performance and progress payments policies, including a reversal or modification of the DoD’s March 2020 increase to the applicable progress payment rate from 80% to 90%, could significantly affect the timing of our cash flows.
Our customers also may seek to negotiate non-traditional contract provisions or contract types. Furthermore, an increased number of contract solicitations require the contractor to bid upfront on cost-reimbursable development work and the follow-on fixed-price production options in one submission. This requirement increases the risk that we may experience lower margins than expected, or a loss, on the production options because we must estimate the cost of producing a product before it has been developed. These risks may cause us not to bid on certain future programs, which could adversely affect our future growth prospects and financial performance. See Note 1, “Organization” and Note 2, “Summary of Significant Accounting Policies” to our audited historical consolidated financial statements included elsewhere in this prospectus for further details about losses incurred on certain programs, including fixed price development programs. In addition, given the customer’s emphasis on cost, even if we effectively manage program life-cycle and sustainment costs and meet customer affordability targets, the customer may elect to recompete programs at the end of existing contracts, which may result in a lost business opportunity or reduce operating margins. From time to time, the U.S. government also has proposed contract terms,
imposed internal policies, or taken positions that represent fundamental changes from historical practices or that we believe are inconsistent with the Federal Acquisition Regulation (“FAR”) or other laws and regulations and which could adversely affect our business. Any of the risks described above could materially and adversely affect us.
We have a history of losses, we anticipate increasing operating expenses in the future, and we may not be able to achieve and, if achieved, maintain profitability.
We have experienced losses in each year since our founding in 2019. During the years ended December 31, 2024 and 2023, we reported net losses of $65.6 million and $25.2 million, respectively. During the three months ended March 31, 2025 and 2024, we reported net losses of $27.9 million and $15.0 million, respectively. We believe that we will continue to incur net losses for the next several years and we may not achieve or maintain profitability in the future, either on the timetable we expect or at all. Because the markets in which we operate are evolving, it is difficult for us to predict our future results of operations or the limits of our market opportunity. We expect our operating expenses to significantly increase as we make significant investments, expand our operations and infrastructure, develop and introduce new technologies and hire additional personnel. These efforts may be more costly than we expect and may not result in revenue growth or increased efficiency. When we become a public company, we will incur additional significant legal, accounting, and other expenses that we did not incur as a private company. If our revenue does not increase to offset these expected increases in our operating expenses, we will not be profitable in future periods. Any of the foregoing could have a material adverse effect on us. We cannot assure you that we will ever achieve or sustain profitability and may continue to incur significant losses going forward, which could cause the value of our Class A common stock to decline.
Our financial results of operations could be materially adversely affected by impairment of our goodwill or other intangible assets.
As a result of our acquisitions, a significant portion of our total assets are intangible assets (including goodwill). Goodwill and intangible assets, net, together accounted for approximately 32.8% of our total assets as of December 31, 2024 and 21.8% of our total assets as of March 31, 2025. We expect to engage in additional acquisition or joint venture activity from time to time, which may result in our recognition of additional intangible assets, including goodwill. We will continue to evaluate on a regular basis whether all or a portion of our intangible assets may be impaired. Under current accounting rules, any determination that impairment has occurred would require us to record an impairment charge, which would negatively affect our earnings.
We will require additional capital to support business growth and this capital might not be available.
We intend to continue to make investments to support our business growth and will require additional funds to respond to business challenges or opportunities, including new acquisitions and Starlab. Accordingly, we will need to engage in government grants as well as customer prebuys and capital markets financing, including equity and project-based financing. We may not be able to obtain such financing or any portion thereof on terms that are favorable to us, if at all. If we are unable to obtain adequate financing on terms satisfactory to us, we may not be able to support our business growth and respond to business challenges and opportunities, which could have a material adverse effect on us.
Starlab will require significant additional capital expenditures for which we have not yet secured and we may be unable to secure financing.
Starlab currently does not generate revenue and is not expected to in the near term. We currently estimate the cost to design, manufacture and launch Starlab to be approximately $2.8 to $3.3 billion. However, the benefits that we believe will result from the completion and commercialization of Starlab may not actually materialize. We expect Starlab to require significant funding to support operations prior to launch, which is currently anticipated to occur in 2029, before subsequently generating revenue, profitability and cash flows, which we expect Starlab to generate in its first full year of operation.
Current funding for Starlab consists of the $217.5 million development grant Nanoracks was awarded, which was subsequently transferred to us, and which we subsequently transferred to Starlab JV, by NASA under Phase I of their CDFF program, of which $70.3 million eligible proceeds remain as of March 31, 2025. We plan to compete for
future funding from NASA and other space agencies to provide a considerable portion of the funding for this initiative. In particular, we plan to compete for Phase II funding from NASA’s commercial LEO development program, which we expect will include substantial funding to support the certification, construction and services for the selected commercial space station providers. However, the U.S. government can introduce significant changes to U.S. space policy at any time. Changes in support for NASA’s current space policy, including its plans to partner with a commercial space station to replace the ISS, may diminish the need for a continuously-crewed space station utilized by NASA and other government agencies. Any such changes could have a material adverse effect on us and the success of Starlab. Accordingly, there can be no assurance that Starlab will be selected for CDFF Phase II or that Starlab will ultimately receive the CDFF contract or such funding.
In addition to NASA funding, we also plan for Starlab to be funded through a combination of customer prebuys as well as capital markets financing, including equity and project-based financing. The actual cost to design, manufacture and launch Starlab may be materially different from the estimate set forth above, which is based on our current expectations and projections about future events and is subject to risks and uncertainties. In addition, there can be no assurance that we will obtain the necessary funding for Starlab, and we may not be able to obtain such funding or any portion thereof on terms that are favorable to us, if at all.
While the Starlab JV is expected to fund a significant portion of the total cost to design, manufacture and launch Starlab through non-dilutive capital sources, including those described above, if we decide to directly fund Starlab operations, we may raise additional funds in the future through the issuance of equity securities, which may cause our stockholders to experience significant dilution. Additionally, sales of substantial amounts of our Class A common stock in the public market following an initial public offering, or the perception that such sales could occur, could adversely affect the market price of our Class A common stock, may make it more difficult for our stockholders to sell our Class A common stock at a time and price that they deem appropriate and could impair our future ability to raise capital through an offering of our equity securities.
Starlab is currently a joint venture that we own with other co-venturers and investors, and we may invest in additional joint ventures in the future and face risks stemming from such joint venture investments.
Starlab is currently a joint venture, which presents certain risks. In particular, we will rely on our joint venture partners to assist in the design, development, manufacture, commercialization and overall success of Starlab. For example, Airbus provides technical design and engineering services, including manufacturing Starlab’s habitat; Mitsubishi contributes by leveraging its expertise in space research and development; MDA Space provides a full range of external robotics, robotics interfaces and robotic mission operations to the station; and Palantir will leverage data modeling through digital twins and artificial intelligence technologies to enhance Starlab’s operations.
Our current joint venture investment in Starlab and any future joint venture investments involve additional risks distinct from investments that are wholly-owned and in which a third-party or other outside investors are not involved, including, among other things, that:
•our joint venture partners may leave the joint venture and we may not be able to replicate the services or technology provided by such joint venture partners;
•we and a co-venturer or partner may reach an impasse in agreeing upon a major decision that requires the approval of other parties;
•we may not have exclusive control over the development, manufacturing, testing, launching, operation, financing, management and other aspects of the joint venture, which may prevent us from taking actions that are in our own best interest but opposed by a co-venturer or partner;
•a co-venturer or partner may at any time have economic or business interests or goals that are or may become inconsistent with ours;
•a co-venturer or partner may encounter liquidity or insolvency issues or may become bankrupt, which may mean that we and any other remaining co-venturers or partners generally would remain liable for the joint venture’s liabilities;
•a co-venturer or partner may be in a position to take action contrary to our instructions, requests, policies or investment objectives;
•a co-venturer or partner may take actions that subject us to liabilities in excess of, or other than, those contemplated;
•in certain circumstances, we may be liable for actions of our co-venturer or partner, including violations of anti-corruption, import and export, taxation and anti-boycott laws;
•our joint venture agreements may restrict the transfer of a co-venturer’s or partner’s interest or otherwise restrict our ability to sell the interest when we desire or on advantageous terms;
•our joint venture agreements may contain buy-sell provisions pursuant to which one co-venturer or partner may initiate procedures requiring the other co-venturer or partner to choose between buying the other co-venturer’s or partner’s interest or selling its interest to that co-venturer or partner;
•if a joint venture agreement is terminated or dissolved, we may not continue to own or operate the interests or investments underlying the joint venture relationship or may need to purchase such interests or investments at a premium to the market price to continue ownership; or
•disputes between us and a co-venturer or partner may result in litigation or arbitration that could increase our expenses and prevent our management from focusing their time and attention on our business.
Any of the above could materially and adversely affect the value of our current joint venture investment or any future joint venture investments and potentially have a material adverse effect on us.
Our business relies on projects with extended timelines and failure to realize these projects may adversely impact our business.
Our business and revenues rely on projects with extended and estimated timelines. For example, Starlab is planned to be in operation as early as 2029. However, our reliance on events in the distant future subjects us to significant risk of changes in economic environment, competitive landscape and technological advances. In particular, we may encounter unanticipated delays in the scheduled commencement date or completion of Starlab, including due to our inability to secure funding, manufacturing delays and launch delays, as well as delays due to weather and supply chain disruptions. If the development and launch of Starlab (or its components) is not as successful as anticipated or if we fail to realize all or some of the benefits within the anticipated timeframe, we may accrue additional costs, fail to gain expected cost savings, fail to recognize additional revenue, become unable to meet our financial objectives, negatively impact customer and employee experience and fail to grow or grow as quickly or compete as effectively as we currently anticipate. In addition, given the large amount of time, we may be unable to adequately prepare for additional risks of which we may not currently be aware and the risks of which we are aware may be heightened. Failure to meet these timelines or delays in operation of Starlab and other projects may adversely affect us.
Any technology intended for use in outer space, including Starlab, may be delayed, damaged or destroyed during pre-launch operations, launch failures or during the execution of the operation, which can materially and adversely affect our operations.
Damage or destruction during pre-launch operations, launch delays or failures, delays in the manufacturing of space infrastructure technology, or incorrect orbital placement during execution of a space mission could have a material adverse effect on us. The delay in service of, or damage to, any technology due to a launch failure could result in significant delays or a permanent reduction in anticipated revenue to be generated by that technology. In addition, if the loss of any technology occurred, we may not be able to accommodate affected customers with our other replacement solutions until a replacement technology is available, and we may not have on hand, or be able to obtain in a timely manner, the necessary funds to cover the cost of any necessary technology replacement. Any launch delay, launch failure, underperformance, delay or perceived delay could have a material adverse effect on us.
For example, Starlab is designed to reach orbit in a single launch. If that launch fails, the entire spacecraft could be destroyed. There are limited launch vehicles capable of lifting an object of Starlab’s mass into orbit and such vehicles do not have a proven track record of successful launches. If such launch vehicles are not operational by our planned launch date, we may experience delays in our ability to commence the Starlab business, and if our attempted launch fails, we may not be able to construct a replacement in a timely manner, or at all.
We have never launched or maintained a space station before and may lack the necessary expertise, personnel and resources to successfully launch and maintain a space station on our own.
We have never launched or maintained a space station like our planned Starlab. Factors that may affect our ability to launch and maintain a space station on our own include, among other things, recruiting and retaining adequate numbers of effective sales and marketing personnel and other unforeseen costs associated with managing vendors. For example, payload launch availability and astronaut crew time of the ISS have limited our ability to expand our mission management business. To achieve commercial success for Starlab, we may need to expand our organization and develop new partnerships. Expanding our organization and developing new partnerships requires significant investment, is time consuming and could potentially delay the successful completion of Starlab. If we are unable to complete or commercialize Starlab, we may not generate revenue from it or be able to reach or sustain profitability.
The benefits that we believe will result from the completion and commercialization of Starlab may not actually materialize.
While we believe that the development and completion of Starlab will result in certain benefits, there can be no assurance that the Company will realize any of such benefits in the anticipated timeframe. Our planned Starlab is a large complex project that is a speculative and expensive undertaking and involves a substantial degree of risk and uncertainty. To date, no private company has successfully developed a space station, which makes it difficult to evaluate our prospects to successfully develop and maintain a space station or the potential markets for space station services if such technologies are developed. In addition, commercial customers and governmental customers may not choose to use Starlab or our services. Accordingly, we cannot assure you that any long-term benefits from the completion of Starlab will materialize in the manner or on the timeline we currently anticipate and the failure to realize such benefits could have a material adverse effect on us.
If our technologies fail to operate as intended, it could have a material adverse effect on us.
The manufacturing, testing, launching and operation of our products and services, including Starlab, involves complex processes and technology. The sophisticated and rigorous design, manufacturing and testing processes and practices we employ do not entirely prevent the risk that we may not be able to successfully launch to space or manufacture our products on schedule, or that our products may not perform as intended. Our products and services employ advanced technologies and sensors that are exposed to severe environmental stresses in space that have, and may in the future, affect the performance of our products. Hardware component problems in space could lead to deterioration in performance or loss of functionality of our technology. In addition, human operators may execute improper commands that may negatively impact the technology’s performance. Exposure of our technology to an unanticipated catastrophic event, such as a meteor shower or a collision with space debris, could reduce the performance of, or completely destroy, the affected technology.
We cannot provide assurances that our technologies will continue to operate successfully in space throughout their expected operational lives. Technical deficiencies or anomalies could significantly hinder its performance even if such technology is operated properly. Additionally, our products may contain defects that are not detectable in pre-launch screenings due to their complexity and the unpredictability of the space environment and our general inability to test our products and solutions in the same conditions under which they will be used.
We may experience other problems with our technology that may reduce its performance. If any one of our technologies is not fully operational, we may lose most or all of the revenue that otherwise would have been derived during such period. When our products fail to perform adequately, some of our contracts may require us to forfeit a portion of our expected profit, receive reduced payments, provide a replacement product or service, or reduce the price of subsequent sales to the same customer. Performance penalties may also be imposed when we fail to meet
delivery schedules or other measures of contract performance. We do not generally insure against potential costs resulting from any required remedial actions or costs or loss of sales due to postponement or cancellation of scheduled operations or product deliveries. Our inability to repair or replace a defective technology, or correct any other technical problem, in a timely manner could result in a significant loss of revenue or expose us to products liability. If any technology becomes impaired or is no longer functional, it would significantly impact our business, prospects, reputation and profitability.
Space is a harsh and unpredictable environment where our products and service offerings are exposed to a wide and unique range of environmental risks, including, among others, coronal mass ejections, solar flares, and other extreme space weather events and potential collision with space debris or another spacecraft, which could adversely affect our technology and spacecraft performance.
Space weather, including coronal mass ejections and solar flares, has the potential to impact the performance and controllability of our technology in orbit, including completely disabling our communications or mechanical capabilities. Although we have some ability to actively maneuver certain equipment to avoid potential collisions with space debris or other spacecraft, this ability is limited by, among other factors, uncertainties and inaccuracies in the projected orbit location of objects tracked and cataloged by the U.S. government. Additionally, some space debris is too small to be tracked and therefore its orbital location is completely unknown; nevertheless, this debris is still large enough to potentially cause severe damage or a failure of our technologies in space should a collision occur. The failure of our technology in space may cause perceptions or direct degradation of performance, and ultimately impact our business, results of operations and financial position.
We operate in highly competitive industries.
We operate in highly competitive industries and many of our competitors have significant advantages, including, among other things, strong customer relationships, more experience with regulatory compliance, greater financial and management resources and access to technologies not available to us. Many of our competitors are substantially larger than we are and may be able to adapt more quickly to changing technology or market conditions or may be able to devote greater resources to the development, promotion and sale of their products. Such competitors may also have ready access to capital to fund their activities, which could provide a competitive advantage relative to us, as we will need financing to fund our development activities. In addition, competition may increase and intensify as more or larger competitor companies, including those formed through joint ventures or consolidation, enter our markets. Our ability to compete may also be adversely affected by limits on our capital resources and our ability to invest in maintaining and expanding our market share.
Competition in the technologies that we prepare as well as the consulting, administrative and advisory services that we deliver is highly diverse, and while our competitors offer different products and services, there is often competition for contracts. Further, many of our contracts and task orders with the federal government are awarded through a competitive bidding process, which is complex and sometimes lengthy. To the extent there is any reduction in the overall number of government contracts, as a result of shifting government priorities or otherwise, we may face increased competition.
Moreover, we face competition from companies that have served as prime contractors on projects for which we served as subcontractors. Conversely, we may face competition from companies that have served as subcontractors on projects for which we served as prime contractor. For example, those companies could choose to offer services that we would typically provide or those companies that previously served as subcontractors could seek prime contractor roles on certain projects.
We may also face competition in the future from emerging low-cost competitors. In addition, some of our foreign competitors currently benefit from, and others may benefit in the future from, protective measures by their home countries where governments are providing financial support, including significant investments in the development of new technologies. Government support of this nature greatly reduces the commercial risks associated with technology development activities for these competitors. This market environment may result in increased pressures on our pricing and other competitive factors.
We depend heavily on a single customer, the U.S. government, for a substantial portion of our business. Changes in this customer’s priorities and spending, or delays or reductions in spending, could have a material adverse effect on us.
During the years ended December 31, 2024 and 2023, approximately 83.9% and 68.7%, respectively, and during the three months ended March 31, 2025 and 2024, approximately 85.6% and 88.2%, respectively, of our revenues were derived from contracts with the U.S. government and its agencies or from subcontracts with other U.S. government contractors. We cannot predict the impact on existing, follow-on, replacement or future programs from potential changes in the threat and global security environment, defense spending levels, government and budgetary priorities, political leadership, procurement practices and strategy, inflation and other macroeconomic trends, military strategy or broader changes in social, economic, security or political demands and priorities. A significant shift in government priorities, programs, strategies or delays or reductions in spending could have a material adverse effect on us.
Any disruptions in federal government operations could have a material adverse effect on us. A prolonged failure to maintain significant U.S. government operations, particularly those pertaining to our business, could materially and adversely affect us. Continued uncertainty related to recent and future government shutdowns, the budget and/or the failure of the government to enact annual appropriations, such as long-term funding under a continuing resolution, could have a material adverse effect on us. Additionally, disruptions in government operations may negatively impact regulatory approvals and guidance that are important to our operations.
Our contracts with the U.S. government may be terminated by the U.S. government at any time, which could have a material adverse effect on us.
Government contract laws and regulations can impose terms or obligations that are different than those typically found in commercial transactions. For example, the U.S. government may terminate any of our government contracts and subcontracts for any reason or no reason at all. Upon termination for convenience of a fixed-price type contract, we are usually entitled to receive the purchase price for delivered items, reimbursement for allowable costs for work-in-process and an allowance for profit on the contract or adjustment for loss if completion of performance would have resulted in a loss. Upon termination for convenience of a cost-reimbursable contract, we are usually entitled to a portion of the fee plus reimbursement of allowable costs, which include our cost to terminate agreements with our suppliers and subcontractors.
However, U.S. government programs do not always have sufficient funds appropriated to cover the termination costs if the government were to terminate for convenience. Under such circumstances, the U.S. government could assert that it is not required to appropriate additional funding, which would negatively affect our expected profit and cash flows.
In the case of our termination for default, the U.S. government could make claims to reduce the contract value or recover its procurement costs and could assess other special penalties. In addition, a termination arising out of our default may expose us to liability and have a material adverse effect on our ability to compete for future contracts and orders.
In addition, the U.S. government could terminate a prime contract under which we are a subcontractor for any reason and/or due to default by the prime contractor, notwithstanding the fact that our performance and the quality of the products or services we delivered were consistent with our contractual obligations as a subcontractor.
Our U.S. government programs often operate for periods of time under Undefinitized Contract Actions (“UCAs”), which means that we begin performing our obligations before the parties agree to terms, specifications and price. The U.S. government has (and has exercised in the past) the ability to unilaterally definitize contracts which, absent a successful appeal, obligates us to perform under terms and conditions imposed by the U.S. government. This can affect our ability to negotiate mutually agreeable contract terms and, if a contract is unilaterally imposed upon us, it may impose burdensome terms and negatively affect our expected profit and cash flows on a program.
Certain of our U.S. government contracts span one or more base years and include multiple option years. The U.S. government may decide not to exercise option periods, which could result in a loss of expected sales or profits. In addition, the U.S. government may decide to exercise option periods for contracts under which it is expected that our costs may exceed the contract price or ceiling, which could result in losses or unreimbursed costs.
As our contracts expire, we may not be able to renew them or replace them with agreements on similar terms.
Certain contracts in our portfolio will be subject to re-contracting in the future. If prices in our market change at the time of such re-contracting, it may impact our ability to re-negotiate or replace these contracts on terms that are acceptable to us, or at all. In addition, a concentrated pool of potential buyers for our products and services may restrict our ability to negotiate favorable terms under new contracts or existing contracts that are subject to re-contracting.
We cannot provide any assurance that we will be able to re-negotiate or replace these contracts once they expire, and even if we are able to do so, we cannot provide any assurance that we will be able to obtain the same prices or terms we currently receive. Our inability to re-negotiate or replace these contracts, or to secure prices at least equal to the current prices we receive, could have a material adverse effect on us.
At times, we rely on a single vendor or a limited number of vendors to provide certain key products or services and the inability of these key vendors to meet our needs could have a material adverse effect on our business.
Historically, we have contracted with a single vendor or a limited number of vendors to provide certain key products or services, such as composites, inertial measurement units, construction of structures, and ground network services. In addition, our manufacturing operations depend on specific technologies and companies for which there may be a limited number of vendors. Our business, financial position and results of operations may be adversely affected if these vendors are unable to meet our needs because they fail to perform adequately, are unable to satisfy new technological requirements, or are unable to dedicate engineering and other resources necessary to provide the contracted services. While alternative sources for these products, services and technologies may exist, we may not be able to develop these alternative sources quickly and cost effectively, which could materially impair our ability to operate our business. Furthermore, these vendors may request changes in pricing, payment terms or other contractual obligations, which could cause us to make substantial additional investments.
Additionally, some of our suppliers’ employees are represented by labor unions. Work stoppages and instability in our relationships with labor unions could delay the production and/or development of our products, which could strain relationships with customers and significantly increase our operating costs and/or result in a loss of revenues which would adversely affect our operations.
We are subject to procurement laws and regulations, including those that enable the U.S. government to terminate contracts for any reason or no reason at all. Our business and reputation could be materially and adversely affected if we or those we do business with fail to comply with these laws.
We must comply with laws and regulations relating to the award, administration and performance of U.S. government contracts. In particular, we are subject to the procurement policies and procedures set forth in the FAR and its agency-specific supplemental regulations. The FAR and its supplements govern aspects of U.S. government contracting, including contractor qualifications, acquisition procedures, solicitation provisions and contract terms. These and other requirements specific to U.S. government contracts must be complied with for a contract to be awarded and the FAR provides for audits and reviews of contract procurement, performance and administration. A violation of these laws and regulations by us, our employees or others working on our behalf, a supplier or a joint venture partner could harm our reputation and result in negative consequences, including the imposition of fines and penalties, the termination of our contracts, suspension or debarment from bidding on or being awarded contracts, loss of our ability to export products or perform services and civil or criminal investigations or proceedings. In addition, costs to comply with new government regulations can increase our costs, reduce our margins and affect our competitiveness.
Our ability to pursue our business activities is regulated by various agencies and departments of the U.S. government and, in certain circumstances, the governments of other countries. Any product that is to be delivered to
the space domain will require licenses from the U.S. Department of Transportation and the Federal Aviation Administration. The Federal Communications Commission also requires licenses for radio communications from rocket launch providers, which as a customer delivering equipment or a provider supporting a rocket launch, may impact us and the equipment waiting to get to space and services it may be providing on the ground to the launch company. Some of our programs require that we and certain of our employees maintain appropriate security clearances. We also require export licenses from the U.S. Department of State, the U.S. Department of Commerce and, occasionally, the governments of other countries with respect to transactions we have with foreign customers or foreign subcontractors. If we are unable to maintain required licenses and/or security clearances, or are otherwise restricted by the regulatory agencies that our businesses are subject to, it could have a material adverse effect on us.
In addition, the U.S. government could implement procurement policies that negatively impact our profitability or the ability to win new business. Changes in procurement policy favoring more incentive-based fee arrangements, different award fee criteria or government contract negotiation offers based upon the customer’s view of what our costs should be (as compared to our actual costs) may affect the predictability of our profit rates or make it more difficult to compete on certain types of programs.
In addition, the U.S. government could implement procurement policies that negatively impact our profitability or the ability to win new business. Changes in procurement policy favoring more incentive-based fee arrangements, different award fee criteria or government contract negotiation offers based upon the customer’s view of what our costs should be (as compared to our actual costs) may affect the predictability of our profit rates or make it more difficult to compete on certain types of programs.
The DoD’s increasing use of “other transaction authority” agreements could adversely impact us.
The DoD is increasingly pursuing rapid acquisition pathways and procedures for new technologies, including through so called “other transaction authority” agreements (“OTAs”). While OTAs do not currently represent a significant portion of our overall revenue for the year ended December 31, 2024 or for the three months ended March 31, 2025 (and less than 6.7% of total funded backlog for the year ended December 31, 2024 and 6.5% of total funded backlog for the three months ended March 31, 2025), the Starlab SAA is an OTA. In addition, the DoD has recently increased the frequency of use and the size of OTAs and we expect this trend to continue. OTAs are exempt from many traditional procurement laws, including the FAR, and may be used, subject to certain conditions, for research, prototype development and follow-on production for a successful prototype. The conditions to award OTAs include, in certain instances, that a non-traditional defense contractor performs a significant portion of the work under the OTA or that non-government sources fund a portion of the cost of the prototype project. We may be unable to pursue certain opportunities if we cannot successfully adapt to the DoD’s rapid acquisition processes. In addition, we may decide not to pursue such opportunities if the DoD significantly increases the use of OTAs with non-traditional defense contractors or increasingly mandates cost sharing. As a result, we may lose strategic new business opportunities in high-growth areas and our future performance and results could be adversely affected. Our success also depends on our ability to continue to identify technological innovation and adapt it to our platforms in light of changes in procurement policies that emphasize acquiring technologies with shorter life cycles.
Some of our contracts with the U.S. government are classified, which may limit investor insight into portions of our business.
We derive a portion of our revenues from U.S. government programs that are subject to security restrictions that preclude the dissemination of information that is classified for national security purposes. We are limited in our ability to provide details about these classified programs, their risks or any disputes or claims relating to such programs, and may not disclose such information pursuant to SEC rules permitting confidential treatment of certain information. As a result, investors and others might have less insight into our classified programs than our other businesses and, therefore, less ability to fully evaluate the risks related to our classified business.
Our current and future acquisitions, dispositions or strategic transactions may fail to successfully integrate with our business activities or fail to deliver the expected return on investment and could have a material adverse effect on us.
Our company was developed through a series of acquisitions and we expect to make additional acquisitions in the future. The acquisition of businesses, offerings, technologies or talent that we believe could complement or expand our business platform, enhance our technical capabilities, or offer growth opportunities may not occur as planned. In addition, such acquisitions may divert the attention of management and cause us to have un-forecasted expenses related to identifying, investigating and pursuing suitable acquisitions, whether or not they are consummated.
Furthermore, there are inherent risks in integrating and managing acquisitions. For example, in our early acquisitions, we did not purchase 100% control of our targets, resulting in difficulties in implementing changes and achieving synergies in a timely manner or at all. If we acquire additional businesses, we may not be able to assimilate or integrate the acquired personnel, operations, solutions and technologies successfully, or effectively manage the combined business following the acquisition. Additionally, we may not achieve the anticipated benefits or synergies from the acquired business due to a number of factors, including, without limitation:
•unanticipated costs or liabilities associated with the acquisition, including claims related to the acquired company, its offerings or technology;
•incurrence of acquisition-related expenses, which would be recognized as a current period expense;
•inability to generate sufficient revenue to offset acquisition or investment costs;
•inability to maintain relationships with customers and partners of the acquired business;
•challenges with incorporating acquired technology and intellectual property or other proprietary rights into our Company’s platform and maintaining quality and security standards consistent with our brand;
•inability to identify security vulnerabilities in acquired technology prior to integration with our technology and platform;
•inability to achieve anticipated synergies or unanticipated difficulty with integration into our corporate culture;
•delays in customer purchases due to uncertainty related to any acquisition;
•the need to integrate or implement additional controls, procedures and policies;
•challenges caused by distance, language and cultural differences;
•harm to our existing business relationships with business partners and customers as a result of the acquisition;
•potential loss of key employees;
•use of resources that are needed in other parts of our business and diversion of management and employee resources;
•inability to recognize acquired deferred revenue in accordance with our revenue recognition policies; and
•use of substantial portions of our available cash or the incurrence of debt to consummate the acquisition.
Acquisitions also increase the risk of unforeseen legal liability, including for potential violations of applicable law or industry rules and regulations, arising from prior or ongoing acts or omissions by the acquired businesses that are not discovered by due diligence during the acquisition process. Our Company may have to pay cash, incur debt or issue equity or equity-linked securities to pay for any future acquisitions, each of which could adversely affect our
financial condition or the market price of our stock. The sale of equity or issuance of equity-linked debt to finance any future acquisitions could result in dilution to stockholders. The incurrence of indebtedness would result in increased fixed obligations and could also include covenants or other restrictions that would impede our Company’s ability to manage its operations. Any of the foregoing could have a material adverse effect on us.
We may not be able to convert our projects in backlog, including funded backlog, into revenue.
Our backlog is comprised of projects for which we have received a written contract or purchase order, either executed or awaiting execution, excluding any customer options for future products or services that have not yet been exercised and potential bookings under IDIQ contracts, which we refer to as unfunded contract options. Backlog in all of our segments includes both single and multi-year awards, and fluctuations in backlog are driven primarily by the timing of large program wins. Our backlog may also include, as of any date of estimation, change orders for any project that have been confirmed, either in writing or verbally, or formally contracted. Change orders may increase or decrease the amount we ultimately bill for a particular project, causing us to realize more or less revenue from a project than was reflected in our backlog as of the date of estimation. Additionally, prior to categorizing a project as part of our backlog, we maintain a running list of projects that are in an advanced stage of active bidding and discussion, including potential change orders for current projects, but for which the customer has not yet confirmed the commercial terms, the value of the contract and/or the scope of our work. These projects are tracked for project planning and budgeting of the business. Once the terms of these projects are further progressed in line with our backlog criteria, they are recorded in our backlog.
In general, our customers have the right to cancel their contracts under termination for convenience clauses. If a customer cancels a contract before the full exercise of the agreement, we may not receive the full revenue from these orders, but would recognize revenue under the agreement of our cost basis with reasonable margin to the extent of progress performed on the contract. In addition, our backlog is typically subject to large variations from quarter to quarter and comparisons of backlog from period to period are not necessarily indicative of future revenues. Some contracts comprising the backlog, including funded backlog, are for programs scheduled many years in the future, and the economic viability of contractual counterparties is not guaranteed over time. As a result, the contracts comprising our backlog may not result in actual revenue in any particular period, or at all, and the actual revenue from such contracts may differ from our backlog estimates. The timing of receipt of revenues, if any, on projects included in both the funded and unfunded backlog could change because many factors and adjustments to contracts may also occur. The failure to realize some portion of our backlog could adversely affect our financial performance.
In addition, our backlog is subject to meaningful customer concentration risk. As of March 31, 2025, approximately 46.6% of the total dollar value of our backlog related to three customers. The top ten customers in our backlog represent approximately 86.8% of the total dollar value of our backlog. Any disruption in our business with those customers, whether as a result of changes in such customers’ demand for products or services, adverse changes in the customer’s industry generally or other challenges in securing or renewing contracts, could have a material adverse impact on us.
Our products and equipment have a finite useful life.
Our ability to earn revenue is dependent on technologies and equipment that have a limited useful life. While our products and equipment are designed for a certain number of cycles, known as the design life, there can be no assurance as to the actual operational life of our products and equipment and such useful life may prove to be shorter than such product’s and equipment’s design life. A number of factors impact the useful lives of our products and equipment, including, among other things, technological advancement leading to obsolescence or damage due to impact from meteors or space junk. In the event that equipment reaches the end of its useful life earlier than anticipated, replacement or repair may be necessary, which may affect costs and reduce profits.
In addition, since we have not yet developed a cost-effective method of repurposing parts and materials once they have been deployed into space, we are not able to recoup any of the value from these parts and materials in the resale market.
Our business involves significant risks and uncertainties that may not be covered by insurance.
A significant portion of our business relates to designing, developing and manufacturing advanced space technology products and services, including Starlab. New technologies may be untested or unproven and the failure of our products and services could result in extensive damage. Accordingly, we may incur liabilities that are unique to our products and services.
The amount of insurance coverage that we maintain may not be adequate to cover all claims or liabilities. Existing coverage may be canceled while we remain exposed to the risk and it is not possible to obtain insurance to protect against all operational risks, natural hazards and liabilities. In particular, the insurance market for the launch and operation of a non-governmentally owned, crewed space station does not currently exist. If a significant accident or event occurs that is not fully insured, if we fail to recover all anticipated insurance proceeds for significant accidents or events for which we are insured, or if we fail to replace or repair products or services damaged by such accidents or events, our operations and financial condition could be harmed.
We have historically insured against liability to third parties from space activities as required by law to the extent that insurance was available on acceptable premiums and terms. However, the insurance coverage for third-party damages may not be sufficient to cover the liability. Although the U.S. government may pay claims for third-party damages to the extent they exceed our insurance coverage, this depends on a government appropriation and is subject to a statutory limit. In addition, this insurance will not protect us against our own losses, including for technologies supporting a launch complex and technology operating in outer space.
The price and availability of insurance fluctuates significantly. Insurance market conditions or factors outside our control, such as failure of our infrastructure technology, could cause premiums to be significantly higher than current estimates and could reduce amounts of available coverage. The cost of our insurance has been increasing and may continue to increase. Higher premiums on insurance policies will reduce our operating income by the amount of such increased premiums. If the terms of insurance policies become less favorable than those currently available, there may be limits on the amount of coverage that we can obtain or we may not be able to obtain insurance at all.
In addition, although we carry business interruption insurance policies, any business interruption losses could exceed the coverage available or be excluded from our insurance policies. Any disruption of our ability to operate our business could result in a material decrease in our revenues or significant additional costs to replace, repair, or insure our assets, which could have a material adverse impact on our financial condition and results of operations.
The release, unplanned ignition, explosion or improper handling of dangerous materials used in our business could disrupt our operations and adversely affect our financial results.
Our business operations involve the handling, production and disposition of potentially explosive and ignitable energetic materials and other dangerous chemicals. The handling, production, transport and disposition of hazardous materials could result in incidents that temporarily shut down or otherwise disrupt our manufacturing operations and could cause production delays. A release of these chemicals or an unplanned ignition or explosion could result in death or significant injuries to employees and others. Material property damage to us and third parties could also occur. Extensive regulations apply to the handling of explosive and energetic materials, including, but not limited to, regulations governing hazardous substances and hazardous waste. The failure to properly store and ultimately dispose of such materials could create significant liability and/or result in regulatory sanctions. Any release, unplanned ignition or explosion could expose us to adverse publicity or liability for damages or cause production delays, any of which could have a material adverse effect on us.
Our products and services support human exploration of space, which includes a risk to human life and the risk of liability.
Our current products and planned future products support crewed missions and human habitation in space, including on the ISS and the planned Starlab. Due to the harsh and unpredictable nature of space, all travel by humans in space carries some risk to human life. If our activities were to result in an unfortunate loss of human life, our business may be exposed to liability for loss of life or injury, products liability, lost profits, loss of reputation, loss of customers or other adverse outcomes.
Interruption or failure of our infrastructure, including our information technology and communications systems, could hurt our ability to effectively perform our daily operations and provide and produce our products and services, which could damage our reputation and harm our operating results.
We are vulnerable to natural disasters and significant disruptions including tsunamis, floods, earthquakes, fires, water shortages, other extreme weather conditions, epidemics or pandemics, acts of terrorism, power shortages and blackouts, aging infrastructures, cyberattacks, computer viruses, computer denial of service attacks or other attempts to harm our systems, and telecommunications failures. In the event of such natural disaster or other disruption, we could experience disruptions to our operations or the operations of suppliers, subcontractors, distributors or customers, destruction of facilities, and/or loss of life. In certain cases, some events may not excuse us from performing our obligations pursuant to agreements with third parties and therefore may expose us to liability.
The availability of many of our products and services depends on the continuing operation of our information technology and communications systems. Any downtime, damage to, or failure of our systems could result in interruptions in our operations and services, which could reduce our revenue and profits. Our manufacturing facilities are also subject to risks associated with an aging infrastructure. An infrastructure failure could result in the destruction of newly developed technologies, satellites, and satellite components being manufactured or in inventory, manufacturing delays, or additional costs. We do not maintain back-up manufacturing facilities or operations. The occurrence of any of the foregoing could result in lengthy interruptions in our operations and services and/or damage our reputation, which could have a material adverse effect on us.
Disruptions in the supply of key raw materials or components and difficulties in the supplier qualification process, as well as increases in prices of raw materials, could adversely impact us.
Key raw materials and components used in our operations include chemicals, composites, electronic, electro-mechanical, and mechanical components, subassemblies and subsystems that are integrated with the manufactured parts for final assembly into finished products and systems. We are impacted by increases in the prices of raw materials used in production on fixed-price business. We monitor sources of supply to attempt to assure that adequate raw materials and other components and supplies needed in manufacturing processes are available. However, our ability to manage inventory and meet delivery requirements may be constrained by our suppliers’ inability to scale production and adjust delivery of long-lead time products during times of volatile demand. Our inability to fill our supply needs would jeopardize our ability to fulfill obligations under commercial and government contracts, which could, in turn, result in reduced sales and profits, contract penalties or terminations and damage to customer relationships, and could have a material adverse effect on us. Prolonged disruptions in the supply of any of our key raw materials or components, difficulty completing qualification of new sources of supply, implementing use of replacement materials, components or new sources of supply, or a continuing increase in the prices of raw materials, energy, or components could have a material adverse effect on us.
Adverse global market, economic and political conditions, including military conflicts or terrorist acts, pandemics and other catastrophic events could have a material adverse effect on us.
Our results of operations are materially affected by market, economic, political conditions, pandemics and other catastrophic events in the United States and internationally, including inflation, deflation, interest rates, availability of capital, energy and commodity prices, trade laws and the effects of governmental initiatives to manage economic conditions. Current or potential customers may delay or decrease spending on our products and services as their business and/or budgets are impacted by economic conditions. The inability of current and potential customers to pay us for our products and services may adversely affect our earnings and cash flows.
Terrorist attacks, actual or threatened acts of war or the escalation of current hostilities, such as the ongoing conflicts between Russia and Ukraine, Israel and Hamas or any other military or trade disruptions impacting our domestic or foreign suppliers, may create volatility and disruption in the United States and global businesses and markets. In particular, these or other conflicts have led and could lead to further regional instability, market disruptions, geopolitical shifts and adverse effects on macroeconomic conditions, security conditions, currency exchange rates, and the supply chain, which could create or exacerbate risks facing our business, including making it more difficult for us to raise capital.
Efforts to reduce the U.S. federal budget or spending could adversely affect our business.
Any reductions in government spending could result in lower utilization of our services, additional price pressure or loss of our U.S. government contracts. Further, there is ongoing uncertainty regarding the federal budget and federal spending levels, including the possible impacts of a failure to increase the “debt ceiling.” Any U.S. government default on its debt could have broad macroeconomic effects that could, among other things, raise our borrowing costs. Any future shutdown of the federal government or failure to enact annual appropriations could also have a material adverse impact on our liquidity, results of operations and financial condition.
Additionally, considerable uncertainty exists regarding how future budget and program decisions will develop, including the spending priorities of the new U.S. presidential administration and Congress and what challenges budget reductions will present for us and our industry generally. On January 20, 2025, an executive order established an advisory commission, the Department of Government Efficiency (“DOGE”), to reform federal and government processes and reduce expenditures. A significant portion of our funding comes from the U.S. government, including the funding for Starlab. Pressures on and uncertainty surrounding the U.S. federal government’s budget, and potential changes in budgetary priorities and spending levels, could adversely affect the funding for and delay or eliminate the ability for additional contracting. While we cannot predict the actions of DOGE, any disruptions to the government budget and spending could materially adversely affect our financial condition and results of operation.
Changes in tax law, effective tax rates or adverse outcomes from other tax increases or an examination of our income or other tax returns could adversely affect our results of operations and financial condition.
Changes in laws and policies relating to taxes may materially and adversely affect our financial condition, results of operations and cash flows. Any changes in our effective tax rates or tax liabilities could adversely affect our results of operations and financial condition. Our future effective tax rates could be subject to volatility or adversely affected by a number of factors including:
•changes in the valuation of our deferred tax assets and liabilities;
•expected timing and amount of the release of any tax valuation allowances;
•expansion into or future activities in new jurisdictions;
•the availability of tax deductions, credits, exemptions, refunds and other benefits to reduce tax liabilities;
•tax effects of share-based compensation; and
•changes in tax laws, tax regulations, accounting principles, or interpretations or applications thereof.
Many countries have recently enacted, or are actively considering changes to existing tax laws that, if enacted, could increase our tax obligations. For example, in 2017, the United States enacted the Tax Cuts and Jobs Act, which made significant changes to its tax laws, including reducing the corporate tax rate and altering the way in which the United States taxes multinational corporations. Some of these changes are scheduled to expire in 2025, although various members of Congress and other governmental officials have proposed extending or modifying many of these rules. In 2021, the Organization for Economic Cooperation and Development released a framework to implement a global minimum tax of 15% (“Pillar 2”). While it is uncertain whether the United States will enact Pillar 2 legislation, other countries have adopted legislation to implement Pillar 2. In August 2022, the Inflation Reduction Act (the “IRA”) was signed into law in the United States. The IRA made a number of changes to U.S. tax laws, including adding a 15% minimum tax on adjusted financial statement income of certain large companies with average book income in excess of $1 billion. Legislation currently pending in Congress could also affect the treatment of U.S. corporations and their shareholders; however, we are not able to predict whether this legislation will be adopted in its current form or at all. Legislative and other authorities both in the United States and in other countries regularly consider and may adopt these proposed or other similar or other changes to tax law, rules and policies, and we are not able to predict if or when any such changes will be made.
In addition, an adverse outcome arising from an examination of our income or other tax returns could result in additional taxes, penalties, interest or other liabilities that could have an adverse effect on our operating results and financial condition.
Risks Related to Our International Operations
Our international business exposes us to risks relating to regulation, currency fluctuations and political or economic instability in foreign markets, which could have a material adverse effect on us.
We conduct business internationally through various products and services, including the ISS, and we intend to continue to do so in the future, including upon operation of Starlab. International operations are subject to certain risks, such as unexpected changes in laws, policies and regulatory requirements, including, but not limited to, regulations related to trade controls; increased cost of localizing systems in foreign countries; increased sales and marketing and research and development expenses; availability of suitable export financing; timing and availability of export licenses; imposition or increases of taxes, tariffs, embargoes and other trade barriers; political and economic instability; issues related to the political relationship between the United States and other countries; effects of austerity programs or similar significant budget reduction programs; potential preferences by prospective customers to purchase from local (non-U.S.) sources; and fluctuations in currency exchange rates, foreign exchange controls and restrictions on cash repatriation; compliance with international laws and U.S. laws affecting the activities of U.S. companies abroad; challenges in staffing and managing foreign operations; difficulties in managing distributors; requirements for additional liquidity to fund our international operations; difficulties in obtaining or enforcing judgments in foreign jurisdictions; ineffective legal protection of our intellectual property rights in certain countries; potentially adverse tax consequences; potential difficulty in making adequate payment arrangements; and potential difficulty in collecting accounts receivable. As a result of these and other risks, we may be unsuccessful in implementing our business plan for our broadband services business internationally, or we may not be able to achieve the revenues that we expect. In addition, some of our customer purchase agreements are governed by foreign laws, which may differ significantly from U.S. laws. We may be limited in our ability to enforce our rights under these agreements and to collect damages, if awarded. Any of the risks described above could materially harm our business and impair the value of our Class A common stock.
Lack of international cooperation with Russia in the space industry could have a material adverse effect on our business.
We generate revenues by managing missions on the ISS, including equipment testing, experiments, satellite deployments and other payloads, as well as through the operation of our Bishop Airlock. Russia’s decision to halt the export of rocket engines used by a number of launch providers to supply the ISS may result in delay or loss of revenue opportunities related to our activities on the ISS as well as to other ride-share missions.
Our international sales and operations are subject to applicable laws relating to trade, including economic and trade sanctions and trade controls, the violation of which could adversely affect our operations.
We must comply with all applicable trade control laws and regulations of the United States and other countries, including the Arms Export Control Act, the International Traffic in Arms Regulations (the “ITAR”), the Export Administration Regulations (“EAR”) and the economic and trade sanctions laws and regulations administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”). The export of certain satellite hardware, services and technical data relating to satellites is regulated by the U.S. Department of State under ITAR. Other items are controlled for export by the U.S. Department of Commerce under the EAR. Applicable trade controls and sanctions restrict our ability to export our products to, or otherwise transact or deal with, certain countries, territories, and persons. For instance, we cannot provide services to certain countries or persons unless we first obtain the necessary authorizations from OFAC. Detecting, investigating and resolving actual or alleged violations of trade control or sanctions laws can require a significant diversion of time, resources, and attention from senior management. In addition, noncompliance with these laws or regulations could result in significant fines, more onerous compliance requirements, more extensive debarments from export privileges, loss of export-related authorizations, reputational harm, adverse media coverage and other collateral consequences. A violation or even an allegation of a violation, of sanctions or trade controls could have a material adverse effect on us.
If significant tariffs or other trade restrictions continue to be placed on foreign imports by the United States and related countermeasures are taken by impacted foreign countries, our sales and results of operations may be harmed.
If significant tariffs or other trade restrictions continue to be placed on foreign imports by the United States and related countermeasures are taken by impacted foreign countries, our sales and results of operations may be harmed. Expanded tariffs or further retaliatory actions may force us to raise prices or absorb higher costs, potentially leading to customer loss and negatively impacting our performance, sales, and earnings.
Seeking to enforce an international contract through foreign courts may take significant amounts of time and expense with no certainty of success.
Our business could be adversely affected if we are required to enforce international contracts through foreign courts and we are unsuccessful or incur significant amounts of time and expenses seeking to do so. High litigation costs and long delays make resolving commercial disputes in foreign courts time consuming and expensive. Such costs can be difficult to calculate with certainty. In addition, in certain jurisdictions in which we currently conduct business or may seek to conduct business in the future, there can be uncertainty regarding the interpretation and application of laws and regulations relating to the enforceability of contractual rights.
Risks Related to Information Technology, Cybersecurity, Data Privacy and Intellectual Property
Any significant failure of, disruption in, or unauthorized access to or use of, our computer systems or those of third parties that we utilize in our operations, including those arising from cyberattacks, could result in a loss or degradation of service, unauthorized processing of data, or theft or tampering of intellectual property, any of which could materially adversely impact our business and financial conditions.
We rely extensively on our computer systems and other information technology, and those of our vendors, suppliers and other third-parties, to manage all aspects of our business and therefore, our operations, products, services, data and intellectual property are inherently at risk of disruption, loss, unauthorized access or use, human error, or tampering by both insider threats and external bad actors. In particular, our operations have faced, and will in the future face, various cyber and other security threats that threaten the confidentiality, integrity and availability of our systems, information technology and data, including attempts from diverse threat actors, such as state-sponsored organizations, opportunistic hackers and hacktivists, as well as through diverse attack vectors, such as malfeasance by insiders, human or technological error, computer viruses and other malicious codes, bugs or other vulnerabilities in software that is integrated into our (or our suppliers’ or vendors’) systems and products, ransomware, unauthorized access attempts, denial of service attacks, phishing, social engineering, hacking and other types of attacks. Any current or future integration of artificial intelligence in our or any third-party providers’ operations, products or services is also expected to pose new or unknown cybersecurity risks and challenges. In addition, threats to the security of our facilities, infrastructure or supply chain, power outages, threats from terrorist acts or other acts of aggression or catastrophic events could have a material adverse impact on our business.
In the ordinary course of our business, we collect, receive, access, use, maintain, handle, store, transmit, disclose, destroy, dispose of and otherwise process personal, sensitive and other proprietary or confidential information, including intellectual property, business information, and personal information of our customers, suppliers and other third parties on our networks, and all such information is at risk. We may have liability to our customers, suppliers and other third parties if their information is lost, exfiltrated, processed in an unauthorized manner or otherwise compromised. Similarly, the data, intellectual property, and products and services in third-party environments are also inherently at risk. To the extent we have access to or rely on any customer, supplier or other third-party network, we face risks of breach, disruption or loss of those networks and information transmitted via those networks as well. Because we do not control our third-party vendors, or the processing of data by our vendors, our ability to monitor the data security of such third parties may be very limited such that we cannot ensure the integrity or security of measures they take to protect and prevent the loss or other unauthorized processing of our data and systems. If our third-party vendors fail to protect their information technology systems and our data, we may be vulnerable to disruptions in service and unauthorized processing of data, experience impacts to our operations, and we could incur liability and reputational damage. Moreover, we have acquired and may continue to
acquire companies with cybersecurity vulnerabilities and/or unsophisticated security measures, which exposes us to significant cybersecurity, operational and financial risks.
Our systems and processes, and those of our customers, suppliers, vendors and other third-parties, can be attacked by third parties seeking to obtain access to or disrupt the data, systems and other information technology assets used in our operations. The techniques used to gain unauthorized access and conduct other types of cyberattacks are varied and constantly evolving as threat actors are becoming increasingly sophisticated in using techniques and tools—including artificial intelligence—that circumvent security controls, evade detection and remove forensic evidence. As a result, we may be unable to anticipate, timely detect, prevent or remediate all unauthorized processing, disruption, loss or harm. Because of our highly desired intellectual property and our support of the U.S. government and other governments, we (and our customers, vendors and suppliers) are a particularly attractive target for such attacks by hostile foreign governments, which have access to substantial technological resources and expertise. We have experienced attacks on our systems from bad actors that, to date, have not had a material adverse effect on our business. We cannot offer assurances, however, that future attacks will not materially adversely affect our business.
A cybersecurity incident or other significant disruption of our or our third-party vendors’ operations, systems, assets, products, or services could:
•disrupt the proper functioning of our networks, applications and systems and therefore our operations and/or those of certain of our customers, suppliers and other business and commercial partners;
•result in the loss, exfiltration or unauthorized processing of personal, sensitive or other regulated data, which may require or result in us notifying individuals, customers, governmental authorities, supervisory bodies and other parties, including pursuant to data privacy, data protection and cybersecurity laws and regulations;
•result in the unauthorized access to, destruction, loss, theft, misappropriation, release or other processing of, our, our customers’, our suppliers’, our vendors’ or our business and commercial partners’ proprietary, confidential, sensitive or otherwise valuable information, including trade secrets, which others could use to compete against us or for disruptive, destructive, or otherwise harmful purposes and outcomes;
•destroy or degrade assets including space, ground and intellectual property assets;
•manipulate or tamper with our operations, products, services or other systems delivered to our customers or suppliers;
•compromise other sensitive government functions;
•subject us to legal claims or proceedings (including class actions), governmental investigations and enforcement actions and regulatory fines, penalties or other liabilities; and
•damage our reputation with our customers (particularly agencies of various governments) and the public generally, and cause us to lose existing or future customers.
We could also be required to spend significant financial and other resources to remedy the damage caused by a cybersecurity incident or significant disruption. In addition, we could be required to pay for investigations, forensic analyses, legal advice, public relations advice or other services, or to repair or replace networks and information technology systems. We cannot guarantee that any costs and liabilities incurred in relation to a cybersecurity incident or significant disruption of our or our vendors’ operations, systems, assets, products or services will be covered by our existing insurance policies or that applicable insurance will be available to us in the future on economically reasonable terms or at all.
A cybersecurity incident that involves classified or other sensitive government information or certain controlled technical information could subject us to civil or criminal penalties and could result in loss of security clearances and other accreditations, loss of our government contracts, loss of access to classified information, loss of export privileges or debarment as a government contractor.
Any actual or perceived failure to comply with new or existing data privacy, data protection, and cybersecurity laws, regulations and other requirements could cause substantial harm to our business.
We are subject to U.S. federal, state, local and international laws, regulations, industry standards and contractual obligations regarding data privacy, data protection and cybersecurity, including those governing the processing and protection of personal, sensitive and other proprietary or confidential information.
In the United States, there are numerous federal and state data privacy and security laws, rules, and regulations governing the Processing of personal data, including federal and state data privacy laws, data breach notification laws, and consumer protection laws. For example, the U.S. Federal Trade Commission (the “FTC”) and many state attorneys general are interpreting federal and state consumer protection laws to impose standards for the online collection, use, dissemination, and security of data. Such standards require us to publish statements that describe how we handle personal data and choices individuals may have about the way we handle their personal data. If such information that we publish is considered untrue or inaccurate, we may be subject to government claims of unfair or deceptive trade practices, which could lead to significant liabilities and consequences. Moreover, according to the FTC, violating consumers’ privacy rights or failing to take appropriate steps to keep consumers’ personal data secure may constitute unfair acts or practices in or affecting commerce in violation of Section 5(a) of the Federal Trade Commission Act. State consumer protection laws provide similar causes of action for unfair or deceptive practices. All 50 U.S. states, the District of Columbia and several U.S. territories have adopted data breach notification laws that require notice to be given to affected individuals, regulators, credit reporting agencies and/or others when certain types of data have been compromised as the result of a cybersecurity breach or incident. In the event of such a cybersecurity incident, our compliance with these laws may subject us to costs associated with investigation, notice and remediation, as well as potential litigation and investigations from applicable regulatory authorities. We may also become liable for damages under our contracts and applicable law and incur penalties and other costs. Depending on the facts and circumstances, any damages, penalties, fines and costs could be significant.
For example, California enacted the California Consumer Privacy Act (the “CCPA”), which gives California residents expanded rights to access and delete their personal information, opt out of certain sales of personal information, and receive detailed information about what personal information is collected, how their personal information is used, and how that personal information is shared. The CCPA provides for civil penalties for violations enforced by the California Attorney General, as well as a private right of action for data breaches that is expected to increase data breach litigation. Additionally, the California Privacy Rights Act (the “CPRA”) expands upon the CCPA and imposes additional data protection obligations on covered businesses, including additional consumer rights processes, limitations on data uses, new audit requirements for higher risk data and opt outs for certain uses and disclosure of sensitive personal information. It also created a new California data protection agency authorized to issue substantive regulations, which is likely to result in increased privacy, cybersecurity and data protection enforcement. The CCPA has encouraged “copycat” laws in other states across the country. For example, Colorado enacted the Colorado Privacy Act (the “CPA”). Similar laws have been proposed (and in some states, passed), and likely will continue to be proposed, in other states and at the federal level which have conflicting requirements that make compliance challenging. We cannot yet determine the full impact that these laws, regulations and standards may have on our business or operations, but it may increase our compliance costs and potential liability, particularly in the event of a data breach, as we grow, and the associated compliance costs may have a material adverse effect on our business.
In addition to the United States, a growing number of other global jurisdictions are considering or have passed legislation implementing data protection requirements that currently or may in the future apply to us and that could increase the cost and complexity of delivering our services, particularly as we expand our operations internationally. For example, in the EU and UK, we are subject to the EU General Data Protection Regulation (“EU GDPR”), the UK General Data Protection Regulation and the UK Data Protection Act (together, the “UK GDPR”) (the EU GDPR and UK GDPR together, the “GDPR”). The GDPR imposes stringent data protection requirements for processing the personal data of individuals within the EU and UK, many of which are different from requirements under existing U.S. privacy laws. The GDPR enhances data protection obligations for “processors” and “controllers” of personal data, including, for example, expanded disclosure requirements, limitations on retention of personal data, mandatory data breach notification requirements and additional obligations. Non-compliance with the GDPR can trigger fines of up to the greater of €20 million/£17.5 million, or 4%, of our global annual turnover, and since we are under the
supervision of relevant data protection authorities in both the EU and the UK, we may be fined under both the EU GDPR and the UK GDPR for the same breach. Non-compliance with the GDPR may also place restrictions on the conduct of our business and the manner in which we interact with our customers. Among other requirements, the GDPR generally prohibits transfers of personal data subject to the GDPR outside of the EU/UK, including the United States, unless a lawful data transfer solution has been implemented or a data transfer derogation applies. Recent legal developments in Europe have created complexity and uncertainty regarding transfers of personal data from the EU and UK to third countries, including the United States. As the landscape further develops, we could suffer additional costs, complaints and/or regulatory investigations or fines, and we may have to take additional or different compliance measures, stop using certain tools and vendors and make other operational changes.
We are also subject to evolving EU/UK privacy laws, which impose strict requirements on the use of cookies (and similar tracking technologies) and communications data including, for example, a requirement to collect valid consent for cookies and similar technologies, a prohibition on pre-checked consents and a requirement to ensure separate consents are sought for each type of non-essential cookie. European court and regulatory decisions are driving increased attention to cookies and tracking technologies, and data protection regulators are increasingly active in enforcement in this area. If enforcement by regulators of the strict approach to opt-in consent for all but essential use cases, as seen in recent guidance and decisions continues, this could lead to substantial costs, require significant systems changes, limit the effectiveness of our marketing activities, divert the attention of our technology personnel, adversely affect our margins, increase costs and subject us to additional liabilities.
Additionally, as we accept debit and credit cards for payment, we are subject to the Payment Card Industry Data Security Standard (“PCI-DSS”), issued by the Payment Card Industry Security Standards Council. PCI-DSS contains compliance guidelines with regard to our security surrounding the physical and electronic storage, processing and transmission of cardholder data. If we or our service providers are unable to comply with the security standards established by banks and the payment card industry, we may be subject to fines, restrictions and expulsion from card acceptance programs, which could materially and adversely affect our business.
Further, we may be impacted by evolving EU cybersecurity laws. The Network and Information Security 2 Directive (“NIS 2”) came into force in January 2023, building on the original Network and Information Security Directive, amending the rules on security of network and information systems in the EU. EU Member States were required to adopt NIS 2 into national law by October 17, 2024. NIS2 broadens the scope of regulated sectors and entities, including the space sector, and imposes heightened cybersecurity obligations on in-scope entities, including in respect of supply chain security, and reporting requirements in respect of incidents having a significant impact on the provision of their services and significant cyber threats. It also introduces more stringent supervisory measures and stricter enforcement requirements – EU Member States must provide for administrative fines of at least the greater of €10 million, or up to 2% of annual worldwide turnover for certain infringements of NIS 2. Once fully in force, national laws implementing NIS 2 may require us to modify our cybersecurity practices and policies and we could incur substantial costs as a result.
Many federal, state and foreign government bodies and agencies have introduced additional laws and regulations governing the use of artificial intelligence and machine learning technologies. It is also possible that new laws and regulations will be adopted in the United States and in other countries, or that existing laws and regulations will be interpreted in ways that would affect the way in which we use artificial intelligence. It may not be possible to predict how such changes in the legal and regulatory landscape may affect our development or use of artificial intelligence. For example, the EU has introduced a new regulation applicable to certain artificial intelligence technologies and the data used to train, test and deploy them (the “EU AI Act”). The EU AI Act entered into force on August 1, 2024, and its requirements will become effective on a staggered basis, with the majority of the substantive requirements applying from August 2, 2026. The EU AI Act will impose material requirements on both the providers and deployers of artificial intelligence technologies, and prohibit certain artificial intelligence practices, with infringement punishable by sanctions of up to 7% of annual worldwide turnover or EUR 35 million (whichever is higher) for the most serious breaches. Once fully applicable, the EU AI Act will have a material impact on the way artificial intelligence is regulated in the EU, and together with developing guidance and/or decisions in this area, may affect our use of artificial intelligence and our ability to provide and to improve our services, require additional compliance measures and changes to our operations and processes, result in increased compliance costs and potential increases in civil claims against us, and could adversely affect our business,
operations and financial condition. In addition, in the United States, the Trump administration has rescinded an executive order relating to the safe, secure and trustworthy development of artificial intelligence technologies that was previously issued by the Biden administration. The Trump administration then issued a new executive order on January 23, 2025 that, among other things, requires certain agencies to develop and submit to the president action plans to “sustain and enhance America’s global AI dominance in order to promote human flourishing, economic competitiveness, and national security,” to review all policies, directives, regulations, orders and other actions taken pursuant to the rescinded Biden executive order and to, as appropriate and consistent with applicable law, suspend, revise, or rescind any such policies, directives, regulations, orders and other actions that are or may be inconsistent with, or present obstacles to, the policy of sustaining and enhancing America’s global AI dominance. Thus, the Trump administration or other agencies or governmental bodies may continue to rescind other existing federal orders, directive, regulations, actions and/or policies relating to artificial intelligence, or may issue, adopt or implement new executive orders and/or other policies, directives, regulations, orders and other actions relating to artificial intelligence in the future. Any such changes at the federal level could require us to expend significant resources to modify our products, services, or operations to ensure compliance or remain competitive.
Although we seek to comply with applicable laws, regulations, industry standards and other legal obligations relating to data privacy, data protection and cybersecurity, these requirements are continuously evolving and may be modified, interpreted, or applied in an inconsistent manner from one jurisdiction to another and may conflict with one another or other legal obligations with which we must comply, which raises both costs of compliance and likelihood that we will fail to satisfy all of our legal requirements. Moreover, many of the laws and regulations in this area are relatively new and their interpretations are uncertain and subject to change. Monitoring, preparing for and complying with the array of data privacy, data protection and cybersecurity legal regimes to which we are subject also requires us to devote significant resources, including, financial and time-related resources. Each of these data privacy, data protection and cybersecurity laws, regulations and standards and any other such changes or new laws, regulations or standards could impose significant limitations on our ability to process data and to offer certain types of products or services, require increased compliance costs and/or changes to our business, which may make our business costlier or less efficient to conduct.
In addition, any failure or perceived failure by us to comply with any data privacy, data protection or cybersecurity laws, regulations, standards or contractual obligations to which we are or may become subject, or other legal obligations relating to data privacy, data protection, cybersecurity or consumer protection could adversely affect our reputation, brands and business, and may result in investigations, claims, proceedings or actions against us by governmental entities, customers, suppliers or others, including class actions, or other liabilities or may require us to change our operations and/or cease using certain data sets. Any such investigations, claims, proceedings, actions, or other liabilities could hurt our reputation, brands and business, force us to incur significant expenses in investigations and defense of such proceedings or actions, distract our management, increase our costs of doing business, result in a loss of customers and third-party partners and result in the imposition of significant damages liabilities or monetary penalties.
In addition, we depend on several third-party vendors in relation to the operation of our business, a number of which process personal information on our behalf. With each such provider, we attempt to mitigate the associated risks of using third parties by performing security assessments and due diligence and entering into contractual arrangements designed to ensure that providers only process personal information according to our instructions, and that they have technical and organizational security measures in place. There is no assurance that these contractual measures and our own privacy and security-related safeguards will protect us from the risks associated with the third-party processing of such information. Any violation of data privacy, data protection or cybersecurity laws, regulations, standards, or contractual obligations by our third-party processors could have a material adverse effect on our business, financial condition and operating results, and result in the fines and penalties outlined above.
Our use of artificial intelligence and machine learning technologies could adversely affect our products and services, harm our reputation, or cause us to incur liability resulting from harm to individuals or violation of laws and regulations or contracts to which we are a party.
We use machine learning, artificial intelligence and automated decision-making technologies throughout our business, and are dedicating resources and efforts to continuously improve our use of such technologies. For
example, we are developing artificial intelligence powered-edge computing units to operate across Earth and space, delivering versatile, real-time intelligence capabilities for defense and national security applications as well as for commercial use. As with many technological innovations, there are significant risks and challenges involved in developing, maintaining and deploying these technologies and there can be no assurance that the usage of such technologies will always enhance our solutions or be beneficial to our business, including our efficiency or profitability.
In particular, if the models underlying the artificial intelligence, machine learning and automated decision-making technologies that we develop or use are: (i) incorrectly designed or implemented; (ii) trained or reliant on incomplete, inadequate, inaccurate, biased or otherwise poor quality data, or on data to which we do not have sufficient rights or in relation to which we and/or the providers of such data have not implemented sufficient legal compliance measures (including with respect to the processing and protection of such data); (iii) used without sufficient oversight and governance to ensure their responsible and ethical use; and/or (iv) adversely impacted by unforeseen defects, technical challenges, cybersecurity threats or material performance issues, the performance of our products, services and business, as well as our reputation and the reputations of our customers and business partners, could suffer or we could incur liability resulting from harm to individuals, civil claims or the violation of laws or contracts to which we are a party.
If we cannot successfully establish, maintain, protect, and enforce our intellectual property, our business could suffer.
Our success depends on our ability to establish, maintain, protect and enforce our intellectual property and other proprietary rights. We rely on a combination of intellectual property rights, contractual protections and other practices to protect our proprietary information, technologies and processes as well as our brand. While it is our policy to maintain, protect and enforce our intellectual property rights, we cannot be sure that the actions we have taken will be adequate to protect us, and if our existing intellectual property rights are rendered invalid or unenforceable, or narrowed in scope, the protection such rights afford our products, services and brands could be impaired. We may be required to spend significant resources to monitor and protect our intellectual property rights and the efforts we take to protect our proprietary rights may not be sufficient. Our failure to maintain adequate protection of our intellectual property rights for any reason could negatively affect our competitive position, impede our ability to commercialize our products and services and harm our business and operating results. In addition, U.S. government contracts typically contain provisions that allow the government to claim rights, including intellectual property rights, in products and data developed under such agreements. We may not have the right to prohibit the U.S. government from using certain technologies developed by us and we may not be able to prohibit third-party companies, including our competitors, from using these technologies in providing products and services to the U.S government. The U.S. government generally takes the position that it has the right to royalty-free use of technologies that are developed under U.S. government contracts or using U.S. government funding.
We primarily rely on patent, copyright and trade secret laws to protect our proprietary technologies and processes, including the operations systems and technologies we use throughout our businesses both in our enabling functions and infrastructure development functions. We currently own certain patents and have applied for and may continue to apply for patent protection relating to certain proprietary aspects of existing and proposed products, processes and services. We cannot guarantee that any of our patent applications will issue into patents and the patents we own could be challenged, invalidated or circumvented by others and may not be of sufficient scope or strength to provide us with any meaningful protection or commercial advantage. Some patent applications in the United States are maintained in secrecy for a period of time after they are filed and since publication of discoveries in the scientific or patent literature tends to lag behind actual discoveries by several months, we cannot be certain that we will be the first creator of inventions covered by any patent application we make or the first to file patent applications on such inventions. The patenting process is expensive and time-consuming, and we may not be able to file and/or prosecute all necessary or desirable patent applications at a reasonable cost or in a timely manner or pursue or obtain patent protection in all relevant markets. Further, we cannot assure you that competitors will not infringe our patents or that we will have adequate resources to enforce our patents.
We rely in part on trade secrets, proprietary know-how and other confidential information to maintain our competitive position. However, trade secret protection is risky and uncertain, and the disclosure or independent
development by third parties of our proprietary technology could have a material adverse impact on our business and results of operations. Although our policy is to enter into confidentiality and invention assignment agreements with our employees and consultants and enter into confidentiality agreements with the parties with whom we have strategic and business relationships, no assurance can be given that these agreements will be effective in controlling access to, and distribution of, our proprietary information or will provide us with effective remedies in the event of a breach. Enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, expensive and time-consuming, and a favorable outcome is not guaranteed. Further, these agreements do not prevent our competitors from independently developing technologies that are substantially equivalent or superior to our technologies, which may allow them to provide products and services similar to ours and thereby harm our competitive position. In addition, while we intend to put in place policies and procedures with respect to the use of artificial intelligence to mitigate risks to our confidential and proprietary information in connection with our anticipated adoption of such technologies, the use of certain artificial intelligence tools may pose risks to our proprietary and confidential information, including the inadvertent disclosure of such information into publicly available third-party training sets.
We also rely on our trademarks to distinguish our products and services from those of our competitors and have registered or applied to register many of these trademarks. If our trademarks are not adequately protected, we may be unable to maintain or build name recognition in our target markets and our business may be adversely affected. We cannot guarantee that our trademark applications will be approved and third parties may oppose our trademark applications or otherwise challenge our use of our trademarks. In the event that our trademarks are successfully challenged, we could be forced to rebrand our services or solutions, which could result in loss of brand recognition and could require us to devote resources to develop, advertise and market new brands. If we are unable to successfully register our trademarks and establish name recognition based on our trademarks, we may not be able to compete effectively and our business may be adversely affected. In addition, competitors or other third parties have in the past adopted, and may in the future adopt, trademarks similar to ours, which may impede our ability to build brand identity, possibly leading to market confusion and potentially requiring us to pursue legal action.
Significant resources may be required to monitor and protect our intellectual property rights, and despite such efforts, we may not be able to detect infringement, misappropriation or other violations of our intellectual property rights by third parties. Litigation may be necessary in the future to enforce or protect our intellectual property rights. Such litigation could be costly, time-consuming, unpredictable and distracting to management and could result in the impairment or loss of portions of our intellectual property. Furthermore, our efforts to enforce our intellectual property rights may be met with defenses, counterclaims, and countersuits attacking the ownership, scope, validity and enforceability of our intellectual property rights. Third parties may also separately challenge the validity and enforceability of our intellectual property in administrative and other legal proceedings. An adverse determination of any litigation proceedings could put our intellectual property at risk of being invalidated. Furthermore, because of the substantial amount of discovery that may be required in connection with intellectual property litigation, there is a risk that some of our proprietary or confidential information could be compromised by disclosure during this type of litigation. Our inability to protect our proprietary technology and other intellectual property against unauthorized copying or use, as well as any costly litigation or diversion of our management’s attention and resources, could allow competitors to develop and commercialize services or products similar to ours and thereby reduce demand for our offerings, could delay future sales and introductions of new capabilities, result in our substituting inferior or more costly technologies into our business, or injure our reputation.
Additionally, we have licensed, and may license in the future, intellectual property rights from third parties, and the licenses we receive to such intellectual property rights may not provide exclusive or unrestricted rights in all fields of use and in all territories in which we may wish to develop or commercialize our products in the future and may restrict our rights to offer certain products in certain markets or impose other obligations on us in exchange for our rights to the licensed intellectual property. If we violated the terms of any of our license agreements, such as by failing to make specified royalty payments or failing to comply with quality control standards, a licensor may have the right to terminate our license. Even if we comply with all the terms of a license agreement, we cannot guarantee that we will be able to renew an agreement when it expires even if we desire to do so. The failure to maintain or renew our material license agreements could result in a loss of revenue and negatively impact our results of operations. In addition, we may be required to license additional technology from third parties to develop and
market new capabilities, and we cannot assure you that we could license that technology on commercially reasonable terms or at all, and our inability to license this technology could harm our ability to compete. We also grant licenses to third parties which allow third parties the right to use certain of our intellectual property in a restricted capacity. Further, a government, including the U.S. government, or a prime contractor customer could require us to relinquish intellectual property and data rights in connection with performing work on a government contract, which could lead to a loss of valuable rights in technology and intellectual property as a condition for participating in a government program. While we attempt to ensure that our intellectual property rights are protected when entering into business relationships, third parties may take actions that could materially and adversely affect our rights in or the value of our intellectual property rights.
Additionally, our intellectual property rights may not be protected in some jurisdictions to the same extent that they are protected in the United States, increasing the potential for infringement. It may be more difficult for us to successfully challenge the use of our intellectual property by other parties in these countries, which could diminish the value of our technologies, products and services and cause our competitive position and growth to suffer. In addition, filing prosecuting and defending our intellectual property in all countries throughout the world where we operate may be prohibitively expensive. The lack of adequate legal protections of intellectual property or adequate legal remedies for infringement, misappropriation and other violations of intellectual property in jurisdictions outside of the United States could have an adverse effect on our business, results of operations, and financial condition.
Third parties may allege that we are infringing, misappropriating, or otherwise violating their intellectual property rights, which could involve substantial costs and adversely impact our business.
Our success in part depends on our ability to develop, manufacture, market and sell our technologies without infringing, misappropriating or otherwise violating the intellectual property rights of third parties. Furthermore, we cannot guarantee that the operation of our business does not and will not infringe or violate the rights of third parties. Because of technological changes in our industry, current patent coverage and the rapid rate of issuance of new patents, our current or future technologies may infringe, misappropriate or otherwise violate existing or future patents or intellectual property rights of other parties. Further, because some patent applications are maintained in secrecy for a period of time, there is a risk that we could develop a product or technology without knowledge of a pending patent application, which product or technology would infringe a third-party patent once that patent is issued.
We have in the past, and may in the future, be subject to claims by third parties alleging that we have infringed, misappropriated or otherwise violated their intellectual property rights. Any such claims, even those without merit, can be expensive and time-consuming to defend and may divert management’s attention and resources, and an adverse result in any proceeding could put our ability to produce, market and sell our technologies in jeopardy. The outcome of any litigation is inherently uncertain, and there can be no assurances that favorable final outcomes will be obtained in all cases. We may be required to spend significant resources to defend against such claims, pay significant money damages, cease using certain processes, technologies, trademarks or other intellectual property, cease making, offering and selling certain technologies, obtain a license (which may not be available on commercially reasonable terms or at all) or redesign all or a portion of our technologies or change our branding (which could be costly, time-consuming, or impossible). While no such claims have been material to date, there is no guarantee that future claims would not have a material effect on our business.
The defense costs and settlements for intellectual property infringement lawsuits may not be covered by insurance. Intellectual property infringement lawsuits can take years to resolve. If we are not successful in our defenses or are not successful in obtaining dismissals of any such lawsuit, legal fees or settlement costs could have an adverse effect on our operations and financial position. Even if resolved in our favor, the volume of intellectual-property-related claims and the mere specter of threatened litigation or other legal proceedings may cause us to incur significant expenses and could distract our personnel from day-to-day responsibilities. The direct and indirect costs of addressing these actual and threatened disputes may have an adverse effect on our operations, reputation, and financial performance.
In addition, some of our agreements with third parties require us to indemnify them for certain intellectual property claims against them, which could require us to incur considerable costs in defending such claims, and may require us to pay significant damages in the event of an adverse ruling. Such third-party partners may also discontinue their relationships with us as a result of injunctions or otherwise, which could result in loss of revenue and adversely impact our business operations.
Intellectual property rights discovered through government-funded programs may be subject to federal regulations such as “march-in” rights, certain reporting requirements and a preference for U.S.-based companies and compliance with such regulations may limit our intellectual property rights.
We may develop, acquire, or license intellectual property rights that have been generated with U.S. government funding or grants. Pursuant to the Bayh-Dole Act of 1980, the U.S. government has certain rights in inventions developed with government funding. These U.S. government rights may include a non-exclusive, non-transferable, irrevocable worldwide license to use inventions for any governmental purpose. In addition, the U.S. government may have the right, under certain limited circumstances, to require us to grant exclusive, partially exclusive or non-exclusive licenses to any of these inventions to a third-party if the U.S. government determines that: (1) adequate steps have not been taken to commercialize the invention; (2) government action is necessary to meet public health or safety needs; or (3) government action is necessary to meet requirements for public use under federal regulations (also referred to as “march-in” rights). Such “march-in” rights would apply to new subject matter arising from the use of such government funding or grants and would not extend to pre-existing subject matter or subject matter arising from funds unrelated to the government funding or grants. If the U.S. government exercised its march-in rights in our intellectual property rights that have been generated through the use of U.S. government funding or grants, we could be forced to license or sublicense intellectual property we developed or that we license on terms unfavorable to us, and there can be no assurance that we would receive compensation from the U.S. government for the exercise of such rights. The U.S. government may also have the right to take title to these inventions if a funding or grant recipient fails to disclose the invention to the government or fails to file an application to register the intellectual property within specified time limits. Intellectual property generated under a government-funded program is also subject to certain reporting requirements, compliance with which may require us to expend substantial resources. In addition, the U.S. government prohibits granting the exclusive right to use or sell these inventions in the United States unless the licensee agrees that products embodying or produced through the inventions will be manufactured substantially in the United States. This preference for U.S. industry may be waived by the federal agency that provided the funding if the owner of the intellectual property rights can show that reasonable but unsuccessful efforts have been made to grant licenses on similar terms to potential licensees that would be likely to manufacture substantially in the United States or that under the circumstances domestic manufacture is not commercially feasible. This preference for U.S. industry may limit our ability to contract with non-U.S. product manufacturers for products covered by such intellectual property rights.
Our use of open source software could compromise the proprietary nature of our software and expose us to other legal liabilities and technological risks.
Some of our proprietary software utilizes and incorporates open source software and we expect to continue to use open source software in our business in the future. Open source software is freely accessible, usable and modifiable, in each case, subject to the terms of the applicable open source software license. Open source software is licensed by its authors or other third parties under open source licenses, which in some instances may subject us to certain unfavorable conditions. For example, certain open source licenses may give rise to requirements to disclose or license our proprietary source code or make available any derivative works or modifications of the open source code on unfavorable terms or at no cost, and we may be subject to such terms if such open source software is combined, linked or otherwise integrated with our proprietary software in certain ways. We have implemented policies relating to our use of open source software that are designed to mitigate the risk of subjecting our proprietary code to these restrictions and requirements. However, we cannot be certain that we use open source software in a manner that is consistent with such policies. For example, we cannot guarantee that all open source software is reviewed prior to use in our platform or that our developers have not incorporated open source software into our products that we are unaware of or that they will not do so in the future. If we fail to comply with our policies, or if our policies are flawed, we may be subject to certain requirements, including requirements that we
offer our software that incorporates or links to the open source software at reduced cost or for free, or that we make available the proprietary source code for such software to the general public.
Furthermore, there are an increasing number of “open source” software license types, almost none of which have been interpreted by U.S. or foreign courts, resulting in a dearth of guidance regarding the proper legal interpretation of such licenses. As a result, there is a risk that these licenses could be construed in a manner that could impose unanticipated conditions or restrictions on our ability to commercialize our products and services. If a third-party were to allege that we had not complied with the conditions of one or more of these licenses, we could be required to incur significant legal expenses defending against such allegations and could be subject to significant damages and required to comply with onerous conditions or restrictions on the use of our proprietary software. In any of these events, we could be required to seek licenses from third parties and pay royalties in order to continue using the open source software necessary to operate our business or we could be required to discontinue use of our software in the event re-engineering cannot be accomplished on a timely basis, or at all. Any of the foregoing could require us to devote additional research and development resources to re-engineer our software, could result in customer dissatisfaction, could allow our competitors to create similar platforms with lower development effort and time and could have a material adverse effect on us. In addition, the use of open source software may entail greater technical and legal risks than those associated with the use of third-party commercial software, as open source licensors generally do not provide support, warranties, controls on origin of the software, indemnification or other contractual protections regarding infringement claims or the quality of the code, including the existence of security vulnerabilities. We cannot ensure that the authors of such open source software will implement or push updates to address security risks or will not abandon further development and maintenance. Many of the risks associated with usage of open source software, such as the lack of warranties or assurance of title, cannot be eliminated and could, if not properly addressed, negatively affect our business. To the extent that our technologies and other business operations depend upon the successful and secure operation of the open source software we use, any undetected errors or defects in this open source software could prevent the deployment or impair the functionality of our software, delay the introduction of new technological capabilities, result in a failure of our technologies, and injure our reputation. For example, undetected errors or defects in open source software could render it vulnerable to breaches or security attacks and make our systems more vulnerable to data breaches or security attacks. In addition, the public availability of such software may make it easier for others to compromise our platform. Any of the foregoing would have a negative effect on our business, financial condition and results of operations.
Risks Related to Employees and the Workforce
We are highly dependent on the services of Mr. Dylan Taylor, Co-Founder, Chairman and Chief Executive Officer and Mr. Matthew Kuta, Co-Founder and President and if we are unable to retain Mr. Taylor and Mr. Kuta, our ability to compete could be harmed.
Much of our success centers around our two founders, Mr. Taylor and Mr. Kuta, who developed our model for acquisitions and revenue streams and provided the vision and leadership for our current success. While every member of our team is valuable, retaining the services and leadership of Mr. Taylor and Mr. Kuta is paramount. In addition to the value that both bring to the company, both Mr. Taylor and Mr. Kuta are influential in the space sector in the local community. They represent the essence and ideals of our company.
If either Mr. Taylor or Mr. Kuta were to discontinue their current roles in the near future or should either founder be unable to fulfill his duties for some reason, we would be hampered in fulfilling our vision, mission and goals. It may take time for us to replace and provide the same level of performance with other individuals. This delay in transition may hinder our ability to meet revenue and acquisition goals that investors anticipate. We do not maintain, and we do not expect to maintain in the future, a key person life insurance policy with respect to either Mr. Taylor, Mr. Kuta, or any of our employees.
Our inability to hire or retain key personnel could have a material adverse effect on us.
Our future success depends on the continued service of our senior management team and key technical employees as well as our ability to identify, attract and retain highly skilled technical, managerial, finance, and other personnel. Our operating performance is also dependent upon personnel who hold security clearances and receive
substantial training to work on certain programs or tasks and can be difficult to replace on a timely basis if we experience unplanned attrition. The loss of any of our key personnel, the inability to attract or retain qualified personnel, or delays in hiring required personnel, particularly in engineering and sales, may seriously harm our business, financial condition and results of operations. We face intense competition for qualified individuals, including for individuals holding high-level clearances, from numerous companies. Often, significant amounts of time and resources are required to train technical, sales and other personnel. Qualified individuals are in high demand and we may incur significant costs to attract and retain them. In addition, we may lose new employees to our competitors or other companies before we realize the benefit of our investment in recruiting and training them. We may be unable to attract and retain suitably qualified individuals who can meet our growing technical, operational and managerial requirements, on a timely basis or at all, and we may be required to pay increased compensation in order to do so. Also, to the extent we hire personnel from competitors, we may be subject to allegations that they have been improperly solicited or divulged proprietary or other confidential information. If we are unable to attract and retain the qualified personnel we need to succeed, our business would suffer.
Labor-related matters, including labor disputes, may adversely affect our operations.
None of our employees are currently represented by a union. If our employees decide to form or affiliate with a union, we cannot predict the effects such future organizational activities will have on our business and operations. If we were to become subject to work stoppages, we could experience disruption in our operations, including delays in manufacturing and operations, and increases in our labor costs, which could harm our business, results of operations, and financial condition.
In addition, we could face a variety of employee claims against us, including but not limited to general discrimination, privacy, wage and hour, labor and employment, Employee Retirement Income Security Act, and disability claims. Any claims could also result in litigation or regulatory proceedings being brought against us by various government agencies that regulate our business, including the U.S. Equal Employment Opportunity Commission. Often these cases raise complex factual and legal issues and create risks and uncertainties. If we were to become subject to such labor disputes, it could have a negative effect on our business, financial condition and results of operations.
Legal and Regulatory Risks
We or our subsidiaries may be party to legal proceedings, investigations and other claims or disputes, which are costly to defend and, if determined adversely to us, could require us to pay fines or damages, undertake remedial measures or prevent us from taking certain actions, any of which could have a material adverse effect on us.
We or our subsidiaries may be party to legal proceedings, investigations and other claims or disputes, which may relate to subjects including commercial transactions, intellectual property, securities, employee relations or compliance with applicable laws and regulations. These legal proceedings could result in substantial costs and diversion of management’s attention and resources and could harm our stock price, business, prospects, results of operations and financial condition. These and other legal proceedings and investigations are inherently uncertain and we cannot predict their duration, scope, outcome or consequences. There can be no assurance that these or any such matters that have been or may in the future be brought against us will be resolved favorably. In connection with any government investigations, we may be required to pay substantial fines or civil and criminal penalties and/or be subject to equitable remedies, including disgorgement or injunctive relief, in the event the government takes action against us or the parties resolve or settle the matter. Other legal or regulatory proceedings, including lawsuits filed by private litigants, may also follow as a consequence. These matters are likely to be expensive and time-consuming to defend, settle and/or resolve and may require us to implement certain remedial measures that could prove costly or disruptive to our business and operations. They may also cause damage to our business reputation. The unfavorable resolution of one or more of these matters could have a material adverse effect on our business.
Our business is subject to various regulatory risks that could have a material adverse effect on us.
The environment in which we operate is highly regulated due to the sensitive nature of our complex and technologically advanced systems, in addition to regulations broadly applicable to publicly listed corporations. There are numerous regulatory risks that could adversely affect operations, including but not limited to:
•Changes in laws and regulations. The laws and regulations governing our business and operations may change in the future. A portion of our revenue is generated from customers outside of the United States and it is likely to increase. There may be a material adverse effect on us if we are required to alter our business to comply with changes in both domestic and foreign regulations, tariffs or taxes and other trade barriers that reduce or restrict our ability to sell our products and services on a global basis, or by political and economic instability in the countries in which we conduct business. Any failure to comply with such regulatory requirements could also subject us to various penalties or sanctions.
•Import and Export Restrictions. Certain of our technologies require the implementation or acquisition of products or technologies from third parties and affiliates, including those in other jurisdictions. In addition, certain of our technologies may be required to be forwarded or exported to other jurisdictions. If the use of the technologies can be viewed by the jurisdiction in which that supplier, subcontractor or affiliate resides as being subject to export constraints or restrictions relating to national security, we may not be able to obtain the technologies and products that we require from subcontractors and suppliers who would otherwise be our preferred choice or may not be able to obtain the export permits necessary to transfer or export our technology. The inability to obtain or maintain export approvals and export restrictions or changes during contract execution or non-compliance by our suppliers, subcontractors, and customers could have an adverse effect on our revenues and margins.
•U.S. Government Approval Requirements. For certain aspects of our business operations, we are required to obtain U.S. government licenses and approvals and to enter into agreements with various government bodies in order to export much of our end components, subcomponents and related equipment, to disclose technical data, or provide defense services to foreign persons. The delayed receipt of or the failure to obtain the necessary U.S. government licenses, approvals and agreements may prohibit entry into or interrupt the completion of contracts which could lead to a customer’s termination of a contract for default or monetary penalties. In addition, certain aspects of our business operations in the future may depend on international agreements between the United States and a Trade Agreement Act partner. As such, any future change or termination of these agreements that we rely on could have a material adverse effect on us.
•Competitive Impact of U.S. Regulations. Export and import control, economic sanction and trade embargo laws and regulations, including those administered by the U.S. Department of Commerce’s Bureau of Industry and Security, the U.S. State Department’s Directorate of Defense Trade Controls and OFAC, may limit certain business opportunities or delay or restrict our ability to contract with potential foreign customers or suppliers. To the extent that our non-U.S. competitors are not subject to similar export and import control, economic sanctions and trade embargo laws and regulations, they may enjoy a competitive advantage with foreign customers and it could become increasingly difficult for us to recapture this lost market share.
•Anti-Corruption Laws. As part of the regulatory and legal environments in which we operate, we are subject to global anti-corruption laws that prohibit improper payments directly or indirectly to government officials, authorities or persons defined in those anti-corruption laws in order to obtain or retain business or other improper advantages in the conduct of business. Our policies mandate compliance with anti-corruption laws. Failure by our employees, agents, subcontractors, suppliers and/or partners to comply with anti-corruption laws could impact us in various ways that include, but are not limited to, criminal, civil and administrative fines and/or legal sanctions and the inability to bid for or enter into contracts with certain entities, all of which could have a significant adverse effect on our reputation, operations and financial results.
Our operations in the U.S. government market are subject to significant regulatory risk.
Our operations in the U.S. government market are subject to significant government regulation. A failure by us to maintain the relevant clearances and approvals could limit our ability to operate in the U.S. government market. Further, there can be no assurance that we will continue to be awarded contracts by the U.S. government. In addition, a failure by us to be compliant with relevant current and future U.S. regulations could result in fines, penalties, repayments, or suspension or debarment from U.S. government contracting or subcontracting for a period of time and could have an adverse effect on our standing and eligibility for future U.S. government contracts.
U.S. government contractors (including their subcontractors and others with whom they do business) must comply with many significant procurement regulations and other specific legal requirements. Although often customary in government contracting, these regulations and other requirements increase our performance and compliance costs and risks and are regularly evolving. New laws, regulations, or procurement requirements or changes to current ones (including, for example, regulations related to cybersecurity, privacy, information protection, intellectual property, cost accounting, counterfeit parts, anti-human trafficking, specialty metals, conflict minerals and use of certain non-US equipment) can significantly increase our costs and risks and reduce our profitability.
In addition, government contracts customarily contain provisions that give the government substantial rights and remedies, many of which are not typically found in commercial contracts and which are not favorable to contractors, including provisions that allow the government to:
•terminate existing contracts, in whole or in part, for any reason or no reason at all;
•reduce or modify the government’s obligations under such agreements without the consent of the other party;
•cancel multi-year contracts and related orders if funds for contract performance for any subsequent year become unavailable;
•decline to exercise an option to renew a contract;
•exercise an option to purchase only the minimum amount specified in a contract;
•decline to exercise an option to purchase the maximum amount specified in a contract;
•audit and investigate contractors and subcontractors;
•claim rights, including intellectual property rights, in products and data developed under such contracts;
•require compliance with mandatory socioeconomic requirements, including labor requirements, subcontracting thresholds and non-discrimination and affirmative action programs and environmental compliance requirements;
•require that delivery or performance of government orders take precedence over those of any other party;
•suspend or debar the contractor from doing business with the government or a specific government agency;
•impose U.S. manufacturing requirements for products that embody inventions conceived or first reduced to practice under such agreements; and
•control or prohibit the export of products.
If we or those with whom we do business do not comply with the laws, regulations, contract terms and processes to which we are subject or if government customer business practices or requirements change significantly, it could affect our ability to compete and have a material adverse effect on us.
We are routinely subject to audit by our customers on government contracts and the results of those audits could have an adverse effect on our business, reputation and results of operations.
U.S. government agencies, including, but not limited to, the Defense Contract Audit Agency, the Defense Contract Management Agency and Offices of Inspectors General, routinely audit and investigate government contractors. These agencies review a contractor’s performance under its contracts, its cost structure, its business systems and its compliance with applicable laws, regulations and standards. The U.S. government can decrease or withhold certain payments when it deems systems subject to its review to be inadequate. Additionally, any costs found to be misclassified may be subject to repayment and from time to time we have had substantial disagreements with government auditors regarding the allowability of costs incurred by us under government contracts, which delays payments even if we are correct in our positions. We have unaudited or unsettled incurred cost claims related to past years, which limits our ability to issue final billings on contracts for which authorized and appropriated funds may be expiring or can result in delays in final billings and our ability to close out a contract.
If an audit or investigation uncovers improper or illegal activities, we may be subject to civil or criminal penalties and administrative sanctions, including reductions of the value of contracts, contract modifications or terminations, forfeiture of profits, suspension of payments, or penalties, fines, suspension or prohibition from doing business with the U.S. government. In addition, we could suffer serious reputational harm if allegations of impropriety were made against us. Similar government oversight and risks to our business and reputation exist in most other countries where we conduct business.
The U.S. government’s determination to award a future contract or contract option may be challenged by an interested party, and, if that challenge is successful, that future contract or option may be terminated.
The laws and regulations governing procurements by the U.S. government provide procedures by which other bidders and interested parties may challenge the award of a government contract at the U.S. Government Accountability Office (“GAO”) or in federal court. If we are awarded a government contract, such challenges or protests could be filed even if there are not any valid legal grounds on which to base the challenge or protest. If any such challenges or protests are filed, the government agency may decide to suspend our performance under the contract while such protests are being considered by the GAO or the applicable federal court, thus potentially delaying delivery of payment. In addition, we could be forced to expend significant funds to defend any potential award. If a challenge or protest is successful, the government agency may be ordered to terminate any one or more of our contracts and reselect bids. The government agencies with which we have contracts could even be directed to award a potential contract to one of the other bidders. Finally, the government agency, in its discretion, may elect to take corrective action to resolve a pending bid protest which could result in the government agency reevaluating bidders, or asking bidders to re-compete for the contract, and the selection of a new bidder.
Failure to comply with the requirements of the National Industrial Security Program Operating Manual could result in interruption, delay, or suspension of our ability to provide our products and services, and could result in loss of current and future business with the U.S. government.
Certain contracts with the U.S. government require us to be issued facility security clearances under the National Industrial Security Program. The National Industrial Security Program requires that a corporation maintaining a facility security clearance be effectively insulated from foreign ownership, control, or influence (“FOCI”). Failure to maintain an agreement with the U.S. Department of Defense regarding the appropriate FOCI mitigation arrangement could result in invalidation or termination of the facility security clearances, which in turn would mean that we would not be able to enter into future contracts with the U.S. government requiring facility security clearances and may result in the loss of our ability to complete existing contracts with the U.S. government.
There is significant uncertainty surrounding U.S. “mission authorization” regulations that may apply to Starlab. Any final regulations and any future regulations may impose significant, unexpected compliance costs on the project.
Current U.S. regulation of space activities includes regulation of launch and reentry of space vehicles, use of spectrum on orbit and remote sensing technologies. Other on-orbit activities, such as operation of a crewed space station or debris removal, that will be undertaken by Starlab, are not currently regulated. As a party to the 1967
Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space, the United States is required to provide authorization and continuous supervision of outer space activities by its nationals. There are several proposals as to how the United States will regulate activities in order to comply with this obligation, but as of the date hereof, it is not clear what these regulations will be or which government agency or entity will enact and enforce them. Any final regulations and any future regulations may impose significant, unexpected costs associated with the Starlab. If these current or future regulations impose onerous obligations on our operations, this may significantly increase the costs associated with the Starlab program and may have a material adverse effect on our ability to complete the project or to recognize the benefits we anticipate from the project.
Our operations are subject to governmental law and regulations relating to environmental matters, which may expose us to significant costs and liabilities that could negatively impact our financial condition.
We are subject to various foreign, federal, state, provincial, and local environmental laws and regulations relating to the operation of our businesses, including those governing pollution, the handling, storage disposal, and transportation of hazardous substances, and the ownership and operation of real property. Such laws and regulations may result in significant liabilities and costs to us, including due to the actions or inactions of the previous owners or operators of our facilities. In addition, new laws and regulations, more stringent enforcement of existing laws and regulations or the discovery of previously unknown contamination could result in additional costs.
Certain foreign, federal, state, provincial and local laws and regulations relating to the protection of the environment may require a current or previous owner or operator of real estate to investigate and remediate hazardous or toxic substances or petroleum product releases at or from the property. Under certain environmental laws and regulations, generators of waste materials and current and former owners or operators of facilities can be subject to liability for investigation and remediation costs at locations that have been identified as requiring response actions. Compliance with environmental laws and regulations can require significant expenditures. In addition, we could incur costs to comply with such current or future laws and regulations, the violation of which could lead to substantial fines and penalties.
We may have to pay governmental entities or third parties for property damage and for investigation and remediation costs that they incurred in connection with any contamination at our current and former properties without regard to whether we knew of or caused the presence of the contaminants. Liability under these laws and regulations may be strict, joint and several, meaning that we could be liable for the costs of cleaning up environmental contamination regardless of fault or the amount of waste directly attributable to us. Even if more than one person may have been responsible for the contamination, each person covered by these environmental laws and regulations may be held responsible for all of the clean-up costs incurred. Environmental liabilities could arise and have a material adverse effect on us. We do not believe, however, that pending environmental regulatory developments in this area will have a material effect on our capital expenditures or otherwise materially adversely affect our operations, operating costs, or competitive position.
We may be adversely affected by global climate change or by legal, regulatory or market responses to such change.
Increasing stakeholder environmental, social and governance (“ESG”) expectations, physical and transition risks associated with climate change, and emerging ESG regulation and policy requirements may pose risk to our market outlook, brand and reputation, financial outlook, cost of capital, global supply chain and production continuity, which may impact our ability to achieve long-term business objectives. Changes in environmental and climate change laws or regulations could lead to additional operational restrictions and compliance requirements upon us or our products, require new or additional investment in product designs, require carbon offset investments or otherwise could negatively impact our business and/or competitive position. Increasing aircraft performance standards and requirements on manufacturing and product air pollutant emissions, especially greenhouse gas (“GHG”) emissions, may result in increased costs or reputational risks and could limit our ability to manufacture and/or market certain of our products at acceptable costs, or at all, and may require additional accounting for, and disclosure of, GHG emissions. Physical impacts of climate change (including as relating to more frequent or more severe weather events and drought-related limitations on access to water), increasing global chemical restrictions and bans, and water and waste requirements may drive increased costs to us and our suppliers. Additionally, if we
fail to achieve or improperly report on any stated environmental goals and commitments, the resulting negative publicity could adversely affect our reputation and/or our access to capital.
Investments in us may be subject to U.S. foreign investment regulations which may impose conditions on or limit certain investors’ ability to purchase our Class A common stock, potentially making our Class A common stock less attractive to investors. Our investments in U.S. companies may also be subject to U.S. foreign investment regulations.
Under the “Exon-Florio Amendment” to the U.S. Defense Production Act of 1950, as amended (the “DPA”), the U.S. President has the power to disrupt or block certain foreign investments in U.S. businesses if he determines that such a transaction threatens U.S. national security. The Committee on Foreign Investment in the United States (“CFIUS”) has been delegated the authority to conduct national security reviews of certain foreign investments. CFIUS may impose mitigation conditions to grant clearance of a transaction.
The Foreign Investment Risk Review Modernization Act (“FIRRMA”), enacted in 2018, amended the DPA to, among other things, expand CFIUS’s jurisdiction beyond acquisitions of control of U.S. businesses. Under FIRRMA, CFIUS also has jurisdiction over certain foreign non-controlling investments in U.S. businesses that are involved with critical technology or critical infrastructure, or that collect and maintain sensitive personal data of U.S. citizens (“TID U.S. Businesses”), if the foreign investor receives specified triggering rights in connection with its investment. We are a TID U.S. Business because we develop and design technologies that would be considered critical technologies. Certain foreign investments in TID U.S. Businesses are subject to mandatory filing with CFIUS. These restrictions on the ability of foreign persons to invest in us could limit our ability to engage in strategic transactions that could benefit our stockholders, including a change of control, and could also affect the price that an investor may be willing to pay for our Class A common stock.
Failure to comply with anti-corruption laws, including the FCPA and similar laws associated with our activities outside of the United States, could subject us to penalties and other adverse consequences.
We operate a global business and may have direct or indirect interactions with officials and employees of government agencies or state-owned or affiliated entities. We are subject to the FCPA, the U.S. domestic bribery statute contained in 18 U.S.C. § 201, the U.S. Travel Act and possibly other anti-bribery and anti-corruption laws in countries in which we conduct activities. These laws that prohibit companies and their employees and third-party intermediaries from corruptly promising, authorizing, offering, or providing, directly or indirectly, improper payments or anything of value to foreign government officials, political parties, and private-sector recipients for the purpose of obtaining or retaining business, directing business to any person, or securing any advantage. In addition, U.S. public companies are required to maintain records that accurately and fairly represent their transactions and have an adequate system of internal accounting controls. In many foreign countries, including countries in which we may conduct business, it may be a local custom that businesses engage in practices that are prohibited by the FCPA or other applicable laws and regulations. We face significant risks if we or any of our directors, officers, employees, agents or other partners or representatives fail to comply with these laws and governmental authorities in the United States and elsewhere could seek to impose substantial civil and/or criminal fines and penalties which could have a material adverse effect on us.
Any violation of the FCPA or other applicable anti-corruption laws could result in whistleblower complaints, adverse media coverage, investigations, loss of export privileges, severe criminal or civil sanctions and, in the case of the FCPA, suspension or debarment from U.S. government contracts, any of which could have a materially adverse effect on our reputation, business, operating results and prospects. In addition, responding to any enforcement action may result in a significant diversion of management’s attention and resources and significant defense costs and other professional fees.
We may be unable to obtain or maintain required authorization or contractual arrangements.
Various types of U.S. domestic and international authorizations and contractual arrangements are required in connection with the products and services that we provide. Compliance with certain laws, regulations, conditions and other requirements, including the payment of fees, may be required to maintain the rights provided by such authorizations. Failure to comply with such requirements, or comply in a timely manner, could lead to the loss of
such authorizations and could have a material adverse impact on our business, financial condition and results of operations.
We currently hold authorizations to operate technology currently in use on the ISS. Such authorizations are conditioned upon meeting certain requirements, which if not met or extended could result in loss of the authorization. While we anticipate that these authorizations will be extended or renewed in the ordinary course such that they otherwise would expire, or replaced by authorizations covering more advanced facilities, we can provide no assurance that this will be the case. Our inability to timely obtain or maintain such authorizations could delay or preclude our operation of such technology or our provision of products and services that rely upon such technology. Further, changes to the laws and regulations under which we operate could adversely affect our ability to obtain or maintain authorizations. Any of these circumstances could have a martial adverse impact on our business, financial condition and results of operations.
The use of spacecraft and other technologies in our business is subject to various conditions imposed by domestic and foreign governments and multinational regulatory entities contained in the authorizations held by us and third parties, as well as the requirements of the laws and regulations of those jurisdictions. Any failure to meet these types of requirements in a timely manner, maintain our contractual arrangements, obtain or maintain our authorizations, or manage potential conflicts, could lead to us losing our rights to operate or may otherwise require us to modify or limit our operations from these locations, which could materially affect our ability to operate, and could have a material adverse impact on our business, financial condition and results of operations.
Risks Related to Our Indebtedness
Our level of indebtedness could have a material adverse effect on us.
We intend to partially draw on the Revolving Credit Facility to repay in full the Term Loan on or around July 1, 2025; however, there can be no assurance that we will partially draw on the Revolving Credit Facility to repay in full the Term Loan on or around July 1, 2025 or at all. Pursuant to the Revolving Credit Agreement we may borrow, from time to time, amounts up to $200.0 million, which amount may be increased pursuant to the terms of the Revolving Credit Agreement. See “Description of Certain Indebtedness.” Our indebtedness could have significant effects on our business, such as:
•limiting our ability to borrow additional amounts to fund capital expenditures, acquisitions, debt service requirements, execution of our growth strategy and other purposes;
•limiting our ability to make investments, including acquisitions, loans and advances, and to sell, transfer or otherwise dispose of assets;
•requiring us to dedicate a substantial portion of our cash flow from operations to pay principal and interest on our borrowings, which would reduce availability of our cash flow to fund working capital, capital expenditures, acquisitions, execution of our growth strategy and other general corporate purposes;
•making us more vulnerable to adverse changes in general economic, industry and competitive conditions, in government regulation and in our business by limiting our ability to plan for and react to changing conditions;
•placing us at a competitive disadvantage compared with our competitors that have less debt; and
•exposing us to risks inherent in interest rate fluctuations because our borrowings are at variable rates of interest, which could result in higher interest expense in the event of increases in interest rates.
In addition, we may not be able to generate sufficient cash flow from our operations to repay our indebtedness when it becomes due and to meet our other cash needs. If we are not able to pay our borrowings as they become due, we will be required to pursue one or more alternative strategies, such as selling assets, refinancing or restructuring our indebtedness or selling additional debt or equity securities. We may not be able to refinance our debt or sell additional debt or equity securities or our assets on favorable terms, if at all, and if we must sell our assets, it may negatively affect our financial condition and results of operations. We may also incur additional indebtedness in the
future to refinance our existing indebtedness or to finance proposed projects. The incurrence of additional indebtedness could magnify the risks described above.
The failure to comply with the covenants under our Credit Agreement or our Revolving Credit Agreement or the volatile credit and capital markets could have a material adverse effect on us.
The failure to comply with the covenants under our Credit Agreement or our Revolving Credit Agreement or the volatile credit and capital markets could have a material adverse effect on us. Our Credit Agreement includes a minimum liquidity threshold, which requires us and the guarantors party thereto to, at all times, maintain an aggregate cash balance in all accounts subject to account control agreements in an amount of at least $12.5 million, with such amount shall be held in no more than four accounts. Liquidity under our Credit Agreement is defined as the aggregate amount of unrestricted and unencumbered cash in deposit accounts and securities accounts. Our Revolving Credit Agreement includes a quarterly minimum liquidity, which requires us and the guarantors thereunder to maintain an aggregate cash balance in all accounts subject to account control agreements in an amount, when taken together with the undrawn portion of the Revolving Credit Facility, of no less than the greater of (a) $100.0 million and (b) solely to the extent consolidated EBITDA is negative, the absolute value of consolidated EBITDA. Liquidity under our Revolving Credit Agreement is defined as unrestricted cash and permitted investments plus undrawn commitments under the Revolving Credit Facility.
Credit and capital markets can be volatile, which could make it more difficult for us to refinance our existing debt or to obtain additional debt or equity financings in the future. Such constraints could increase our costs of borrowing and could restrict our access to other potential sources of future liquidity. Our failure to comply with the covenants under our Credit Agreement or to have sufficient liquidity to make interest and other payments required by our debt could result in a default of such debt and acceleration of our borrowings, which could have a material adverse effect on us.
Risks Related to Financial and Accounting Matters
We use estimates when accounting for contracts. Contract cost growth or changes in estimated contract revenues and costs can have a material adverse effect on us.
Contract accounting requires judgment, including in assessing risks, estimating contract revenues and costs, and predicting future performance. Given the size and nature of our many contracts, estimating total revenues and costs at completion is complex and subject to many variables. For example, because revenue is recognized upon fulfillment of performance obligations, we make numerous assumptions and estimates when determining the total estimated costs of completion, including items such as development costs, performance of subcontractors, availability and cost of materials, labor productivity and cost, overhead and capital costs.
Our operating results can be adversely affected when estimated contract costs increase, especially without comparable increases in revenue. There are many reasons estimated contract costs can increase, including, among other things, inflation, labor challenges, supply chain challenges and market and exchange rate volatility; delays or limitations in customer funding; design or other development challenges; production challenges (including from technical or quality issues and other performance concerns); inability to realize learning curves or other cost savings; changes in laws or regulations; actions necessary for long-term customer satisfaction; challenges caused by the global health environment; and natural disasters or environmental matters. Incentives, awards, price escalations, liquidated damages, or penalties related to performance on contracts are considered in estimating revenue and profit rates using either the expected value method or most likely amount method. It is possible that materially different amounts could be obtained, because of the significance of the judgments and estimation processes described above, if different assumptions were used or if the underlying circumstances were to change. Changes in underlying assumptions, circumstances, or estimates may have a material adverse effect upon future period financial reporting and performance. See Note 2, “Summary of Significant Accounting Policies” to our audited historical consolidated financial statements included elsewhere in this prospectus for further details.
We will incur increased costs as a result of operating as a publicly traded company, and our management will be required to devote substantial time to new compliance initiatives.
We will incur significant legal, accounting and other expenses that we did not incur as a private company. As a public company with listed equity securities, we will need to comply with new laws, regulations and requirements, including the reporting requirements of the Exchange Act, which will require, among other things, that we file with the SEC annual, quarterly and current reports with respect to our business and financial condition. In addition, the Sarbanes-Oxley Act, as well as rules subsequently adopted by the SEC and the New York Stock Exchange to implement provisions of the Sarbanes-Oxley Act, impose significant requirements on public companies, including requiring establishment and maintenance of effective disclosure and financial controls and changes in corporate governance practices. There are significant corporate governance and executive compensation related provisions in the Dodd-Frank Wall Street Reform and Consumer Protection Act that require the SEC to adopt additional rules and regulations in these areas such as “say on pay” and proxy access. Emerging growth companies are permitted to implement many of these requirements over a longer period and up to five years from the pricing of this offering. We intend to take advantage of this legislation for as long as we are permitted to do so. Once we become required to implement these requirements, we will incur additional compliance-related expenses. Stockholder activism, the current political environment and the current high level of government intervention and regulatory reform may lead to substantial new regulations and disclosure obligations, which may lead to additional compliance costs and impact the manner in which we operate our business in ways we cannot currently anticipate.
We expect the rules and regulations applicable to public companies to continue to increase our legal and financial compliance costs and to make some activities more time-consuming and costly. If these requirements divert the attention of our management and personnel from other business concerns, they could have a material adverse effect on us. The increased costs will decrease our net income or increase our net loss and may require us to reduce costs in other areas of our business or increase the prices of our solutions or services. For example, we expect these rules and regulations to make it more difficult and more expensive for us to obtain director and officer liability insurance and we may be required to incur substantial costs to maintain the same or similar coverage. We cannot predict or estimate the amount or timing of additional costs we may incur to respond to these requirements. The impact of these requirements could also make it more difficult for us to attract and retain qualified persons to serve on our board of directors, our board committees or as executive officers.
In addition, public company reporting and disclosure obligations may cause our business and financial condition to become more visible. We believe that this increased profile and visibility may result in threatened or actual litigation from time to time. If such claims are successful, our business, operating results and financial condition may be adversely affected, and even if the claims do not result in litigation or are resolved in our favor, these claims, and the time and resources necessary to resolve them and the diversion of the attention of management, could have a material adverse effect on us.
If we fail to implement and maintain an effective system of internal control over financial reporting, we may not be able to accurately determine or disclose our financial results. As a result, our stockholders could lose confidence in our financial results.
Upon completion of this offering, we will become subject to the informational requirements of the Exchange Act and will be required to file reports and other information with the SEC. As a publicly traded company, we will be required to maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports that we file with, or submit to, the SEC is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. They include controls and procedures designed to ensure that information required to be disclosed in reports filed with, or submitted to, the SEC is accumulated and communicated to management, including our principal executive and principal financial officers, to allow timely decisions regarding required disclosure. Effective disclosure controls and procedures are necessary for us to provide reliable reports, effectively prevent and detect fraud, and to operate successfully as a public company. Designing and implementing effective disclosure controls and procedures is a continuous effort that requires significant resources and devotion of time. We may discover deficiencies in our disclosure controls and procedures that may be difficult or time consuming to remediate in a timely manner. Any failure to maintain effective disclosure controls and procedures or effective internal control over financial reporting, or to timely effect any necessary improvements
thereto, could cause us to fail to meet our reporting obligations (which could affect the listing of our Class A common stock on the New York Stock Exchange). Additionally, ineffective disclosure controls and procedures or internal control over financial reporting could also adversely affect our ability to prevent or detect fraud, harm our reputation and cause investors to lose confidence in our reports filed with, or submitted to, the SEC, which would likely have a negative effect on the market price of our Class A common stock.
We identified material weaknesses in our internal controls as of December 31, 2021, which have been remediated as of December 31, 2024. We may identify additional material weaknesses in the future or otherwise fail to maintain effective internal control over financial reporting, which may result in material misstatements of our financial statements which could have a material adverse effect on our business and trading price of our securities.
As a publicly traded company, we will be required to report annual audited consolidated financial statements and quarterly unaudited interim consolidated financial statements prepared in accordance with GAAP. We will rely on our internal control over financial reporting to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our consolidated financial statements for external purposes in accordance with GAAP. More broadly, effective internal control over financial reporting is a necessary component of our program to seek to prevent, and to detect any, fraud and to operate successfully as a public company.
In connection with the preparation of our consolidated financial statements for the year ended December 31, 2021, we identified material weaknesses in internal control over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis.
These material weaknesses resulted in a restatement of the 2020 annual consolidated financial statements and related disclosures and immaterial misstatements to the 2021 annual consolidated financial statements, which were recorded prior to the issuance of the consolidated financial statements as of and for the year ended December 31, 2021. The material weaknesses had no impact on any amounts reported in the financial statements for the year ended December 31, 2024.
Following the identification of the material weaknesses in our internal control over financial reporting as of December 31, 2021, we prepared an action plan and implemented that plan to remediate the control deficiencies that led to the material weaknesses in a timely manner. Specifically, the Company has undertaken the following remedial actions: (i) hired dedicated personnel to fill senior roles within the accounting department to improve the control environment across the business, (ii) established a defined framework that management has undertaken in order to evaluate the risks within the Company and establish procedures over them, (iii) invested in additional accounting personnel with experience in complex transactions in order to give us expertise in evaluation and accounting for complex transactions and implementing the appropriate procedures, (iv) implemented procedures within the business in order to evaluate revenue contracts and accounting practices for appropriate revenue recognition and (v) utilized two different enterprise resource planning software systems and several third-party solutions supporting various business processes, and instilled discipline in these systems over the past few years by designing and implementing IT general controls within these systems. During the fourth quarter of 2024, we successfully completed the testing necessary to conclude that the material weaknesses have been remediated.
While the SEC’s rules and regulations will require us to assess the effectiveness of our internal control over financial reporting on an annual basis as of the Company’s year-end beginning with our second annual report on Form 10-K, for as long as we are an “emerging growth company” under the JOBS Act (which we may be until the last day of the fiscal year following the fifth anniversary of this offering), the independent registered public accounting firm that issues an audit report on our financial statements will not be required to audit the effectiveness of our internal control over financial reporting pursuant to the SEC’s rules and regulations. In the future, we may identify additional deficiencies in our internal control over financial reporting that may be material weaknesses, including those that we have previously remediated.
Our business could be adversely impacted if we have deficiencies in our disclosure controls and procedures or internal control over financial reporting.
The design and effectiveness of our disclosure controls and procedures and internal control over financial reporting, including new and revised financial and IT-related controls that we have been designing, implementing and operating, may not prevent all errors, misstatements or misrepresentations. While management will continue to review the effectiveness of our disclosure controls and procedures and internal control over financial reporting, there can be no guarantee that our internal control over financial reporting will be effective in accomplishing all control objectives all of the time. Deficiencies in our internal control over financial reporting, including any material weakness which may occur in the future, could result in misstatements of our results of operations, restatements of our financial statements, a decline in our stock price, or otherwise materially adversely affect us.
Our ability to use net operating loss carryforwards and certain other tax attributes may be limited.
For the years ended December 31, 2024 and 2023, the Company had approximately $98.2 million and $108.6 million of federal net operating loss carryforwards, of which $0.5 million and $0.5 million are subject to expiration beginning in 2035, and had approximately $49.6 million and $48.3 million of post-apportionment state net operating loss carryforwards, of which $39.3 million and $44.3 million are subject to expiration beginning in 2035. It is possible that we will not generate taxable income in time to use these net operating loss carryforwards before their expiration, to the extent that they expire, or at all. U.S. federal net operating losses incurred in 2018 and in future years may be carried forward indefinitely, but the deductibility of such net operating losses is limited.
In addition, our federal and state net operating loss carryforwards and certain other tax attributes (such as research and development tax credits) may be subject to significant limitations under Sections 382 and 383 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), respectively, and similar provisions of state law. These limitations apply if we experience an “ownership change,” which is generally defined as a greater than 50 percentage point change (by value) in the ownership of our equity by certain stockholders over a rolling three-year period. We have not conducted a formal study to assess whether any ownership change has occurred. If we have undergone an ownership change in the past, or if we undergo an ownership change in the future, including as a result of this offering, our ability to use our pre-change net operating loss carryforwards and other pre-change tax attributes to offset our post-change income or taxes may be limited. Similar provisions of state tax law may also apply to limit the use of our state net operating loss carryforwards or other tax attributes. Future changes in our stock ownership, some of which may be outside of our control, may result in an ownership change under these rules.
Risks Related to this Offering and Ownership of our Class A Common Stock
We are controlled by Dylan Taylor, our Chairman and Chief Executive Officer, whose interests in our business may conflict with ours or yours.
Our Class B common stock is beneficially owned by Dylan Taylor, our Chairman and Chief Executive Officer, whose interests may differ from or conflict with the interests of our other stockholders. Each share of our Class A common stock is entitled to one vote per share. Each share of our Class B common stock is entitled to 15 votes per share. Following this offering, Mr. Taylor will beneficially own all of the issued and outstanding shares of our Class B common stock and, accordingly, will own approximately 10.3% of our outstanding capital stock and control approximately 63.4% of the voting power of our outstanding capital stock (assuming (i) no exercise of the underwriters’ option to purchase additional shares to cover over-allotments, if any, and (ii) Mr. Taylor does not purchase any shares of Class A common stock pursuant to the directed share program, and excluding shares of Class B common stock underlying Mr. Taylor’s outstanding stock options). As a result, Mr. Taylor will have the ability to exercise control over our affairs, including control over the outcome of all matters submitted to our stockholders for approval, including the election of directors and significant corporate transactions. The directors so elected will have the authority, subject to the terms of our indebtedness and applicable rules and regulations, to issue additional stock, implement stock repurchase programs, declare dividends and make other decisions. Mr. Taylor may have interests that differ from yours and may vote in a way with which you disagree and which may be adverse to your interests. For example, Mr. Taylor may have a different tax position or other differing incentives from other stockholders that could influence his decisions regarding whether and when to cause us to dispose of assets, incur new or refinance
existing indebtedness or take other actions. Additionally, Mr. Taylor may cause us to make strategic decisions or pursue acquisitions that could involve risks to you or may not be aligned with your interests. This concentrated control may have the effect of delaying, preventing, or deterring a change in control of our company, could deprive our stockholders of an opportunity to receive a premium for their capital stock as part of a sale of our company and might ultimately affect the market price of our Class A common stock. Moreover, while stockholders would generally be entitled to dissenters’ rights of appraisal under applicable Delaware law, there are certain exceptions. As a result, Mr. Taylor will be able to effectively control us.
Future transfers of Class B common stock will generally result in those shares converting into shares of Class A common stock, subject to limited exceptions described in our amended and restated certificate of incorporation, including transfers to immediate family members (including upon Mr. Taylor’s death), trusts (including grantor retained annuity trusts) for which the stockholder or their immediate family member serves as trustee, and partnerships, corporations, and other entities exclusively owned by Mr. Taylor or his immediate family. In addition, each share of Class B common stock will convert automatically into one share of Class A common stock upon the earlier to occur of (i) a date that is fixed by our board of directors that is no less than 61 days and no more than 180 days following the date Mr. Taylor is no longer providing services to us as an executive officer or member of our board of directors, (ii) the first trading day following the seventh anniversary of this offering and (iii) the date on which the number of shares of Class A and Class B common stock beneficially owned by Mr. Taylor and Mr. Taylor’s permitted transferees (including shares underlying outstanding options) represents less than 50% of the shares of Class A and Class B common stock beneficially owned by Mr. Taylor on the closing date of this offering.
The multi-class structure of our common stock may adversely affect the trading market for our Class A common stock.
We cannot predict whether our multi-class structure will result in a lower or more volatile market price of our Class A common stock, adverse publicity, or other adverse consequences. Certain stock index providers exclude or limit the ability of companies with multi-class share structures from being added to certain of their indices. In addition, several stockholder advisory firms and large institutional investors oppose the use of multiple class structures. As a result, the multi-class structure of our common stock may make us ineligible for inclusion in certain indices and may discourage such indices from selecting us for inclusion, notwithstanding our automatic termination provision, may cause stockholder advisory firms to publish negative commentary about our corporate governance practices or otherwise seek to cause us to change our capital structure, and may result in large institutional investors not purchasing shares of our Class A common stock. Given the sustained flow of investment funds into passive strategies that seek to track certain indices, any exclusion from certain stock indices could result in less demand for our Class A common stock. Any actions or publications by stockholder advisory firms or institutional investors critical of our corporate governance practices or capital structure could also adversely affect the value of our Class A common stock.
We are an “emerging growth company” and we cannot be certain if the reduced disclosure requirements applicable to “emerging growth companies” will make our Class A common stock less attractive to investors.
We are an “emerging growth company,” as defined in Section 2(a)(19) of the Securities Act, and we may take advantage of certain exemptions and relief from various reporting requirements that are applicable to other public companies that are not “emerging growth companies.” In particular, while we are an “emerging growth company,” among other exemptions:
•we will not be required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act;
•we will be subject to reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and
•we will not be required to hold nonbinding advisory votes on executive compensation or stockholder approval of any golden parachute payments not previously approved.
In addition, Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards, meaning that such company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of this extended transition period, and as a result, our financial statements may not be comparable with similarly situated public companies. We may remain an “emerging growth company” until the fiscal year-end following the fifth anniversary of the completion of this initial public offering, though we may cease to be an “emerging growth company” earlier under certain circumstances, including (1) if our gross revenue exceeds $1.235 billion in any fiscal year, (2) if we become a large accelerated filer, with at least $700 million of equity securities held by non-affiliates, or (3) if we issue more than $1.0 billion in non-convertible notes in any three-year period.
We cannot predict if investors may find our Class A common stock less attractive if we rely on the exemptions and relief granted by the JOBS Act. If some investors find our Class A common stock less attractive as a result, there may be a less active trading market for our Class A common stock and our stock price may decline and/or become more volatile.
Upon the listing of our shares on the New York Stock Exchange, we will be a “controlled company” within the meaning of New York Stock Exchange rules and, as a result, will qualify for, and may rely on, exemptions from certain corporate governance requirements. You will not have the same protections afforded to stockholders of companies that are subject to such requirements.
After completion of this offering, Dylan Taylor, our Chairman and Chief Executive Officer, will continue to control a majority of the combined voting power of all classes of our stock entitled to vote generally in the election of directors through his ownership of our Class B common stock. As a result, we will be a “controlled company” within the meaning of the New York Stock Exchange corporate governance standards. Under these rules, a company of which more than 50% of the voting power in the election of directors is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain corporate governance requirements, including the requirements that, within one year of the date of the listing of our Class A common stock:
•a majority of our board of directors consist of independent directors;
•our board of directors have a compensation committee that is comprised entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and
•our board of directors have a nominating and corporate governance committee that is comprised entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities.
Although upon completion of this offering a majority of our board of directors will consist of independent directors and we will have compensation and nominating and corporate governance committees comprised entirely of independent directors. Although we do not intend to utilize any of these exemptions upon completion of this offering, we may utilize any or all of these exemptions at our election and at any time at our discretion prior to the time we cease to be a “controlled company.” Accordingly, to the extent we utilize these exemptions, you will not have the same protections afforded to stockholders of companies that are subject to all of these corporate governance requirements. If we were to avail ourselves of such exemptions, you would not have the same protections afforded to stockholders of companies that are subject to all of the New York Stock Exchange corporate governance requirements.
There may not be an active, liquid trading market for shares of our Class A common stock, which may cause shares of our Class A common stock to trade at a discount from the initial offering price and make it difficult to sell the shares of Class A common stock you purchase.
Prior to this offering, there has not been a public trading market for shares of our Class A common stock. We cannot predict the extent to which investor interest in us will lead to the development of a trading market or how active and liquid that market may become. If an active and liquid trading market does not develop or continue, you may have difficulty selling your shares of our Class A common stock at an attractive price or at all. The initial public offering price per share of common stock will be determined by agreement between us and the representatives of the
underwriters, and may not be indicative of the price at which shares of our Class A common stock will trade in the public market after this offering. The market price of our Class A common stock may decline below the initial offering price and you may not be able to sell your shares of our Class A common stock at or above the price you paid in this offering, or at all. An inactive trading market may also impair our ability to raise capital to continue to fund operations by selling shares and may impair our ability to acquire other companies or technologies by using our shares as consideration.
Our stock price may fluctuate significantly following this offering, and you may not be able to resell shares of our Class A common stock at or above the price you paid or at all, and you could lose all or part of your investment as a result.
Even if a trading market develops, the market price of our Class A common stock may be highly volatile and could be subject to wide fluctuations. You may not be able to resell your shares at or above the initial public offering price due to a number of factors such as those listed in “—Risks related to Our Business and Industry” and the following:
•results of operations that vary from the expectations of securities analysts and investors;
•results of operations that vary from those of our competitors;
•changes in expectations as to our future financial performance, including financial estimates and investment recommendations by securities analysts and investors;
•changes in economic conditions for companies in our industry;
•changes in market valuations of, or earnings and other announcements by, companies in our industry;
•declines in the market prices of stocks generally, particularly those of companies in our industry;
•additions or departures of key management personnel;
•strategic actions by us or our competitors;
•announcements by us, our competitors, our suppliers or our distributors of significant contracts, price reductions, new products or technologies, acquisitions, dispositions, joint marketing relationships, joint ventures, other strategic relationships or capital commitments or announcements relating to government awards, changes in government spending, or changes in government space program focus;
•changes in preference of our customers and our market share;
•changes in general economic or market conditions or trends in our industry or the economy as a whole;
•changes in business or regulatory conditions;
•future sales of our Class A common stock or other securities;
•investor perceptions of or the investment opportunity associated with our Class A common stock relative to other investment alternatives;
•the public’s response to press releases or other public announcements by us or third parties, including our filings with the SEC;
•changes or proposed changes in laws or regulations or differing interpretations or enforcement thereof affecting our business;
•announcements relating to litigation or governmental investigations;
•guidance, if any, that we provide to the public, any changes in this guidance or our failure to meet this guidance;
•the development and sustainability of an active trading market for our stock;
•changes in accounting principles; and
•other events or factors, including those resulting from informational technology system failures and disruptions, natural disasters, pandemics, war, acts of terrorism or responses to these events.
Furthermore, the stock market in general, and companies in our industry in particular, have experienced extreme volatility that, in some cases, were unrelated or disproportionate to the operating performance of these companies. These broad market and industry fluctuations may adversely affect the market price of our Class A common stock, regardless of our actual operating performance. In addition, price volatility may be greater if the public float and trading volume of our Class A common stock is low.
In the past, following periods of market volatility or the reporting of unfavorable news, stockholders have instituted securities class action litigation. If we were to become involved in securities litigation, it could have a substantial cost and divert resources and the attention of management from our business regardless of the outcome of such litigation.
Our quarterly operating results have fluctuated and may in the future fluctuate and be less than prior periods, our projections or the expectations of securities analysts or investors, which could materially adversely affect our stock price.
Our operating results have fluctuated from quarter to quarter at points in the past, and they may do so in the future. Therefore, results of any one fiscal quarter are not a reliable indication of results to be expected for any other fiscal quarter or for any year. If we fail to increase our results over prior periods, to achieve our projected results or to meet the expectations of securities analysts or investors, our stock price may decline, and the decrease in the stock price may be disproportionate to the shortfall in our financial performance. Results may be affected by various factors, including those described in these risk factors.
We currently do not intend to declare dividends on our common stock in the foreseeable future and, as a result, your returns on your investment may depend solely on the appreciation of our Class A common stock.
We currently do not expect to declare any dividends on our common stock in the foreseeable future. Instead, we anticipate that all of our earnings in the foreseeable future will be used to provide working capital, support our operations, finance the growth and development of our business and reduce our net debt. Any determination to declare or pay dividends in the future will be at the discretion of our board of directors, subject to applicable laws and dependent upon a number of factors, including our earnings, capital requirements and overall financial conditions. In addition, our ability to pay dividends on our common stock is currently limited by the terms of our Credit Agreement and may be further restricted by the terms of any future debt or preferred securities. Accordingly, your only opportunity to achieve a return on your investment in our Company may be if the market price of our Class A common stock appreciates and you sell your shares at a profit. The market price for our Class A common stock may never exceed, and may fall below, the price that you pay for such Class A common stock. See “Dividend Policy.”
Investors in this offering will suffer immediate and substantial dilution.
The initial public offering price per share of Class A common stock will be substantially higher than our adjusted net tangible book value (deficit) per share immediately after this offering. As a result, you will pay a price per share of Class A common stock that substantially exceeds the per share book value of our tangible assets after subtracting our liabilities. In addition, you will pay more for your shares of common stock than the amounts paid by our existing stockholders. Assuming an initial public offering price of $27.50 per share of Class A common stock, which is the mid-point of the estimated price range set forth on the cover page of this prospectus, you will incur immediate and substantial dilution in an amount of $20.90 per share of Class A common stock. If the underwriters exercise their option to purchase additional shares, you will experience additional dilution. See “Dilution.”
You may be diluted by the future issuance of additional common stock in connection with our incentive plans, acquisitions or otherwise.
After this offering, we will have approximately 350,651,200 shares (or 349,001,200 shares if the underwriters exercise in full their option to purchase additional shares) of Class A common stock and 44,304,638 shares of Class B common stock authorized but unissued. Our amended and restated certificate of incorporation to become effective immediately prior to the consummation of this offering will authorize us to issue these shares of common stock and options relating to common stock for the consideration and on the terms and conditions established by our board of directors in its sole discretion, whether in connection with acquisitions or otherwise. We have reserved shares for issuance under the 2025 Plan and the ESPP. See “Executive Compensation—Incentive Compensation Plans.” Any Class A common stock that we issue, including under the 2025 Plan, the ESPP or other incentive plans that we have adopted or we may adopt in the future, would dilute the percentage ownership held by the investors who purchase Class A common stock in this offering. In the future, we may also issue our securities in connection with investments or acquisitions. The number of shares of our Class A common stock issued in connection with an investment or acquisition could constitute a material portion of our then-outstanding shares of our common stock. Any issuance of additional securities in connection with investments or acquisitions may result in additional dilution to you.
Voyager Technologies, Inc. is a holding company with no operations of its own and, as such, it depends on its subsidiaries for cash to fund all of its operations and expenses, including future dividend payments, if any.
Our operations are conducted entirely through our subsidiaries and our ability to generate cash to meet our debt service obligations or to make future dividend payments, if any, is highly dependent on the earnings and the receipt of funds from our subsidiaries via dividends or intercompany loans. We do not currently expect to declare or pay dividends on our common stock for the foreseeable future; however, to the extent that we determine in the future to pay dividends on our common stock, the agreements governing our indebtedness may restrict the ability of our subsidiaries to pay dividends or otherwise transfer assets to us. In addition, Delaware law may impose requirements that may restrict our ability to pay dividends to holders of our common stock.
Future sales, or the perception of future sales, by us or our existing stockholders in the public market following this offering could cause the market price for our Class A common stock to decline.
After this offering, the sale of shares of our Class A common stock in the public market, or the perception that such sales could occur, could harm the prevailing market price of shares of our Class A common stock. These sales, or the possibility that these sales may occur, also might make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate.
Upon consummation of this offering and after giving effect to the Stock Split and the IPO Recapitalization Transactions, we will have a total of 49,348,800 shares of Class A common stock outstanding. All shares of our Class A common stock sold in this offering (except for shares of our Class A common stock purchased by our directors and officers in the directed share program, which are subject to a 180-day lock-up period) will be freely tradable without restriction or further registration under the Securities Act, except for any shares of Class A common stock held by our affiliates, as that term is defined under Rule 144 of the Securities Act (“Rule 144”), including our directors, executive officers and other affiliates, which may be sold only in compliance with the limitations described in “Shares Eligible for Future Sale.”
In connection with this offering, we and all directors and executive officers and the holders of substantially all of our outstanding stock and stock options have agreed that, without the prior written consent of Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC on behalf of the underwriters, we and they will not, and will not publicly disclose an intention to, dispose of or hedge any shares of our Class A common stock or securities convertible into or exchangeable for shares of our Class A common stock (including Class B common stock) during the period ending 180 days after the date of this prospectus, subject to certain exceptions. See “Underwriting” for a description of these lock-up agreements.
Upon the expiration of the contractual lock-up agreements pertaining to this offering, all of the issued and outstanding shares of our Class A common stock (including shares of our Class A common stock issuable following
the Class B Stock Exchange) will be eligible for sale in the public market, subject to volume, manner of sale and other limitations under Rule 144. Following completion of this offering, shares covered by registration rights would represent approximately 45.5% of our outstanding Class A common stock (or 44.0%, if the underwriters exercise in full their option to purchase additional shares). Registration of any of these outstanding shares of Class A common stock would result in such shares becoming freely tradable without compliance with Rule 144 upon effectiveness of the registration statement. See “Shares Eligible for Future Sale.”
As restrictions on resale end, the market price of our shares of Class A common stock could drop significantly if the holders of these shares sell them or are perceived by the market as intending to sell them. These factors could also make it more difficult for us to raise additional funds through future offerings of our shares of Class A common stock or other securities.
In addition, the shares of our Class A common stock reserved for future issuance under the 2025 Plan will become eligible for sale in the public market once those shares are issued, subject to provisions relating to various vesting agreements, lock-up agreements and Rule 144, as applicable. A total of 5,419,327 shares of Class A common stock (or Class B common stock, if determined by the plan administrator) have been reserved for issuance under the 2025 Plan.
The cornerstone investors have, severally and not jointly, indicated an interest in purchasing up to an aggregate of $60 million in shares of Class A common stock in this offering at the initial public offering price. The shares of Class A common stock to be purchased by the cornerstone investors will not be subject to a lock-up agreement with the underwriters. Because this indication of interest is not a binding agreement or commitment to purchase, the cornerstone investors may determine to purchase more, less or no shares in this offering or the underwriters may determine to sell more, less or no shares to the cornerstone investors. If the cornerstone investors are allocated all or a portion of the shares in which they have, severally and not jointly, indicated an interest in this offering, or more, and purchase any such shares, such purchases could reduce the available public float for our shares of Class A common stock if the cornerstone investors hold such shares long-term.
In the future, we may also issue our securities in connection with investments or acquisitions. The number of shares of our Class A common stock issued in connection with an investment or acquisition could constitute a material portion of our then-outstanding shares of our Class A common stock. Any issuance of additional securities in connection with investments or acquisitions may result in additional dilution to you.
We have broad discretion to determine how to use the funds we receive from this offering and may use them in ways that may not enhance our results of operations or the price of our Class A common stock.
We have broad discretion over the use of proceeds we receive from this offering, and we could spend the proceeds we receive from this offering in ways our stockholders may not agree with or that do not yield a favorable return, or no return at all. We currently expect to use the net proceeds from this offering primarily to fund strategic growth initiatives, including investment in research and development programs and the acquisition of capital assets necessary to support our long-term innovation roadmap and growth strategies. Additionally, a portion of the proceeds may be allocated to pursue potential mergers and acquisitions aligned with our core business areas; however, we do not have agreements or commitments for any material acquisitions or investments at this time. Remaining proceeds will be used for general working capital and corporate purposes, including repayment of indebtedness outstanding, administrative expenses, systems improvements, and other operational needs. The use of the net proceeds from this offering may differ substantially from our current plans. If we do not invest or apply the proceeds we receive from this offering in ways that improve our results of operations, we may fail to achieve expected financial results or be required to raise additional capital, which could cause our stock price to decline. In addition, pending their use, the proceeds of this offering may be placed in investments that do not produce income or that may lose value.
If securities analysts do not publish research or reports about our business or if they downgrade our stock or our sector, our stock price and trading volume could decline.
The trading market for our Class A common stock will rely in part on the research and reports that industry or financial analysts publish about us or our business. We do not control these analysts and cannot assure you that any
analysts will initiate or maintain research coverage of us and our stock. Furthermore, if one or more of the analysts who do cover us provide more favorable recommendations about our competitors or downgrade our stock or our industry, or the stock of any of our competitors, or publish inaccurate or unfavorable research about our business, the price of our stock could decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, we could lose visibility in the market, which in turn could cause our stock price or trading volume to decline.
Provisions in our organizational documents could delay or prevent a change of control.
Certain provisions of our amended and restated certificate of incorporation, amended and restated bylaws may have the effect of delaying or preventing a merger, acquisition, tender offer, takeover attempt or other change of control transaction that a stockholder might consider to be in its best interest, including attempts that might result in a premium over the market price of our Class A common stock.
These provisions will provide for, among other things:
•the division of our board of directors into three classes, as nearly equal in size as possible, with directors in each class serving three-year terms and with terms of the directors of only one class expiring in any given year;
•the ability of our board of directors to issue one or more series of preferred stock with voting or other rights or preferences that could have the effect of impeding the success of an attempt to acquire us or otherwise effect a change of control;
•the requirement that, following the date that no shares of Class B common stock are outstanding, any action to be taken by our stockholders be effected at a duly called annual or special meeting and not by written consent;
•the ability of our board of directors to establish the number of directors and fill any vacancies and newly created directorships;
•no cumulative voting;
•that directors may only be removed “for cause” and only with the approval of two-thirds of our stockholders;
•a multi-class common stock structure in which holders of our Class B common stock may have the ability to control the outcome of matters requiring stockholder approval, even if they own significantly less than a majority of the outstanding shares of our common stock, including the election of directors and other significant corporate transactions, such as a merger or other sale of our company or its assets;
•advance notice requirements for nominations of directors by stockholders and for stockholders to include matters to be considered at stockholder meetings; and
•certain limitations on convening special stockholder meetings.
These provisions could make it more difficult for a third-party to acquire us, even if the third-party’s offer may be considered beneficial by many of our stockholders. As a result, our stockholders may be limited in their ability to obtain a premium for their shares. See “Description of Capital Stock.”
Our board of directors will be authorized to issue and designate shares of our preferred stock in additional series without stockholder approval.
Our amended and restated certificate of incorporation will authorize our board of directors, without the approval of our stockholders, to issue 50,000,000 shares of our preferred stock, subject to limitations prescribed by applicable law, rules and regulations and the provisions of our amended and restated certificate of incorporation, as shares of preferred stock in series, to establish from time to time the number of shares to be included in each such series and
to fix the designation, powers, preferences and rights of the shares of each such series and the qualifications, limitations or restrictions thereof. The powers, preferences and rights of these additional series of preferred stock may be senior to or on parity with our Class A common stock, which may reduce its value.
Our amended and restated certificate of incorporation will provide that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for certain stockholder litigation matters and the federal district courts of the United States shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, employees or stockholders.
Our amended and restated certificate of incorporation will provide (A) (i) any derivative action or proceeding brought on behalf of the Company, (ii) any action asserting a claim of breach of a fiduciary duty owed by any current or former director, officer, other employee or stockholder of the Company to the Company or the Company’s stockholders, (iii) any action asserting a claim arising pursuant to any provision of the Delaware’s General Corporation Law (the “DGCL”), our amended and restated certificate of incorporation or our amended and restated bylaws (as either may be amended or restated) or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware or (iv) any action asserting a claim governed by the internal affairs doctrine of the law of the State of Delaware shall, to the fullest extent permitted by law, be exclusively brought in the Court of Chancery of the State of Delaware or, if such court does not have subject matter jurisdiction thereof, the federal district court of the State of Delaware; and (B) the federal district courts of the United States shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act. Notwithstanding the foregoing, the exclusive forum provision shall not apply to claims seeking to enforce any liability or duty created by the Exchange Act. Nothing in our amended and restated certificate of incorporation or amended and restated bylaws precludes stockholders that assert claims under the Exchange Act, from bringing such claims in federal court to the extent that the Exchange Act confers exclusive federal jurisdiction over such claims, subject to applicable laws.
The choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage such lawsuits against us and our directors, officers and other employees and result in increased costs for investors to bring a claim. Alternatively, if a court were to find the choice of forum provision contained in our amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, results of operations and financial condition. For example, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. Accordingly, there is uncertainty as to whether a court would enforce such a forum selection provision as written in connection with claims arising under the Securities Act. Any person or entity purchasing or otherwise acquiring or holding any interest in shares of our capital stock shall be deemed to have notice of and consented to the forum provisions in our amended and restated certificate of incorporation. See “Description of Capital Stock—Exclusive Forum.”
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements. All statements other than statements of historical facts contained in this prospectus may be forward-looking statements. Statements regarding our future results of operations and financial position, business strategy, and plans and objectives of management for future operations, including, among others, statements regarding the consummation of this offering, expected growth, future capital expenditures, and debt service obligations, are forward-looking statements. In some cases, you can identify forward-looking statements by terms, such as “may,” “will,” “should,” “would,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” or “continue,” or the negative of these terms or other similar expressions. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.
Forward-looking statements contained in this prospectus include, but are not limited to, statements about:
•our expectations regarding financial condition or results of operations, including but not limited to our expectations regarding revenue, cost of revenue, operating expenses, stock-based compensation and our ability to achieve and maintain future profitability;
•our future sources of and needs for liquidity and capital resources;
•our expectations regarding the size and growth of the market for our products and services;
•our business strategies and our ability to grow our business;
•our ability to successfully design, launch, and operate Starlab;
•our ability to enhance existing, or develop new products and services and the impact of any such enhancements or developments;
•the implementation or interpretation of current or future regulations and legislation;
•our ability to maintain contracts and relationships with key customers;
•our ability to maintain our existing, or to develop additional, valuable intellectual property rights; and
•the other factors discussed under “Risk Factors.”
We caution you that the foregoing list may not contain all of the forward-looking statements made in this prospectus.
We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. These forward-looking statements are subject to a number of risks, assumptions, and uncertainties, including those described in the section titled “Risk Factors.” Moreover, we operate in a very competitive and rapidly changing environment.
New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, assumptions, and uncertainties, the future events and trends discussed in this prospectus may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
We undertake no obligation to update any of these forward-looking statements for any reason after the date of this prospectus or to conform these statements to actual results or revised expectations, except as required by law.
You should read this prospectus and the documents that we reference in this prospectus and have filed with the SEC as exhibits to the registration statement of which this prospectus is a part with the understanding that our actual future results, performance, and events and circumstances may be materially different from what we expect.
USE OF PROCEEDS
We estimate that we will receive net proceeds from this offering of $274.2 million (or approximately $316.4 million if the underwriters exercise in full their option to purchase additional shares) based on an assumed initial public offering price of $27.50 per share of Class A common stock, which is the midpoint of the price range set forth on the front cover of this prospectus, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.
A $1.00 increase (decrease) in the assumed initial public offering price of $27.50 per share, which is the midpoint of the price range set forth on the front cover of this prospectus, would increase (decrease) the net proceeds from this offering by $10.3 million, assuming the number of shares offered by us, as set forth on the front cover of this prospectus, remains the same and after deducting the assumed underwriting discounts and commissions and estimated offering expenses payable by us. An increase (decrease) of one million shares from the expected number of shares to be sold by us in this offering, assuming no change in the assumed initial public offering price per share, which is the midpoint of the price range set forth on the front cover of this prospectus, would increase (decrease) our net proceeds from this offering by $25.6 million.
We intend to use the net proceeds from this offering primarily to fund strategic growth initiatives, including investment in research and development programs and the acquisition of capital assets necessary to support our long-term innovation roadmap and growth strategies. Additionally, a portion of the proceeds may be allocated to pursue potential mergers and acquisitions aligned with our core business areas; however, we do not have agreements or commitments for any material acquisitions or investments at this time. Remaining proceeds will be used for general working capital and corporate purposes, including repayment of indebtedness outstanding, administrative expenses, systems improvements, and other operational needs.
We currently have no indebtedness outstanding under the Revolving Credit Facility; however, following the closing of this offering, we intend to partially draw on the Revolving Credit Facility to repay in full the Term Loan. Borrowings under the Revolving Credit Facility bear interest at our option at (i) Adjusted Term SOFR, subject to a 0.00% floor, plus a margin, or (ii) the alternate base rate, subject to a 1.00% floor, plus a margin. For Adjusted Term SOFR borrowings, the applicable rate margin is between 2.25% and 2.75% depending on our liquidity. For base rate borrowings, the applicable margin is between 1.25% and 1.75% depending on our liquidity. We are also required to pay a fee on undrawn amounts under the Revolving Credit Facility of between 0.25% and 0.30% per annum, depending on our liquidity, payable quarterly in arrears. The Revolving Credit Agreement has a maturity of four years and will mature on May 30, 2029.
We may find it necessary or advisable to use the net proceeds for other purposes, and we will have broad discretion in the application and specific allocations of the net proceeds of this offering. Pending the uses described above, we intend to invest the net proceeds from this offering in short- and intermediate-term, interest-bearing obligations, investment-grade instruments or other securities.
DIVIDEND POLICY
We currently intend to retain any future earnings, if any, to provide working capital, support our operations, finance the growth and development of our business and reduce our net debt, and we do not currently intend to declare or pay any cash dividends in the foreseeable future. We are prohibited by the terms of our Credit Agreement from paying cash dividends. Any determination to declare dividends in the future will be at the discretion of our board of directors, subject to applicable laws, and will be dependent on a number of factors, including our earnings, capital requirements, overall financial condition and other factors our board of directors may deem relevant.
CAPITALIZATION
The following table sets forth our cash and cash equivalents and capitalization as of March 31, 2025:
•on an actual basis as derived from our historical audited consolidated financial statements included elsewhere in this prospectus;
•on a pro forma basis to give effect to (i) the Preferred Stock Recapitalization, (ii) the SMI Promissory Notes Conversion, (iii) the filing and effectiveness of our amended and restated certificate of incorporation that will become effective immediately prior to the completion of this offering (including the Common Stock Reclassification pursuant thereto), (iv) the Class B Stock Exchange, (v) repayment of the Term Loan, and (vi) stock-based compensation expense of $10.2 million associated with options that contain a performance-based vesting condition that was satisfied upon the effectiveness of the registration statement of which this prospectus forms a part, as if each of the foregoing had occurred on March 31, 2025; and
•on a pro forma as adjusted basis, giving effect to (i) the pro forma adjustments set forth above, and (ii) the issuance of 11,000,000 shares in this offering at an initial public offering price of $27.50 per share, which is the midpoint of the price range set forth on the front cover of this prospectus, and the application of the net proceeds therefrom as set forth under “Use of Proceeds,” after deducting underwriting discounts, commissions and estimated offering expenses that remain payable by us of $28.3 million, which is net of $2.1 million of offering costs paid as of March 31, 2025 as if each had occurred on March 31, 2025. See “Use of Proceeds.”
The information set forth in the table below is illustrative only and will adjust based on the actual initial public offering price and other terms of this offering determined at the time of the pricing of this offering.
The following table should be read in conjunction with the sections of this prospectus entitled “Summary Consolidated Financial Data and Other Data,” “Use of Proceeds,” “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” and “Description of Certain Indebtedness” as well as our historical audited consolidated financial statements and related notes thereto included elsewhere in this prospectus.
| | | | | | | | | | | | | | | | | |
| As of March 31, 2025 |
(in thousands, except shares and per share amounts) | Actual | | Pro Forma | | Pro Forma as Adjusted |
Cash and cash equivalents(1)(2) | $ | 175,488 | | | $ | 116,328 | | | $ | 390,562 | |
Long term debt, including current portion of long-term debt: |
| | | |
|
Term Loan(1) | 57,633 | | | — | | | — | |
SMI Promissory Notes | 24,999 | | | — | | | — | |
Total debt | 82,632 | | | — | | | — | |
Mezzanine Equity: |
| | | |
|
Class A-1 redeemable preferred stock: $0.0001 par value per share; 7,500,000 shares authorized, 6,967,720 shares issued and outstanding, actual; 0 shares authorized, issued and outstanding, pro forma and pro forma as adjusted; liquidation preference of $109,434 | 97,349 | | | — | | | — | |
Redeemable noncontrolling interest | 27,595 | | | 27,595 | | | 27,595 | |
Equity (Deficit): |
| | | |
|
Class A preferred stock: $0.0001 par value per share; 1 share authorized, 1 share issued and outstanding, actual; 0 shares authorized, issued and outstanding, pro forma and pro forma as adjusted as adjusted; liquidation preference of $1 | — | | | — | | | — | |
Class B convertible preferred stock: $0.0001 par value per share; 4,400,000 shares authorized, 3,285,995 shares issued and outstanding, actual; 0 shares authorized, issued and outstanding, pro forma and pro forma as adjusted; liquidation preference of $148,602 | 134,982 | | | — | | | — | |
Class C convertible preferred stock: $0.0001 par value per share; 4,600,000 shares authorized, 3,853,234 shares issued and outstanding, actual; 0 shares authorized, issued and outstanding, pro forma and pro forma as adjusted; liquidation preference of $168,849 | 158,311 | | | — | | | — | |
Common stock, $0.0001 par value, voting common stock; 375,000,000 shares authorized, 15,266,853 shares issued and outstanding, actual; 0 shares authorized, issued and outstanding, pro forma and pro forma as adjusted | 1 | | | — | | | — | |
| Class A common stock, $0.0001 par value; 0 shares authorized 0 shares issued and outstanding, actual; 400,000,000 shares authorized, 38,604,802 shares issued and outstanding, pro forma; 400,000,000 shares authorized, 49,605,802 shares issued and outstanding pro forma as adjusted | — | | | 3 | | | 4 | |
| Class B common stock, $0.0001 par value; 0 shares authorized 0 shares issued and outstanding, actual; 50,000,000 shares authorized, 5,695,362 shares issued and outstanding, pro forma and pro forma as adjusted | — | | | 1 | | | 1 | |
Additional paid-in capital | 61,822 | | | 487,676 | | | 759,729 | |
Accumulated other comprehensive loss | 6 | | | 6 | | | 6 | |
Accumulated deficit | (308,051) | | | (319,794) | | | (319,794) | |
Total stockholders’ (deficit) equity(2) | 47,071 | | | 167,892 | | | 439,946 | |
Total capitalization | $ | 254,647 | | | $ | 195,487 | | | $ | 467,541 | |
________________
(1)We currently have no indebtedness outstanding under the Revolving Credit Facility. However, we intend to partially draw on the Revolving Credit Facility to repay in full the Term Loan on or around July 1, 2025. We expect to repay indebtedness outstanding under the Revolving Credit Facility in the future with cash on hand from available balances as of the date of this prospectus. Pro forma Cash and cash equivalents reflects the repayment of the Revolving Credit Facility used to repay the Term Loan. See “Prospectus Summary—Recent Developments” and “Description of Certain Other Indebtedness.”
(2)Cash and cash equivalents and Total stockholders’ (deficit) equity does not include the $20.8 million of equity raised, representing approximately 0.5 million additional shares, between March 31, 2025 and May 2025 as part of the Company’s
fundraising efforts, nor does it include management’s intent to settle accrued dividends on the Class B convertible preferred stock in cash. Such accrued dividends were $25.8 million as of March 31, 2025. The intended settlement of the Class B convertible preferred dividends in cash will utilize cash on hand by the Company.
A $1.00 increase (decrease) in the assumed initial public offering price of $27.50 per share, which is the midpoint of the price range set forth on the front cover of this prospectus, would increase (decrease) the as adjusted amount of each of cash and cash equivalents, total stockholders’ (deficit) equity and total capitalization by approximately $10.2 million, assuming the number of shares offered by us, as set forth on the front cover of this prospectus, remains the same and after deducting the assumed underwriting discounts and commissions and estimated offering expenses payable by us. An increase (decrease) of one million shares from the expected number of shares to be sold by us in this offering, assuming no change in the assumed initial public offering price of $27.50 per share, which is the midpoint of the price range set forth on the front cover of this prospectus, would increase (decrease) the as adjusted amount of each of cash and cash equivalents, total stockholders’ (deficit) equity and total capitalization by approximately $25.6 million, after deducting the assumed underwriting discounts and commissions and estimated offering expenses payable by us.
The number of shares of Class A and Class B common stock to be issued and outstanding after this offering is based on 38,604,802 shares of Class A common stock and 5,695,362 shares of Class B common stock outstanding as of March 31, 2025, after giving effect to the Preferred Stock Recapitalization, the SMI Promissory Notes Conversion, the Common Stock Reclassification and the Class B Stock Exchange. The number of shares of our Class A common stock to be outstanding after this offering does not include:
•3,920,816 shares of Class A common stock issuable upon the exercise of options outstanding as of March 31, 2025 under the 2020 Plan, with a weighted-average exercise price of $13.87;
•549,693 shares of Class B common stock issuable upon exercise of stock options outstanding as of March 31, 2025 under the 2020 Plan, at a weighted average exercise price of $15.17 per share;
•1,046,622 shares of Class A common stock issuable upon the exercise of warrants outstanding as of March 31, 2025, with a weighted-average exercise price of $24.35;
•762,750 shares of Class A common stock issuable upon the vesting of restricted stock awards to be granted under our 2025 Plan (as defined below) immediately following the effectiveness of the applicable Form S-8 registration statement;
•45,000 shares of Class B common stock issuable upon the vesting of restricted stock awards to be granted under our 2025 Plan immediately following the effectiveness of the applicable Form S-8 registration statement;
•4,611,577 remaining shares of Class A common stock or Class B common stock reserved for future issuance under the 2025 Plan, that will become effective in connection with this offering (after giving effect to the issuance of the stock awards described above); and
•1,100,883 shares of Class A common stock reserved for issuance under the ESPP that will become effective in connection with this offering.
The 2025 Plan and the ESPP also provide for automatic annual increases in the number of shares reserved thereunder.
DILUTION
If you invest in shares of our Class A common stock in this offering, your ownership interest will be immediately diluted to the extent of the difference between the initial public offering price per share of our Class A common stock and the adjusted net tangible book value (deficit) per share of our Class A common stock after giving effect this offering.
Our historical net tangible book value (deficit) as of March 31, 2025 was approximately $(27.8) million, or $(1.82) per share of Class A common stock. Net tangible book value per share is determined by dividing the amount of total tangible assets less total tangible liabilities, including adjustments for deferred IPO costs, right-of-use assets and liabilities, contract assets and liabilities, deferred tax liabilities, embedded derivatives, preferred stock classified as mezzanine equity, and redeemable noncontrolling interests classified as mezzanine equity, by the number of shares of Class A common stock.
On a pro forma basis after giving effect to (i) the Preferred Stock Recapitalization, (ii) the SMI Promissory Notes Conversion, (iii) the filing and effectiveness of our amended and restated certificate of incorporation that will become effective immediately prior to the completion of this offering (including the Common Stock Reclassification pursuant thereto), (iv) the Class B Stock Exchange, (v) repayment of the Term Loan, and (vi) stock-based compensation expense of $10.2 million associated with options that contain a performance-based vesting condition that was satisfied upon the effectiveness of the registration statement of which this prospectus forms a part, as if each of the foregoing had occurred on March 31, 2025, our pro forma net tangible book value (deficit) as of March 31, 2025 would have been approximately $93.1 million, or $2.10 per share of our common stock.
After giving further effect to the sale and issuance by us of 11,000,000 shares of our Class A common stock in this offering at the assumed initial public offering price of $27.50 per share, which is the midpoint of the estimated offering price range set forth on the cover page of this prospectus, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us, our pro forma as adjusted net tangible book value (deficit) as of March 31, 2025 would have been $365.1 million, or $6.60 per share. This represents an immediate dilution of $20.90 per share of our Class A common stock to new investors purchasing shares of our Class A common stock in this offering. The following table illustrates this dilution per share of our Class A common stock, assuming an initial public offering price of $27.50 per share of our Class A common stock, which is the midpoint of the price range set forth on the front cover of this prospectus, after deducting the underwriting discounts and commissions and estimated offering expenses payable by us:
| | | | | | | | | | | |
| Assumed initial public offering price per share of our Class A common stock | | | $ | 27.50 | |
| Historical net tangible book value (deficit) per share of Class A common stock as of March 31, 2025 | $ | (1.82) | | | |
| Increase per share attributable to the pro forma adjustments described above | 3.92 | | | |
| Pro forma net tangible book value per share of Class A our common stock as of March 31, 2025 | 2.10 | | | |
| Increase in pro forma net tangible book value per share attributable to new investors purchasing shares of Class A common stock in this offering | 4.50 | | | |
| Pro forma as adjusted net tangible book value per share of our Class A common stock after giving effect to this offering | | | 6.60 | |
| Dilution in adjusted net tangible book value per share of our Class A common stock to new investors purchasing shares of our Class A common stock in this offering | | | $ | 20.90 | |
Each $1.00 increase (decrease) in the assumed initial public offering price of $27.50 per share of our Class A common stock, which is the midpoint of the price range set forth on the front cover of this prospectus, would not impact the pro forma as adjusted net tangible book value (deficit) or the pro forma as adjusted net tangible book value (deficit) per share of our Class A common stock, but it would increase (decrease) dilution in pro forma as adjusted net tangible book value (deficit) per share of our Class A common stock to new investors purchasing shares of our Class A common stock in this offering by $0.81, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and
commissions and estimated offering expenses payable by us. Similarly, each increase or decrease of one million shares in the number of shares of our Class A common stock offered by us would increase or decrease, as applicable, our pro forma as adjusted net tangible book value by approximately $0.35 per share and increase or decrease, as applicable, the dilution to new investors purchasing shares of Class A common stock in this offering by approximately $0.35 per share, assuming the assumed initial public offering price remains the same, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. The information discussed above is illustrative only and will adjust based on the actual initial public offering price and other terms of this offering determined at the time of the pricing of this offering.
If the underwriters exercise in full their option to purchase additional shares of our Class A common stock from us to cover over-allotments, if any, the pro forma as adjusted net tangible book value (deficit) per share of our Class A common stock would be $0.55, and the dilution in pro forma as adjusted net tangible book value (deficit) per share of our Class A common stock to new investors purchasing shares of our Class A common stock in this offering would be $0.55.
The following table summarizes, on a pro forma as adjusted basis as described above, the difference between our existing stockholders and new investors purchasing shares of our Class A common stock in this offering with respect to the number of shares of our Class A common stock purchased from us, the total consideration paid to us for these shares or to be paid to us for these shares, and the average price per share of our Class A common stock paid by our existing stockholders or to be paid by new investors purchasing shares of our Class A common stock in this offering, at the assumed initial public offering price of $27.50 per share of our Class A common stock, which is the midpoint of the price range set forth on the front cover of this prospectus, after deducting the underwriting discounts and commissions and estimated offering expenses payable by us:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Shares Purchased | | Total Consideration | | Average Price Per Share |
| Number | | Percent | | Amount (in millions) | | Percent | |
| | | % | | $ | | % | | $ |
Existing stockholders | 44,300,164 | | 80.1% | | $ | 671.8 | | | 69.0% | | $15.17 |
New investors | 11,000,000 | | 19.9% | | $ | 302.5 | | | 31.0% | | $27.50 |
Total | 55,300,164 | | 100.0 | % | | $ | 974.3 | | | 100.0 | % | | $17.62 |
Each $1.00 increase (decrease) in the assumed initial public offering price of $27.50 per share of our Class A common stock, which is the midpoint of the price range set forth on the front cover of this prospectus, would increase (decrease) the total consideration paid to us by new investors purchasing shares of our Class A common stock in this offering by approximately $11.0 million, or the percent of total consideration paid to us by new investors purchasing shares of our Class A common stock in this offering by approximately 0.8%, assuming the number of shares of our Class A common stock offered by us in this offering as set forth on the cover page of this prospectus remains the same and after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. An increase (decrease) of one million shares in the number of shares of our Class A common stock sold in this offering by us would increase (decrease) the total consideration paid to us by new investors purchasing shares of our Class A common stock in this offering by approximately $27.5 million, or the percent of total consideration paid to us by new investors purchasing shares of our Class A common stock in this offering by approximately 2.0%, assuming the initial public offering price of $27.50 per share of our Class A common stock, which is the midpoint of the price range set forth on the front cover of this prospectus, remains the same and after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. The information discussed above is illustrative only and will adjust based on the actual initial public offering price and other terms of this offering determined at the time of the pricing of this offering.
The number of shares of Class A and Class B common stock to be issued and outstanding after this offering is based on 38,604,802 shares of Class A common stock and 5,695,362 shares of Class B common stock outstanding as of March 31, 2025, after giving effect to the Preferred Stock Recapitalization, the SMI Promissory Notes
Conversion, the Common Stock Reclassification and the Class B Stock Exchange. The number of shares of our Class A common stock to be outstanding after this offering does not include:
•3,920,816 shares of Class A common stock issuable upon the exercise of options outstanding as of March 31, 2025 under the 2020 Plan, with a weighted-average exercise price of $13.87;
•549,693 shares of Class B common stock issuable upon exercise of stock options outstanding as of March 31, 2025 under the 2020 Plan, at a weighted average exercise price of $15.17 per share;
•1,046,622 shares of Class A common stock issuable upon the exercise of warrants outstanding as of March 31, 2025, with a weighted-average exercise price of $24.35;
•762,750 shares of Class A common stock issuable upon the vesting of restricted stock awards to be granted under our 2025 Plan (as defined below) immediately following the effectiveness of the applicable Form S-8 registration statement;
•45,000 shares of Class B common stock issuable upon the vesting of restricted stock awards to be granted under our 2025 Plan immediately following the effectiveness of the applicable Form S-8 registration statement;
•4,611,577 remaining shares of Class A common stock or Class B common stock reserved for future issuance under the 2025 Plan, that will become effective in connection with this offering (after giving effect to the issuance of the stock awards described above); and
•1,100,883 shares of Class A common stock reserved for issuance under the ESPP that will become effective in connection with this offering.
The 2025 Plan and the ESPP also provide for automatic annual increases in the number of shares reserved thereunder
In addition, we may choose to raise additional capital due to market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. To the extent additional capital is raised through the sale of equity or convertible debt securities, the issuance of such securities could result in further dilution to our stockholders.
The foregoing discussion does not reflect any potential purchases made by participants in the directed share program that are associated with us.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion of our financial condition and results of operations should be read together with the “Summary Consolidated Financial and Other Data,” “Business” and consolidated financial statements and related notes that are included elsewhere in this prospectus. This discussion contains forward-looking statements based upon our current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under “Risk Factors,” “Special Note Regarding Forward-Looking Statements” or in other parts of this prospectus.
Overview
We are an innovation-driven defense technology and space solutions company committed to advancing and delivering an array of transformative, mission-critical solutions that include defense systems, communications and intelligence collection systems, advanced space technology, infrastructure and mission services. We address complex challenges to fortify national security, protect critical assets and unlock new frontiers for human progress. Our founding was rooted in our goal of building a company that would address challenges at the forefront of the defense, national security and space industries. Since 2019, we have accomplished significant achievements, including the successful deployment of first-of-its-kind missile defense maneuvering capabilities, the development of groundbreaking space technology and the selection by NASA to develop a replacement for the ISS.
We have grown both organically and through acquisitions, including Nanoracks, Valley Tech Systems, Space Micro and Zin Technologies. We serve as a “prime” contractor and “subcontractor” to various government and private enterprise customers through our defense, national security and space product offerings. Since 2019, we have executed and successfully vertically and horizontally integrated seven acquisitions, and have grown our revenue to $144.2 million in 2024 and $34.5 million for the three months ended March 31, 2025. In addition, we received cash proceeds of $3.0 million in 2022, $62.0 million in 2023, $62.2 million in 2024 and $20.0 million, during the three months ended March 31, 2025 (with $70.3 million of eligible proceeds remaining as of March 31, 2025) from our $217.5 million development grant with NASA to design Starlab, the commercial space station replacement for the ISS which is set to be decommissioned in 2030. We intend to operate Starlab through the Starlab JV, a Voyager-led and majority-owned global joint venture, with international equity partners that include Airbus, Mitsubishi, MDA Space and Palantir. Our growth and increased size and scale are the result of investment and focus on our key technology offerings, as well as our ability to attract, cultivate and integrate accretive acquisitions.
Key Factors Affecting Our Performance
Our results have been affected, and are expected to be affected in the future, by a variety of factors. A discussion of key factors that have had, or may have, an effect on our results is set forth below. For a further discussion of the factors affecting our results of operations, see “Risk Factors”.
Government Expenditures and Private Enterprise Investment
Government expenditure and private enterprise investment have fueled the growth in our target markets and we expect the continued availability of government expenditures and private investment for our customers to help fund purchases of our products and services. However, changes in the volume and relative mix of government expenditures and private investment, as well as in areas of spending growth, may impact our results of operations. In particular, our results can be affected by shifts in strategies and priorities on defense-related programs, commercial space exploration and space infrastructure. Cost-cutting and efficiency initiatives, current and future budget restrictions, spending cuts and other efforts to reduce government expenditures and private enterprise investment, as well as shifts in overall priorities, could cause our government and private enterprise customers to reduce or delay funding or invest appropriated funds on a less consistent basis or not at all, and demand for our solutions or services could diminish. Furthermore, any disruption in the functioning of government agencies, including as a result of government closures and shutdowns, could have a negative impact on our operations and cause us to lose revenue or incur additional costs due to, among other things, our inability to maintain access and schedules for government testing or deploy our staff to customer locations or facilities as a result of such disruptions.
There is also uncertainty around the timing, extent, nature and effect of Congressional and other U.S. government actions to address budgetary constraints and caps on the discretionary budget for defense and non-defense departments and agencies. In addition, there is uncertainty around the ability of Congress to determine how to allocate the available budget authority and pass appropriations bills to fund both U.S. government departments and agencies that are, and those that are not, subject to the caps. Additionally, budget deficits and the growing U.S. national debt may increase pressure on the U.S. government to reduce federal spending across all federal agencies, with uncertainty about the size and timing of those reductions. Furthermore, delays in the completion of future U.S. government budgets could delay procurement of the federal government services that we provide. A reduction in the amount of, or reductions, delays, or cancellations of funding for, services that we are contracted to provide to the U.S. government due to any of these impacts or related initiatives, legislation or otherwise could have a material adverse effect on our business and results of operations.
Backlog
Our total backlog is comprised of funded and unfunded backlog. Our funded backlog represents the portion of definitized contracts with customers that contain remaining performance obligations. Unfunded backlog (also referred to herein as unfunded contract options) includes unexercised contract options and potential bookings under IDIQ contracts. In order to effectively manage our resources and develop our financial budgets, we continuously monitor our backlog.
Our backlog may also include, as of any date of estimation, change orders that have been confirmed for any project, either in writing or verbally, or formally contracted. Change orders may increase or decrease the amount we ultimately bill for a particular project, causing us to realize more or less revenue from a project than was reflected in our backlog as of the date of estimation. Additionally, prior to categorizing a project as part of our backlog, we maintain a running list of projects that are in an advanced stage of active bidding and discussion, including potential change orders for current projects, but for which the customer has not yet confirmed the commercial terms, the value of the contract and/or the scope of our work. These projects are tracked for project planning and budgeting of the business. Once the terms of these projects are further progressed in line with our backlog criteria, they are recorded in our funded backlog.
Backlog in all of our segments includes both single and multi-year awards. Fluctuations in backlog are driven primarily by the timing of large program wins. Total backlog as of March 31, 2025 was $179.2 million, of which $93.1 million was funded. We expect to convert approximately 87.8% of the total $93.1 million of funded backlog as of March 31, 2025 into revenue in 2025.
In addition, our backlog is subject to meaningful customer concentration risk. As of March 31, 2025, approximately 46.6% of the total dollar value of our funded backlog related to three customers. The top ten customers in our backlog represent approximately 86.8% of the total dollar value of our funded backlog. For purposes of evaluating our backlog, we consider all U.S. government entities to be one customer. Additionally, backlog that is originally funded through U.S. government efforts is considered to be U.S. government backlog even if the program is directly contracted through an intermediary.
We also monitor bookings, which may form a part of our backlog. Bookings represent funded contracts awarded to us during the fiscal period. Our bookings represent the ongoing replacement of backlog into our business. Bookings may or may not translate into revenue during the fiscal period awarded but will materialize into either current revenue or future performance obligations that would be categorized as backlog at the end of the fiscal period, or a combination of both.
In general, our customers have the right to cancel their contracts under termination for convenience clauses. If a customer cancels a contract before full performance of such contract, we may not receive the full revenue from such booking. Instead, we would recognize revenue under the contract on a cost basis with reasonable margin to the extent of the progress performed under such contract. In addition, our backlog is typically subject to large variations from quarter to quarter and comparisons of backlog from period to period are not necessarily indicative of future revenues. Some contracts comprising the backlog are for programs scheduled many years in the future and the economic viability of contractual counterparties is not guaranteed over time. As a result, the contracts comprising
our backlog may not result in actual revenue in any particular period, or at all, and the actual revenue from such contracts may differ from our backlog estimates. The timing of recognition of revenues, if any, on projects included in the backlog could change. We review these projects regularly and increase or decrease backlog accordingly. The failure to realize some portion of our backlog could adversely affect our financial performance.
Project Revenue Mix and Impact on Margins
We may experience future variability in the profitability of our contracts and such variability may occur at levels and frequencies different from historical experience. Such variability in profitability may be due to strategic decisions, cost overruns, or other circumstances within or outside of our control. Accordingly, our historical experience with profitability of our contracts is not indicative or predictive of future experience.
Our financial success is based on our ability to deliver high quality products on a timely basis and at a cost-effective price for our customers. When agreeing to contractual terms, our management team makes assumptions and projections about future conditions and events. The accounting for our contracts and programs involves assumptions and estimates about these conditions and events. These projections and estimates assess:
•the productivity and availability of labor;
•the allocation of indirect costs to labor and material costs incurred;
•the complexity of the work to be performed;
•the cost and availability of materials and components; and
•schedule requirements.
If there is a significant change in one or more of these circumstances, estimates or assumptions, or if the risks under our contracts are not managed adequately, the profitability of contracts could be adversely affected. This could materially affect earnings and margins.
In particular, profitability can fluctuate depending on the type of contract award. Contracts with certain customers reflect firm fixed pricing structures. As a result, our gross profit is dependent on the efficient and effective execution of our contracts. Our ability to maximize gross profit may be impacted by, but not limited to, unanticipated cost overruns, disruptions in our supply chains, learning curve and non-recurring engineering costs related to our contracts with customers. If our fixed-price development efforts create a larger portion of our revenue output, we may have a higher risk profile, which may result in reduced margins.
From time to time, we may strategically enter into contracts with low or negative margins relative to other contracts or that are at risk of cost overruns. This may occur due to strategic decisions built around positioning ourselves for future contracts or to enhance our product and service offerings. However, in some instances, loss contracts may occur from unforeseen cost overruns that are not recoverable from the customer. We establish loss reserves on contracts in which the cost estimate-at-completion (“EAC”) exceeds the estimated revenue. The loss reserves are recorded in the period in which a loss is determined. Our reference to adjustments to EAC in the context of describing our results of operations includes net changes during the period in our aggregate program contract values, EAC and other program estimates, and includes the impact of cost overruns and recognition of loss reserves.
Additionally, the timing of our cash flows is impacted by the timing of achievement of billable milestones on contracts. Historically, this has resulted and could continue to result in fluctuations in working capital levels and quarterly free cash flow. As a result of such quarterly fluctuations in free cash flow, we believe that quarter-to-quarter comparisons of our results of operations may not necessarily be meaningful and should not be relied upon as indicators of future performance.
Ability to Improve Profit Margins and Scale our Business
We intend to continue to invest in initiatives to improve our operating leverage and significantly ramp up production. We believe continued reductions in costs and increases in production volumes will cause the cost of
production to decline and improve our profit margins. Our ability to achieve our production-efficiency objectives could be negatively impacted by a variety of factors including, but not limited to, lower-than-expected facility utilization rates, manufacturing and production cost overruns, increased purchased material costs and unexpected supply-chain quality issues or interruptions.
Basis of Presentation
The accompanying consolidated financial statements include the accounts of Voyager Technologies, Inc. and our consolidated subsidiaries and have been prepared in conformity with GAAP. All intercompany amounts have been eliminated in consolidation.
Components of Results of Operations
Net Sales
Net sales in the consolidated statements of operations consists entirely of revenue from contracts with customers, net of sales discounts. Our sales are derived from a combination of cost-plus contracts, fixed price contracts, and time and materials contracts for both U.S. government and commercial and international deliverables. We account for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. We recognize revenue upon satisfying the performance obligations identified in the contract, which is achieved as services are rendered, upon completion of a service, or through the transfer of control of the promised good or service to the customer either at a point-in-time or over time. Our contracts can range from short-term periods of less than 12 months to multi-year obligations.
We generate net sales in our Defense & National Security segment, which represented approximately 66.1% and 50.9% of our net sales for the three months ended March 31, 2025 and year ended December 31, 2024, respectively, by providing leading technology capabilities that support marquee programs with expertise in defense systems, signals intelligence, communication technologies, guidance, navigation systems and control systems.
We generate net sales in our Space Solutions segment, which represented approximately 33.9% and 49.1% of our net sales for the three months ended March 31, 2025 and year ended December 31, 2024, respectively, by providing technology solutions, operating at the forefront of space technology and specializing in mission enabling, reliable hardware, software and engineering services for space missions. Our portfolio offering includes advanced space technology systems, space infrastructure and space science.
The following tables set forth our net sales by contract type for the periods indicated:
| | | | | | | | | | | |
| Three Months Ended March 31, |
| Net sales by contract type (dollars in thousands) | 2025 | | 2024 |
| Cost-plus fee and time and materials | $ | 20,044 | | | $ | 18,654 | |
| Firm fixed price | 14,463 | | | 11,562 | |
| Total net sales | $ | 34,507 | | | $ | 30,216 | |
| | | | | | | | | | | |
| Years Ended December 31, |
| Net sales by contract type (dollars in thousands) | 2024 | | 2023 |
| Cost-plus fee and time and materials | $ | 82,972 | | | $ | 79,881 | |
| Firm fixed price | 61,208 | | | 56,181 | |
| Total net sales | $ | 144,180 | | | $ | 136,062 | |
The following tables set forth our net sales by customer for the periods indicated:
| | | | | | | | | | | |
| Three Months Ended March 31, |
| Net sales by customer (dollars in thousands) | 2025 | | 2024 |
| U.S. government | $ | 29,526 | | | $ | 26,656 | |
| Commercial and international | 4,981 | | | 3,560 | |
| Total net sales | $ | 34,507 | | | $ | 30.216 | |
| | | | | | | | | | | |
| Years Ended December 31, |
| Net sales by customer (dollars in thousands) | 2024 | | 2023 |
| U.S. government | $ | 121,025 | | | $ | 93,473 | |
| Commercial and international | 23,155 | | | 42,589 | |
| Total net sales | $ | 144,180 | | | $ | 136,062 | |
Starlab Space Stations does not and is not expected to generate revenue from customers in the current fiscal period or in the near term. While Starlab does not generate revenue today, nor is expected to generate revenue in the near term, we have received significant funding from NASA under our SAA. The Starlab program is partially funded through government grants. These grants are not considered revenue. We expect to continue to receive funding from NASA in the near-term and before we begin to generate revenue (See “—Research and Development Costs—Government Grants” for additional details).
Cost of Sales
Cost of sales represent the costs required to fulfill performance obligations on a direct or indirect basis. Our Cost of sales are primarily driven by labor, materials, subcontractors necessary to fulfill our contractual obligations along with program application indirect costs.
Selling, General and Administrative
Selling, general and administrative expenses consist primarily of personnel-related expenses for our sales, marketing, supply chain, finance, legal, human resources and administrative personnel, as well as the costs of customer service, information technology, risk management and related insurance, travel, allocated overhead and other marketing, communications and administrative expenses. We also expect to further invest in our corporate infrastructure and incur additional expenses associated with operating as a public company, including increased legal and accounting costs, investor relations and compliance costs. As a result, we expect that selling, general and administrative expenses will increase in absolute dollars in future periods but decline as a percentage of total revenue over time. In addition, upon becoming a public company, we anticipate that we may incur significant additional annual expenses including, among other things, additional directors’ and officers’ liability insurance, costs to administer a public company stock compensation plan, director fees, costs to comply with reporting requirements of the SEC, transfer agent fees, costs for additional accounting, legal and administrative personnel, increased auditing, tax and legal fees, stock exchange listing fees, additional stock-based compensation expense and similar expenses.
Research and Development Costs
Research and development costs are expensed as incurred. Research and development costs include employee compensation, contractor fees, materials and supplies, and facility costs. For the three months ended March 31, 2025, gross research and development costs were $6.0 million. For the year ended December 31, 2024, gross research and development costs were $13.0 million.
Government Grants
We recognize government assistance when there is reasonable assurance that we will comply with the conditions of the assistance and that the assistance will be received.
NASA established the LEO Development program, or the SAA to help facilitate two objectives:
•Develop a robust commercial space economy in LEO, including supporting the development of commercially owned and operated LEO destinations from which various customers, including private entities, public institutions, NASA and foreign governments, can purchase services; and
•Stimulate the growth of commercial activities in LEO.
On December 1, 2021, Nanoracks entered into an agreement under the SAA with NASA (the “Nanoracks Agreement”), pertaining to the LEO Development program, to design, build and maintain a commercial space station, known as “Starlab”. The Nanoracks Agreement and its subsequent amendments signed through 2023 provides $217.5 million in funding for the design and manufacture of Starlab, which is earned upon completion of defined milestones. Once a milestone is earned, we are under no further obligation to continue work on Starlab. Milestone payments are expected to be earned through December 2025. As of March 31, 2025, we have cumulatively earned $147.2 million in milestones under the program, with $78.0 million in milestones earned as of March 31, 2024. All milestones earned as of March 31, 2025 and March 31, 2024 were received in cash.
When the government grant assistance is related to an asset, the assistance will be deducted from the carrying value of the asset. When the government grant assistance is related to costs incurred, the assistance is deducted from the related expense. For the three months ended March 31, 2025 and 2024, $2.0 million and $0.5 million, respectively, were offset against research and development costs. For the three months ended March 31, 2025, $18.0 million of assistance was offset against construction in progress assets. For the three months ended March 31, 2024, $10.7 million of assistance was offset against construction in progress assets, along with grant funding for capital expenditures not yet incurred of $6.0 million in accrued expenses and other current liabilities on the consolidated balance sheets. For the years ended December 31, 2024 and 2023, $5.4 million and $37.0 million, respectively, were offset against research and development costs. For the year ended December 31, 2024, $54.9 million of assistance was offset against construction in progress assets. For the year ended December 31, 2023, $26.9 million of assistance was offset against construction in progress assets, along with grant funding for capital expenditures not yet incurred of $6.0 million in accrued expenses and other current liabilities on the consolidated balance sheets.
Amortization of Acquired Intangibles
Amortization of acquired intangibles includes amortization of intangibles acquired in acquisitions.
Finance and Interest Expense
Finance and interest expense consists primarily of finance gains and charges on debt extinguishments and issuances, along with interest expense incurred on debt.
Other Income, Net
Other income, net consists primarily of interest income on our cash and cash equivalents along with gain (loss) on foreign exchange relates to currency fluctuations that generate foreign exchange gains or losses on invoices denominated in currencies other than the U.S. dollar.
Income Tax (Benefit) Expense
Income tax (benefit) expense includes the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement carrying amount and the tax basis of assets and liabilities, along with net operating loss carryforwards using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are provided if, based upon the weight of available evidence, it is more likely than not that some or all the deferred tax assets will not be realized. When uncertain tax positions exist, we recognize the tax benefit of tax positions to the extent that the benefit would more likely than not be realized assuming examination by the taxing authority. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as
consideration of the available facts and circumstances. We recognize any interest and penalties accrued related to unrecognized tax benefits as income tax expense.
Results of Operations
Three Months Ended March 31, 2025 Compared to Three Months Ended March 31, 2024
The following table sets forth our results of operations for the periods indicated:
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | Change |
| (dollars in thousands) | 2025 | | 2024 | | Year over Year | | % |
| Net sales | $ | 34,507 | | | $ | 30,216 | | | $ | 4,291 | | | 14.2 | % |
| Cost of sales | 28,922 | | | 24,035 | | | 4,887 | | | 20.3 | % |
| Selling, general, and administrative | 26,286 | | | 15,590 | | | 10,696 | | | 68.6 | % |
| Research and development | 4,040 | | | 767 | | | 3,273 | | | * |
| | | | | | | |
| Amortization of acquired intangibles | 1,548 | | | 1,744 | | | (196) | | | (11.2) | % |
| Loss from operations | $ | (26,289) | | | $ | (11,920) | | | $ | (14,369) | | | 120.5 | % |
| Other income (expense): | | | | | | | |
| | | | | | | |
| | | | | | | |
| Finance and interest expense | (2,729) | | | (2,994) | | | 265 | | | (8.9) | % |
| Other income, net | 1,137 | | | 210 | | | 927 | | | * |
| Loss before income taxes | (27,881) | | | (14,704) | | | (13,177) | | | 89.6 | % |
| Income tax expense | 48 | | | 248 | | | (200) | | | (80.6) | % |
| Net loss | (27,929) | | | (14,952) | | | (12,977) | | | 86.8 | % |
| Net loss attributable to noncontrolling interests | (991) | | | (129) | | | (862) | | | * |
| Net loss attributable to Voyager Technologies, Inc. | $ | (26,938) | | | $ | (14,823) | | | $ | (12,115) | | | 81.7 | % |
________________
*% Change not meaningful; non-meaningful changes are defined as greater than absolute value of 200% change or a change from 0%
Net sales
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | Change | | | | |
| (dollars in thousands) | 2025 | | 2024 | | Year over Year | | % | | | | | | | | |
Total net sales | $ | 34,507 | | | $ | 30,216 | | | $ | 4,291 | | | 14.2 | % | | | | | | | | |
The increase in net sales was primarily due to an increase in sales in the Defense & National Security segment, which experienced growth of $8.9 million in external sales driven by significant programs won during 2024, offset by a decrease of $4.6 million in net sales in the Space Solutions segment, driven by lower volumes in commercial sales. For a further discussion of the drivers behind the change in revenues, see “—Results by Segment.”
Cost of sales
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | Change | | | | |
| (dollars in thousands) | 2025 | | 2024 | | Year over Year | | % | | | | | | | | |
| Cost of sales | $ | 28,922 | | | $ | 24,035 | | | $ | 4,887 | | | 20.3 | % | | | | | | | | |
The increase in costs of sales was primarily due to an increase in sales volumes and input costs in the Defense & National Security segment, driving a $9.2 million cost increase in the quarter ended March 31, 2025. The increase was primarily offset by lower volumes and input costs in the Space Solutions segment, which drove a decrease in costs of sales year over year of $4.3 million.
Selling, general, and administrative
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | Change | | | | |
| (dollars in thousands) | 2025 | | 2024 | | Year over Year | | % | | | | | | | | |
| Selling, general, and administrative | $ | 26,286 | | | $ | 15,590 | | | $ | 10,696 | | | 68.6 | % | | | | | | | | |
The increase in selling, general, and administrative costs was primarily due to a $5.7 million increase in costs associated with portions of non-cash services rendered from Palantir throughout the quarter ended March 31, 2025 along with a $4.4 million increase in employee compensation expenses associated with internal commissions for fundraising efforts, salaries, and stock compensation cost increases during the quarter ended March 31, 2025.
Research and development
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | Change | | | | |
| (dollars in thousands) | 2025 | | 2024 | | Year over Year | | % | | | | | | | | |
| Research and development | $ | 4,040 | | | $ | 767 | | | $ | 3,273 | | | * | | | | | | | | |
The increase in research and development, net was primarily due to research and development efforts at Voyager and Starlab LLC for $3.0 million and $1.4 million, respectively, offset by an increase in government grants attributable to contra expense of $1.5 million.
Amortization of acquired intangibles
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | Change | | | | |
| (dollars in thousands) | 2025 | | 2024 | | Year over Year | | % | | | | | | | | |
| Amortization of acquired intangibles | $ | 1,548 | | | $ | 1,744 | | | $ | (196) | | | (11.2) | % | | | | | | | | |
Finance and interest expense, net
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | Change | | | | |
| (dollars in thousands) | 2025 | | 2024 | | Year over Year | | % | | | | | | | | |
| Finance and interest expense | $ | (2,729) | | | $ | (2,994) | | | $ | 265 | | | (8.9) | % | | | | | | | | |
Other income, net
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | Change | | | | |
| (dollars in thousands) | 2025 | | 2024 | | Year over Year | | % | | | | | | | | |
| Other income, net | $ | 1,137 | | | $ | 210 | | | $ | 927 | | | * | | | | | | | | |
The increase in other income, net was associated with increased interest income associated with increased cash holdings during the quarter ended March 31, 2025.
Income tax expense
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | Change | | | | |
| (dollars in thousands) | 2025 | | 2024 | | Year over Year | | % | | | | | | | | |
| Income tax expense | $ | 48 | | | $ | 248 | | | $ | (200) | | | (80.6) | % | | | | | | | | |
Year Ended December 31, 2024 Compared to Year Ended December 31, 2023
The following table sets forth our results of operations for the periods indicated:
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Change |
| (dollars in thousands) | 2024 | | 2023 | | 2023 to 2024 | | % |
| Net sales | $ | 144,180 | | | $ | 136,062 | | | $ | 8,118 | | | 6.0 | % |
| Cost of sales | 109,265 | | | 108,277 | | | 988 | | | 0.9 | % |
| Selling, general, and administrative | 62,570 | | | 54,043 | | | 8,527 | | | 15.8 | % |
| Research and development | 7,611 | | | (18,542) | | | 26,153 | | | (141.0) | % |
| Impairment losses | 3,594 | | | — | | | 3,594 | | | * |
| Amortization of acquired intangibles | 9,582 | | | 6,457 | | | 3,125 | | | 48.4 | % |
| Loss from operations | $ | (48,442) | | | $ | (14,173) | | | $ | (34,269) | | | * |
| Other income (expense): | | |
| | | | |
| Change in fair value of embedded derivatives | $ | 387 | | | $ | — | | | $ | 387 | | | * |
| Loss on debt extinguishment | (9,392) | | | (1,287) | | | (8,105) | | | * |
| Finance and interest expense | (12,016) | | | (10,590) | | | (1,426) | | | 13.5 | % |
| Other income, net | 2,127 | | | 1,193 | | | 934 | | | 78.3 | % |
| Loss before benefit for income taxes | (67,336) | | | (24,857) | | | (42,479) | | | 170.9 | % |
| Income tax (benefit) expense | (1,708) | | | 341 | | | (2,049) | | | * |
| Net loss | (65,628) | | | (25,198) | | | (40,430) | | | 160.4 | % |
| Net (loss) income attributable to noncontrolling interests | (3,556) | | | 240 | | | (3,796) | | | * |
| Net loss attributable to Voyager Technologies, Inc. | $ | (62,072) | | | $ | (25,438) | | | $ | (36,634) | | | 144.0 | % |
________________
*% Change not meaningful; non-meaningful changes are defined as greater than absolute value of 200% change or a change from 0%
Net Sales
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Change |
| (dollars in thousands) | 2024 | | 2023 | | 2023 to 2024 | | % |
Total net sales | $ | 144,180 | | | $ | 136,062 | | | $ | 8,118 | | | 6.0 | % |
The increase in net sales was primarily due to an increase in U.S. government sales in the Defense & National Security segment, which experienced growth of $10.7 million in external sales, offset by a decrease of $2.6 million in the Space Solutions segment, driven by lower volumes in commercial sales. For a further discussion of the drivers behind the change in revenues, see “—Results by Segment.”
Cost of Sales
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Change |
| (dollars in thousands) | 2024 | | 2023 | | 2023 to 2024 | | % |
| Cost of sales | $ | 109,265 | | | $ | 108,277 | | | $ | 988 | | | 0.9 | % |
The increase in costs of sales was primarily due to an increase in U.S. government sales in the Defense & National Security segment, driving a $9.1 million cost increase in the year ended December 31, 2024. The increase was primarily offset by lower volumes in the Space Solutions segment, which drove a decrease in costs of sales year over year of $7.6 million.
Selling, General, and Administrative
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Change |
| (dollars in thousands) | 2024 | | 2023 | | 2023 to 2024 | | % |
| Selling, general, and administrative | $ | 62,570 | | | $ | 54,043 | | | $ | 8,527 | | | 15.8 | % |
The increase in selling, general, and administrative costs was primarily due to a $6.9 million increase in costs associated with non-cash services rendered throughout the year along with a $1.1 million increase in employee compensation expenses associated with stock options granted to employees during the year ended December 31, 2024 due to the volume of options given to employees as well as the valuation of options increasing during the year ended December 31, 2024.
Research and Development
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Change |
| (dollars in thousands) | 2024 | | 2023 | | 2023 to 2024 | | % |
| Research and development, net | $ | 7,611 | | | $ | (18,542) | | | $ | 26,153 | | | (141.0) | % |
The increase in research and development, net was primarily due to timing of milestone grants under the SAA that offset research and development expenditures during such period. The government grants offsetting research and development costs decreased from $37.0 million in the year ended December 31, 2023 to $5.4 million in the year ended December 31, 2024. See “—Research and Development Costs—Government Grants”. This decrease in government grants was partially offset by a decrease in gross research and development expenditures from $18.5 million in the year ended December 31, 2023 to $13.0 million in the year ended December 31, 2024, driven primarily by the development phase of our Starlab program that incurred more capital expenditures than research expenses.
Impairment Loss
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Change |
| (dollars in thousands) | 2024 | | 2023 | | 2023 to 2024 | | % |
| Impairment losses | $ | 3,594 | | | $ | — | | | $ | 3,594 | | | * |
We experienced impairment losses of $3.6 million during the year ended December 31, 2024 related to the full impairment of our investment in Atomos Nuclear and Space Corporation (“Atomos”).
Amortization of Acquired Intangibles
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Change |
| (dollars in thousands) | 2024 | | 2023 | | 2023 to 2024 | | % |
| Amortization of acquired intangibles | $ | 9,582 | | | $ | 6,457 | | | $ | 3,125 | | | 48.4 | % |
The increase in amortization of acquired intangibles is primarily driven by the shortening of useful lives associated with previously acquired intangibles that experienced a shorter useful life due to our integration activities during the year ended December 31, 2024.
Finance and Interest Expense
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Change |
| (dollars in thousands) | 2024 | | 2023 | | 2023 to 2024 | | % |
| Finance and interest expense | $ | (12,016) | | | $ | (10,590) | | | $ | (1,426) | | | 13.5 | % |
The increase in finance and interest expense was primarily driven by increased weighted average borrowings outstanding during the year ended December 31, 2024 compared to the year ended December 31, 2023.
Other Income, Net
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Change |
| (dollars in thousands) | 2024 | | 2023 | | 2023 to 2024 | | % |
| Other income, net | $ | 2,127 | | | $ | 1,193 | | | $ | 934 | | | 78.3 | % |
The increase in other income, net was associated with increased interest income from cash holdings along with gains associated with foreign currency exchange impacts during the year ended December 31, 2024.
Income Tax (Benefit) Expense
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Change |
| (dollars in thousands) | 2024 | | 2023 | | 2023 to 2024 | | % |
| Income tax (benefit) expense | $ | (1,708) | | | $ | 341 | | | $ | (2,049) | | | * |
The income tax benefit was driven by a $2.6 million deferred tax benefit during the year ended December 31, 2024, which was partially offset by current year tax expenses of $0.9 million. The income tax expense during the year ended December 31, 2023 was associated primarily with current income tax expense on earnings that were not able to be offset by losses from the consolidated group.
Results by Segment
Three Months Ended March 31, 2025 Compared to Three Months Ended March 31, 2024
We measure the performance of our reportable segments based on net sales and Segment Adjusted EBITDA. Our operating and reportable segments are: Defense & National Security, Space Solutions and Starlab Space Stations.
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| (dollars in thousands) | 2025 | | 2024 | | | | |
| Net Sales: | | | | | | | |
| Defense & National Security | $ | 23,544 | | | $ | 14,701 | | | | | |
| Space Solutions | 12,304 | | | 17,043 | | | | | |
| Starlab Space Stations | — | | | — | | | | | |
| Total net sales, reportable segments | 35,848 | | | 31,744 | | | | | |
| Intersegment eliminations | (1,341) | | | (1,528) | | | | | |
| Total Net Sales | $ | 34,507 | | | $ | 30,216 | | | | | |
| | | | | | | |
| Segment Adjusted EBITDA: | | | | | | | |
| Defense & National Security | $ | 110 | | | $ | (265) | | | | | |
| Space Solutions | (1,178) | | | (1,124) | | | | | |
| Starlab Space Stations | (1,386) | | | (2,478) | | | | | |
| Total Segment Adjusted EBITDA, reportable segments | (2,454) | | | (3,867) | | | | | |
| Intersegment eliminations | — | | | — | | | | | |
| Corporate and other expenses | (8,787) | | | (3,312) | | | | | |
Consolidated Adjusted EBITDA | $ | (11,241) | | | $ | (7,179) | | | | | |
Defense & National Security
The following table provides selected financial information for the Defense & National Security segment.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | Change | | | | |
| (dollars in thousands) | 2025 | | 2024 | | Year over Year | | % | | | | | | | | |
| Net sales | $ | 23,544 | | | $ | 14,701 | | | $ | 8,843 | | | 60.2 | % | | | | | | | | |
| | | | | | | | | | | | | | | |
| Segment Adjusted EBITDA | $ | 110 | | | $ | (265) | | | $ | 375 | | | (141.5) | % | | | | | | | | |
| Segment Adjusted EBITDA margin percentage | 0.5 | % | | (1.8) | % | | | | | | | | | | | | |
The increase in net sales was driven primarily by a $6.0 million increase in U.S. government revenue and a $2.8 million increase in commercial contract revenue during the quarter ended March 31, 2025 compared to the quarter ended March 31, 2024. The increase in net sales were primarily driven off volume increases from contracts obtained during the year ended 2024.
Space Solutions
The following table provides selected financial information for the Space Solutions segment.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | Change | | | | |
| (dollars in thousands) | 2025 | | 2024 | | Year over Year | | % | | | | | | | | |
| Net sales | $ | 12,304 | | | $ | 17,043 | | | $ | (4,739) | | | (27.8) | % | | | | | | | | |
| | | | | | | | | | | | | | | |
| Segment Adjusted EBITDA | $ | (1,178) | | | $ | (1,124) | | | $ | (54) | | | 4.8 | % | | | | | | | | |
| Segment Adjusted EBITDA margin percentage | (9.6) | % | | (6.6) | % | | | | | | | | | | | | |
The decrease in net sales was driven primarily by a $3.1 million decrease in U.S. government revenue mostly due to decreased volumes on programs ending during the quarter ended March 31, 2025 compared to the quarter ended March 31, 2024 along with a reduction from commercial contract revenue of $1.6 million due to lower program volumes.
Starlab Space Stations
The following table provides selected financial information for the Starlab Space Stations segment.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | Change | | | | |
| (dollars in thousands) | 2025 | | 2024 | | Year over Year | | % | | | | | | | | |
| Net sales | $ | — | | | $ | — | | | $ | — | | | * | | | | | | | | |
| | | | | | | | | | | | | | | |
| Segment Adjusted EBITDA | $ | (1,386) | | | $ | (2,478) | | | $ | 1,092 | | | (44.1) | % | | | | | | | | |
| Segment Adjusted EBITDA margin percentage | * | | * | | | | | | | | | | | | |
________________
*Not meaningful
The increase in Segment Adjusted EBITDA was driven primarily by an increase of grant funding attributable to contra expenses, which were received in the quarter ended March 31, 2025 of $2.0 million compared to $0.5 million received in the quarter ended March 31, 2024.
Intersegment Eliminations
Intersegment eliminations are related to projects between our segments, including the construction of our Starlab program. Intersegment eliminations decreased to $1.3 million from $1.5 million for the three months ended
March 31, 2025 compared to the three months ended March 31, 2024. The decrease in intersegment eliminations was primarily related to an decrease in Starlab driven programs.
Year Ended December 31, 2024 Compared to Year Ended December 31, 2023
We measure the performance of our reportable segments based on net sales and Segment Adjusted EBITDA. Our operating and reportable segments are: Defense & National Security, Space Solutions and Starlab Space Stations.
| | | | | | | | | | | | | |
| Years Ended December 31, | | |
| (dollars in thousands) | 2024 | | 2023 | | |
| Net sales: | | | | | |
| Defense & National Security | $ | 77,470 | | | $ | 63,154 | | | |
| Space Solutions | 74,593 | | | 76,771 | | | |
| Starlab Space Stations | — | | | — | | | |
| Total net sales, reportable segments | 152,063 | | | 139,925 | | | |
| Intersegment eliminations | (7,883) | | | (3,863) | | | |
| Total net sales | $ | 144,180 | | | $ | 136,062 | | | |
| | | | | |
| Segment Adjusted EBITDA: | | | | | |
| Defense & National Security | $ | 2,180 | | | $ | (390) | | | |
| Space Solutions | 2,720 | | | 4,777 | | | |
| Starlab Space Stations | (8,315) | | | 12,569 | | | |
| Total Segment Adjusted EBITDA, reportable segments | (3,415) | | | 16,956 | | | |
| Corporate and other expenses | (13,899) | | | (15,535) | | | |
Consolidated Adjusted EBITDA | $ | (17,314) | | | $ | 1,421 | | | |
Defense & National Security
The following table provides selected financial information for the Defense & National Security segment.
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Change |
| (dollars in thousands) | 2024 | | 2023 | | 2023 to 2024 | | % |
| Net sales | $77,470 | | $ | 63,154 | | | $ | 14,316 | | | 22.7 | % |
| | | | | | | |
| Segment Adjusted EBITDA | 2,180 | | $ | (390) | | | $ | 2,570 | | | * |
| Segment Adjusted EBITDA margin percentage | 2.8 | % | | (0.6) | % | | | | |
________________*% Change not meaningful; non-meaningful changes are defined as greater than absolute value of 200% change or a change from 0%
The increase in net sales was driven primarily by a $6.3 million increase in U.S. government sales along with an increase in commercial and intercompany sales of $8.0 million during the year ended December 31, 2024 compared to the year ended December 31, 2023.
The increase in Segment Adjusted EBITDA was driven primarily by an increase in sales of $14.3 million offset by an increase in costs of goods sold of $9.2 million associated with the increase in program volumes during the year ended December 31, 2024 and an increase in selling, general, and administrative costs of $2.3 million primarily driven by integration efforts within the business.
Space Solutions
The following table provides selected financial information for the Space Solutions segment.
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Change |
| (dollars in thousands) | 2024 | | 2023 | | 2023 to 2024 | | % |
| Net sales | $ | 74,593 | | | $ | 76,771 | | | $ | (2,178) | | | (2.8) | % |
| | | | | | | |
| Segment Adjusted EBITDA | 2,720 | | $ | 4,777 | | | $ | (2,057) | | | (43.1) | % |
| Segment Adjusted EBITDA margin percentage | 3.6 | % | | 6.2 | % | | | | |
The decrease in net sales was driven primarily by a $24.7 million decrease in commercial contract revenue due to decreased volumes on program phasing during the year ended December 31, 2024 compared to the year ended December 31, 2023. This was partially offset by an increase in U.S. government sales of $21.2 million primarily driven by volume growth on NASA funded programs and an increase in international government revenue of $1.3 million driven primarily by volume growth on ESA funded programs.
The decrease in Segment Adjusted EBITDA was driven primarily by a decrease in sales of $2.2 million.
Starlab Space Stations
The following table provides selected financial information for the Starlab Space Stations segment.
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Change |
| (dollars in thousands) | 2024 | | 2023 | | 2023 to 2024 | | % |
| Net sales | $ | — | | | $ | — | | | $ | — | | | — | |
| | | | | | | |
| Segment Adjusted EBITDA | $ | (8,315) | | | $ | 12,569 | | | $ | (20,884) | | | (166.2) | % |
| Segment Adjusted EBITDA margin percentage | * | | * | | | | |
________________
*Not meaningful
The decrease in Segment Adjusted EBITDA was driven primarily by increases in funding received under the SAA that offset operating expenses associated with the Starlab construction. Due to timing differences on the program, milestones earned and grant funding received during the year ended December 31, 2023 were greater than operating expenditures as of the same date, leading to a positive Segment Adjusted EBITDA. However, during the year ended December 31, 2024, the incurred expenses were greater than the milestones earned and grant funding received, resulting in negative Segment Adjusted EBITDA. During the year ended December 31, 2024, we had $13.7 million of underlying expenses within the Starlab Space Stations segment offset by $5.4 million of government grants, compared to $24.4 million of expenses that were more than offset by $37.0 million of government grants in the year ended December 31, 2023.
Intersegment Eliminations
Intersegment eliminations are related to projects between our segments, including the construction of our Starlab program. Intersegment eliminations increased to $7.9 million from $3.9 million for the year ended December 31, 2024 compared to the year ended December 31, 2023. The increase in intersegment eliminations was primarily related to an increase in Starlab driven programs.
Key Performance Indicators and Non-GAAP Financial Measures
In assessing the performance of our business, in addition to considering a variety of measures in accordance with GAAP, our management team also monitors key operational metrics and non-GAAP financial measures that assist us in evaluating our business, measuring our performance, identifying trends, formulating financial projects and making strategic decisions.
We believe that these operational metrics and non-GAAP financial measures provide useful information to users of our financial statements in understanding and evaluating our results of operations in the same manner as our management team. The presentation of operational metrics and non-GAAP financial measures is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.
The following tables set forth our key performance metrics, which are further discussed below:
| | | | | | | | | | | |
| (dollars in thousands) | March 31, 2025 | | December 31, 2024 |
Funded backlog (as of period end)(1) | | | |
| Defense & National Security | $ | 54,464 | | | $ | 59,234 | |
| Space Solutions | 38,664 | | | 42,499 | |
| Starlab Space Stations | — | | | — | |
| Total funded backlog | 93,128 | | | 101,733 | |
Unfunded contract options(2) | $ | 86,043 | | | $ | 98,349 | |
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| (dollars in thousands) | 2025 | | 2024 | | | | |
Bookings(3) | $ | 25,939 | | | $ | 25,374 | | | | | |
| Net sales | 34,507 | | | 30,216 | | | | | |
| Gross profit | 5,585 | | | 6,181 | | | | | |
| Net loss | (26,938) | | | (14,823) | | | | | |
Adjusted EBITDA(4) | (21,356) | | | (7,179) | | | | | |
| | | | | | | |
| Cash flow used in operating activities | (14,354) | | | (7,906) | | | | | |
Free cash flow(5) | $ | (23,324) | | | $ | (13,306) | | | | | |
| | | | | | | |
| | | | | | | |
________________
(1)Funded backlog is comprised of projects for which we have received a written contract or purchase order, either executed or awaiting execution, excluding any unfunded contract options. Our backlog may also include, as of any date of estimation, change orders for any project that have been confirmed, either in writing or verbally, or formally contracted.
(2)Unfunded contract options (also referred to herein as unfunded backlog) represent customer options for future products or services that have not yet been exercised and potential bookings under IDIQ contracts. As of March 31, 2025, unfunded contract options were primarily comprised of customer options for future products or services that have not yet been exercised in the Defense & National Security segment.
(3)Bookings represent funded contracts awarded to us during the fiscal period. Funded contracts represent definitized contracts for performance obligations from customers that contain the right to receive consideration in exchange for goods transferred to the customer.
(4)See “Non-GAAP Financial Measures” below for a discussion of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net loss attributable to Voyager Technologies, Inc., the most directly comparable GAAP measure to Adjusted EBITDA.
(5)See “Non-GAAP Financial Measures” below for a discussion of free cash flow and a reconciliation of free cash flow to net cash provided by operating activities, the most directly comparable GAAP measure to free cash flow.
| | | | | | | | | | | | | |
| Years Ended December 31, |
| (dollars in thousands) | 2024 | | 2023 | | |
Funded backlog (as of period end)(1) | | | | | |
| Defense & National Security | $ | 59,234 | | | $ | 33,016 | | | |
| Space Solutions | 42,499 | | | 53,483 | | | |
| Starlab Space Stations | — | | | — | | | |
| Total funded backlog | 101,733 | | | 86,499 | | | |
Unfunded contract options(2) | 98,349 | | | 93,069 | | | |
Bookings(3) | 159,415 | | | 102,148 | | | |
| Net sales | 144,180 | | | 136,062 | | | |
| Gross profit | 34,915 | | | 27,785 | | | |
| Net loss | (62,072) | | | (25,438) | | | |
Adjusted EBITDA(4) | (29,983) | | | 1,421 | | | |
| | | | | |
| Cash flow used in operating activities | (25,502) | | | (15,381) | | | |
Free cash flow(5) | $ | (53,275) | | | $ | (5,733) | | | |
| | | | | |
| | | | | |
________________
(1)Funded backlog is comprised of projects for which we have received a written contract or purchase order, either executed or awaiting execution, excluding any unfunded contract options. Our backlog may also include, as of any date of estimation, change orders for any project that have been confirmed, either in writing or verbally, or formally contracted.
(2)Unfunded contract options (also referred to herein as unfunded backlog) represent customer options for future products or services that have not yet been exercised and potential bookings under IDIQ contracts. As of December 31, 2024, unfunded contract options were primarily comprised of customer options for future products or services that have not yet been exercised in the Defense & National Security segment.
(3)Bookings represent funded contracts awarded to us during the fiscal period. Funded contracts represent definitized contracts for performance obligations from customers that contain the right to receive consideration in exchange for goods transferred to the customer.
(4)See “Non-GAAP Financial Measures” below for a discussion of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net loss attributable to Voyager Technologies, Inc., the most directly comparable GAAP measure to Adjusted EBITDA.
(5)See “Non-GAAP Financial Measures” below for a discussion of free cash flow and a reconciliation of free cash flow to net cash provided by operating activities, the most directly comparable GAAP measure to free cash flow.
Non-GAAP Financial Measures
Non-GAAP financial measures are not calculated or presented in accordance with GAAP and other companies in our industry may calculate them differently than we do. As a result, non-GAAP financial measures have limitations as analytical and comparative tools and you should not consider them in isolation, or as a substitute, for analysis of our results as reported under GAAP. In addition, in evaluating Adjusted EBITDA and free cash flow, you should be aware that in the future we may incur expenses similar to those eliminated in this presentation. Our presentation of Adjusted EBITDA and free cash flow should not be construed as an inference that our future results will be unaffected by unusual items. Management compensates for these limitations by primarily relying on our GAAP results in addition to using Adjusted EBITDA and free cash flow supplementally.
Adjusted EBITDA
We consider Adjusted EBITDA to be a useful, supplemental, measure of our operating performance. We use Adjusted EBITDA to supplement GAAP measures in evaluating the performance of our business and the effectiveness of our strategies, to make budgeting decisions, make certain compensation decisions, and to compare our performance against that of our peer companies, many of which present similar non-GAAP financial measures.
In addition, we believe Adjusted EBITDA provides a useful measure for period-to-period comparisons of our business, as it removes the impact of our capital structure and other items not indicative of our core operating performance from operating results.
We define EBITDA as net loss attributable to Voyager Technologies, Inc. plus (less) finance and interest expense, provision for income tax expense (benefit), and depreciation and amortization. We define Adjusted EBITDA as EBITDA adjusted for change due to stock-based compensation, business acquisition costs, restructuring charges, impairment losses, income (loss) attributable to noncontrolling interests, and other items we do not believe are indicative of our core operating performance, including incremental organizational costs attributable to this offering, changes in the fair value of earnout liabilities, and foreign exchange gain/loss. The reconciliation between EBITDA and Adjusted EBITDA, and net loss attributable to Voyager Technologies, Inc. (the most comparable GAAP measure) for the periods shown below:
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| (dollars in thousands) | 2025 | | 2024 | | | | |
| Net loss attributable to Voyager Technologies, Inc. | $ | (26,938) | | | $ | (14,823) | | | | | |
| Finance and interest expense | 2,729 | | | 2,994 | | | | | |
| Depreciation and amortization | 2,602 | | | 2,713 | | | | | |
| Taxes | 48 | | | 248 | | | | | |
| EBITDA | (21,559) | | | (8,868) | | | | | |
| Stock-based compensation | 1,723 | | | 730 | | | | | |
Business acquisition costs(1) | 156 | | | 230 | | | | | |
Restructuring(2) | 418 | | | 1,113 | | | | | |
| Impairment losses | — | | | — | | | | | |
| Net loss attributable to noncontrolling interests | (991) | | | (129) | | | | | |
| | | | | | | |
Other(3) | (1,103) | | | (255) | | | | | |
Adjusted EBITDA(4) | $ | (21,356) | | | $ | (7,179) | | | | | |
| | | | | | | |
________________
(1)Business acquisition costs include legal costs and incremental transaction costs associated with an acquisition.
(2)Restructuring includes costs for retention and severance payments related to management’s decision to undertake certain actions to realign our cost structure through workforce reductions and the closure of certain facilities, businesses and product lines.
(3)Other includes capital market and advisory fees related to advisors assisting with transitional activities associated with becoming a public company, changes in fair value of earn out liabilities, and foreign exchange gain/loss that are all individually insignificant for the period.
(4)Adjusted EBITDA for the period includes the impact of non-cash services, which are excluded from Segment Adjusted EBITDA. For further information regarding these non-cash services, please refer to the notes to our consolidated financial statements included elsewhere in this prospectus.
| | | | | | | | | | | | | | | | | |
| Years Ended December 31, |
| (dollars in thousands) | 2024 | | 2023 | | | | | | |
| Net loss attributable to Voyager Technologies, Inc. | $ | (62,072) | | | $ | (25,438) | | | | | | | |
| Finance and interest expense | 12,016 | | | 10,590 | | | | | | | |
| Depreciation and amortization | 13,595 | | | 10,294 | | | | | | | |
| Taxes | (1,708) | | | 341 | | | | | | | |
| EBITDA | (38,169) | | | (4,213) | | | | | | | |
| Stock-based compensation | 3,761 | | | 2,707 | | | | | | | |
Business acquisition costs(1) | 282 | | | 644 | | | | | | | |
Restructuring(2) | 2,295 | | | 3,562 | | | | | | | |
| Impairment losses | 3,594 | | | — | | | | | | | |
| Net (loss) income attributable to noncontrolling interests | (3,556) | | | 240 | | | | | | | |
| | | | | | | | | |
Other(3) | 1,810 | | | (1,519) | | | | | | | |
Adjusted EBITDA(4) | $ | (29,983) | | | $ | 1,421 | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
________________
(1)Business acquisition costs include legal costs and incremental transaction costs associated with an acquisition.
(2)Restructuring includes costs for retention and severance payments related to management’s decision to undertake certain actions to realign our cost structure through workforce reductions and the closure of certain facilities, businesses and product lines.
(3)Other includes capital market and advisory fees related to advisors assisting with transitional activities associated with becoming a public company, changes in fair value of earn out liabilities, and foreign exchange gain/loss that are all individually insignificant for the period.
(4)Adjusted EBITDA for the period includes the impact of non-cash services, which are excluded from Segment Adjusted EBITDA. For further information regarding these non-cash services, please refer to the notes to our consolidated financial statements included elsewhere in this prospectus.
Free Cash Flow
We consider free cash flow to be a useful, supplemental measure of our ability to generate cash on a normalized basis. We use free cash flow to supplement GAAP measures in evaluating our flexibility to allocate capital and pursue opportunities that may enhance shareholder value and the effectiveness of our strategies, to make budgeting decisions and to compare our performance against that of our peer companies, many of which present similar non-GAAP financial measures.
We believe that while expenditures and dispositions of property, plant and equipment will fluctuate on a period-to-period basis, we seek to ensure that we have adequate capital on hand to maintain ongoing operations and enable growth of the business. Additionally, free cash flow is of limited usefulness in that it does not represent residual cash flows available for discretionary expenditures due to the fact the measures do not deduct the payments required for debt service and other contractual obligations or payments.
We define free cash flow as the sum of our cash (used in) provided by operating activities less our net capital expenditures. The net capital expenditures of the Company are defined as the gross capital expenditures for the purchase of property and equipment less the grant funding we received in order to make such purchases. Based on the nature of government grants for purposes of funding capital expenditures on our Starlab program, these grants are pass through for purposes of making capital expenditures as they are directly used to source funding on capital expenditures. Our calculation of free cash flow may not be comparable to the calculation of similarly titled measures reported by other companies. The reconciliation between free cash flow and net cash (used in) provided by operating activities (the most comparable GAAP measure) for the periods presented is shown below:
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| (dollars in thousands) | 2025 | | 2024 | | | | |
| Cash used in operating activities | $ | (14,354) | | | $ | (7,906) | | | | | |
| Purchases of property and equipment | (26,970) | | | (16,050) | | | | | |
| Grant funding for property and equipment | 18,000 | | | 10,650 | | | | | |
| Free cash flow | $ | (23,324) | | | $ | (13,306) | | | | | |
| | | | | | | | | | | |
| Years Ended December 31, |
| (dollars in thousands) | 2024 | | 2023 |
| Cash used in operating activities | $ | (25,502) | | | $ | (15,381) | |
| Purchases of property and equipment | (82,703) | | | (17,210) | |
| Grant funding for property and equipment | 54,930 | | | 26,858 | |
| Free cash flow | $ | (53,275) | | | $ | (5,733) | |
The reconciliation between total Voyager capital expenditures, Starlab Space Stations capital expenditures and capital expenditures excluding Starlab for the periods presented is shown below:
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| (dollars in thousands) | 2025 | | 2024 | | | | |
| Total Voyager capital expenditures | $ | 26,970 | | | $ | 16,050 | | | | | |
| Less: Starlab Space Stations capital expenditures | 25,894 | | | 15,190 | | | | | |
| Capital expenditures excluding Starlab Space Stations | $ | 1,076 | | | $ | 860 | | | | | |
| | | | | | | | | | | | | | | |
| Years Ended December 31, |
| (dollars in thousands) | 2024 | | 2023 | | | | |
| Total Voyager capital expenditures | $ | 82,703 | | | $ | 17,210 | | | | | |
| Less: Starlab Space Stations capital expenditures | 79,381 | | | 15,691 | | | | | |
| Capital expenditures excluding Starlab Space Stations | $ | 3,322 | | | $ | 1,519 | | | | | |
Innovation Spend
We are focused on delivering innovative solutions to the defense, national security and space end markets, and research and development is at the core of our business. We believe innovation spend and innovation spend excluding Starlab provide our management and investors useful measures of our aggregate spend on research and development type activities in support of our customers’ needs and our future growth. However, innovation spend is an operating metric, not a financial measure calculated or presented in accordance with GAAP, and companies in our industry may calculate innovation spend or similar operating metrics differently than we do. We define innovation spend as research and development costs associated with IRS Section 174 categorization, as well as spend on designated development programs. Development programs are defined as initiatives that, when developed, will expand the Company’s product offerings under a customer funded arrangement. Innovation spend is comprised of various costs recognized in cost of sales and research and development costs within the consolidated statements of operations, as well as certain costs capitalized within property and equipment, net on our consolidated balance sheets. We define innovation spend excluding Starlab as innovation spend, minus the portion of innovation spend attributable to Starlab Space Stations. The table below sets forth the components of our innovation spend and innovation spend excluding Starlab for the years ended December 31, 2024, December 31, 2023 and three months ended March 31, 2025:
| | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | Three Months Ended March 31, | | |
| (dollars in thousands) | 2024 | | 2023 | | 2025 | | |
| Capitalized research and development under Section 174 | $ | 105,206 | | | $ | 46,222 | | | $ | 33,599 | | | |
Development program innovation spend(1) | 22,024 | | | 20,330 | | | 5,513 | | | |
| Innovation spend | 127,230 | | | 66,552 | | | 39,112 | | | |
| Less: Starlab Space Stations innovation spend | 101,678 | | | 42,556 | | | 29,378 | | | |
| Innovation spend excluding Starlab Space Stations | $ | 25,552 | | | $ | 23,996 | | | $ | 9,734 | | | |
________________(1)Development program innovation spend represents program spend on designated innovation programs within the business that is necessary for fulfillment of performance obligations on revenue generating programs.
Liquidity and Capital Resources
As of March 31, 2025, we had cash and cash equivalents of approximately $175.5 million, which primarily consisted of demand deposits and money market mutual funds substantially all held within U.S. bank accounts. We currently expect that our principal sources of funding will include our current cash balances and other forms of debt financings and equity offerings. We are focused on maintaining flexibility in the future evolution of our capital structure and seek to access the lowest cost of capital while also remaining opportunistic as organic and external opportunities arise. Targeted external growth opportunities would be funded primarily with a mix of equity, cash and
debt. In addition to NASA funding, we will consider all financing options for the Starlab, including funding through a combination of customer prebuys, the largest examples being other international space agencies, where prospective customers pay us in advance for usage of Starlab, as well as capital markets financing, including equity and project-based financing.
Our primary operating cash requirements include the payment of compensation and related costs, financing acquisitions, ongoing investment in Starlab and costs for our facilities and information technology infrastructure. As of March 31, 2025, we believe our existing cash and cash equivalents and funds received from the capital and equity markets will be sufficient to meet our working capital and capital expenditure needs over the next twelve months.
We expect our cost of sales, operating expenses and capital expenditures to increase in connection with our ongoing activities, particularly as we grow with our customers and win new business, expand our portfolio offering with new technologies, and continue to develop the next generation of space infrastructure.
Specifically, our costs, operating expenses and capital expenditures will increase as we:
•grow our revenue base;
•scale up our manufacturing processes and capabilities;
•maintain, expand and protect our intellectual property portfolio; and
•hire additional personnel in management to support the expansion of our operational, financial, information technology, and other areas to support our operations as a public company.
Although we believe that our current capital is adequate to sustain our operations for a period of time, changing circumstances may cause us to consume capital significantly faster than we currently anticipate, and we may need to spend more money than currently expected because of circumstances beyond our control.
Summary of Cash Flows
Three Months Ended March 31, 2025 Compared to Three Months Ended March 31, 2024
The following table presents the major components of our cash used in operating activities, cash used in investing activities and cash provided by financing activities for the periods presented:
| | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| (dollars in thousands) | 2025 | | 2024 | | Change |
| Cash used in operating activities | $ | (14,354) | | | $ | (7,906) | | | $ | (6,448) | |
| Cash used in investing activities | (8,970) | | | (5,400) | | | (3,570) | |
| Cash provided by financing activities | 142,854 | | | 24,540 | | | 118,314 | |
| Effect of foreign exchange on cash and cash equivalents | 28 | | | (10) | | | 38 | |
| Net increase in cash, cash equivalents, and restricted cash | $ | 119,558 | | | $ | 11,224 | | | $ | 108,334 | |
Operating Activities
Cash flows from operating activities can vary significantly from period to period as a result of our working capital requirements, given our portfolio of programs and the timing of milestone receipts and payments with customer and suppliers in the ordinary course of business. Investment in working capital is also necessary to build our business and manage supplier activities within program arrangements. We expect working capital balances to continue to vary from period to period. We efficiently fund our working capital requirements with financing activities.
The decrease in cash used in operating activities was driven by the net loss of $(26.9) million, which was offset by changes in working capital and non-cash activities of $12.6 million during the quarter ended March 31, 2025.
Investing Activities
The primary driver for the increase in cash used in investing activities relates to an increase in capital investment of $10.9 million, primarily at Starlab, offset by a $7.4 million increase in government grant funding received.
Financing Activities
The increase in cash provided by financing activities was driven by a $43.2 million and $74.7 million increase in Class A common stock and Series C fundraising, respectively, during the quarter ended March 31, 2025 as compared to the period ended March 31, 2024.
Year Ended December 31, 2024 Compared to Year Ended December 31, 2023
The following table presents the major components of our cash used in operating activities, cash (used in) provided by investing activities and cash provided by financing activities for the periods presented:
| | | | | | | | | | | | | | | | | |
| Years Ended December 31, | | |
| (dollars in thousands) | 2024 | | 2023 | | Change |
| Cash used in operating activities | $ | (25,502) | | | $ | (15,381) | | | $ | (10,121) | |
| Cash (used in) provided by investing activities | (27,773) | | | 11,598 | | | (39,371) | |
| Cash provided by financing activities | 78,957 | | | 1,931 | | | 77,026 | |
| Effect of foreign exchange on cash and cash equivalents | (31) | | | 9 | | | (40) | |
| Net increase (decrease) in cash, cash equivalents, and restricted cash | $ | 25,651 | | | $ | (1,843) | | | $ | 27,494 | |
Operating Activities
Cash flows from operating activities can vary significantly from period to period as a result of our working capital requirements, given our portfolio of programs and the timing of milestone receipts and payments with customer and suppliers in the ordinary course of business. Investment in working capital is also necessary to build our business and manage supplier activities within program arrangements. We expect working capital balances to continue to vary from period to period. We efficiently fund our working capital requirements with financing activities.
The increase in cash used in operating activities was driven by the net loss of $65.6 million, which was offset by changes in working capital and non-cash activities of $40.1 million during the year ended December 31, 2024.
Investing Activities
The primary driver for the increase in cash used in investing activities relates to an increase in capital investment on the Starlab program of $79.4 million compared to cash outflows related to Starlab in the year ended December 31, 2023 of $15.7 million, or an increase in cash used in investing activities of $63.7 million. This was compounded by an increase in cash used in investing activities due to an increase in capital expenditures within the business and other items of $3.9 million in the year ended December 31, 2024 compared to similar activities during the year ended December 31, 2023. This was partially offset by increases in government grants offsetting capital expenditures of $54.9 million in the year ended December 31, 2024 compared to $26.9 million in the year ended December 31, 2023.
Financing Activities
The increase in cash provided by financing activities was driven by $66.6 million of Series C investment fundraising, the $13.4 million noncontrolling interest investment in Starlab, and the $10.1 million 2024 Convertible Note (as defined below), partially offset by $9.5 million of additional financing raised on a loan vehicle in the year ended December 31, 2023 compared to the year ended December 31, 2024, and $3.1 million of Series B investment fundraising in the year ended December 31, 2023 that didn’t recur in the year ended December 31, 2024.
Selected Quarterly Financial Data
The following table summarizes our selected unaudited quarterly results of operations. The information for each of these quarters has been prepared on the same basis as our audited annual consolidated financial statements and reflects, in the opinion of management, all adjustments of a normal, recurring nature that are necessary for the fair statement of the results of operations for these periods. This data should be read in conjunction with our audited consolidated financial statements included elsewhere in this prospectus. Historical results are not necessarily indicative of the results that may be expected for the full fiscal year or any other period.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three months ended |
| (dollars in thousands) | December 31, 2024 | | September 30, 2024 | | June 30, 2024 | | March 31, 2024 | | December 31, 2023 | | September 30, 2023 | | June 30, 2023 | | March 31, 2023 |
| Revenue | $ | 37,712 | | | $ | 39,599 | | | $ | 36,653 | | | $ | 30,216 | | | $ | 42,293 | | | $ | 39,157 | | | $ | 32,843 | | | $ | 21,769 | |
| Net loss attributable to Voyager Technologies, Inc. | (8,960) | | | (14,967) | | | (23,322) | | | (14,823) | | | (1,766) | | | (1,835) | | | (13,579) | | | (8,258) | |
| Finance and interest expense | 2,987 | | | 2,940 | | | 3,095 | | | 2,994 | | | 3,042 | | | 3,112 | | | 2,688 | | | 1,748 | |
| Depreciation and amortization | 4,001 | | | 4,124 | | | 2,758 | | | 2,713 | | | 2,718 | | | 2,721 | | | 2,799 | | | 2,056 | |
| Taxes | (1,926) | | | 92 | | | (122) | | | 248 | | | (470) | | | 488 | | | (23) | | | 346 | |
| EBITDA | (3,898) | | | (7,811) | | | (17,591) | | | (8,868) | | | 3,524 | | | 4,486 | | | (8,115) | | | (4,108) | |
| Stock-based compensation | 1,072 | | | 845 | | | 1,113 | | | 730 | | | 829 | | | 557 | | | 668 | | | 653 | |
Business acquisition costs(1) | 26 | | | 25 | | | — | | | 230 | | | 5 | | | 42 | | | 3 | | | 594 | |
Restructuring(2) | 320 | | | 314 | | | 548 | | | 1,114 | | | 704 | | | 1,194 | | | 1,164 | | | 502 | |
| Impairment losses | — | | | 3,594 | | | — | | | — | | | — | | | — | | | — | | | — | |
| Net (loss) income attributable to noncontrolling interests | (418) | | | (280) | | | (2,729) | | | (129) | | | 467 | | | (1) | | | (252) | | | 26 | |
| | | | | | | | | | | | | | | |
Other(3) | (3,381) | | | (5,517) | | | 10,964 | | | (256) | | | (3,233) | | | 141 | | | 64 | | | 1,508 | |
Adjusted EBITDA(4) | $ | (6,279) | | | $ | (8,830) | | | $ | (7,695) | | | $ | (7,179) | | | $ | 2,296 | | | $ | 6,419 | | | $ | (6,468) | | | $ | (825) | |
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| (dollars in thousands) | 2025 | | 2024 | | | | |
| Net loss attributable to Voyager Technologies, Inc. | $ | (26,938) | | | $ | (14,823) | | | | | |
| Finance and interest expense | 2,729 | | | 2,994 | | | | | |
| Depreciation and amortization | 2,602 | | | 2,713 | | | | | |
| Taxes | 48 | | | 248 | | | | | |
| EBITDA | (21,559) | | | (8,868) | | | | | |
| Stock-based compensation | 1,723 | | | 730 | | | | | |
Business acquisition costs(1) | 156 | | | 230 | | | | | |
Restructuring(2) | 418 | | | 1,113 | | | | | |
| Impairment losses | — | | | — | | | | | |
| Net loss attributable to noncontrolling interests | (991) | | | (129) | | | | | |
| | | | | | | |
Other(3) | (1,103) | | | (255) | | | | | |
Adjusted EBITDA(4) | $ | (21,356) | | | $ | (7,179) | | | | | |
| | | | | | | |
________________
(1)Business acquisition costs includes legal costs and incremental transaction costs associated with an acquisition.
(2)Restructuring includes costs for retention and severance payments related to management’s decision to undertake certain actions to realign our cost structure through workforce reductions and the closure of certain facilities, businesses and product lines.
(3)Other includes capital market and advisory fees related to advisors assisting with transitional activities associated with becoming a public company, changes in fair value of earn out liabilities, and foreign exchange gain/loss that are all individually insignificant for the period.
(4)Adjusted EBITDA for the period includes the impact of non-cash services, which are excluded from Segment Adjusted EBITDA. For further information regarding these non-cash services, please refer to the notes to our consolidated financial statements included elsewhere in this prospectus.
Outstanding Indebtedness
The following table summarizes our long-term debt as of the dates presented:
| | | | | | | | | | | |
| (dollars in thousands) | March 31, 2025 | | December 31, 2024 |
| Term loan | $ | 65,972 | | | $ | 65,972 | |
| 2024 Convertible Notes | 10,532 | | | 10,274 | |
| SMI Promissory Notes | 24,999 | | | 24,593 | |
| Less: debt issuance costs | (10,996) | | | (11,820) | |
| Net carrying amount | 90,507 | | | 89,019 | |
| Less: current portion | 676 | | | 665 | |
| Total long-term debt, net | $ | 89,831 | | | $ | 88,354 | |
Term Loan
On June 28, 2024, we and our domestic subsidiaries, excluding Starlab, entered into a $58.0 million Loan and Security Agreement (“Credit Agreement”) with the lenders party thereto and Hercules Capital, Inc., as administrative agent and collateral agent, which provided for a $58.0 million term loan (the “Term Loan”). The Term Loan matures on July 1, 2028. The Term Loan bears interest at a variable annual rate equal to the sum of (a) the greater of (i) the Wall Street Journal Prime Rate or (ii) 8.50%, and (b) 1.25% per annum. The Term Loan bears additional interest, which is equal to 2.50% of the total outstanding principal, computed daily based on the actual number of days elapsed and added to the outstanding principal balance. Commencing on July 1, 2026, we are required to make payments of $2.6 million the first business day of each month, which includes both principal repayment and scheduled interest payments. The two-year interest only period can be extended over the balance of the agreement upon achievement of certain gross profit and EBITDA milestones. The Term Loan is secured by substantially all our assets and the assets of the guarantors.
The Credit Agreement includes a minimum liquidity threshold, which requires us and the guarantors to, at all times, maintain an aggregate cash balance in all accounts subject to account control agreements in an amount of at least $12.5 million. Additionally, the Credit Agreement contains restrictive covenants and events of default. See “Description of Certain Indebtedness—Term Loan.” We, at our option, may voluntarily prepay the Term Loan. Such prepayments require repayment of all outstanding principal, all accrued and unpaid interest, the end-of-term charge, and a prepayment charge that is equal to 3.00% of outstanding principal if prepaid before June 28, 2025, 2.00% of outstanding principal if prepaid between June 28, 2025 months and June 28, 2026, or 1.00% of outstanding principal if prepaid after June 28, 2026, but before the maturity date.
We used the proceeds from the Term Loan to refinance our $50.0 million senior secured note (the “Term Note”) in June 2024, resulting in a loss on debt extinguishment of $10.7 million.
We currently have no indebtedness outstanding under the Revolving Credit Facility. However, we intend to partially draw on the Revolving Credit Facility to repay in full the Term Loan on or around July 1, 2025. We expect to repay the amounts drawn on or around July 1, 2025 under the Revolving Credit Facility with cash on hand in the future. See “Prospectus Summary—Recent Developments” and “Description of Certain Other Indebtedness.”
2024 Convertible Notes
At various times during 2024, Starlab JV issued convertible promissory notes (“2024 Convertible Notes”) for a total principal amount of approximately $10.1 million. In January 2025, Starlab Space LLC raised an additional $0.1 million. As of March 31, 2025, there is a total principal amount of $10.2 million outstanding under the 2024 Convertible Notes. The notes bear interest at a rate of 5.0% per annum, payable at maturity, which is on the third anniversary of the issue date if no triggering events occur prior to that date. Starlab JV has the option to prepay all or any of the principal and any accrued and unpaid interest at any time.
The 2024 Convertible Notes are convertible into equity units upon the following: (i) a qualified financing event, defined as a transaction or series of transactions pursuant to which Starlab JV issues shares of any class or series of equity securities to one or more investors, including any of the lenders with the principal purpose of raising capital that raises gross proceeds of at least $10.0 million, excluding the amount represented by the conversion of any outstanding indebtedness in accordance with their respective terms; (ii) at the option of the lender upon a nonqualified financing event; (iii) a liquidity event, defined as a consolidation or merger with another corporation, entity, or person or other event through which the unit holders, immediately prior to such consolidation or merger, own less than 50% of the voting power of the surviving entity, immediately after such consolidation or merger, a sale or other disposition of substantially all Starlab JV’s assets, or the closing of Starlab JV’s first underwritten public offering; and (iv) the maturity date. Upon a conversion event described in (i) or (ii), the notes will convert into the same class and series of units as those sold as part of the financing event. Upon a conversion event described in (iii) or (iv), the notes will convert into Class A-1 Units of Starlab JV. The number of Class A-1 Units issued will be equal to (1) the outstanding principal balance of the note and all accrued and unpaid interest due, divided by (2) 85% of the price per unit paid by the investors to purchase the new securities in the subsequent financing.
We evaluated the features of the 2024 Convertible Notes and determined that items (i) and (ii) met the definition of embedded derivatives as they are not clearly and closely related to the debt host instrument and were bifurcated and measured at fair value. The fair value was measured using the scenario based method inside the “with and without” method and resulted in a value of approximately $3.1 million at inception which was recorded as a discount on the convertible notes. The key assumptions utilized in the valuation were the scenario timing, mandatory conversion discount, discount rate, and scenario probabilities.
Interest expense on the 2024 Convertible Notes totaled $0.1 million for the three months ended March 31, 2025 and $0.2 million for the year ended December 31, 2024. Amortization of the debt discount was $0.2 million for the three months ended March 31, 2025 and $0.3 million for the year ended December 31, 2024. The 2024 Convertible Notes were converted into Starlab equity units in April 2024.
SMI Promissory Notes
In May and June 2023, we acquired additional shares of SMI from certain minority stockholders in exchange for promissory notes (collectively, the “SMI Promissory Notes”) in aggregate amount of approximately $28.4 million. In October 2024, the SMI Promissory Notes were modified for certain shareholders to be payable in our equity securities at the earlier of October 2, 2025 for certain holders or the completion of our initial public offering, or October 2, 2026 or the completion of our initial public offering for other holders. The SMI Promissory Notes bear interest at the Wall Street Journal Prime Rate, which is accrued in arrears. The SMI Promissory Notes had an outstanding balance of approximately $25.0 million at March 31, 2025.
Off-Balance Sheet Arrangements
As of March 31, 2025, we had no material off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
Contractual Commitments
We enter into contractual obligations in the normal course of business.
Operating Lease Commitments
Our operating lease commitments primarily consist of office lease rentals. As of March 31, 2025, December 31, 2024 and December 31, 2023, we had fixed lease payment obligations of $15.3 million, $14.4 million, and $12.1 million, respectively, with $2.4 million to be paid within the 2025 fiscal year and the remainder thereafter. For additional discussion on our operating leases, see Note 9, “Leases” to our audited consolidated financial statements included elsewhere in this prospectus.
Non-Cancellable Service Contract Commitments
We have a commitment for future launch services. As of March 31, 2025, we would owe $13.5 million to cancel the services. For additional discussion, see Note 14, “Commitments and Contingencies” to our unaudited condensed consolidated financial statements included elsewhere in this prospectus.
Non-Cancellable Subscription-Based Services
We have a commitment for subscription-based services totaling a commitment of $2.0 million that is payable in the form of the Company’s equity as of the period ending March 31, 2025. For additional discussion, see Note 14, “Commitments and Contingencies” to our unaudited condensed consolidated financial statements included elsewhere in this prospectus.
Critical Accounting Policies and Estimates
This Management’s Discussion and Analysis of Financial Condition and Results of Operations discusses our Consolidated Financial Statements, which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires management to make judgments, assumptions and estimates that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. For a summary of our significant accounting policies, see Note 2, “Summary of Significant Accounting Policies” to the Consolidated Financial Statements. On an ongoing basis, management evaluates its estimates, including those related to the valuation of acquired intangibles, intangibles, long-lived assets, redeemable noncontrolling interests, realization of tax assets and estimates of tax liabilities, valuation of equity securities and financial instruments, estimated useful lives of long-lived assets, and reported amounts of revenues and expenses during the reporting period.
We consider the following accounting policies to be critical to an understanding of our financial condition and results of operations because these policies require the most difficult, subjective or complex judgments on the part of management in their application. Actual results could differ from our estimates and assumptions, and any such differences could be material to our Consolidated Financial Statements.
Revenue Recognition
We account for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. We recognize revenue upon satisfying the performance obligations identified in the contract, which is achieved as services are rendered, upon completion of a service, or through the transfer of control of the promised good or service to the customer either at a point-in-time or over time.
Once we identify the performance obligations, we determine the transaction price, which includes estimating the amount of variable consideration to be included in the transaction price, if any. Our contracts generally do not contain penalties, credits, price concessions, or other types of potential variable consideration. Prices are fixed at contract inception and are not contingent on performance or any other criteria.
Control is transferred over time for: (a) certain contracts under which we produce products with no alternative use and for which it has an enforceable right to recover costs incurred plus a reasonable profit margin for work completed to date; and (b) certain other contracts under which we create or enhance a customer-owned asset while performing design and development services. Under the cost-to-cost method, revenue is recognized for these contracts based on our efforts toward satisfying a performance obligation relative to the total expected efforts, which is measured using the proportion of costs incurred to date to the total EAC of the performance obligation. Revenue
for the current period is recorded at an amount equal to (i) the ratio of costs incurred to date, (ii) divided by total estimated costs, multiplied by (iii) the transaction price, less (iv) cumulative revenue recognized in prior periods. Contract costs include all direct material and labor costs and any indirect costs related to contract performance.
These projections require us to make numerous assumptions and estimates when determining the total estimated costs of completion, including items such as development costs, performance of subcontractors, availability and cost of materials, labor productivity and cost, overhead, and capital costs. We review our cost estimates on a periodic basis, or when circumstances change and warrant a modification to a previous estimate. Cost estimates are largely based on negotiated or estimated purchase contract terms, historical performance trends, and other economic projections. For the three months ended March 31, 2025, we recorded an aggregate unfavorable EAC adjustment across programs of $2.2 million, which resulted in a $2.0 million reduction of revenue included within the results of operations for the three months ended March 31, 2025. For the year ended December 31, 2024, we recorded an aggregate unfavorable EAC adjustment across programs of $5.2 million, which resulted in a $2.2 million reduction of revenue included within the results of operations for the year ended December 31, 2024. For the year ended December 31, 2023, we recorded an aggregate unfavorable EAC adjustment across programs of $3.9 million, which resulted in a $1.7 million reduction of revenue included within the results of operations for the year ended December 31, 2023. The impact in each period was the result of an aggregation of individually immaterial EAC adjustments on contracts. For the quarter ended March 31, 2025 and the years ended December 31, 2024 and 2023, there were no material favorable EAC adjustments, neither individually nor in the aggregate.
When estimates of total costs to be incurred on a contract exceed total estimates of the transaction price, a provision for the entire loss is determined at the contract level and is recorded in the period in which the loss is evident, which we refer to as a loss provision. For the quarter ended March 31, 2025 and the years ended December 31, 2024 and 2023, there were no material loss contract provisions recorded, neither individually nor in the aggregate.
Net sales in the income statement consists entirely of revenue from contracts with customers, net of sales discounts.
Income Taxes
We recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement carrying amount and the tax basis of assets and liabilities, and net operating loss carryforwards using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are provided if, based upon the weight of available evidence, it is more likely than not that some or all the deferred tax assets will not be realized. When uncertain tax positions exist, we recognize the tax benefit of tax positions to the extent that the benefit would more likely than not be realized assuming examination by the taxing authority. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances. We recognize any interest and penalties accrued related to unrecognized tax benefits as income tax expense.
Class A Common Stock Valuations
The fair value of our Class A common stock and underlying stock options has historically been determined by our Board of Directors, with assistance from management and contemporaneous third-party valuations. Given the absence of a public trading market for our Class A common stock and in accordance with the American Institute of Certified Public Accountants Practice Aid, Valuation of Privately Held Company Equity Securities Issued as Compensation, our Board of Directors has exercised reasonable judgment and considered numerous objective and subjective factors to determine the best estimate of the fair value of our Class A common stock at each grant date. These factors include:
•third-party valuations of common and preferred stock and secondary market trading information;
•the prices, rights, preferences, and privileges of the preferred stock relative to those of the Class A common stock;
•the lack of marketability of the Class A common stock;
•the actual operating and financial results;
•our current business conditions and projections;
•the likelihood of various potential liquidity events, such as an initial public offering or sale of the Company, given prevailing market conditions;
•the lack of marketability of our Class A common stock;
•the historical sales price of our Class A common stock in secondary transactions;
•average historical stock price volatility of comparable publicly traded companies in its industry peer group; and
•the U.S. and global economic and capital market conditions and outlook.
Following our listing on the New York Stock Exchange, the fair value per share of our Class A common stock for purposes of determining stock-based compensation will be the last available closing price of our Class A common stock as reported on or before the applicable grant date.
In determining the fair value of our Class A common stock, the third-party valuation estimates the enterprise value of our business using the income approach. The income approach estimates value based on the expectation of future cash flows that a company will generate. These cash flows are discounted to the present using a rate of return that incorporates the risk-free rate for the use of funds, the expected rate of inflation, and risks associated with the particular investment. The estimated enterprise value is then allocated to the Class A common stock using (i) the Option Pricing Method with respect to a scenario in which holders of our capital stock were assumed to be able to realize liquidity through our buy-back programs, other secondary-market transactions, and similar transactions; and (ii) a Monte Carlo Simulation with respect to a scenario in which we completed an initial public offering event.
An additional indication of fair value considered when valuing our Class A common stock is the weighted average price of secondary market transactions. We considered qualified transactions over a period of time prior to and sometimes extending beyond the date of valuation.
Recent Accounting Pronouncements
See Note 3, “Recent Accounting Pronouncements” in the consolidated financial statements.
Quantitative and Qualitative Disclosures About Market Risk
We have operations within and outside of the United States, and as such we are exposed to market risks in the ordinary course of our business, including the effects of interest rate changes and fluctuations in foreign currency exchange rates. Information relating to quantitative and qualitative disclosures about these market risks is set forth below.
Interest Rate Risk
We had cash and cash equivalents totaling $175.5 million as of March 31, 2025 and $55.9 million as of December 31, 2024. Our cash and cash equivalents are held for working capital purposes.
Our cash equivalents and our investment portfolio are subject to market risk due to changes in interest rates. Due in part to these factors, our future investment income may fall short of our expectations due to changes in interest rates or we may suffer losses in principal if we are forced to sell securities that decline in market value due to changes in interest rates. However, because we classify our marketable securities as “available for sale,” no gains are recognized due to changes in interest rates. As losses due to changes in interest rates are generally not considered to be credit related changes, no losses in such securities are recognized due to changes in interest rates unless we
intend to sell, it is more likely than not that we will be required to sell, we sell prior to maturity or we otherwise determine that all or a portion of the decline in fair value are due to credit related factors.
As of March 31, 2025, a hypothetical 10% relative change in interest rates would not have had a material impact on the value of our cash equivalents or investment portfolio. Fluctuations in the value of our cash equivalents and investment portfolio caused by a change in interest rates (gains or losses on the carrying value) are recorded in other comprehensive income (loss) and are realized only if we sell the underlying securities prior to maturity.
We are exposed to interest rate risk on our variable-rate borrowings. As of March 31, 2025, we had $82.6 million of variable rate indebtedness. As of March 31, 2025, the variable rate indebtedness is comprised of $57.6 million outstanding under the Term Note and $25.0 million outstanding under the SMI Promissory Notes. The Term Note bears interest at the Wall Street Journal Prime Rate plus 4.5% per annum. The SMI Promissory Notes bear interest at the Wall Street Journal Prime Rate.
As of March 31, 2025, a hypothetical 10% relative change in interest rates would have resulted in an increase in interest expense to service our variable-rate debt of approximately $2.0 million.
We may decide in future periods to engage in hedging transactions to further mitigate the interest rate risk under our variable-rate borrowings.
Foreign Currency Risk
Although the majority of our transactions are denominated in U.S. dollars, some of our transactions are denominated in foreign currencies. Certain contractual relationships with customers and vendors mitigate risks from currency exchange rate changes that arise from normal purchasing and normal sales activities. Our revenue and purchase contracts are primarily denominated in U.S. dollars. However, fluctuations in the value of foreign currencies may make payments in U.S. dollars, as provided for under our existing contracts, more difficult for foreign customers. In addition, fluctuations in foreign currencies could introduce volatility into our financial statements for contracts denominated in a foreign currency. As of March 31, 2025, a hypothetical 10% depreciation in the U.S. dollar relative to the year-end foreign currencies under our contracts in place as of that date would not have resulted in a reduction in our net sales on a year to date basis.
BUSINESS
Our Company
We are an innovation-driven defense technology and space solutions company. Our company was purpose-built to address issues at the forefront of defense, national security and space industries and we have organized our business to reflect this goal. We strive to solve complex challenges to fortify national security, protect critical assets and unlock new frontiers for human progress and economic development. We are committed to developing and delivering an array of transformative, mission-critical solutions to customers enabled by our advanced technology, analytics and space infrastructure capabilities. Our solutions include communications and intelligence collection systems, defense systems, advanced space technology, in-space infrastructure and space mission services. Our business consists of diversified solutions across three business segments: Defense & National Security, Space Solutions and Starlab Space Stations. Since 2019, we have accomplished significant achievements in each of these segments, including the successful deployment of first-of-its-kind missile defense maneuvering capabilities, the development of groundbreaking space technology and the selection by NASA to develop a replacement for the ISS.
We operate a flexible business model that allows us to serve both as a prime contractor, providing fulsome and integrated solutions directly to customers, as well as a merchant supplier, or subcontractor, providing critical technologies to support several commercial and government programs across the space and national security sectors. Our key partners and customers include Palantir, NASA, Lockheed Martin, the U.S. Air Force and Sierra Space. Our ability to serve in both prime and merchant supplier capacities with these customers and partners allows us to selectively participate in a wide range of programs in whichever capacity is more attractive to us. Prime contractor roles allow us to lead the entirety of a program, managing the supply chain, technology integration and end customer relationship. Merchant Supplier roles are an opportunity for us to supply our differentiated technologies to a broader range of programs and support multiple prime competitors, on attractive terms. Our ability to serve in both capacities allows us to selectively participate in a wide range of programs in whichever capacity is best suited to our solution, financial contribution and probability of win.
Our growth strategy includes organic and inorganic expansion, leveraging our existing technologies and pairing out our software capabilities with our hardware, leading to the development of new solutions to meet customer needs. Since 2019, we have executed and successfully vertically and horizontally integrated seven acquisitions, and have grown our revenue to $144.2 million in 2024 and $34.5 million for the three months ended March 31, 2025. In addition, we received cash proceeds of $3.0 million in 2022, $62.0 million in 2023, $62.2 million in 2024 and $20.0 million during the three months ended March 31, 2025 (with $70.3 million of eligible proceeds remaining as of March 31, 2025) from our $217.5 million development grant with NASA to design Starlab, the commercial space station replacement for the ISS which is set to be decommissioned in 2030. We intend to operate Starlab through Starlab JV, a Voyager-led and majority-owned global joint venture, with international equity partners that include Airbus, Mitsubishi, MDA Space and Palantir. Our growth and increased size and scale are the result of investment and focus on our key technology offerings, as well as our ability to attract, cultivate and integrate accretive acquisitions. Additionally, the threat environment is driving investment in solutions that cross multiple domains, such as missile defense programs that require interoperability among space-, air- and ground-based systems. Our position and technology heritage across multiple domains and systems positions us well to support this trend towards increasing convergence.
Our business consists of diversified solutions across three business segments:
•Defense & National Security, which provides innovative mission-critical solutions to protect dynamic and contested domains. We pioneer communications technologies, guidance, navigation and controls, signals intelligence and defense systems.
•Space Solutions, which delivers space infrastructure, advanced space technology, science systems and mission services that power commercial, academic and government missions from low-Earth orbit to deep space.
•Starlab Space Stations, which is a commercial space station planned to succeed the ISS and provide continued permanent human presence in space. It is operated through our U.S.-led global joint venture with Airbus, Mitsubishi, MDA Space and Palantir, among others.
We operate in markets that have tailwinds supporting investment from both commercial and government clients worldwide. From a Defense & National Security perspective, we believe our solutions serve a total addressable market of $163 billion. Our serviceable addressable market is $11 billion. Our Space Solutions & Starlab Space Stations segments serve a total addressable market of $16 billion, of which we serve $1 billion. There are significant opportunities both in the U.S. as well as for allied international economics and governments.
Our business thrives through collaboration and synergies across our various business segments. Our ability to share technology, identify cross-selling opportunities and realize cost savings through improved organizational efficiency drives our growth and financial performance. For example, we are developing artificial intelligence powered edge computing units to operate across Earth and space, layered with Palantir’s operating system and our end-to-end intelligence analytics platform, to deliver real-time intelligence capabilities for defense and national security applications and for space exploration. Starlab’s technical design and business case benefit tremendously from our broader organization, aiding in our continued development of the project. We are distinctively positioned as a leader in space science and commercialization and we intend to bring the extensive business development, mission design, management and customer service experience of our Space Solutions segment to support the development and operations of our Starlab Space Stations segment.
We maintain long-term relationships with many of the industry’s largest and most important blue-chip customers, across both government agencies and commercial entities. Since our founding and through March 31, 2025, we have been awarded approximately $800 million in contracts and SAAs. Our largest customer is NASA, which represented 25.6% of our revenue for the year ended December 31, 2024 and 19.7% of our revenue for the three months ended March 31, 2025. Our close relationship with government customers highlights the public-private partnership model that has been a significant driver of growth in the national security and space industries and commercialization opportunities. For example, we attached the Bishop Airlock to the ISS in 2020, demonstrating the viability of the public-private partnership model for the development of critical commercial space infrastructure and paving the way for our partnership with NASA on Starlab. We expect this partnership model to continue to provide us with a significant opportunity to participate in critical national security and space technology development in the future. For example, in 2023, in addition to the $800 million in contracts and SAAs discussed above, we were awarded a $900 million ceiling IDIQ contract by the Air Force Life Cycle Management Center’s Architecture and Integration Directorate to deliver a cost-effective intelligence, surveillance and reconnaissance system. We believe we are well-positioned to benefit from this funding mechanism given our close relationships with government customers and our track record as a reliable technology and solutions provider. Although we see our relationship with the U.S. government as a positive, we do rely on this relationship for a substantial portion of our business. Changes to the U.S. government’s priorities and spending, or delays or reductions in spending, could have a material adverse effect on us.
We benefit from business segments that serve varied end markets as well as meaningful customer diversity. We believe that our revenue diversification provides significant resiliency and positions us well to capitalize on new business opportunities across markets and customers. The following charts summarize our revenue for the year ended December 31, 2024 by segment and customer:
We also receive meaningful cash proceeds from our development grants for research and development, providing further diversity for financing our initiatives. Development grants allow us to receive sizeable funding from our customers to develop what we believe are next-generation technologies without having significant cash constraints due to our size. We also work hand-in-hand with our customers to create solutions addressing directly their needs. In December 2021, our subsidiary Nanoracks was awarded a SAA, which was subsequently transferred to us, and which we subsequently transferred to Starlab JV, under Phase I of NASA’s CDFF program as part of the agency’s effort to foster a commercial space station to succeed the ISS. Through this SAA, we were initially awarded $160 million in development grants—the largest CDFF award from NASA—to pursue the design and development of Starlab through 2026. In 2023, Northrop Grumman, another CDFF SAA recipient, withdrew its space station program and joined our effort as a strategic supply chain partner to Starlab. Subsequently, we were awarded an additional $58 million in development grants under our CDFF SAA, bringing our total grant to $217.5
million. As we achieve certain program milestones, cash proceeds are paid to us from the $217.5 million total grant, including $3.0 million paid in 2022, $62.0 million paid in 2023, $62.2 million paid in 2024, and $20.0 million paid in the three months ended March 31, 2025. As of March 31, 2025, we have $70.3 million of our development grant remaining. On January 13, 2025, we achieved the first milestone by successfully completing the preliminary design review in collaboration with NASA, an important step toward full-scale production. The next milestone is detailed design and hardware development, leading to a Critical Design Review to confirm Starlab’s readiness. The U.S. government continues to support investment in these technologies. For example, NASA’s fiscal year 2026 budget request includes approximately $2.1 billion for commercial LEO development through 2030. Based on our previous success receiving grants, we believe we are well-positioned to win future development grants and contracts from NASA and other space agencies to aid in funding the development of Starlab. Additionally, in 2025, we received an award of $15 million by the Texas Space Commission as part of their Space Exploration and Aeronautics Research Fund grant program to help support Starlab and grow its ecosystem of suppliers and customers across Texas.
We are supported by a highly skilled workforce operating across our facility footprint. As of March 31, 2025, we employed approximately 514 people across 10 locations. We believe our footprint is well-aligned with our markets, enabling close collaboration with government and commercial customers, reliable manufacturing operations and access to the required testing environment for our technologies. In addition to our footprint, our Starlab Space Stations segment benefits from access to the existing facilities and operations of our equity and
strategic partners, lowering direct capital expenditure needs for Starlab development. These equity and strategic partners are also helping develop and deliver technologies, solutions and hardware for Starlab.
Our Platform and Journey
Voyager was Purpose-Built to Address the Underserved Needs of Defense, National Security and Space Customers
The U.S. and allied defense and national security supply chain is ill-equipped to provide critical technologies at scale in today’s rapidly evolving threat environment. This supply chain has been predominately served by traditional aerospace and defense industry players. However, with the increasing complexity of advanced technologies, traditional aerospace and defense industry players are unable to develop and deliver affordable, cutting-edge and disruptive technologies at the modern speed of warfare. The slow and bureaucratic nature of traditional defense procurement processes and its legacy contractor base burdened by large, complex cost structures hinders rapid innovation and the development and integration of emerging technologies.
Historically, space activities were driven by government-led, owned and operated programs that often executed slowly and inefficiently. To address these deficiencies, the space industry has shifted to a public-private partnership model in recent years, exemplified by NASA’s use of commercial launch providers such as SpaceX and Northrop Grumman. However, the space industry lacks sufficient well-operated companies with advanced technological capabilities at scale to address the complicated needs of the growing space economy. Additionally, demand for space activities has evolved to include the needs of commercial customers across industries such as healthcare, agriculture, energy and advanced manufacturing. With space destinations limited to the new Chinese government-owned Tiangong Station and the aging ISS, these customers are constrained in capacity and options necessary to pursue a rapidly expanding opportunity in the space economy. Though we were built to address this growing need, many of our competitors are substantially larger than we are and may be able to adapt more quickly to changing technology or market conditions or may be able to devote greater resources to the development, promotion and sale of their products, which may make it more difficult for us to execute on our business and growth strategies.
Voyager Is Addressing Attractive Growth Markets
The U.S. defense and national security industry continues to demonstrate a stable and long-term growth trajectory, driven by its vital role in ensuring national security and maintaining global stability. With sustained
government investment, a robust pipeline of advanced technological innovations and increasing focus on modernization to address evolving threats, the industry remains a cornerstone of the nation’s economy. As global security challenges intensify, we believe we are well-positioned to adapt, expand and deliver cutting-edge capabilities, reinforcing the resilience of the nation’s leadership position in a competitive global landscape. We expect that growth in national security spending will continue as militaries invest to maintain operational readiness and counter ever-evolving threats. In the United States, defense and national security spending has generally benefited from strong bi-partisan support, generating a stable and growing investment over time. The fiscal year 2025 request for the DoD budget was approximately $850 billion, compared to approximately $700 billion for fiscal year 2022. Furthermore, space is a growing priority for defense and national security investment, as space is increasingly contested, congested and competitive and space-based capabilities play a greater role for conventional warfighting forces on land, air and sea. In 2023, governments worldwide invested approximately $59 billion in space defense and security activities according to Euroconsult.
The space economy has experienced historic growth over the past decade, driven by advancements in satellite technology, reusable launch systems and increased commercial investment. According to Euroconsult, from telecommunications to Earth observation to emerging sectors such as resource exploration, the global space economy has expanded to exceed $508 billion in 2023, representing the value of all contracts in the industry, as well as non-contracted government activities. This growth trajectory is expected to accelerate with projections surpassing $820 billion by 2032 according to Euroconsult. Private enterprises are a major part of demand in the market, with commercial customers comprising approximately 85% of the total space economy in 2023 according to Euroconsult. We expect the commercial space economy will continue to grow and we believe we are well-positioned to meet the unique needs of commercial customers. As both national and private enterprises continue to innovate and collaborate, the space economy is poised to become a cornerstone of economic and technological progress, opening new frontiers for exploration, commerce and sustainability.
Voyager Is Driven By Innovation At Scale
Innovation is core to our identity. Through our strategic acquisitions, we leverage more than three decades of technology development and spaceflight heritage to offer reliable, differentiated solutions to our customers beginning when SAMS was developed in 1993 by ZIN Technologies, Inc. We operate an agile and entrepreneurial business model positioned to rapidly develop and iterate technologies to meet the evolving needs of our defense, national security and space customers. Including through our acquired business lines, we have executed over 1,000 customer space missions and supplied over 220 spacecraft subsystems, a track record that entrenches us with our commercial and government customers who continue to trust us to deliver solutions for many of their most important programs. We have the capability to support these programs at scale and meet the growing demand for critical technologies in our markets.
Since our founding in 2019, we have won and executed major roles on several marquee programs. For instance, in 2024, Lockheed Martin selected us to deliver the upper stage propulsion subsystem and optical guidance technology for MDA’s NGI program, a vital component in defending the United States against long-range ballistic missile threats from strategic adversaries. Our dual-use optical guidance technologies have played a critical role on a number of national security and space programs, including RTX Corporation’s missile defense initiatives and
Millennium Space Systems’ (a Boeing company) small satellite constellation programs, where they are vital to mission success.
| | | | | |
| The NGI program is a critical U.S. national security initiative designed to counter long-range ballistic missile threats. We are subcontracted by Lockheed Martin and provide advanced propulsion subsystems for the NGI program, including a RCS with thrust and control algorithms for precision orientation control and a stage separation propulsion system. Our controllable solid propulsion technology enhances interceptor reliability, accuracy, and affordability by mimicking liquid and cold-gas system performance. The RCS ensures stable and precise flight adjustments, while the stage separation system ensures optimal transitions between flight stages. In 2020, we became the first and only company to attach a permanently integrated, privately-owned commercial module to the ISS, the Bishop Airlock. The Bishop Airlock enables movement of equipment, supplies and payloads between the ISS and the open vacuum of space. The technology and expertise developed in the airlock program has been critical to our development of advanced space infrastructure and space stations. |
| | | | | |
| Our Bishop Airlock, the first permanent, commercial addition to the ISS, provides a versatile platform for deploying satellites, experiments and robotics. Leading robotics innovator, Gitai, leveraged the Bishop Airlock to successfully demonstrate its advanced robotic arm in space. Their robotic arms performed tasks such as tool operation, structure assembly and maintenance, showcasing the potential of robotics to reduce astronauts’ workload on routine tasks. This collaboration showed how robotics can enhance operational efficiency and free up crew time for critical activities. We believe the Bishop Airlock is advancing space technology and enabling sustainable human-robot collaboration for future space exploration. In 2021, NASA awarded Nanoracks, a prime contract, which was subsequently transferred to us, and which we subsequently transferred to Starlab JV, to develop Starlab, our commercial replacement for the ISS which is set to be decommissioned in 2030. We believe Starlab will be essential to ensuring continued permanent human presence in LEO by the United States and its allies. We believe that by continuing to pioneer with disruptive solutions and by continuing to execute reliably for our customers, we will continue to win highly attractive, important roles on marquee programs of the future. |
Experienced Leadership and Team
Our company culture, strategy and operational execution are driven by our visionary co-founders, Dylan Taylor and Matthew Kuta. Dylan Taylor, our Chairman and Chief Executive Officer, is a global business leader with experience as a Fortune 1000 executive in several industries. Matthew Kuta, our President, is a former private equity investor and distinguished F-15E fighter pilot for the U.S. Air Force. Their experience was paramount to our founding in 2019, assembling a world-class team of disruptors with a proven track record of forward-thinking and entrepreneurship. We also leverage the expertise of our Board of Directors, Defense & National Security Strategic Advisory Board and Space Strategic Advisory Board, all of which are comprised of industry experts with government and commercial industry experience, including former military generals, agency directors, NASA astronauts and administrators, CEOs and globally renowned scientists. To assist in our ability to launch and maintain a space station on our own we intend to, among other things, recruit and retain adequate numbers of effective sales and marketing personnel.
Our Segments
Defense & National Security Segment
| | | | | |
| Our Defense & National Security segment, which represented approximately 50.9% of our revenue for the year ended December 31, 2024 and approximately 66.1% of our revenue for the three months ended March 31, 2025, provides leading technology capabilities that support marquee programs with expertise in defense systems, signals intelligence, communications technologies and guidance, navigation and control systems. |
Defense Systems
| | | | | |
| We offer distinct, controllable solid propulsion technology, enabling missile programs critical to fortifying national defense systems. Our breakthrough solid fuel propulsion technology delivers precise thrust for orienting, positioning and steering missiles, including the extremely fast and accurate high thrust levels required for hypersonic applications. Controllable solid propulsion technology is of significant value to our customers compared to liquid and cold-gas systems, because solid systems are less expensive to produce and maintain and can be stored for decades without risk of fuel leaks. Currently, we have a $78 million contract (assuming receipt of maximum fees) to provide the advanced solid-propulsion subsystem for Lockheed Martin’s NGI contract with the U.S. Missile Defense Agency. We believe that our advanced technology will gain increased adoption on a broad range of existing and future advanced missile programs, including missile defense interceptors and kill vehicles, strategic, tactical and hypersonic missiles and reentry systems. Additionally, our technology is multi-use, with the potential for applications on civil, commercial and military space launch systems and payloads. |
Signal Intelligence Systems
| | | | | |
| We believe our end-to-end intelligence analytics platform provides considerable enhancement to how government agencies process and act on critical intelligence. Our advanced signal processing, geolocation technologies and artificial intelligence driven analytics enhance situational awareness, cutting through the noise to reveal mission-critical intelligence. By integrating our proprietary software solutions with Palantir’s operating system, we plan to transform multi-source, raw signals intelligence data into real-time, actionable insights for complex mission situations. With a decade-long track record as a trusted partner to national security agencies and defense primes, our solutions are vital for ensuring operational efficiency, security and mission success across the military and intelligence community. As the demand for cutting-edge intelligence capabilities accelerates, we believe our technology-first approach positions us at the forefront of the defense-tech revolution. |
Communication Technologies
| | | | | |
| We offer a broad range of space-qualified communications technologies, including radiation-hardened laser and RF communications systems and advanced electro-optical and digital systems. Our offerings include transceivers, mission-data transmitters and command and data handling systems that can sustain high-quality performance for extended periods of time. Our solutions have a long-standing heritage, enabling LEO and deep space missions since 2002, with a failure-free cumulative track record of over 275 flight years in space. As our industry continues to evolve, we expect our business will grow to serve new end markets, such as on-orbit edge computing and large-scale orbital infrastructure, including for our own Starlab Space Stations segment. |
Guidance, Navigation and Control Systems
| | | | | |
| We design, develop, and produce critical technologies for controlling and navigating spacecraft, rendezvous and proximity operations and non-GPS position, navigation and timing. Our solutions portfolio includes sun sensors, star trackers, and inertial measurement units that currently serve the growing satellite constellation market and other demanding and essential missions. Our technologies are multi-use, applicable to critical national security, commercial and civil programs. Our high-performance systems operate in space today, including on NASA’s Magnetospheric Multiscale Mission satellites, where they enable precise, closed control for the tight flight formation the mission requires. |
Artificial Intelligence Powered Edge Computing
| | | | | |
| We are developing artificial intelligence enabled edge computing in space, bringing intelligence processing directly to satellites to enhance security and accelerate decision-making. By processing data at the source, we plan to eliminate the need for transmission to ground stations, reducing vulnerabilities and enabling real-time insights in even the most contested environments. Our radiation hardened GPUs provide high-performance computing in space, while our integration of Palantir’s operating system and proprietary applications delivers what we believe are exceptional artificial intelligence driven analytics. This capability enables streamlined intelligence gathering and processing, enhancing operational efficiency and resilience for national security and defense applications as well as space exploration. |
Space Solutions Segment
| | | | | |
| Our Space Solutions segment, which represented approximately 49.1% of our revenue for the year ended December 31, 2024 and approximately 33.9% of our revenue for the three months ended March 31, 2025, is a provider of leading space technology solutions, operating at the forefront of space technology and specializing in mission operations, reliable hardware, software and engineering services for space missions. We are known for pushing innovation in space technology and commercial space exploration, providing reliable, high-performance systems and services that advance the capabilities of our customers in space. Our portfolio offering includes advanced space technology systems, space infrastructure and space science and mission management. |
Advanced Space Technology Systems
| | | | | |
| We offer a broad range of industry-defining solutions supporting ground and space flight systems for crewed and robotic applications. We have provided integrated hardware and software systems and engineering services to NASA, the DoD and commercial customers. Our solutions include in-space propulsion systems with applications for orbital servicing, manufacturing and deep space exploration. For example, we developed the power propulsion units used in the solar electric powered propulsion system on NASA’s Double Asteroid Redirect Test spacecraft that successfully collided with an asteroid in September 2022 to test defense against near-Earth objects. |
Space Infrastructure
| | | | | |
| We are a pioneer of commercial space infrastructure development. The Bishop Airlock is the first and only permanent, privately-owned module attached to the ISS. The Bishop Airlock allows for the movement of equipment, supplies and payloads between the ISS and the open vacuum of space, providing a significantly larger alternative to other airlocks on the ISS. To date, we have leveraged the Bishop Airlock to enable complex in-space robotics installation and testing, deploy waste from the ISS and move payloads around hosting sites on the outside of the ISS. We currently hold contracts with NASA, the ESA and commercial customers for the Bishop Airlock. The Bishop Airlock helped successfully demonstrate the viability of the public-private partnership model for the development of critical space infrastructure, and developed expertise that we believe positions us for success with Starlab. |
Space Science & Mission Management
| | | | | |
| We operate at the forefront of space commercialization with decades of experience offering science and mission management capabilities, and providing commercial mission management services on the ISS. To date, including through our acquired and developed technologies, we have deployed over 330 satellites for commercial and government programs, overseen more than 1,000 customer missions conducted by over 35 nations and territories and remain the largest commercial user of the ISS in the world. Our commercial space station services have enabled biopharma and agriculture research, DoD technology demonstrations, research, media programs, STEM education and materials research. We believe our leadership in space station services and existing diversified customer base will be a significant growth driver as we build out payload and research facilities for future customers on Starlab. However, we have never launched or maintained a space station before and may lack the necessary expertise, personnel and resources to successfully launch and maintain a space station on our own. A core example of our longstanding enablement of space science on the ISS includes the SAMS, which we built and is one of the longest-running systems on the ISS. SAMS measures and tracks tiny disturbances in an on-orbit microgravity environment and has collected data on every NASA crewed spacecraft over the past three decades. SAMS and its associated systems collect data 24/7, measuring over a trillion acceleration measurements on the ISS since 2001 and greatly informs our development of Starlab. |
Starlab Space Stations
| | | | | |
| Starlab JV is a Voyager-led and majority-owned global joint venture that is designing and building, and is expected to ultimately operate, Starlab. We expect that, once in operation, Starlab will be positioned to serve a global customer base of space agencies, researchers and private enterprises. Starlab is being designed to ensure a continued, permanent human presence in LEO and a seamless transition of microgravity science and research from the ISS into the new commercial space station era that we believe will enable sustainable, profit-generating activities in LEO and attract multiple new commercial and scientific organizations into the accelerating space economy. |
Today, NASA and its international partners allocate approximately $5 billion annually to support ISS related operations and initiatives according to NASA, JAXA and ESA. To date, there has not been a need to develop a commercial space station, given a commercially-funded space station could not compete with the government-funded ISS. However, given the station’s aging infrastructure, NASA has publicly declared plans to de-orbit the ISS
in 2030. NASA has stated it is awarding funding to private enterprises to develop commercial replacements for the ISS.
NASA has developed standards for processes such as safety and mission assurance, health and medical, design, and construction, as well as technical standards for areas such as rendezvous and docking, power, and life support that guide the development and operation of these systems. Starlab is leveraging these standards, as well as utilizing existing qualified commercial hardware that is derived from them to the full extent possible. Starlab is our solution for a commercially-led, owned and operated replacement, leveraging the public-private partnership model proven with NASA’s use of commercial launch providers, including SpaceX and Northrop Grumman. We have the space heritage to provide the right solution for a post-ISS space, with over 4 million hours of in-space experience. We have also achieved over 20 milestones related to Starlab on a path to derisking the technology.
NASA’s procurement to replace the ISS is being conducted in two phases. During Phase I, the current phase, NASA accepted three designs to preliminary design review for Critical Design Review. Critical Design Review is a key milestone that a program achieves before commencing major hardware construction. For Phase I, Starlab was given the highest funding award from NASA, and Starlab’s funding has grown and continues to outpace other competitors. Phase II will be the final competition phase where potential providers offer crew and cargo services to NASA, including launch, training, space station accommodations, science and research activities/experiments and return and recovery. While any competitor can bid on Phase II, only three potential bidders currently have funded contracts with NASA. Given the complexity of the space station system, we believe the funded providers have a better chance of winning one of two potential awards for crew and cargo services, as the funded providers have been working closely with NASA for at least three years and have an understanding of the process. We believe customers will view Starlab as a reliable provider in line with the highest industry standard.
Key to Starlab’s value proposition is a utilitarian design that we believe presents low technological risk relative to competing programs. Starlab utilizes a proven metallic habitat design and is designed to be deployed and achieve initial operational capability in a single launch on SpaceX’s Starship, removing the need for additional complex, expensive and operationally risky in-space assembly missions while maintaining all of the U.S. Lab (Destiny) research and development capacity and approximately 45% of the pressurized volume of the U.S. Segment (Non-Russian) of the ISS. Starlab is also being designed to support the attachment of additional modules that can serve specific use cases and end markets. This capability is designed to allow Starlab to meet current and potential future demand profiles, without the risk of overbuilding prior to future demands and use cases materializing. We envision the potential addition of dedicated modules or wholly new space stations for use cases such as on-orbit manufacturing and assembly, drug and biopharma development, semiconductor fabrication and material science.
Starlab is designed to reach orbit in a single launch. If that launch fails, the entire spacecraft could be destroyed. There are limited launch vehicles capable of lifting an object of Starlab’s mass into orbit and such vehicles do not have a proven track record of successful launches. If such launch vehicles are not operational by our planned launch date, we may experience delays in our ability to commence the Starlab business, and if our attempted launch fails, we may not be able to construct a replacement in a timely manner, or at all.
Our Starlab JV partners include Airbus, Mitsubishi, MDA Space and Palantir. In addition to these partners, Starlab has strategic partnerships with several organizations, including Hilton, Northrop Grumman and The Ohio State University. Starlab has also secured a launch contract with SpaceX for its Starship launch vehicle, leveraging its wider diameter rocket fairing. We believe our joint venture structure aligns our and each of our partners’ interests in the future success of Starlab, and each of our partners intends to contribute vital features to Starlab’s success:
•Airbus is providing technical design and engineering services, and has the responsibility for constructing Starlab’s habitat.
•Mitsubishi will contribute by leveraging its expertise in space research and development. MDA Space will provide the full range of external robotics, robotics interfaces and robotic mission operations to the station.
•Palantir will leverage data modeling through digital twins and artificial intelligence technologies to enhance Starlab’s operations.
This joint venture structure creates a strong international partnership among leading commercial participants that we believe will help capture our future anchor space agency customers and with expected operational and financial support from their respective sovereign agencies. It recreates the existing ISS international partnership structure of the United States, Europe, Japan and Canada on a commercial basis and enables technology collaboration, development funding and commercial contracts from international partners.
Starlab currently does not generate revenue and is not expected to in the near term. We currently estimate the cost to design, manufacture and launch Starlab to be approximately $2.8 to $3.3 billion. However, the benefits that we believe will result from the completion and commercialization of Starlab may not actually materialize. We expect Starlab to require significant funding to support operations prior to launch, which is currently anticipated to occur in 2029, before subsequently generating revenue, profitability and cash flows, which we expect Starlab to generate in its first full year of operation. With an estimated useful life of thirty years, we anticipate Starlab will have an infrastructure-like financial profile and will generate a significant portion of our revenue, profitability and cash flows once launched and fully operational.
Current funding for Starlab consists of the $217.5 million development grant Nanoracks was awarded by NASA under Phase I of their CDFF program, which was subsequently transferred to us, and which we subsequently transferred to Starlab JV, of which $70.3 million eligible proceeds remain as of March 31, 2025. We plan to compete for future funding from NASA and other space agencies to provide a considerable portion of the funding for this initiative. In particular, we plan to compete for Phase II funding from NASA’s commercial LEO development program, which we expect will include substantial funding to support the certification, development and services for the selected commercial space station providers. In addition to NASA funding, we also plan for Starlab to be funded through a combination of customer prebuys, the largest examples being other international space agencies, where prospective customers pay us in advance for usage of Starlab, as well as capital markets financing, including equity and project-based financing. Furthermore, although Voyager is not required under the terms of the Starlab JV to directly fund Starlab operations, we may choose to do so. While the Starlab JV is expected to fund a significant portion of the total cost to design, manufacture and launch Starlab through non-dilutive capital sources, including those described above, if we decide to directly fund Starlab operations, we may raise additional funds in the future through the issuance of equity securities, which may cause our stockholders to experience significant dilution. The actual cost to design, manufacture and launch Starlab may be materially different from the estimate set forth above, which is based on our current expectations and projections about future events and is subject to risks and uncertainties. In addition, there can be no assurance that we will obtain the necessary funding for Starlab, and we may not be able to obtain such funding or any portion thereof on terms that are favorable to us, if at all.
Joint Venture Agreement for Starlab JV
On December 23, 2023, we and Airbus entered into the Joint Venture Agreement forming Starlab JV. which, among other things, is focused on developing Starlab. Following the formation of Starlab JV, each of Mitsubishi, MDA Space and Palantir acquired minority interests in Starlab JV. As of March 31, 2025, we had an ownership interest of 67.0% in Starlab JV, Airbus had an ownership interest of 30.5%, Mitsubishi and MDA Space each had an ownership interest of 0.8%, and Palantir had an ownership interest of 1.0%. Pursuant to the terms of the Joint Venture Agreement, we have the ability to nominate three directors to the board and Airbus has the ability to nominate two directors to the board. Certain holders of minority interests in Starlab JV have the ability to appoint non-voting directors under certain circumstances. While we are able to appoint more than a majority of the board and are therefore able to enact a variety of amendments to the Joint Venture Agreement in our sole discretion, certain fundamental changes require unanimous consent of the directors.
Pursuant to the terms of the Joint Venture Agreement, we and our joint venture partners are obligated to provide cash and other services to Starlab JV. As of March 31, 2025, we have contributed to Starlab JV certain contracts (including the SAA), certain intellectual property, and $11.5 million in cash. Each of Airbus, Mitsubishi, Palantir, MDA Space and us has the unilateral obligation to fund up to $10.0 million if the cash balance of Starlab JV to support Starlab is less than $10.0 million at any time and the board of Starlab JV determines that third-party funding is not available. In addition, Airbus agreed to contribute to Starlab JV up to an aggregate amount of $80.0 million in funded grant programs awarded to Airbus or its affiliates specifically for use in connection with Starlab or the
technologies to be deployed in connection therewith. To date, Airbus has not made any capital contributions to Starlab JV. In addition, each of Mitsubishi, MDA Space and Palantir have agreed to provide certain ongoing strategic collaboration services to Starlab JV. We and Airbus have each agreed with Starlab JV to certain governance provisions with respect to the ownership and licensing of certain intellectual property utilized in connection with the operation and ownership of Starlab JV, and Starlab JV has granted Airbus and Voyager certain participation rights and rights of first refusal with respect to the procurement of certain equipment or engineering services in connection with Starlab and other future space stations that may be developed by Starlab JV.
Pursuant to the Joint Venture Agreement, we have also agreed to certain exclusivity provisions. For example, Starlab JV agreed to provide Mitsubishi with exclusivity as Starlab JV’s sole Japanese space industry partner so long as Mitsubishi is entitled to designate a director. In addition, so long as Mitsubishi or certain of its affiliates is a member of Starlab JV, Mitsubishi Starlab JV will be the sole LEO space station partner of Mitsubishi and certain of its affiliates. In addition, Starlab JV agreed to provide Palantir exclusivity as the sole supplier to Starlab JV of the enterprise-wide data management platform solutions that Palantir agreed to provide for the internal management and development of Starlab JV.
Our Industry
Defense & National Security Industry
We operate in an industry that has experienced significant growth driven by the current geopolitical environment and growing defense and national security investment. Current events, including conflicts between Russia and Ukraine and the conflict in the Middle East, have resulted in increased defense and national security spending globally, while the potential for future engagements with China, Russia, Iran and North Korea have been a catalyst for defense modernization efforts across the United States and its allies. We expect that growth in national security spending will continue for decades to come as militaries invest to maintain operational readiness and counter ever-evolving threats, particularly driven by the rise of China as a near peer threat to the United States. In the United States, defense and national security spending benefits from strong bi-partisan support, which has resulted in a stable and growing investment over time. We believe any potential shifts in defense spending may likely benefit us and our key focus areas, which have historically aligned with top DoD priorities. The fiscal year 2025 request for the DoD budget was approximately $850 billion, compared to approximately $700 billion for fiscal year 2022. We believe our Defense & National Security segment serves a total addressable market of $163 billion, representing the fiscal year 2025 DoD budget request for research and development as well as procurement. Within our total addressable market, we believe we serve a serviceable addressable market of $11 billion, representing the portion of the fiscal year 2025 DoD budget request allocated to research development, test and evaluation and procurement for the following categories: classified; command, control, communications and computers; weapons; space; undersea and science and technology. Our serviceable addressable market is expected to grow steadily, increasing up to $12 billion in fiscal year 2029 based on DoD projections.
Missile and missile defense programs are a core investment priority for the United States and its allies and represent significant growth opportunities for our Defense & National Security segment. The technological requirements of missile and missile defense systems have increased rapidly. Advancing hypersonic capabilities is critical to ensuring national security, as Russia and China continue to develop and deploy hypersonic weapons. Furthermore, the contested domain is continuing to move higher and higher in altitude and many of the missile defense systems now must operate in a new environment, the vacuum of space. The United States is focused on addressing this critical need, with the fiscal year 2025 DoD budget request including $2 billion within our serviceable addressable market to enhance U.S. missile-defense capabilities to defend the homeland, U.S. deployed forces and its allies and partners.
The space domain is also a critical investment priority for the DoD and allies. The fiscal year 2026 budget request for space within our serviceable addressable market was approximately $2.1 billion. Intelligence, surveillance and reconnaissance, advanced missile tracking, communications and navigation are examples of essential capabilities that require space-based technologies for successful execution. Additionally, as our adversaries increase their ability and willingness to engage in offensive operations in the space domain, the DoD must invest in capabilities to protect, deter, detect and counter enemy attacks on our space infrastructure. Investment in both
hardware and software are essential for mission success, including increasing utilization of artificial intelligence and machine learning to analyze signals and data.
Space Industry
We operate in the space industry, a market which is expected to grow from $508 billion in 2023 to $820 billion by 2032, according to Euroconsult. This expected growth is the product of several long-term trends, including the reduced cost orbital launch and increasingly capable satellite technology, which are expected to drive progress and create a unique set of space-based infrastructure and space-to-space economic opportunities. Government funding is a major part of the space industry demand. The fiscal year 2026 request for NASA’s budget is approximately $19 billion. We expect an increasingly large part of government funding, and industry spending broadly, will be captured by private enterprises, as governments continue to leverage the public-private partnership model that has been successful on multiple space programs to date. Based on Novaspace, we believe our Space Solutions and Starlab Space Stations segments serve a total addressable market of $16 billion of which we serve $1 billion.
The space industry has experienced structural evolution over time, contributing to additional growth in our addressable markets. With launch costs decreasing by more than 95% since the first space shuttle launch, and launch cadence and reliability improving substantially, space has become more accessible to a wider audience to include commercial enterprises, academic institutions and research centers, in addition to governments and defense contractors. The result of increased demand and reduced costs of access has resulted in significantly increased hardware in orbit, which is expected to continue. According to Novaspace, approximately 37,000 satellites are expected to be launched from 2024 to 2033, a significant increase compared to the approximately 10,600 satellites launched from 2014 to 2023. Increased hardware in space requires technology solutions to launch, support and service these satellites’ missions, creating opportunity across the space technology ecosystem.
A large driver of space industry demand is the benefits that space technology enables here on Earth. As the space industry continues to expand at a rapid pace, data collected in space through satellite constellations and the research, development and manufacturing activities performed in space will have meaningful application to terrestrial industries, including healthcare, biotechnology, semiconductors, material science, telecommunications, disaster mitigation, defense and security, among many others. For example, advancements in robotic tools, originally designed for space applications, may progress development of surgery robotics. Water filtration and air purification systems, originally built for space, may be effectively deployed on Earth, addressing an increasingly complex problem of clean drinking water. Climate change and disaster response analysis can be aided through the increased Earth observations made from small satellites with rapid imagery. Additionally, the microgravity environment enables the production of advanced materials for industrial and biotechnology applications that are difficult or impossible to replicate on the Earth’s surface. We believe the potential to create immense value terrestrially will continue to increase the value and opportunities of the space industry.
Within the space industry, commercial space infrastructure is a significant end market for us. Every year, according to NASA, JAXA and ESA, approximately $5 billion is spent by the United States and partner nations, to support ISS related operations and initiatives. Maintaining constant U.S. and allied presence in LEO is not only critical to continuing important scientific research conducted onboard, but also as a symbol of national sovereignty and soft power. The only other space station in Earth’s orbit is the Tiangong Space Station, owned and operated by China operating as an extension of their Belt and Road initiative. The United States will not be dependent on China for American and allied human spaceflight and human supported research and development, driving the need for a U.S.-led space station replacement upon retirement of the ISS. With the ISS set to de-orbit in 2030, we expect the capital spent on the ISS today to be allocated to one or more commercially led space stations, including Starlab.
Beyond the activities conducted on the ISS today, we expect on-orbit activities to increase over time, driven by demand growth from industries such as healthcare, agriculture, energy and manufacturing, as they look to deploy on-orbit capabilities such as research and development, manufacturing and assembly. We believe a transition to commercial-led space station ownership will help accelerate commercial demand for on-orbit activities, as companies will value the increased privacy and security afforded to them by a dedicated commercial module or space station.
Our Competitive Strengths
We believe the following strengths are key differentiators for our business model, enable us to provide innovative and mission-critical solutions to our customers and drive profitable growth in our business.
Leading Defense and Space Technology Company Providing Critical Solutions in the Large, Growing and Stable National Security and Space Economies
Our focus is on delivering innovative solutions to the defense, national security and space end markets, which we believe are highly attractive. Our markets are large and growing meaningfully, driven by strong demand from both government and commercial customers. U.S. government spending is an important driver of demand and it benefits from broad support across the political spectrum, evidenced by the consistent focus on national security and space programs through various administrations. In addition to overall growth in the national security and defense markets, our strategy is aligned with specific high-growth tailwinds, which include the requirement for hypersonic and other next-generation missile defense capabilities, demand for high-speed and high-throughput space communications technology and the requirement for a continued, defensible and resilient U.S. and allied presence in LEO. Our broad offering of both national security and space solutions provides us with a diversity of end market exposure, which we believe will result in stable overall demand in our business and meaningful upside from multiple high growth vectors.
We believe that our solutions offerings are well-positioned to serve customers in these attractive end markets. We have developed fit-for-purpose solutions to address our customers’ needs across diverse applications, including, among others, defense systems, satellite subsystems, advanced space technology and space infrastructure. We believe our solutions compare favorably relative to our competitors, providing leading performance, proven in-space heritage and value underpinned by differentiated technology solutions that establish a competitive moat for our business.
Longstanding Relationship with a Broad Base of Blue-Chip Customers Who Rely on Our Solutions for Mission-Critical Applications
We maintain close relationships with a broad base of blue-chip customers, including over 20 government space and defense agencies and multiple commercial players. We serve key agencies including NASA, our largest customer, as well as multiple components of the DoD, including the MDA, U.S. Air Force and U.S. Space Force. We have supported several programs for international space agencies including the Canadian Space Agency, ESA, Italian Space Agency, Germany Aerospace Center, Japanese Aerospace Exploration Agency, UAE Space Agency, the Saudi Space Commission and others. Many of our commercial customers are industry leaders and include major defense primes such as Lockheed Martin, Northrop Grumman and RTX Corporation, as well as space companies including Blue Origin and Maxar, and commercial companies such as Madison Square Garden. Our customer relationships have been fostered over many years, with multiple examples of reoccurring business, demonstrating the value we provide to our partners. During the year ended December 31, 2024 and the three months ended March 31, 2025, 95% and 99%, respectively of our net sales were generated from customers we also transacted with in the prior year.
Our customers rely on us to deliver technological solutions that are highly complex and mission-critical to their programs. We have built trust with our customers through our long track record by executing over 1,000 customer space missions, which includes over 330 customer satellites deployed and experiments conducted for customers in over 35 nations and territories. Our reputation as a reliable partner underpins the trust customers have in us to address new challenges, resulting in a “flywheel” that continues to drive growth as we continue to execute for customers. For example, for over ten years, our Space Science & Mission Management business has enabled domestic and foreign government agencies and commercial participants to access the ISS, providing services and solutions that have accelerated the accessibility of space for both space and non-space players. For example, for Madison Square Garden’s Sphere Studios, we are collaborating across three ISS missions to launch, operate, and validate custom camera technology being developed for their state-of-the-art MSG Sphere venues. This ongoing experience was critical to acquiring and maintaining support for the Bishop Airlock project. Subsequently, having proven expertise in space infrastructure, we competed for and won a commercial prime contract to develop Starlab,
which we are continuing to develop with NASA today. We expect that our close customer relationships and reputation for quality execution will continue to position us well for future growth opportunities.
Flexible Multi-Use Technology Solutions Allow Voyager to Serve Diverse Applications Across Our Civil, Commercial and National Security Customers
We operate a flexible business, with technology solutions that offer critical capabilities across our civil, commercial and national security end markets. Furthermore, many of our solutions are multi-use, meaning they have important applications in multiple different end markets. For example, our laser and RF communications technologies are designed to support a wide range of customers, including aerospace and defense primes, civil and defense government agencies, commercial entities and “new space” ventures. Additionally, we are developing artificial intelligence powered edge computing units to operate across Earth and space, delivering versatile, real-time intelligence capabilities for defense and national security applications as well as commercial. By supporting multiple end markets and use cases, our solutions benefit from diversified demand drivers that result in stronger growth and stable performance. Additionally, by serving multiple customers with varying performance requirements, we benefit from diverse customer feedback and participate in joint-development that drives additional improvement to our technology, further differentiating our solutions offerings. Our nimbleness allows us to pivot to the needs of our customers and end-markets faster.
Adaptive Business Model Provides Optionality to Effectively Serve U.S. And Allied Agencies Directly, as Well as Act as a “Merchant Supplier” or Subcontractor to Large Contractors
We operate an agile business model that allows us to serve in both a prime contractor and merchant supplier capacity. Examples of our prime contracts include our Starlab program as well as our HUNCH program with NASA, where we engage in project-based learning programs with high school students to further space education. In addition to prime contractor capabilities, we often act as a subcontractor on programs across the space and national security industries. When we act as a merchant supplier, we are able to deliver our technology solutions to a wide range of programs and support multiple prime competitors. Merchant supplier roles often offer very attractive terms that enhance our financial performance. Examples of our merchant supplier programs include providing star trackers to Millennium Space Systems for their small satellite constellations programs and providing Airbus software-defined radios for their international LEO satellite constellation. By maintaining a flexible business model, we are able to participate on a wide breadth of marquee programs for many of the most important public and private sector
customers in the industry. We can also pivot and focus on programs and contracts with the highest return on investment.
Backlog Driving Revenue Visibility, Robust Opportunities Pipeline and Significant Grant Funding
We have a track record of successfully executing on both organic and inorganic growth opportunities, leveraging our broad portfolio of market leading technology solutions. As of December 31, 2024, we had backlog (including unfunded contract options) of approximately $200 million, of which approximately 67% was attributable to our Defense & National Security segment and approximately 33% was attributable to our Space Solutions segment. As of March 31, 2025, we have remaining backlog from Hypersonic Interceptor DACS, Next Generation Interceptor and Trident II D5 Life Extension II, which provides meaningful visibility to our near- and medium-term revenues over the next several years. Additionally, as of March 31, 2025, we had a pipeline of identified projects, such as Navy / Airforce Exo-ACS, Golden Dome (f/k/a Iron Dome America): Enhanced Capability SM3/ THAAD / PAC 3 and SM-3 Block IIA / Block IB TDACS that we are pursuing of approximately $3.6 billion of potential revenue, supporting our future growth initiatives. Of such pipeline, approximately 75% was attributable to our Defense & National Security segment (including approximately $1 billion attributable to contracts we are pursuing for follow-on production on the NGI program) and approximately 25% was attributable to our Space Solutions segment. In addition, approximately 75% of our Defense & National Security segment pipeline was attributable to key missile programs. Based on U.S. missile defense and strategic deterrence priorities to overmatch peer, near peer, and rogue nations weapon systems capabilities, we expect each of these projects may extend to or beyond 2040.
Our Starlab Space Stations segment provides upside potential to our business and is well-positioned to deliver revenue in the future. In addition to the revenue we generated in fiscal year 2024 and the three months ended March 31, 2025, we received $62.2 million and $20.0 million, respectively, of cash proceeds from our $217.5 million CDFF development grant with NASA, with $70.3 million eligible proceeds remaining as of March 31, 2025. We believe we are well-positioned to win future awards from U.S. and allied agencies for continued Starlab development ahead of launching Starlab prior to the ISS decommissioning. Post-launch, we believe Starlab will have the opportunity to generate consistent revenues, similar to the financial profile of today’s terrestrial infrastructure projects.
Experienced Leadership Team with Deep Experience in Defense and Space Technology, with a Track Record of Success
Our experienced leadership team, led by our founders Dylan Taylor and Matthew Kuta, has extensive entrepreneurial, operational and financial experience. Their vision was integral in founding Voyager in 2019, assembling a world-class team of disruptors. Since inception, our founders, management team, Board of Directors and Strategic Advisory Boards have been critical to our technology development, contract wins, significant partnerships and successful acquisitions. Our leadership and advisors include former generals, NASA administrators, astronauts and proven public and private sector experts across national security and space. We believe our leadership team’s breadth of industry experience, culture of innovation and reliable execution and track record of operational success position us for significant further earnings growth. In addition, our management team’s incentives are well-aligned with the success of Voyager and its stockholders. Members of the management team and our Board of Directors are expected to hold approximately 11.0% of the shares of our Class A common stock and Class B common stock outstanding as of March 31, 2025, after giving effect to the sale of shares of Class A common stock by us in this offering.
Although we believe these competitive strengths will contribute to the growth and success of our company, our business is subject to risks that may prevent us from achieving our business objectives or otherwise adversely affect our business, results of operations or financial condition. For a description of the competitive challenges we face and the limitations of our business and operations see “Risk Factors.”
Our Growth Strategy
We intend to pursue the following strategies in order to continue realizing meaningful growth across our business.
Leverage Core Technologies and Expertise in the Defense & National Security and Space Solutions Segments to Grow with Customers and Win New Business
We plan to continue to grow our business by leveraging our existing portfolio of highly differentiated technology solutions. We believe that many of our current programs in which we participate are poised for significant growth. For example, we expect that our work with Lockheed Martin for their NGI program will lead to a production contract, with regular and reoccurring revenues. Beyond our current programs, we plan to utilize our current technologies to compete for new programs and applications. For example, we believe our technology-validated propulsion technologies can add value to a wide range of end use applications, including strategic, ballistic and hypersonic missiles. Furthermore, because our technologies are multi-use, we plan to identify cross-selling opportunities across our segments, such as capitalizing on opportunities to deploy propulsion technology in solutions for commercial space launch and on-orbit thrust and propulsion, dual-use of guidance, navigation and controls technology for both commercial and defense customers and artificial intelligence powered edge computing and advanced analytics for both intelligence and space exploration to drive mission-critical insights and optimized decision-making.
Develop Advanced Technologies to Expand Solutions and Attract a Broader Customer Set
We intend to continue purposeful development of what we believe is cutting-edge national security and space technology solutions, leveraging our technological expertise and our strategic partnership with artificial intelligence leader Palantir. Our research and development expertise and close customer collaboration enables rapid product development and improvement and the ability to modify our offerings for market demand. We have multiple development programs in process to augment existing offerings or to create innovative, novel technologies, such as the ongoing refinement of our high-performance satellite and spacecraft communications systems and components.
Integrate Software Capabilities with Hardware Solutions to Create Software Enabled Offerings
We have developed various advanced software solutions around signals intelligence, communication technologies, guidance, navigation and control systems. We intend to further integrate our hardware solutions with our software programs to offer fully-enabled solutions that we believe will address all customer and end-market needs. We also plan to team with industry-leading technology firms such as Palantir, to expand our capability set and offer trusted analytical services with mission operations.
Continue to Successfully Develop the Next Generation of Space Station Infrastructure
We intend to continue development of Starlab to meet the demand for an ISS replacement following its planned de-orbit. In the near-term, we plan to continue pursuing achievement of milestone payments under our current $217.5 million SAA with NASA under Phase I of their CDFF program, with numerous milestones expected to be achieved in the next year, which awards will be used to fund a portion of the research and development associated with Starlab. We believe our current development program with NASA will position us for future collaboration, and as such we expect to win additional follow-on awards from NASA and allied agencies for Starlab development. Following the deployment of Starlab as an anticipated ISS replacement, we intend to explore expansion of our business through either the deployment of additional Starlab attachment modules or the launch of additional space stations in order to meet further demand from government and private sector customers.
Drive Additional Value Creation Through Acquisition Opportunities
Since 2020, we have completed and integrated seven acquisitions. We intend to continuously evaluate acquisition opportunities, leveraging sector connectivity and a proven corporate development function. We plan to maintain a disciplined and selective focus on complementary companies which meet a defined customer need, demonstrate strategic excellence, and offer the opportunity for significant growth and synergy realization. We look for what we believe are unique assets that are early-stage innovations and bring them onto our platform to accelerate development into next-generation solutions. We plan to continue effectively integrating future acquisitions and using such acquisitions to expand our technology portfolio and drive financial performance to realize meaningful value creation.
We specialize in identifying inorganic opportunities that add synergistic technologies to our portfolio, building the capabilities necessary to tackle further attractive growth opportunities. For example, today we are contracted to supply multiple solutions to Lockheed Martin’s NGI program, both propulsion technology and guidance technology. Our diversified position on the NGI program would not be possible without the strategic acquisitions of Valley Tech Systems in 2021 and Space Micro in 2022.
Expand Profitability Through Opportunity Selection, Operational Excellence and Scale
We plan to broaden our mix of contracts over time that we believe will increase profitability. Today, a meaningful portion of our revenue is derived from service contracts and cost-plus contracts, which have typically yielded lower margins relative to the rest of our business. As those contracts are completed, we are focused on entering into higher-margin contracts delivering our advanced hardware, software and mission management solutions. Furthermore, we intend to continue driving operational and financial excellence across the business to drive margin expansion through improved operations and the realization of cost efficiencies and synergies. We have established a scalable corporate structure designed to efficiently support current business operations and adapt seamlessly to growth. We utilize customer-funded R&D opportunities to help offset the cost of development to provide solutions while maintaining our financial efficiency. This structure enables us to meet evolving business needs and capitalize on opportunities for significant revenue growth without requiring substantial expansions in headcount or organizational complexity. As we continue to realize growth from our organic and inorganic initiatives, we expect to achieve increased operating leverage in our business to further drive margin and cash flow improvement.
Although we believe these growth strategies will contribute to the success of our company, our business is subject to risks that may prevent us from achieving our business objectives or otherwise adversely affect our business, results of operations or financial condition. For a description of the strategic challenges we face and the limitations of our business and operations see “Risk Factors.”
Lockheed Martin Cost Plus Fixed Fee / Cost Plus Incentive Fee Subcontract
On November 11, 2021, Valley Tech Systems, Inc. and Lockheed Martin Corporation entered into a Cost Plus Fixed Fee / Cost Plus Incentive Fee subcontract to provide an advanced solid propulsion subsystem in support of MDA’s NGI program (the “Lockheed Martin Agreement”). Lockheed Martin Corporation will reimburse us for actual cost incurred and shall pay us for performance as described in the Lockheed Martin Agreement up to the estimated cost of approximately $78 million, including incentive fees of up to approximately $8 million. The Lockheed Martin Agreement shall extend through December 20, 2028; however, Lockheed Martin may terminate for convenience.
Palantir Agreement
On April 1, 2024, we and Palantir Technologies Inc. entered into a Terms of Service (the “Palantir Agreement”) for (i) Palantir’s development of a payload scheduling prototype, which will allow us to schedule payloads to the ISS, (ii) Palantir’s development of a customer hub, which will include development of a customer landing page and application marketplace for a customer facing hub, deployment of a security and permissions infrastructure for multi-tenancy and creation of a technical runbook explaining how to add participants, and (iii) a joint study between Palantir and us. Pursuant to the Palantir Agreement, we paid an initial payment of $4.75 million for the services, which was paid through the issuance of 228,365 shares of our Class A common stock. In addition, we shall pay an annual $250,000 fee for use of the Palantir platform for the duration of the Palantir Agreement, which payment may be satisfied, at our option, in our Class A common stock. Pursuant to the Palantir Agreement, Palantir retains intellectual property ownership over the service documentation, data connection software, sample materials, website, models and application programming interfaces Palantir provides or makes available to us in connection with the Palantir Agreement. However, we will own all rights, title and interest in the data, model, algorithms, analyses, transformation code or other content provided or created by us through the Palantir Agreement. The Palantir Agreement shall expire on September 30, 2029 unless otherwise terminated pursuant to its terms.
Nanoracks Funded Space Act Agreement
On December 1, 2021, NASA awarded Nanoracks a SAA, which was subsequently transferred to Voyager Technologies, Inc., and which was subsequently transferred to Starlab JV, under Phase I of NASA’s CDFF program as part of the agency’s effort to foster a commercial space station to succeed the ISS. The SAA initially awarded $160 million in development grants—the largest CDFF award from NASA—to pursue the design and development of Starlab through 2026. The SAA shall be completed by achieving certain milestones and payments shall be made upon successful completion of each milestone, subject to limitations noted in the SAA. Under the SAA, if we first produce proprietary data, and issue a restrictive notice, NASA will use reasonable efforts to protect such proprietary data. Additionally, if we complete all milestones under the SAA, NASA will not assert rights in the proprietary data we produce. If NASA terminates the SAA for failure to perform, then it shall have the right to use, reproduce, prepare derivative works, distribute to the public, perform publicly, display publicly or disclose our proprietary data. If the SAA is terminated for any other reason, we and NASA will negotiate rights over the proprietary data. Pursuant to the SAA, each party agrees to cross-waive certain claims based on damage in the space operations. The SAA shall remain in effect through December 2026. The SAA may be unilaterally terminated by NASA for, among other things, failure to perform and certain acts outside of the control of NASA, including a failure of Congress to appropriate sufficient funding.
Air Force Solicitation, Offer and Award
On June 6, 2022, the Air Force Life Cycle Management Center’s Architecture and Integration Directorate (the “Air Force”) awarded Valley Tech Systems, Inc., our subsidiary, an IDIQ contract to deliver an intelligence, surveillance and reconnaissance system (the “IDIQ Agreement”) with a combined not-to-exceed aggregate award of $900 million across all task orders and participants. To date, we have earned $1,000 under the IDIQ Agreement. We plan to compete for task orders under the IDIQ Agreement. The IDIQ Agreement expires in November 2027; however, the Air Force has the option to extend services and order quantity so long as the duration of the contract does not exceed 10 years. The Air Force may also terminate the contract for convenience.
Intellectual Property
Our success depends in part upon our ability to develop, maintain, protect, and enforce our core technology and intellectual property rights, some of which have been obtained through acquisitions and some of which have been developed internally by our employees and consultants. We do this, both in the United States and abroad, by asserting our rights under a combination of patent, trademark, copyright and trade secret laws when we deem it to be appropriate to do so, by requiring our consultants and employees to execute non-disclosure and invention assignment agreements, and by endeavoring to control access to and distribution of, our proprietary information through non-disclosure agreements with our vendors and business partners. Unpatented research, development and engineering know-how make an important contribution to our business as a trade secret, but we pursue patent protection when we believe it is possible and consistent with our overall strategy for safeguarding our intellectual property rights.
Regulatory
We are subject to various government regulations, including various U.S. government regulations as a contractor and subcontractor to the agencies of the U.S. government. Among the most significant U.S. government regulations affecting our business are:
•the Federal Acquisition Regulations and supplemental agency regulations, which comprehensively regulate the formation, administration, and performance under government contracts;
•the Truthful Cost or Pricing Data Statute (formerly the Truth in Negotiations Act), which requires certification and disclosure of all cost and pricing data in connection with contract negotiations;
•the Cost Accounting Standards, which impose accounting requirements that govern our right to reimbursement under cost-based government contracts;
•the Industrial Security Manual, which establishes the security guidelines for classified programs and facilities as well as individual security clearances;
•the Committee on Foreign Investment in the United States, which is tasked with reviewing the national security implications of foreign acquisitions of and direct investments in U.S. businesses;
•the rules and regulations of the Bureau of Alcohol, Tobacco, Firearms and Explosives;
•the False Claims Act and the False Statements Act, which, respectively, impose penalties for payments made on the basis of false facts provided to the government and impose penalties on the basis of false statements, even if they do not result in a payment; and
•laws, regulations and executive orders restricting the use and dissemination of information classified for National Security purposes and the exportation of certain products and technical data.
We also need special security clearances to continue working on and advancing certain of our programs and contracts with the U.S. government. Classified programs generally will require that we comply with various Executive Orders, federal laws and regulations and customer security requirements that may include restrictions on how we develop, store, protect and share information, and may require our employees to obtain government clearances.
In addition, we are subject to industry-specific regulations due to the nature of the products and services we provide. For example, certain aspects of our business are subject to further regulation by additional U.S. government authorities, including (i) the Federal Aviation Administration, which regulates airspace for all air vehicles in the U.S. National Airspace System, (ii) the National Telecommunications and Information Administration and the Federal Communications Commission, which regulate the wireless communications upon which our UAS business depend in the United States and (iii) the Defense Trade Controls of the U.S. Department of State that administers the ITAR, which regulate the export of controlled technical data, defense articles and defense services, as discussed further in “—International Traffic in Arms Regulations and Export Controls.”
The nature of the work we do for the federal government may also limit the parties who may invest in or acquire us. Export laws may keep us from providing potential foreign acquirers with a review of the technical data they would be acquiring. In addition, there are special requirements for foreign parties who wish to buy or acquire control or influence over companies that control technology or produce goods in the security interests of the United States. There may need to be a review under the Exon-Florio provisions of the Defense Production Act, including review by CFIUS under FIRRMA.
Finally, the government may require a prospective foreign owner to establish intermediaries to actually run that part of the Company that does classified work, and establishing a subsidiary and its separate operation may make such an acquisition less appealing to such potential acquirers.
In addition, the export from the United States of certain of our products may require the issuance of a license by the U.S. Department of Commerce under the Export Administration Act, and its implementing regulations as kept in force by the International Emergency Economic Powers Act of 1977. Some of our products may require the issuance of a license by the U.S. Department of State under the Arms Export Control Act and its implementing regulations, which licenses are generally harder to obtain and take longer to obtain than do Export Administration Act licenses.
We are also subject to state and local laws designed to limit the use or other processing of personal information gathered online and that require online services to establish privacy policies.
International Traffic in Arms Regulations and Export Controls
Our business is subject to, and we must comply with, stringent U.S. import and export control laws, including the ITAR and the U.S. EAR. The ITAR generally restrict the export of hardware, software, technical data, and services that have defense or strategic applications. The EAR similarly regulate the export of hardware, software, and technology that has commercial or “dual-use” applications (i.e., for both military and commercial applications)
or that have less sensitive military or space-related applications that are not subject to the ITAR. The regulations exist to advance the national security and foreign policy interests of the United States.
The U.S. government agencies responsible for administering the ITAR and the EAR have significant discretion in the interpretation and enforcement of these regulations. The agencies also have significant discretion in approving, denying, or conditioning authorizations to engage in controlled activities. Such decisions are influenced by the U.S. government’s commitments to multilateral export control regimes, particularly the Missile Technology Control Regime with respect to the spaceflight business.
Many different types of internal controls and efforts are required to ensure compliance with such export control rules. In particular, we are required to maintain a registration under the ITAR; determine the proper licensing jurisdiction and classification of products, software and technology; and obtain licenses or other forms of U.S. government authorizations to engage in activities, including the performance of services for foreign persons, related to and that support our spaceflight business. The authorization requirements include the need to get permission to release controlled technology to foreign person employees and other foreign persons. The inability to secure and maintain necessary licenses and other authorizations could negatively affect our ability to compete successfully or to operate our spaceflight business as planned. Any changes in the export control regulations or U.S. government licensing policy, such as that necessary to implement U.S. government commitments to multilateral control regimes, may restrict our operations.
Failures by us to comply with export control laws and regulations could result in civil or criminal penalties, fines, investigations, more onerous compliance requirements, loss of export privileges, debarment from government contracts, or limitations on our ability to enter into contracts with the U.S. government.
Employees and Human Capital Resources
As of March 31, 2025, we had 505 employees and 9 contractors across the United States, France and Italy, of which approximately 312 were in research and development, engineering and technology teams that are poised to design and develop future products and services. Prior to joining our Company, many of our employees had experience working for a wide variety of reputed research, commercial and military aerospace and non-aerospace organizations. To date, we have not experienced any work stoppages, and we consider our relationship with our employees to be good.
Our human capital resources objectives include identifying, recruiting, retaining, incentivizing and integrating our employees. We believe our success depends on our ability to attract, retain, develop, and motivate diverse highly skilled personnel. In particular, we depend upon the personal efforts and abilities of the principal members of our senior management to partner effectively as a team and to provide strategic direction, develop our business, manage our operations, and maintain a cohesive and stable work environment. We also rely on qualified managers and skilled employees, such as scientists and engineers, with technical expertise in operations, scientific knowledge, engineering skills and quality management experience in order to operate our business successfully.
Our compensation program is designed to retain, motivate and, as needed, attract highly qualified employees. Accordingly, we use a mix of competitive base salary, cash-based annual incentive compensation, equity compensation awards and other employee benefits.
Facilities
Our corporate headquarters is located at 1225 17th Street, Suite 1100, Denver, Colorado 80202. We currently lease additional office space and industrial facilities in Texas, Nevada, California, Ohio, Alabama and Washington, D.C. We do not own any real property. We intend to procure additional space when we add employees and expand geographically. We believe that our facilities are adequate to meet our needs for the immediate future, and that, should it be needed, suitable additional space will be available to accommodate any such expansion of our operations.
Legal Proceedings
We are from time to time subject to various claims, lawsuits and other legal and administrative proceedings arising in the ordinary course of business. However, we do not consider any such claims, lawsuits or proceedings that are currently pending, individually or in the aggregate, to be material to our business or likely to result in a material adverse effect on our future operating results, financial condition or cash flows.
MANAGEMENT
Executive Officers and Board of Directors
The following table sets forth information about our directors and executive officers as of March 31, 2025:
| | | | | | | | | | | | | | |
| NAME | | AGE | | POSITION |
Dylan Taylor | | 54 | | Chief Executive Officer and Chairman |
Matthew Kuta | | 42 | | President, Director |
Filipe De Sousa | | 48 | | Chief Financial Officer |
R. Marshall Smith | | 61 | | President, Space Solutions |
Margaret Vernal | | 47 | | Chief Legal Officer, General Counsel and Secretary |
Matthew Magaña | | 44 | | President, Defense & National Security |
Wallis Laughrey | | 49 | | Chief Strategy Officer |
Alan Stern | | 67 | | Director |
Cheryl Shavers | | 71 | | Director |
Gabe Finke | | 59 | | Director |
Marian Joh | | 54 | | Director |
William Shelton | | 71 | | Director |
Set forth below is a brief description of the business experience of our directors and executive officers. All of our executive officers serve at the discretion of our board of directors.
Dylan Taylor – Dylan Taylor has served as our Chief Executive Officer since August 2019. Mr. Taylor previously served in various roles as President at Colliers International Group Inc. (NASDAQ: CIGI), from January 2009 to August 2019, including CEO, Real Estate Services, Global President, Global Chief Operating Officer and CEO of the Americas. Mr. Taylor is the founder of Space for Humanity, a non-profit organization that will send diverse passengers into orbit on commercial space vehicles. Mr. Taylor served as chairman of the board of Space for Humanity from January 2017 through December 2022. Mr. Taylor previously served as a Director and as a member of the Audit Committee for UMB Bank (NASDAQ: UMBF) from January 2017 through June 2018 and as a mutual fund director for the Jackson Funds from January 2014 through March 2018. Mr. Taylor holds a Master of Business Administration degree in Finance and Strategy from the Booth School of Business at University of Chicago and has a Bachelor of Science degree in Engineering from the honors college at the University of Arizona.
We believe that Mr. Taylor is qualified to serve on our board of directors due to his track record of success as our CEO and his extensive expertise in space investment and entrepreneurship.
Matthew Kuta – Matthew Kuta has served as a member of our board of directors and our President since August 2019. Additionally, Mr. Kuta was one of our co-founders. He has served on the board of directors of the United States Air Force Academy Foundation since July 2017. Mr. Kuta has served on the board of directors of XO Markets from December 2021 April 2023, of Altius Space Machines from October 2019 to January 2022, of Pioneer from July 2020 to January 2022 and of The Launch Company from April 2021 to January 2022. Mr. Kuta was a key member of the private equity investment team at Goldman Sachs from March 2017 through April 2019. He was a military officer and F-15E fighter pilot evaluator and instructor from June 2005 through June 2017. Mr. Kuta holds a Bachelor of Science degree from the United States Air Force Academy, a Master of Business Administration degree from Duke University’s Fuqua School of Business, and a Master of Arts in Diplomacy from Norwich University.
We believe that Mr. Kuta is qualified to serve on our board of directors due to his track record of success as our President and Chief Operating Officer and his strong background in finance for the new space industry.
Filipe (Phil) De Sousa – Phil De Sousa has served as our Chief Financial Officer since October 2022. Previously, Mr. De Sousa served as Chief Financial Officer, Transamerican Auto Parts from October 2019 until September 2022 at Polaris Inc. (NYSE: PII) and as Vice President Finance, Global Operations and Engineering from
March 2017 until October 2019. Additionally, Mr. De Sousa served as Xylem, Inc.’s (NYSE: XYL) Vice President Finance, Investor Relations from its spin-off from ITT Corporation (NYSE: ITT) in October 2011 until March 2017. Mr. De Sousa held multiple Finance positions, including Manager of Financial Reporting and Manager of Financial Planning and Analysis, while working for ITT Corporation from March 2007 until the spin-off of Xylem Inc. Prior to joining ITT Corporation in March 2007, Mr. De Sousa worked in various accounting and finance roles at Hexcel Corporation (NYSE: HXL) and Tudor Investment Corporation. Mr. De Sousa started his professional career working with the Assurance and Advisory practice at Arthur Andersen LLP. Mr. De Sousa holds a Bachelor of Business Administration degree and Master of Business Administration degree from Iona University and is a Registered Certified Public Accountant in New York State.
R. Marshall Smith – R. Marshall Smith has served as our President, Space Solutions since January 2025. Mr. Smith previously served as our Chief Technology Officer from January 2024 until January 2025 and Vice President for Exploration from October 2022 until January 2024. Prior to joining Voyager, he was Senior Vice President for Space Systems at Nanoracks LLC, leading the program formation of Starlab. He came to Nanoracks in August 2021 after more than 37 years at NASA where he led the development of most of NASA’s current human space systems culminating with his position as Deputy Associate Administrator in the Human Exploration and Operations Mission Directorate. Mr. Smith holds a Bachelor of Science degree and a Master of Science degree in Electrical and Computer Engineering from the University of Tennessee and Virginia Polytechnic Institute, respectively.
Margaret (Meg) Vernal – Meg Vernal has served as our Chief Legal Officer, General Counsel and Secretary since March 2024. Ms. Vernal served as our Deputy General Counsel from September 2021 to March 2024. Prior to joining the Company, Ms. Vernal was the Content Manager, Mergers & Acquisitions for Lexis Nexis, a division of RELX plc (NYSE: RELX) from April 2015 until September 2021. Ms. Vernal holds a Bachelor of Arts degree in Politics, Philosophy & Economics and German from Claremont McKenna College, a Juris Doctor degree from Georgetown University Law Center, and a Master of Laws degree in Space, Cyber and Telecommunications Law from the University of Nebraska College of Law.
Matthew Magaña – Matthew Magaña has served as our President, Defense & National Security since October 2024. Prior to joining the Company, he served as Executive Vice President of Space Payload Systems at Raytheon Technologies (NYSE: RTX), President of Blue Canyon Technologies from December 2020 until April 2022 and as Vice President of Space Systems, at Raytheon from January 2017 to November 2020. We believe that Mr. Magaña’s strong academic foundation in engineering, communications, and business equips him with the technical acumen and strategic leadership skills necessary to drive innovation, increase operational efficiency, and enhance shareholder value.
Wallis Laughrey – Wallis Laughrey has been our Chief Strategy Officer since November 2024. Prior to that he served as Vice President of Anduril Labs and Senior Strategy Advisor at Anduril Industries, Inc. from March 2023 to December 2024. He was Chief Strategy and Transformation Officer from January 2021 to March 2022; Vice President of Space and C2 Systems from May 2016 to December 2021 and Vice President of Advanced Concepts & Technology from July 2014 to May 2016 at Raytheon Intelligence and Space. Mr. Laughrey also had prior leadership roles at Northrop Grumman and the US Air Force. Mr. Laughrey has a Bachelor of Science from the United States Air Force Academy, a Master of Public Administration from the University of Colorado and a Master of Science in Product Development Engineering from the University of Southern California.
Alan Stern – Dr. Alan Stern has served as a member of our board of directors since October 2019. Dr. Stern has been the Chief Exploration Officer of World View Enterprises since April 2021 and has also served as Chief Scientist there from December 2014. Dr. Stern was the founder of The Golden Spike Company and served as the Chief Executive Officer from September 2010 until the company’s closure in February 2019. Since April 2008, he has run his own aerospace consulting practice. Dr. Stern formerly served in Washington, D.C. as NASA’s chief of all space and Earth science programs from February 2007 to March 2008. He also served as Associate Vice President and Special Assistant to the President at the Southwest Research Institute from February 2009, the Director of the Florida Space Institute from September 2011 to January 2013 and as Chief Scientist and Mission Architect for Moon Express from September 2010 to February 2013. In November 2018, he was named by the Trump administration to a six-year term on the U.S. National Science Board. Dr. Stern holds a Bachelor of Science degree in Physics, a Bachelor of Art degree in Astronomy and a Master of Science degree in aerospace engineering
and planetary atmospheres from the University of Texas at Austin. He holds a Doctorate degree in astrophysics and planetary science in 1989 from the University of Colorado.
We believe that Dr. Stern is qualified to serve on our board of directors due to his extensive background in space program management.
Cheryl Shavers – Dr. Cheryl Shavers has served as a member of our board of directors since October 2019. Dr. Shavers has served as the Chief Executive Officer of Global Smarts, Inc., an advisory services and strategy firm, since February 2001. She has served on the board of directors of Knowles Corporation (NYSE: KN) since August 2017, including serving as a member of the Audit Committee from August 2017 to May 2019 and as a member of the Compensation Committee since May 2019. She has served on the Nominating and Governance Committee since August 2017 and was appointed Chair of the Nominating and Governance Committee in October 2021. She also has served on the board of directors of ITT (NYSE: ITT) since October 2018, where she has been a member of the Compensation Committee since May 2019 and a member of the Nominating and Governance Committee since October 2018. Dr. Shavers has an extensive experience in government service, including serving as Under Secretary of Commerce for Technology at the Department of Commerce from August 1999 to January 2001 and as a member of the U.S.-Israel Science and Technology Commission (USISTC) from August 1999 to January 2001. She is also a practicing registered Patent Agent with the Patent & Trademark Office of the Department of Commerce. Dr. Shavers holds a Bachelor of Science degree in Chemistry and a Ph.D. in Solid State Chemistry, both from Arizona State University and an Honorary Master’s degree in Engineering Management from California Polytechnic State University.
We believe that Dr. Shavers is qualified to serve on our board of directors due to her extensive experience leading private companies and public entities, overseeing international equity investments and acquisitions and serving on federal committees related to national security, international science and commercial space.
Gabe Finke – Gabe Finke has served as a member of our board of directors since October 2019. Mr. Finke currently serves as Chief Executive Officer and Chief Investment Officer at Ascentris, LLC, a real estate private equity firm he co-founded in July 2010. From July 2003 until November 2015, Mr. Finke was the Chief Executive Officer and Chief Investment Officer of Amstar Advisers, the previous name of Ascentris, and Amstar Group. Prior to Ascentris, Mr. Finke was a Principal at The Carlyle Group from January 1999 until June 2003 and Senior Vice President of Prologis from July 1994 to December 1998, where he was head of European real estate development. Mr. Finke graduated with Highest Honors in Mechanical Engineering from Georgia Institute of Technology and earned an MBA from Harvard Business School.
We believe that Mr. Finke is qualified to serve on our board of directors due to his strong background in management and entrepreneurship.
Marian Joh – Marian Joh has served as a member of our board of directors since February 2021. Ms. Joh co-founded Andrews Space, a leading aerospace prime contractor and small satellite manufacturer, in July 1999 and has served as its President and Chief Executive Officer. Ms. Joh served as Director of Spaceflight Industries from July 2013 to September 2018. Ms. Joh has served on the board for multiple organizations, including the Seattle Academy of Arts and Sciences from June 2017 to June 2024 and The Evergreen School from June 2008 to June 2014. Previously, Ms. Joh served as COO of Sarcos Robotics from February 2021 to January 2022 and as President of Spaceflight Systems from March 2015 to September 2017. Previously, Ms. Joh served in executive and financial leadership roles at Tornado Development from July 1999 to June 2002, Scheinrock Advisory Group from October 1996 to June 1999, and Kistler Aerospace Corporation from May 1995 to September 1996. Ms. Joh holds a Bachelor of Arts degree in Accounting and Economics from Western Washington University.
We believe that Ms. Joh is qualified to serve on our board of directors due to her background leading major space organizations as they develop and build their infrastructure through rapid growth phases.
William Shelton – General William Shelton has served as a member of our board of directors since October 2019. General Shelton retired as Commander, Air Force Space Command in September 2014. During his career, he commanded space operations units at every level and held staff positions in a wide range of Air Force and Department of Defense organizations. He is the former Chairman of the Board of Directors for the Space Foundation
serving on the board from January 2016 to December 2019 and serving as Chairman from January 2017 to January 2019. He is a member of the board of directors for Airbus Defense and Space, Inc., serving since February 2015, and serving on the Colorado Thirty Group Board of Trustees since January 2015 and serving as Chairman since July 2020. He also served on the PredaSAR Corporation Board from March 2020, until the board was dissolved in March 2021. General Shelton served as a board member of the Board of Trustees for the Aerospace Corporation from March 2015 to December 2019, where he served on the Governance and Nominating Committee from January 2018 to December 2019, the Compensation Committee from January 2018 to December 2019 and the Audit Committee from March 2015 to January 2018. He served as Vice Chairman of that board from January 2018 to December 2019. General Shelton earned a Bachelor of Science degree in astronautical engineering from the United States Air Force Academy, a Master of Science degree in astronautical engineering from the Air Force Institute of Technology and a Master of Science degree in national security studies from the National War College.
We believe that General Shelton is qualified to serve on our board of directors due to his significant leadership experience and extensive experience in space operations and policy.
Composition of our Board of Directors
Our board of directors consists of seven directors. Our amended and restated certificate of incorporation provides that, subject to the right of holders of any series of preferred stock, our board of directors will be divided into three classes of directors, with the classes to be as nearly equal in number as possible, and with the directors serving staggered three-year terms, with only one class of directors being elected at each annual meeting of stockholders. As a result, approximately one-third of our board of directors will be elected each year. Our Class I directors are Gabe Finke , Marian Joh and Matthew Kuta (with their terms expiring at the annual meeting of stockholders to be held in 2026 ), our Class II directors are Cheryl Shavers and William Shelton (with their terms expiring at the annual meeting of stockholders to be held in 2027) and our Class III directors are Alan Stern and Dylan Taylor (with their terms expiring at the annual meeting of stockholders to be held in 2028 ).
At each annual meeting of stockholders, upon the expiration of the term of a class of directors, each director in the class, or the successor to each such director in the class, will be elected to serve from the time of election and qualification until the third annual meeting following his or her election and until his or her successor is duly elected and qualified, in accordance with our amended and restated certificate of incorporation. Any increase or decrease in the number of directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of the directors. This classification of our board of directors may have the effect of delaying or preventing changes in control of our company.
When considering whether directors and nominees have the experience, qualifications, attributes or skills, taken as a whole, to enable our board of directors to satisfy its oversight responsibilities effectively in light of our business and structure, the board of directors focuses primarily on each person’s background and experience as reflected in the information discussed in each of the directors’ individual biographies set forth above. We believe that our directors provide an appropriate mix of experience and skills relevant to the size and nature of our business.
Controlled Company Exception
After the completion of this offering, Dylan Taylor, our Chairman and Chief Executive Officer, will continue to beneficially own a majority of the voting power of our capital stock through his ownership of all of our outstanding shares of Class B common stock, which are entitled to 15 votes per share. As a result, we will be a “controlled company” within the meaning of the New York Stock Exchange corporate governance standards and may elect not to comply with certain corporate governance standards, including that: (1) a majority of our board of directors consist of independent directors, (2) our board of directors have a compensation committee that is comprised entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities and (3) our board of directors have a nominating and corporate governance committee that is comprised entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities. Although upon completion of this offering a majority of our board of directors will consist of independent directors and we will have compensation and nominating and corporate governance committees comprised entirely of independent directors, we may utilize any or all of these exemptions at any time at our discretion prior to the time we cease to be
a “controlled company.” Accordingly, to the extent we utilize these exemptions, you will not have the same protections afforded to stockholders of companies that are subject to all of these corporate governance requirements. In the event that we cease to be a “controlled company” and shares of our Class A common stock continue to be listed on the New York Stock Exchange, we will be required to comply with these provisions within the applicable transition periods.
Director Independence
Our board of directors has determined that each of Alan Stern, Cheryl Shavers, Gabe Fink, Marian Joh and William Shelton qualifies as an “independent director,” as defined under the rules of the New York Stock Exchange. In making these determinations, our board of directors considered the current and prior relationships that each director has with our Company and all other facts and circumstances our board of directors deemed relevant in determining their independence, including the beneficial ownership of our capital stock by each director, and the transactions involving them described in the section titled “Certain Relationships and Related Party Transactions.”
Committees of Our Board of Directors
Our board of directors directs the management of our business and affairs, as provided by Delaware law, and conducts its business through meetings of the board of directors and standing committees. We have a standing audit committee, nominating and corporate governance committee and compensation committee. In addition, from time to time, special committees may be established under the direction of the board of directors when necessary to address specific issues.
Audit Committee
Our audit committee is responsible for, among other things:
•appointing, compensating, retaining, evaluating, terminating and overseeing our independent registered public accounting firm;
•discussing with our independent registered public accounting firm their independence from management;
•reviewing with our independent registered public accounting firm the scope and results of their audit;
•approving audit and permissible non-audit services to be performed by our independent registered public accounting firm;
•overseeing the financial reporting process and discussing with management and our independent registered public accounting firm the quarterly and annual consolidated financial statements that we file with the SEC;
•overseeing our financial and accounting controls and compliance with legal and regulatory requirements;
•reviewing our policies on risk assessment and risk management;
•overseeing our financial, cybersecurity and data privacy risks;
•reviewing related person transactions; and
•establishing procedures for the confidential anonymous submission of concerns regarding accounting, internal controls or auditing matters.
Our audit committee consists of Marian Joh, Gabe Finke and Alan Stern, with Marian Joh serving as chair. Rule 10A-3 of the Exchange Act and the New York Stock Exchange rules require that our audit committee have a majority of independent members and be composed entirely of independent members within one year of the date of our IPO. Our board of directors has affirmatively determined that Marian Joh, Gabe Finke and Alan Stern each meet the definition of “independent director” for purposes of serving on the audit committee under Rule 10A-3 under the Exchange Act and the New York Stock Exchange rules. Each member of our audit committee also meets the financial literacy requirements of the New York Stock Exchange listing standards. In addition, our board of
directors has determined that Gabe Finke qualifies as an “audit committee financial expert,” as such term is defined in Item 407(d)(5) of Regulation S-K. Our board of directors will adopt a written charter for the audit committee, which will be available on our principal corporate website at www.voyagertechnologies.com upon completion of this offering. The information on our website is deemed not to be incorporated in this prospectus or to be part of this prospectus.
Nominating and Corporate Governance Committee
Our nominating and corporate governance committee is responsible for, among other things:
•identifying individuals qualified to become members of our board of directors, consistent with criteria approved by our board of directors;
•reviewing and recommending to our board of directors those to serve on the committees of the board and as chair thereof;
•overseeing the evaluation of the effectiveness of our board of directors and its committees; and
•developing and recommending to our board of directors a set of corporate governance guidelines.
Our nominating and corporate governance committee consists of William Shelton, Cheryl Shavers, Marian Joh and Alan Stern, with William Shelton serving as chair. Our board has determined that each of William Shelton, Cheryl Shavers, Marian Joh and Alan Stern meets the definition of “independent director” for purposes of serving on the nominating and corporate governance committee under the New York Stock Exchange rules. Our board of directors has adopted a written charter for the nominating and corporate governance committee, which is available on our principal corporate website at www.voyagertechnologies.com. The information on our website is deemed not to be incorporated in this prospectus or to be part of this prospectus.
Compensation Committee
Our compensation committee is responsible for, among other things:
•reviewing and approving the compensation of our Chief Executive Officer and other executive officers;
•administering our incentive and equity-based compensation plans;
•reviewing and making recommendations to the board of directors regarding director compensation; and
•appointing and overseeing any compensation consultants.
Our compensation committee consists of Gabe Finke, William Shelton, Cheryl Shavers and Alan Stern, with Gabe Finke serving as chair. Our board has determined that each of Gabe Finke, William Shelton, Cheryl Shavers and Alan Stern meets the definition of “independent director” for purposes of serving on the compensation committee under the New York Stock Exchange rules, including the heightened independence standards for members of a compensation committee, and each is a “non-employee director” as defined in Rule 16b-3 of the Exchange Act. Our board of directors has adopted a written charter for the compensation committee, which is available on our principal corporate website at www.voyagertechnologies.com. The information on our website is deemed not to be incorporated in this prospectus or to be part of this prospectus.
Risk Oversight
Our board of directors is responsible for overseeing our risk management process. Our board of directors focuses on our general risk management strategy, the most significant risks facing us, and oversees the implementation of risk mitigation strategies by management. Our audit committee is also responsible for discussing our policies with respect to risk assessment and risk management. Our board of directors believes its administration of its risk oversight function has not negatively affected our board of directors’ leadership structure.
Compensation Committee Interlocks and Insider Participation
None of the members of our compensation committee is or has been an officer or employee of our Company. None of our executive officers serves, or has served during the last completed fiscal year, as a member of the board of directors or compensation committee (or other committee performing equivalent functions) of any entity that has one or more of its executive officers serving on our board of directors or compensation committee.
Code of Business Conduct and Ethics
Our board of directors has adopted a written code of business conduct and ethics (the “Code”) that applies to our directors, officers and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A copy of the Code is posted on our website, www.voyagertechnologies.com. In addition, we intend to continue to post on our website all disclosures that are required by SEC rules or the New York Stock Exchange listing standards concerning any amendments to, or waivers from, any provision of the Code. The information on our website is deemed not to be incorporated in this prospectus or to be part of this prospectus.
EXECUTIVE COMPENSATION
This section discusses the material components of the executive compensation program for our executive officers who are named in the “Summary Compensation Table” below. As an emerging growth company, we have elected to take advantage of exemptions from the various reporting requirements applicable to public companies that are not emerging growth companies, including reduced disclosure obligations regarding executive compensation in this prospectus and, while an emerging growth company, our future periodic reports and proxy.
In 2024, our “named executive officers” and their positions were as follows:
•Dylan Taylor, Chairman and Chief Executive Officer.
•Matthew Kuta, President; and
•Filipe DeSousa, Chief Financial Officer.
This discussion may contain forward-looking statements that are based on our current plans, considerations, expectations and determinations regarding future compensation programs. Actual compensation programs that we adopt following the completion of this offering may differ materially from the currently planned programs summarized in this discussion.
Summary Compensation Table
The following table sets forth information concerning the compensation of our named executive officers for the year ended December 31, 2024.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Name and Principal Position | | Year | | Salary ($)(1) | | Bonus(2) | | Option Awards ($)(3) | | Non-Equity Incentive Plan Compensation ($)(4) | | All Other Compensation ($)(5) | | Total ($) |
Dylan Taylor Chairman and Chief Executive Officer | | 2024 | | 376,923 | | | — | | | 863,238 | | | — | | | 34,692 | | | 1,274,853 | |
Matthew Kuta President | | 2024 | | 360,000 | | | 300,000 | | | — | | | 300,000 | | | — | | | 960,000 | |
Filipe De Sousa Chief Financial Officer | | 2024 | | 394,231 | | | — | | | 258,972 | | | 200,000 | | | 2,308 | | | 855,511 | |
________________
(1)The amounts reflect increases to the base salaries of each named executive officer effective in March 2024, as described below in “Narrative to Summary Compensation Table—2024 Base Salaries”.
(2)This amount represents the discretionary portion of Mr. Kuta’s 2024 payment under our annual bonus program, as described below in “Narrative to Summary Compensation Table – 2024 Bonuses.”
(3)The amounts reported represent the aggregate grant date fair value of the stock options granted during the year ended December 31, 2024, calculated in accordance with FASB ASC Topic 718, rather than the amount paid to or realized by the named executive officer. We provide information regarding the assumptions used to calculate the value of the option awards made to executive officers in Note 15 to our audited consolidated financial statements included elsewhere in this prospectus.
(4)Amounts represent the annual performance bonus earned with respect to 2024 under our annual bonus program, as described below in “Narrative to Summary Compensation Table—2024 Bonuses”.
(5)Amounts represent a company-paid matching contribution to the executive’s 401(k) plan account and, for Mr. Taylor, payment for personal consulting services for Mr. Taylor in the amount of $31,000.
NARRATIVE TO SUMMARY COMPENSATION TABLE
2024 Base Salaries
Our named executive officers receive a base salary to compensate them for services rendered to our company. The base salary payable to each named executive officer is intended to provide a fixed component of compensation reflecting the executive’s skill set, experience, role and responsibilities. The base salaries for Messrs. Taylor, Kuta and De Sousa for 2024 were initially $395,000, $300,000 and $375,000, respectively, and in March 2024 were subsequently increased to $400,000, $360,000 and $400,000, respectively (with Mr. Kuta’s increase to $360,000 having retroactive effect to January 1, 2024).
In connection with this offering, we increased the base salaries for Messrs. Kuta and De Sousa to $400,000 and $416,000, respectively. Mr. Taylor’s salary will remain at $400,000.
2024 Bonuses
We offer our named executive officers the opportunity to earn cash bonuses to compensate them for attaining short-term company and/or individual goals. For 2024, annual bonuses were based on the achievement of both Company financial and operational goals as well as individual performance. The Company financial component of the 2024 annual bonus program (weighted up to 100% of target) was based on the achievement of specified Company Adjusted EBITDA targets, while achievement of the Company operational component goals, consisting of goals related to successful private capital fundraising, refinancing and credit facility upgrades, restructuring and integration execution, obtaining strategic artificial intelligence partnerships and joint ventures, and milestone achievements toward public market readiness, could adjust the annual bonus payout positively or negatively up to an additional 50% (though not below zero). Performance achievement under the 2024 annual bonus program was determined by our compensation committee in consultation with Mr. Taylor.
For purposes of the 2024 annual bonus program, “Adjusted EBITDA” is defined as EBITDA, adjusted for change due to stock-based compensation, incremental organizational costs attributable to this offering, business acquisition costs, change in fair value of earnout liabilities, restructuring charges, income (loss) attributable to noncontrolling interests, impairment, foreign exchange gain/loss and other items we do not believe are indicative of our core operating performance.
For 2024, the target bonuses for Messrs. Taylor, Kuta and De Sousa were $1,595,000, $600,000 and $400,000, respectively. However, Mr. Taylor waived his right to receive a bonus with respect to the 2024 fiscal year. With respect to the 2024 annual bonus program, the financial component of the 2024 annual bonus was deemed to have not been achieved and the Company operational goals were deemed achieved at the target performance level, resulting in an overall payout of 50%. In light of Mr. Kuta’s extraordinary contributions towards the achievement of the operational goals, the compensation committee determined to discretionarily increase his 2024 annual bonus payout an additional 50% for a total annual bonus payout to Mr. Kuta of 100% of target.
In connection with this offering, we established target bonuses for Messrs. Taylor and De Sousa at 100% of their respective annual base salaries and the target bonus for Mr. Kuta at $600,000, respectively.
Equity Compensation
We historically have used stock options as the primary incentive for long-term compensation to our employees (including our named executive officers) because they are able to profit from stock options only if our stock price increases relative to the exercise price of the applicable stock options, which is set at the fair market value of our common stock applicable to the stock option as of the applicable grant date. Typically, stock options we grant to employees are intended to qualify as “incentive stock options” to the extent permitted under the Code, though we also grant non-qualified stock options to certain employees where determined appropriate by our board of directors.
Generally, the stock options we grant vest with respect to 25% of the stock options awarded after a one-year cliff and then in equal monthly installments during the three-year period thereafter, subject to the employee’s
continued service with us as of the applicable vesting date. Pursuant to the 2020 Plan, any outstanding stock options will accelerate and vest in full in connection with this offering.
The following table sets forth the options granted to our named executive officers during 2024. These options were granted with an exercise price equal to $9.48 per share and vest in accordance with our standard vesting schedule described above.
| | | | | | | | |
Named Executive Officer | | 2024 Options Granted |
Dylan Taylor | | 75,000 | |
Matthew Kuta | | — | |
Filipe De Sousa | | 22,500 |
Equity Compensation Plans
We currently maintain the Voyager Technologies, Inc. 2020 Incentive Plan, or the 2020 Plan, in order to attract, retain, motivate and reward employees, non-employee directors and key consultants to the Company and its subsidiaries. For additional information about the 2020 Plan, please see the section titled “Incentive Compensation Plans—Existing Equity Plan” below.
In connection with this offering, we adopted the 2025 Incentive Award Plan, or the 2025 Plan, in order to facilitate the grant of cash and equity incentives with respect to our Class A common stock (or, if determined by the plan administrator, shares of our Class B common stock) to directors, employees (including our named executive officers) and consultants of our company and to enable our company to obtain and retain services of these individuals. Following the effective date of the 2025 Plan, we will not make any further grants under our 2020 Plan. However, the 2020 Plan will continue to govern the terms and conditions of the outstanding awards granted thereunder. For additional information about the 2025 Plan, please see “Incentive Compensation Plans—2025 Incentive Award Plan” below.
In connection with this offering, we amended our 2020 Plan and the awards outstanding thereunder to cover shares of our Class A common stock and, solely with respect to Mr. Taylor’s outstanding awards thereunder, shares of our Class B common stock.
IPO Awards
In addition, in connection with this offering, we approved the grant of restricted stock awards to certain of our employees, including our named executive officers, under the 2025 Plan, effective immediately following the effectiveness of the applicable Form S-8 registration statement. We granted in the aggregate, awards with respect to 770,250 shares of our Class A and Class B common stock to such employees (including our named executive officers). Of such awards, we granted awards with respect to 45,000 shares of Class B common stock to Mr. Taylor, as well as awards with respect to 50,000 and 30,000 shares of our Class A common stock to Messrs. Kuta and De Sousa, respectively. Such awards will generally vest in three equal installments on each of the third, fourth and fifth anniversaries of the grant date, subject to the holder’s continued service through the applicable vesting dates.
Other Elements of Compensation
Retirement Plan
We maintain a 401(k) retirement savings plan, or the 401(k) plan, for our employees, including our named executive officers, who satisfy certain eligibility requirements. Our named executive officers are eligible to participate in the 401(k) plan on the same terms as other full-time employees. The Code allows eligible employees to defer a portion of their compensation, within prescribed limits, on a pre-tax basis through contributions to the 401(k) plan. Currently, we provide matching contributions equal to 50% of a participant’s salary deferrals up to 8% of his or her compensation, subject to limits provided in the Code. These matching contributions vest over a three-year period. We believe that providing a vehicle for tax-deferred retirement savings through our 401(k) plan adds to
the overall desirability of our compensation package and further incentivizes our employees, including our named executive officers, in accordance with our compensation policies.
The amounts of such Company matching contributions paid by us on behalf of Messrs. Taylor and De Sousa are set forth above in the Summary Compensation Table in the column entitled “All Other Compensation.”
Employee Benefits and Perquisites
All of our employees, including our named executive officers, are eligible to participate in our health and welfare plans, including:
•medical, dental and vision benefits;
•health savings accounts and health, limited purpose and dependent care flexible spending accounts;
•short-term and long-term disability insurance; and
•life insurance.
In addition, we paid for personal consulting services on behalf of Mr. Taylor in the amount of $31,000.
We did not provide any other perquisites or special personal benefits to our named executive officers in fiscal year 2024, but our compensation committee may from time to time approve them in the future when our compensation committee determines that such perquisites are necessary or advisable to fairly compensate or incentivize our employees.
We believe the perquisites and benefits described above are necessary and appropriate to provide a competitive compensation package to our named executive officers.
No Tax Gross-ups
We do not make gross-up payments to cover our named executive officers’ personal income taxes that may pertain to any of the compensation or perquisites paid or provided by us.
Clawback Policy
In connection with this offering, we adopted a compensation recovery policy that is compliant with the listing rules of the NYSE, as required by the Dodd-Frank Act, to be effective upon the completion of this offering.
Outstanding Equity Awards at 2024 Fiscal Year-End
The following table summarizes the number of shares of common stock underlying outstanding equity incentive awards for each named executive officer as of December 31, 2024. Following the Common Stock Reclassification and the completion of this offering, Mr. Taylor will hold equity awards with respect to shares of our Class B common stock and our other named executive officers will hold equity awards with respect to shares of our Class A
common stock. The awards described below have been adjusted to reflect the Stock Split that has been effected in connection with this offering.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Option Awards(1) |
Name | | Grant Date | | Number of Securities Underlying Unexercised Options (#) Exercisable | | Number of Securities Underlying Unexercised Options (#) Unexercisable | | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | | Option Exercise Price ($) | | Option Expiration Date |
Dylan Taylor | | 2/1/2020 | | 58,797 | | — | | — | | 3.17 | | | 1/31/2030 |
| | 10/11/2020 | | 78,396 | | — | | — | | 3.17 | | | 10/10/2030 |
| | 11/16/2021 | | 89,062 | | 23,437 | | — | | 19.54 | | | 11/15/2031 |
| | 2/2/2023 | | 34,374 | | 40,626 | | — | | 23.12 | | | 2/1/2033 |
| | 2/29/2024 | | — | | 75,000 | | — | | 9.48 | | | 2/28/2034 |
Matthew Kuta | | 2/1/2020 | | 19,599 | | — | | — | | 3.17 | | | 1/31/2030 |
| | 10/11/2020 | | 97,995 | | — | | — | | 3.17 | | | 10/10/2030 |
| | 2/2/2023 | | 68,749 | | 81,250 | | — | | 23.12 | | | 2/1/2033 |
| | 11/14/2023 | | 162,499 | | 437,500 | | — | | 9.48 | | | 11/13/2033 |
Filipe De Sousa | | 10/27/2022 | | 40,624 | | 34,375 | | — | | 23.12 | | | 10/26/2032 |
| | 2/29/2024 | | — | | 22,500 | | — | | 9.48 | | | 2/28/2034 |
________________
(1)Each option vests as to 25% of the stock options awarded after a one-year cliff and then in equal monthly installments during the three-year period thereafter, subject to the employee’s continued service with us as of the applicable vesting date.
Executive Compensation Arrangements
Prior to this offering, we had entered into employment agreements with each of our named executive officers (the “Prior Employment Agreements”). In connection with this offering, we entered into new employment agreements with each of our named executive officers (the “Executive Employment Agreements”), effective as of the date of closing of this offering. The principal elements of the Prior Employment Agreements as in effect prior to this offering in 2025 and the Executive Employment Agreements with each of our named executive officers are summarized below.
Prior Employment Agreements
Taylor Agreement
On January 1, 2022, we entered into an employment agreement with Mr. Taylor providing for his employment as Chief Executive Officer (the “Taylor Agreement”). Pursuant to the Taylor Agreement, Mr. Taylor is entitled to an annual base salary of $395,000 (which was subsequently increased to $400,000) and is eligible to earn an annual cash performance bonus with a target amount of $1,595,000 based on the achievement of performance goals determined by our compensation committee in its discretion. In addition, Mr. Taylor is eligible to participate in the employee benefits programs offered by us to our senior executive officers, the Company’s equity-based incentive plan and the Company’s annual equity incentive program applicable to its senior executive officers.
The Taylor Employment Agreement provides for employment on an “at will” basis. Pursuant to the Taylor Agreement, if Mr. Taylor’s employment is terminated by us without Cause or by Mr. Taylor for Good Reason (each as defined below), then, subject to his timely execution and non-revocation of a separation agreement and release of claims as well as his continued compliance with the applicable restrictive covenants, he will be entitled to: (i) a severance payment equal to 18 months of base salary, payable in accordance with the ordinary payroll practices of the Company over the 18-month period following the date of termination, and (ii) accelerated vesting of any
unvested time-based equity awards outstanding as of the date of his termination that would have vested during the 12-month period following the date of his termination if he had remained employed through such 12-month period.
The Taylor Agreement contains 18-month post-termination non-competition and non-solicitation of customers and service providers covenants, as well as perpetual mutual non-disparagement covenants.
For purposes of the Taylor Agreement, “Cause” generally means the occurrence of any of the following, as determined by the board of directors in its reasonable judgment: (i) the executive’s material failure to perform (other than by reason of disability), or substantial misconduct in the performance of, the executive’s duties and responsibilities for the Company or any of its affiliates which causes material harm to the Company; (ii) the executive’s material and demonstrable breach of any provision of Section 5 of the Taylor Agreement or of any other confidentiality, invention assignment or other restrictive covenant obligation set forth in any written agreement by and between the executive and the Company or any of its affiliates; (iii) the executive’s material and demonstrable breach of any other provision of the Taylor Agreement or any other written agreement by and between the executive and the Company or any of its affiliates; (iv) the executive’s material violation of any applicable policy or code of conduct of the Company or any of its affiliates, which violation causes material reputational or financial harm to the Company; or (v) the executive’s indictment for, or plea of nolo contendere to, any felony or any crime involving moral turpitude. Notwithstanding the foregoing, a circumstance otherwise giving rise to Cause pursuant to clauses (i), (ii), (iii) or (iv), if capable of cure, will not constitute Cause if cured by Mr. Taylor within ten (10) days following the Company’s written notice to him.
For purposes of the Taylor Agreement, “Good Reason” generally means the occurrence of any of the following without the executive’s consent: (i) a material reduction in base salary, other than an across-the-board reduction applicable to similarly situated executives of the Company; or (ii) a material diminution of executive’s duties, authorities or responsibilities; provided, however, that no resignation for Good Reason shall be effective unless and until (A) the executive has first provided the Company with written notice specifically identifying the acts or omissions constituting the grounds for “Good Reason” within 30 days after the initial existence of the facts or circumstances constituting Good Reason, (B) the Company has not cured such acts or omissions within 30 days of its actual receipt of such notice, and (C) the effective date of Executive’s termination for Good Reason occurs no later than 90 days after the initial existence of the facts or circumstances constituting Good Reason.
Kuta Agreement
Effective as of January 1, 2022, we entered into an employment agreement with Mr. Kuta providing for his employment as Chief Operating Officer (the “Kuta Agreement”), though Mr. Kuta now serves as our President. Pursuant to the Kuta Agreement, Mr. Kuta is entitled to an initial annual base salary of $300,000 (which was subsequently increased to $360,000) and is eligible to earn an annual cash performance bonus with a target amount of $600,000 based on the achievement of performance goals determined by our Chief Executive Officer in his discretion. In addition, Mr. Kuta is eligible to participate in the employee benefits programs offered by us to our senior executive officers, the Company’s equity-based incentive plan and the Company’s annual equity incentive program applicable to its senior executive officers.
The Kuta Employment Agreement provides for employment on an “at will” basis.
Pursuant to the Kuta Agreement, if Mr. Kuta’s employment is terminated by us without Cause or by Mr. Kuta for Good Reason (each as defined below), then, subject to his timely execution and non-revocation of a separation agreement and release of claims as well as his continued compliance with the applicable restrictive covenants, he will be entitled to: (i) a severance payment equal to 18 months of base salary, payable in accordance with the ordinary payroll practices of the Company over the 18 month period following the date of termination, and (ii) accelerated vesting of any unvested time-based equity awards outstanding as of the date of his termination that would have vested during the 12-month period following the date of his termination if he had remained employed through such 12-month period.
The Kuta Agreement contains 18-month post-termination non-competition and non-solicitation of customers and service providers covenants, as well as perpetual mutual non-disparagement covenants.
For purposes of the Kuta Agreement, “Cause” and “Good Reason” have generally the same meaning as in the Taylor Agreement.
De Sousa Agreement
On September 14, 2022, we entered into an employment agreement with Mr. De Sousa providing for his employment as Chief Financial Officer commencing on October 10, 2022 (the “De Sousa Agreement”). Pursuant to the De Sousa Agreement, Mr. De Sousa is entitled to an annual base salary of $400,000 beginning in 2024 and is eligible to earn an annual cash performance bonus with a target amount of $400,000 based on the achievement of individual and company performance goals. In addition, Mr. De Sousa is eligible to participate in certain employee benefits programs offered by us to our employees.
The De Sousa Employment Agreement provides for employment on an “at will” basis. Pursuant to the De Sousa Agreement, if Mr. De Sousa’s employment is terminated by us without Cause or by Mr. De Sousa for Good Reason(each as defined below), then, subject to his timely execution and non-revocation of a release of claims, he will be entitled to a severance payment equal to 12 months of base salary plus any accrued bonus as reasonably determined by the board of directors, payable in accordance with the ordinary payroll practices of the Company over the 12-month period following the date of termination. The De Sousa Agreement contains 12-month post-termination non-competition and non-solicitation of customers and employees covenants, as well as a perpetual non-disparagement covenant.
For purposes of the De Sousa Agreement, “Cause” generally means: his (i) conviction of (including plea of guilty or no-contest to) any felony or any crime involving dishonesty or moral turpitude; (ii) violation of law, or act of fraud or dishonesty, in connection with his employment; (iii) refusal or failure to comply with any lawful directive of the Company or any of its officers or directors that is not cured (if capable of cure) within 10 days after written notice to executive identifying the refusal or failure; (iv) breach of his fiduciary duty or duty of loyalty to the Company or any of its affiliates that is not cured (if capable of cure) within 10 days after written notice to him identifying the breach; (v) breach of the De Sousa Agreement or any other contract with any of the Company or any of its affiliates that is not cured (if capable of cure) within 10 days after written notice to him identifying the breach; or (vi) violation of any applicable policy of any of the Company or any of its affiliates that is not cured (if capable of cure) within 10 days after written notice to him identifying the violation.
For purposes of the De Sousa Agreement, “Good Reason” generally means, without his consent: (i) a material diminution in his duties, responsibilities, authority, or reporting relationship; (ii) a material reduction in the aggregate compensation provided to him unless such reduction is concurrently made to the entire Company’s executive committee; or (iii) a material breach of any other material term of the De Sousa Agreement; provided, however, that any such condition shall not constitute “Good Reason” unless he provides written notice to the Company of the condition claimed to constitute Good Reason within 30 days of the initial existence of such condition and, thereafter, the board of directors fails to cure such “Good Reason” within 30 days following its receipt of such written notice from executive, and within 10 days thereafter, he terminates employment for “Good Reason.”
New Employment Agreements
In connection with this offering, we entered into employment agreements with each of our named executive officers (the “Executive Employment Agreements”), effective as of the date of closing of this offering, which will replace the Prior Employment Agreements and provide for each of our named executive officers’ continued employment in their roles described above. In addition to providing for the base salaries and annual target bonus opportunities for each named executive officer as described above, the Executive Employment Agreements each provide for an indefinite at-will term of employment.
Under the Executive Employment Agreements, each executive is entitled to receive the same severance benefits as under their Prior Employment Agreements, as described above. The Executive Employment Agreements also provide for a Section 280G “best net” cutback, and the executives are each subject to perpetual confidentiality obligations and non-competition and non-solicitation covenants through the end of their employment (or the 12-month anniversary thereof for Messrs. Taylor and Kuta) with us.
For purposes of each Executive Employment Agreement, “Cause” and “Good Reason” generally have the same meanings as in the Prior Employment Agreements, as described above for each of our named executive officers.
Director Compensation
We have entered into service agreements with each of our non-employee directors providing for the terms of their service on our board of directors. Pursuant to these service agreements, each director is entitled to receive an annual cash retainer of $100,000 for their service, payable quarterly in arrears, as well as an annual stock option grant. The option grants vest with respect to 25% of the stock options awarded after a one-year cliff and then in equal monthly installments during the three-year period thereafter, subject to the director’s continued service with us as of the vesting date. Notwithstanding, no directors received stock option grants in 2024.
Messrs. Taylor and Kuta receive no additional compensation for their service on our board of directors. Their respective compensation as Chief Executive Officer and as President is set forth in the Summary Compensation Table above.
2024 Director Compensation Table
| | | | | | | | | | | | | | |
| Name | | Fees Earned or Paid in Cash ($) | | Total ($) |
William Shelton | | 80,000 | | | 80,000 | |
Gabe Finke | | 80,000 | | | 80,000 | |
Alan Stern | | 80,000 | | | 80,000 | |
Ellen Lord(1) | | 80,000 | | | 80,000 | |
Cheryl Shavers | | 80,000 | | | 80,000 | |
Marian Joh | | 80,000 | | | 80,000 | |
________________
(1)Ms. Lord ceased serving as a member of our board of directors on November 21, 2024, though continued to serve on our advisory board and will continue to receive an annual cash retainer fee of $80,000 for her service on the advisory board.
The table below shows the aggregate numbers of shares of our Class A common stock underlying option awards held by each non-employee director as of December 31, 2024. The awards described below have been adjusted to reflect the Stock Split that has been effected in connection with this offering.
| | | | | | | | |
| Name | | Options Outstanding at Fiscal Year End |
| William Shelton | | 84,498 | |
| Gabe Finke | | 84,483 | |
| Alan Stern | | 84,483 | |
| Ellen Lord | | 60,000 | |
| Cheryl Shavers | | 59,698 | |
| Marian Joh | | 69,799 | |
Non-Employee Director Compensation Policy
In connection with this offering, we adopted a non-employee director compensation policy that, effective upon the completion of this offering, will be applicable to each of our non-employee directors and supersede their prior service agreements. Pursuant to this non-employee director compensation policy, each non-employee director will receive a mixture of cash and equity compensation.
Pursuant to this policy, each eligible non-employee director will receive an annual cash retainer of $100,000 that will be paid quarterly in arrears. In addition, an eligible director serving as lead independent director of our board of directors will receive an additional cash retainer of $25,000; the chairperson of the audit committee will
receive an additional cash retainer of $25,000 and each other member of the audit committee will receive an additional cash retainer of $10,000; the chairperson of the compensation committee will receive an additional cash retainer of $15,000 and each other member of the compensation committee will receive an additional cash retainer of $10,000; and the chairperson of the nominating and corporate governance committee will receive an additional cash retainer of $15,000 and each other member of the nominating and corporate governance committee will receive an additional cash retainer of $10,000.
In addition and pursuant to this policy, non-employee directors will be eligible to receive an annual equity award of restricted stock units with a grant date fair value of $155,000 (with prorated awards made to directors who join after this offering on a date other than the date of an annual meeting), which will generally vest in full on the earlier of (i) the day immediately prior to the date of our annual stockholder meeting immediately following the date of grant and (ii) the first anniversary of the grant date, subject to the non-employee director continuing service through such date. In the event of a change in control (as defined in the 2025 Plan), all outstanding equity awards granted to our non-employee directors pursuant to this policy will accelerate and vest in full.
IPO Awards
In connection with this offering, we granted restricted stock awards with respect to 7,500 shares of our Class A common stock to each of our non-employee directors under the 2025 Plan. Such awards will vest in three equal installments on each of the third, fourth and fifth anniversaries of the grant date, subject to the non-employee director’s continued service through the applicable vesting dates.
Incentive Compensation Plans
Existing Equity Plan
We currently maintain the 2020 Plan. On and after the closing of this offering and following the effectiveness of the 2025 Plan, no further grants will be made under the 2020 Plan. In connection with the Common Stock Reclassification, we amended the 2020 Plan and outstanding awards thereunder to cover shares of Class A common stock other than with respect to the outstanding awards held by Mr. Taylor, which were amended to cover shares of Class B common stock.
The 2020 Plan provides for certain designated eligible employees, directors, and consultants of the Company and its subsidiaries the opportunity to receive equity and equity-based awards including options, stock appreciation rights, restricted stock, phantom stock, sale phantom stock, bonus stock, performance awards and other stock-based awards and annual incentive awards. We believe that such awards function as a compelling incentive and retention tool. The 2020 Plan is administered by our board of directors or compensation committee thereof.
Under the 2020 Plan, in the event of an unusual or non-recurring event such as a dividend, recapitalization, stock split, combination or similar event, the plan administrator may make substitutions or adjustments in its discretion to the terms and conditions of awards outstanding under the 2020 Plan.
In the event of a change in control (as defined in the 2020 Plan) of the Company, including an initial public offering, unless otherwise determined by the plan administrator or as otherwise provided for in an employment agreement or award agreement with the applicable participant, all time-based awards (including awards as to which performance conditions were previously satisfied or deemed satisfied) under the 2020 Plan will accelerate and vest in full with any awards carrying a right to exercise becoming fully exercisable for the balance of the term of the award without regard to a participant’s termination of service (unless the participant’s service is terminated for cause), and with respect to awards subject to performance goals and conditions under the 2020 Plan, the applicable performance goals and conditions shall be deemed met or exceeded as provided by the plan administrator in the applicable award agreement or other agreement with the participant. In addition, the plan administrator may in its discretion, determine to allow any time-based award holders (including holders of awards as to which performance conditions were previously satisfied or deemed satisfied) the right to elect to receive a cash amount equal to the change in control price (less the exercise price with respect to options) during the 60-day period immediately following the change in control in lieu of acquiring the shares of stock covered by such award.
As of May 30, 2025, there were 1,015,794 shares available for issuance under the 2020 Plan. As of May 30, 2025, 3,920,816 shares were subject to outstanding options with respect to Class A common stock under the 2020 Plan with a weighted average exercise price of $13.87 per share and 549,693 shares were subject to outstanding options held by Mr. Taylor with respect to Class B common stock under the 2020 Plan with a weighted average price of $15.17 per share.
This summary is not a complete description of all provisions of the 2020 Plan and is qualified in its entirety by reference to the 2020 Plan, which is filed as an exhibit to the registration statement of which this prospectus is part.
2025 Incentive Award Plan
In connection with this offering, we adopted the 2025 Incentive Award Plan, or the 2025 Plan under which we may grant cash and equity-based incentive awards to eligible service providers in order to attract, motivate and retain the talent for which we compete. The material terms of the 2025 Plan are summarized below. This summary is not a complete description of all provisions of the 2025 Plan and is qualified in its entirety by reference to the 2025 Plan, which will be filed as an exhibit to the registration statement of which this prospectus is a part.
Eligibility and Administration
Our employees, consultants and directors, and employees, consultants and directors of our subsidiaries are eligible to receive awards under the 2025 Plan. The 2025 Plan is expected to be initially administered by our board of directors with respect to awards to non-employee directors and by our compensation committee with respect to other participants, each of which may delegate its duties and responsibilities to committees of our directors and/or officers (referred to collectively as the plan administrator below), subject to certain limitations that may be imposed under the 2025 Plan, Section 16 of the Exchange Act, and/or stock exchange rules, as applicable. The plan administrator has the authority to make all determinations and interpretations under, prescribe all forms for use with, and adopt rules for the administration of, the 2025 Plan, subject to its express terms and conditions. The plan administrator will also set the terms and conditions of all awards under the 2025 Plan, including any vesting and vesting acceleration conditions.
Limitation on Awards and Shares Available
The maximum number of shares of our Class A common stock (or Class B common stock, if determined by the plan administrator) available for issuance under the 2025 Plan is equal to the sum of (i) 4,403,533 shares, plus (ii) any shares available for issuance under the 2020 Plan as of the effective date of the 2025 Plan or subject to awards under the 2020 Plan that are forfeited or lapse unexercised and, following the effective date of the 2025 Plan, are not issued under the 2020 Plan, plus (iii) an annual increase on the first day of each year beginning in 2026 and ending in and including 2035, equal to the lesser of (A) five percent (5%) of the shares of Class A common stock and Class B common stock outstanding on an as-converted basis on the last day of the immediately preceding fiscal year and (B) such lesser amount as determined by our board of directors; provided, however, no more than 44,035,330 shares may be issued upon the exercise of incentive stock options. The share reserve formula under the 2025 Plan is intended to provide us with the continuing ability to grant equity awards to eligible employees, directors and consultants for the ten-year term of the 2025 Plan.
Awards granted under the 2025 Plan upon the assumption of, or in substitution for, outstanding equity awards previously granted by an entity in connection with a corporate transaction with us, such as a merger, combination, consolidation or acquisition of property or stock will not reduce the shares authorized for grant under the 2025 Plan. The maximum grant date fair value of cash and equity awards granted to any non-employee director pursuant to the 2025 Plan during any calendar year is $750,000, increased to $1,000,000 for the non-employee director’s initial year of service as a non-employee director.
Awards
The 2025 Plan provides for the grant of stock options, including incentive stock options (“ISOs”) and nonqualified stock options (“NSOs”), restricted stock, dividend equivalents, stock payments, restricted stock units (“RSUs”), other incentive awards, stock appreciation rights (“SARs”) and cash awards. No determination has been
made as to the types or amounts of awards that will be granted to certain individuals pursuant to the 2025 Plan. Certain awards under the 2025 Plan may constitute or provide for a deferral of compensation, subject to Section 409A of the Code, which may impose additional requirements on the terms and conditions of such awards. All awards under the 2025 Plan will be set forth in award agreements, which will detail all terms and conditions of the awards, including any applicable vesting and payment terms and post-termination exercise limitations. Awards other than cash awards generally will be settled in shares of our Class A common stock, or, if determined by the plan administrator, in shares of Class B common stock or through cash settlement of any award. A brief description of each award type follows.
•Stock Options. Stock options provide for the purchase of shares of our common stock in the future at an exercise price set on the grant date. ISOs, by contrast to NSOs, may provide tax deferral beyond exercise and favorable capital gains tax treatment to their holders if certain holding period and other requirements of the Code are satisfied. The exercise price of a stock option may not be less than 100% of the fair market value of the underlying share on the date of grant (or 110% in the case of ISOs granted to certain significant stockholders), except with respect to certain substitute options granted in connection with a corporate transaction. The term of a stock option may not be longer than ten years (or five years in the case of ISOs granted to certain significant stockholders).
•SARs. SARs entitle their holder, upon exercise, to receive from us an amount equal to the appreciation of the shares subject to the award between the grant date and the exercise date. The exercise price of a SAR may not be less than 100% of the fair market value of the underlying share on the date of grant (except with respect to certain substitute SARs granted in connection with a corporate transaction). The term of a SAR may not be longer than ten years.
•Restricted Stock and RSUs. Restricted stock is an award of nontransferable shares of our common stock that remain forfeitable unless and until specified conditions are met, and which may be subject to a purchase price. RSUs are contractual promises to deliver shares of our common stock in the future, which may also remain forfeitable unless and until specified conditions are met. Delivery of the shares underlying RSUs may be deferred under the terms of the award or at the election of the participant, if the plan administrator permits such a deferral.
•Stock Payments, Other Incentive Awards and Cash Awards. Stock payments are awards of fully vested shares of our common stock that may, but need not, be made in lieu of base salary, bonus, fees or other cash compensation otherwise payable to any individual who is eligible to receive awards. Other incentive awards are awards other than those enumerated in this summary that are denominated in, linked to or derived from shares of our common stock or value metrics related to our shares, and may remain forfeitable unless and until specified conditions are met. Cash awards are cash incentive bonuses subject to performance goals.
•Dividend Equivalents. Dividend equivalents represent the right to receive the equivalent value of dividends paid on shares of our common stock and may be granted alone or in tandem with awards other than stock options or SARs. Dividend equivalents are credited as of dividend record dates during the period between the date an award is granted and the date such award vests, is exercised, is distributed or expires, as determined by the plan administrator.
Vesting
Vesting conditions determined by the plan administrator may apply to each award and may include continued service, performance and/or other conditions.
Certain Transactions
The plan administrator has broad discretion to take action under the 2025 Plan, as well as make adjustments to the terms and conditions of existing and future awards, to prevent the dilution or enlargement of intended benefits, facilitate the transaction, or give effect to changes in applicable law or accounting principles, in connection with certain transactions and events affecting our common stock, such as a change in control, stock dividends, stock
splits, mergers, consolidations and other corporate transactions. This includes cancelling awards for cash or property, accelerating the vesting of awards, providing for the assumption or substitution of awards by a successor entity, adjusting the number and type of shares subject to outstanding awards and/or with respect to which awards may be granted under the 2025 Plan and replacing or terminating awards under the 2025 Plan. In addition, in the event of certain non-reciprocal transactions with our stockholders known as “equity restructurings,” the plan administrator will make equitable adjustments to the 2025 Plan and outstanding awards.
Non-U.S. Participants, Claw-Back Provisions, Transferability, and Participant Payments
The plan administrator may modify award terms, establish subplans and/or adjust other terms and conditions of awards, subject to the share limits described above, in order to facilitate grants of awards subject to the laws and/or stock exchange rules of countries outside of the United States. All awards will be subject to the provisions of any claw-back policy implemented by us to the extent set forth in such claw-back policy and/or in the applicable award agreement. With limited exceptions for estate planning, domestic relations orders, certain beneficiary designations and the laws of descent and distribution, awards under the 2025 Plan are generally non-transferable, and are exercisable only by the participant. With regard to tax withholding, exercise price and purchase price obligations arising in connection with awards under the 2025 Plan, the plan administrator may, in its discretion, accept cash or check, provide for net withholding of shares, allow shares of our common stock that meet specified conditions to be repurchased, allow a “market sell order” or such other consideration as it deems suitable.
Plan Amendment and Termination
Our board of directors may amend or terminate the 2025 Plan at any time; however, except in connection with certain changes in our capital structure, stockholder approval will be required for any amendment that increases the number of shares available under the 2025 Plan. No award may be granted pursuant to the 2025 Plan after the tenth anniversary of the earlier of (i) the date on which our board of directors adopts the 2025 Plan and (ii) the date on which our stockholders approve the 2025 Plan.
Employee Stock Purchase Plan
In connection with this offering, we adopted the 2025 Employee Stock Purchase Plan, or the ESPP, subject to approval by our stockholders. The ESPP is designed to allow our eligible employees to purchase shares of our Class A common stock, at periodic intervals, with their accumulated payroll deductions. The ESPP consists of two components: a Section 423 component, which is intended to qualify under Section 423 of the Code and a non-Section 423 component, which need not qualify under Section 423 of the Code. The material terms of the ESPP are summarized below. This summary is not a complete description of all provisions of the ESPP and is qualified in its entirety by reference to the ESPP, which will be filed as an exhibit to the registration statement of which this prospectus is a part.
Shares Available; Administration
The aggregate number of shares of our Class A common stock that will initially be reserved for issuance under the ESPP will be equal to (i) 1,100,883 shares, plus (ii) an annual increase on the first day of each year beginning in 2026 and ending in and including 2035, equal to the lesser of (A) one percent (1%) of the outstanding shares of Class A common stock and Class B common stock outstanding on an as-converted basis on the last day of the immediately preceding fiscal year and (B) such lesser amount as determined by our board of directors; provided that in no event will more than 11,008,830 shares of our Class A common stock be available for issuance under the Section 423 component of the ESPP. Our board of directors or the compensation committee will have authority to interpret the terms of the ESPP and determine eligibility of participants. We expect that the compensation committee will be the initial administrator of the ESPP.
Eligibility
The plan administrator may designate certain of our subsidiaries as participating “designated subsidiaries” in the ESPP and may change these designations from time to time. We expect that our employees, other than employees who, immediately after the grant of a right to purchase Class A common stock under the ESPP, would own (directly
or through attribution) stock possessing 5% or more of the total combined voting power or value of all classes of our common or other class of stock, will be eligible to participate in the ESPP.
Grant of Rights
The Section 423 component of the ESPP will be intended to qualify under Section 423 of the Code and shares of our Class A common stock will be offered under the ESPP during offering periods. The length of the offering periods under the ESPP will be determined by the plan administrator and may be up to 27 months long. Employee payroll deductions will be used to purchase shares on each purchase date during an offering period. The purchase dates for each offering period will be the final trading day in each purchase period. Offering periods under the ESPP will commence when determined by the plan administrator. The plan administrator may, in its discretion, modify the terms of future offering periods. We do not expect that any offering periods will commence under the ESPP at the time of this offering.
The ESPP will permit participants to purchase Class A common stock through payroll deductions of up to a percentage of their eligible compensation, which includes a participant’s gross base compensation for services to us. The plan administrator will establish a maximum number of shares that may be purchased by a participant during any offering period, which, in the absence of a contrary designation, will be equal to 2,500 shares. In addition, under the Section 423 component, no employee will be permitted to accrue the right to purchase stock under the ESPP at a rate in excess of $25,000 worth of shares during any calendar year during which such a purchase right is outstanding (based on the fair market value per share of our Class A common stock as of the first trading day of the offering period).
On the first trading day of each offering period, each participant will automatically be granted an option to purchase shares of our Class A common stock. The option will expire at the end of the applicable offering period and will be exercised on each purchase date during such offering period to the extent of the payroll deductions accumulated during the offering period. The purchase price will be the lower of 85% of the fair market value of a share on the first day of an offering period in which a participant is enrolled or 85% of the fair market value of a share on the purchase date, which will occur on the last day of each purchase period. Participants may voluntarily end their participation in the ESPP prior to the end of the applicable offering period and will be paid their accrued payroll deductions that have not yet been used to purchase shares of Class A common stock.
Unless a participant has previously canceled his or her participation in the ESPP before the purchase date, the participant will be deemed to have exercised his or her option in full as of each purchase date. Upon exercise, the participant will purchase the number of whole shares that his or her accumulated payroll deductions will buy at the option purchase price, subject to the participation limitations listed above. Participation will end automatically upon a participant’s termination of employment.
A participant will not be permitted to transfer rights granted under the ESPP other than by will, the laws of descent and distribution or as otherwise provided under the ESPP.
Certain Transactions
In the event of certain transactions or events affecting our common stock, such as any stock dividend or other distribution, reorganization, merger, consolidation, or other corporate transaction, the plan administrator will make equitable adjustments to the ESPP and outstanding rights if the plan administrator determines it is appropriate to prevent dilution or enlargement of rights. In addition, in the event of the foregoing transactions or events or certain significant transactions, the plan administrator may provide for (i) either the replacement of outstanding rights with other rights or property or termination of outstanding rights in exchange for cash, (ii) the assumption or substitution of outstanding rights by the successor or survivor corporation or parent or subsidiary thereof, if any, (iii) the adjustment in the number and type of shares of stock subject to outstanding rights, (iv) the use of participants’ accumulated payroll deductions to purchase stock on a new purchase date prior to the next scheduled purchase date and termination of any rights under ongoing offering periods or (v) the termination of all outstanding rights.
Plan Amendment and Termination
The plan administrator may amend, suspend or terminate the ESPP at any time. However, stockholder approval will be obtained for any amendment to the ESPP that increases the aggregate number or changes the type of shares that may be sold pursuant to rights under the ESPP or as may otherwise be required under Section 423(b) of the Code or other applicable law.
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
We describe below transactions and series of similar transactions, during our last three fiscal years or currently proposed, to which we were a party or will be a party, in which:
•the amounts involved exceeded or will exceed $120,000; and
•any of our directors, executive officers or beneficial holders of more than 5% of any class of our capital stock had or will have a direct or indirect material interest.
Other than as described below, there have not been, nor are there any currently proposed, transactions or series of similar transactions meeting this criteria to which we have been or will be a party other than compensation arrangements for our executive officers and directors, which are described in the section of this prospectus entitled “Executive Compensation.”
Indemnification of Directors and Officers
We intend to enter into indemnification agreements with each of our executive officers and directors prior to the completion of this offering. The indemnification agreements will provide the executive officers and directors with contractual rights to indemnification, expense advancement and reimbursement, to the fullest extent permitted under the DGCL, subject to certain exceptions contained in those agreements. See “Description of Capital Stock—Limitations on Liability and Indemnification Matters.” We also intend to enter into indemnification agreements with our future directors and executive officers.
Exchange and Forfeiture Agreement
To facilitate the Class B Stock Exchange, we intend to enter into an exchange and forfeiture agreement with Mr. Taylor and certain entities controlled by Mr. Taylor (collectively, “the Exchange Stockholders”), effective as of immediately after the filing and effectiveness of our amended and restated certificate of incorporation, pursuant to which (i) 5,695,362 shares of our Class A common stock held by the Exchange Stockholders will automatically be exchanged for an equivalent number of shares of our Class B common stock and (ii) Mr. Taylor will forfeit the one share of our Class A Preferred Stock.
Purchases in Directed Share Program
At our request, the underwriters have reserved up to $20 million of shares of Class A common stock (or up to 727,272 shares of Class A common stock assuming an initial public offering price of $27.50 per share, which is the midpoint of the price range set forth on the cover page of this prospectus) to be issued by us and offered by this prospectus for sale, at the initial public offering price, to certain of our employees and friends and family members of certain of our directors, officers and employees. See “Underwriting.” All purchases of Class A common stock in the directed share program will be at the public offering price. Purchases by any related persons participating in the directed share program may individually exceed $120,000.
Policies and Procedures for Related Party Transactions
Upon the consummation of this offering, we will adopt a written Related Person Transaction Policy (the “policy”), which will set forth our policy with respect to the review, approval, ratification and disclosure of related person transactions.
Under the policy, related person transactions will be reviewed and approved or ratified by the audit committee and a “related person transaction” is a transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which we were, are or will be a participant and the amount involved exceeded, exceeds or will exceed $120,000 and in which any “related person” (as defined in the policy) had, has or will have a direct or indirect material interest.
The policy will require that notice of a proposed related person transaction be provided to our legal department and if our legal department determines that such transaction is a related person transaction, the proposed transaction will be submitted to our audit committee. Under the policy, our audit committee will consider relevant facts and circumstances, including, without limitation, whether such transaction is inconsistent with, our best interests and the
best interests of our stockholders, whether the transaction is on terms comparable to those that could be obtained in arm’s length dealings with an unrelated third party and the extent of the related person’s interest in the transaction. In the event that we become aware of a related person transaction that has not been previously reviewed and approved, the transaction will be submitted to the audit committee so that it may determine whether to ratify the related person transaction.
The policy will also provide that management will update the audit committee as to any material changes to any approved or ratified related person transaction and that, except as otherwise in compliance with applicable law, rule or regulation, no director may participate in approval of a related person transaction for which he or she is a related person.
PRINCIPAL STOCKHOLDERS
The following table sets forth information with respect to the beneficial ownership of our voting securities upon completion of this offering (after giving effect to the Stock Split and the IPO Recapitalization Transactions), by:
•each person or group known by us to beneficially own more than 5% of the shares of our voting securities;
•each of our directors and named executive officers; and
•all of our directors and executive officers as a group.
The following table does not reflect any shares of Class A common stock that may be purchased in this offering or pursuant to our directed share program described under “Underwriting—Directed Share Program.”
The SEC has defined “beneficial ownership” of a security to mean the possession, directly or indirectly, of voting power and/or investment power over such security. A stockholder is also deemed to be, as of any date, the beneficial owner of all securities that such stockholder has the right to acquire within 60 days after that date through the exercise or vesting of any right to acquire shares of common stock. Shares issuable pursuant to options are deemed to be outstanding for computing the beneficial ownership percentage of the person holding those options but are not deemed to be outstanding for computing the beneficial ownership percentage of any other person. Unless otherwise indicated in the footnotes to the following table, to our knowledge all persons listed below have sole voting and investment power with respect to the shares of our common stock beneficially owned by them, subject to applicable community property laws. The following table gives effect to (i) the accelerated vesting of outstanding options under the 2020 Plan in connection with this offering and (ii) the issuance of 807,750 restricted shares of Class A common stock and Class B common stock in connection with this offering.
Except as otherwise indicated in the footnotes below, the address of each beneficial owner is c/o Voyager Technologies, Inc., 1225 17th Street, Suite 1100, Denver, Colorado 80202.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Class A Common Stock | | Class B Common Stock | | | |
| | | | | | | | | | | |
Name of Beneficial Owner | | Shares(1) | | Percentage (1) | | Shares | | Percentage | | Percentage of total voting power (1)(2) |
5% Stockholders: | |
| |
| |
| |
| |
| |
Dylan Taylor(3) | | 6,140,055 | | | 10.9 | % | | 6,140,055 | | 100 | % | | 65.1 | % | |
Directors and Named Executive Officers: | |
| |
| |
| |
| |
| |
Dylan Taylor(3) | | 6,140,055 | | 10.9 | % | | 6,140,055 | | 100 | % | | 65.1 | % | |
Matthew Kuta(4) | | 1,155,159 | | 2.3 | % | | — | | — | | | * | |
Filipe De Sousa(5) | | 127,500 | | * | | — | | — | | | * | |
Alan Stern(6) | | 101,798 | | * | | — | | — | | | * | |
Cheryl Shavers(7) | | 67,199 | | * | | — | | — | | | * | |
Gabe Finke(8) | | 177,102 | | * | | — | | — | | | * | |
Marian Joh(9) | | 77,300 | | * | | — | | — | | | * | |
William Shelton(10) | | 91,998 | | * | | — | | — | | | * | |
All directors and executive officers as a group (12 persons)(11) | | 8,238,111 | | 15.9 | % | | 6,140,055 | | 100 | % | | 65.5 | % | |
________________
*Indicates beneficial ownership of less than 1%.
(1)Assumes 49,348,800 shares of Class A common stock and 5,695,362 shares of Class B common stock outstanding immediately following this offering and assumes that the underwriters do not exercise their option to purchase 1,650,000 additional shares of Class A common stock. Includes 807,750 restricted shares of Class A common stock and Class B common stock subject to vesting requirements that will be issued in connection with this offering.
(2)Represents the voting power with respect to all shares of our Class A common stock and Class B common stock, voting together as a single class, except under limited circumstances. Each share of our Class A common stock is entitled to one vote per share. Each share of our Class B common stock is entitled to 15 votes per share. For more information, see “Description of Capital Stock.”
(3)Consists of (i) 3,195,362 shares of Class B common stock held directly by Mr. Taylor, (ii) 2,500,000 shares of Class B common stock held by the DET 2025 GRAT for which Mr. Taylor serves as trustee, (iii) 45,000 restricted shares of Class B
common stock subject to vesting requirements and (iv) 399,693 shares of Class B common stock issuable pursuant to outstanding stock options held by Mr. Taylor that are currently exercisable or would be exercisable within 60 days of June 2, 2025. The shares of Class A common stock represent the potential conversion of all shares of Class B common stock and rights to Class B common stock to Class A common stock on a one-for-one basis. The percentage of total voting power shown for Mr. Taylor assumes no conversion of Class B common stock to Class A common stock.
(4)Consists of (i) 237,565 shares of Class A common stock held by Mr. Kuta, (ii) 50,000 restricted shares of Class A common stock subject to vesting requirements and (iii) 867,594 shares of Class A common stock issuable pursuant to outstanding stock options held by Mr. Kuta that are currently exercisable or would be exercisable within 60 days of June 2, 2025.
(5)Consists of (i) 30,000 shares of restricted Class A common stock subject to vesting requirements and (ii) 97,500 shares of Class A common stock issuable pursuant to outstanding stock options held by Mr. De Sousa that are currently exercisable or would be exercisable within 60 days of June 2, 2025.
(6)Consists of (i) 9,800 shares of Class A common stock held by Mr. Stern, (ii) 7,500 shares of restricted Class A common stock subject to vesting requirements and (iii) 84,498 shares of Class A common stock issuable pursuant to outstanding stock options held by Mr. Stern that are currently exercisable or would be exercisable within 60 days of June 2, 2025.
(7)Consists of (i) 7,500 shares of Class A common stock issuable upon the vesting of restricted stock awards and (ii) 59,699 shares of Class A common stock issuable pursuant to outstanding stock options held by Ms. Shavers that are currently exercisable or would be exercisable within 60 days of June 2, 2025.
(8)Consists of (i) 85,104 shares of Class A common stock held by Mr. Finke, (ii) 7,500 shares of restricted Class A common stock subject to vesting requirements and (iii) 84,498 shares of Class A common stock issuable pursuant to outstanding stock options held by Mr. Finke that are currently exercisable or would be exercisable within 60 days of June 2, 2025.
(9)Consists of (i) 7,500 shares of restricted Class A common stock subject to vesting requirements and (ii) 69,800 shares of Class A common stock issuable pursuant to outstanding stock options held by Ms. Joh that are currently exercisable or would be exercisable within 60 days of June 2, 2025.
(10)Consists of (i) 7,500 shares of restricted Class A common stock subject to vesting requirements and (ii) 84,498 shares of Class A common stock issuable pursuant to outstanding stock options held by Mr. Shelton that are currently exercisable or would be exercisable within 60 days of June 2, 2025.
(11)The Class A common stock holdings consist of an aggregate of (i) 6,472,524 shares of Class A common stock held by the directors and executive officers, (ii) 207,500 shares of restricted Class A common stock subject to vesting requirements and (ii) 1,558,087 shares of Class A common stock issuable pursuant to outstanding stock options held by the directors and executive officers that are currently exercisable or would be exercisable within 60 days of June 2, 2025. The shares of Class A common stock include shares held by Mr. Taylor that represent the potential conversion of all shares of Class B common stock and rights to Class B common stock to Class A common stock. The percentage of total voting power shown assumes no conversion of the Class B common stock held by Mr. Taylor to Class A common stock.
DESCRIPTION OF CAPITAL STOCK
General
At or prior to the consummation of this offering, we will file an amended and restated certificate of incorporation and we will adopt our amended and restated bylaws. Our amended and restated certificate of incorporation will authorize capital stock consisting of:
•450,000,000 shares of common stock, par value $0.0001 per share, of which 400,000,000 shares will be designated as Class A common stock, $0.0001 par value per share, and 50,000,000 shares will be designated as Class B common stock, $0.0001 par value per share ; and
•50,000,000 shares of preferred stock, par value $0.0001 per share.
We are selling 11,000,000 shares of our Class A common stock in this offering (12,650,000 shares if the underwriters exercise their over-allotment option to purchase additional shares of our Class A common stock in full).
After giving effect to the Stock Split, the Preferred Stock Recapitalization, the SMI Promissory Notes Conversion, the filing and effectiveness of our amended and restated certificate of incorporation that will become effective prior to the completion of this offering (including the Common Stock Reclassification pursuant thereto), and the Class B Stock Exchange, as of May 30, 2025, there were 38,348,800 shares of our Class A common stock outstanding, held by 330 stockholders of record, 5,695,362 shares of our Class B common stock outstanding, held by two stockholders of record, and no shares of our preferred stock outstanding.
The following summary describes the material provisions of our capital stock. We urge you to read our amended and restated certificate of incorporation and our amended and restated bylaws, which are included as exhibits to the registration statement of which this prospectus forms a part.
Certain provisions of our amended and restated certificate of incorporation and our amended and restated bylaws summarized below may be deemed to have an anti-takeover effect and may delay or prevent a tender offer or takeover attempt that a stockholder might consider in its best interest, including those attempts that might result in a premium over the market price for the shares of Class A common stock.
Common Stock
We will have two series of authorized common stock: Class A common stock and Class B common stock. The rights of holders of shares of Class A common stock and Class B common stock are identical, except with respect to voting, conversion and transfer rights.
Voting Rights
Holders of shares of our Class A common stock will be entitled to one vote for each share held of record on all matters submitted to a vote of stockholders. Holders of our Class B common stock are entitled to 15 votes per share on any matter submitted to our stockholders. Holders of shares of Class A common stock and Class B common stock will vote together as a single class on all matters (including the election of directors) submitted to a vote of stockholders, unless otherwise required by Delaware law or our amended and restated certificate of incorporation that becomes effective immediately prior to the completion of this offering.
Under Delaware law, holders of our Class A common stock or Class B common stock would be entitled to vote as a separate class if a proposed amendment to our amended and restated certificate of incorporation would increase or decrease the aggregate number of authorized shares of such class, increase or decrease the par value of the shares of such class, or alter or change the powers, preferences, or special rights of the shares of such class so as to affect them adversely. As a result, in these limited instances, the holders of a majority of the Class A common stock could defeat any amendment to our amended and restated certificate of incorporation. For example, if a proposed amendment of our amended and restated certificate of incorporation provided for the Class A common stock to rank junior to the Class B common stock with respect to (1) any dividend or distribution, (2) the distribution of proceeds
were we to be acquired, or (3) any other right, Delaware law would require the vote of the Class A common stock. In this instance, the holders of a majority of Class A common stock could defeat that amendment to our amended and restated certificate of incorporation.
Our amended and restated certificate of incorporation, which will come into effect immediately prior to the closing of this offering, will not provide for cumulative voting for the election of directors.
Dividends
Holders of shares of our Class A common stock and Class B common stock will be entitled to receive ratably those dividends, if any, as may be declared by our board of directors out of funds legally available therefor, subject to any statutory or contractual restrictions on the payment of dividends and to any restrictions on the payment of dividends imposed by the terms of any outstanding preferred stock.
Liquidation
In the event of our dissolution or liquidation, after payment in full of all amounts required to be paid to creditors and to the holders of preferred stock having liquidation preferences, if any, the holders of shares of our Class A common stock will be entitled to share ratably in the remaining assets legally available for distribution.
Holders of our Class A common stock and Class B common stock are not entitled to preemptive rights and are not subject to subscription, conversion, redemption or sinking fund provisions, except for the conversion provisions with respect to the Class B common stock described below. There will be no redemption or sinking fund provisions applicable to our Class A common stock or Class B common stock. The rights, preferences and privileges of the holders of our Class A common stock and Class B common stock will be subject to and may be adversely affected by the rights of the holders of shares of any series of our preferred stock that we may designate in the future.
Conversion
Each outstanding share of our Class B common stock is convertible at any time at the option of the holder into one share of our Class A common stock. In addition, each share of our Class B common stock will convert automatically into one share of our Class A common stock upon any transfer, whether or not for value, which occurs after the closing of this offering, except for certain permitted transfers described in our amended and restated certificate of incorporation, including transfers to immediate family members (including upon Mr. Taylor’s death), trusts (including grantor retained annuity trusts) for which the stockholder or their immediate family member serves as trustee, and partnerships, corporations, and other entities exclusively owned by Mr. Taylor or his immediate family. All of the outstanding shares of Class B common stock will convert automatically into shares of Class A common stock upon the earliest to occur following this offering: (i) the date that is fixed by our board of directors that is no less than 61 days and no more than 180 days following the date Mr. Taylor is no longer providing services to us as an executive officer or member of our board of directors; (ii) a date that is fixed by our board of directors that is no less than 61 days and no more than 180 days following the death or incapacity of Mr. Taylor, (iii) the first trading day following the seventh anniversary of this offering and (iv) the date on which the number of shares of Class A and Class B common stock beneficially owned by Mr. Taylor and Mr. Taylor’s permitted transferees (including shares underlying outstanding options) represents less than 50% of the shares of Class A and Class B common stock beneficially owned by Mr. Taylor on the closing date of this offering. Once converted or transferred and converted into our Class A common stock, the Class B common stock will not be reissued.
Fully Paid and Nonassessable
All shares of our Class A common stock outstanding upon consummation of this offering will be fully paid and non-assessable.
Preferred Stock
Pursuant to the provisions of our amended and restated certificate of incorporation, that will become effective immediately prior to the consummation of this offering, each currently outstanding share of our convertible preferred stock will automatically be converted into one share of our Class A common stock. In addition, the one
share of our Class A Preferred Stock will be forfeited and cancelled pursuant to the terms of an exchange and forfeiture agreement entered into by the holder of such share with us. Following this offering, no shares of preferred stock will be outstanding.
Following the completion of this offering, our board of directors will be authorized to direct us to issue shares of preferred stock in one or more series without stockholder approval. Our board of directors has the discretion to determine the rights, powers, preferences, privileges and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences, of each series of preferred stock.
The purpose of authorizing our board of directors to issue preferred stock and determine its rights and preferences is to eliminate delays associated with a stockholder vote on specific issuances. The issuance of preferred stock, while providing flexibility in connection with possible acquisitions, future financings and other corporate purposes, could have the effect of making it more difficult for a third-party to acquire, or could discourage a third-party from seeking to acquire, a majority of our outstanding voting stock. Additionally, the issuance of preferred stock may adversely affect the holders of our Class A common stock by restricting dividends on the Class A common stock, diluting the voting power of the common stock or subordinating the liquidation rights of the common stock. As a result of these or other factors, the issuance of preferred stock could have an adverse impact on the market price of our Class A common stock.
Forum Selection
Our amended and restated certificate of incorporation will provide that, unless we consent to the selection of an alternative forum, the Court of Chancery of the State of Delaware (the “Court of Chancery”) is the sole and exclusive forum for: (a) any derivative action, suit, or proceeding brought on our behalf; (b) any action, suit, or proceeding asserting a claim of breach of fiduciary duty owed by any of our current or former directors, officers or other employees or stockholder to us or to our stockholders, creditors or other constituents; (c) any action, suit, or proceeding asserting a claim arising pursuant to the Delaware General Corporation Law, our amended and restated certificate of incorporation or amended and restated bylaws, or as to which the Delaware General Corporation Law confers exclusive jurisdiction on the Court of Chancery; or (d) any action, suit, or proceeding asserting a claim governed by the internal affairs doctrine, unless the Court of Chancery does not have subject matter jurisdiction thereof, the federal district court of the District of Delaware or other state courts of the State of Delaware; provided that the exclusive forum provisions will not apply to suits brought to enforce any liability or duty created by the Exchange Act, or to any claim for which the federal courts have exclusive jurisdiction.
Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. Accordingly, both state and federal courts have jurisdiction to entertain such Securities Act claims. To prevent having to litigate claims in multiple jurisdictions and the threat of inconsistent or contrary rulings by different courts, among other considerations, our amended and restated certificate of incorporation will further provide that, unless we consent in writing to the selection of an alternative forum, to the fullest extent permitted by law, the federal district courts of the United States of America are the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act; however, there is uncertainty as to whether a court would enforce such provision, and investors cannot waive compliance with federal securities laws and the rules and regulations thereunder. Nothing in our amended and restated certificated of incorporation or amended and restated bylaws preclude stockholders that assert claims under the Exchange Act from bringing such claims in state or federal court, subject to applicable law.
Although we believe the provision benefits us by providing increased consistency in the application of Delaware law in the types of lawsuits to which it applies, the provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers, other employees or stockholders, which may have the effect of discouraging lawsuits with respect to such claims or make such lawsuits more costly for stockholders. However, our stockholders will not be deemed to have waived our compliance with federal securities laws and the rules and regulations thereunder.
Dividends
Declaration and payment of any dividend will be subject to the discretion of our board of directors. The time and amount of dividends will be dependent upon, among other things, our business prospects, results of operations, financial condition, cash requirements and availability, debt repayment obligations, capital expenditure needs, contractual restrictions, covenants in the agreements governing our current and future indebtedness, industry trends, the provisions of Delaware law affecting the payment of dividends and distributions to stockholders and any other factors or considerations our board of directors may regard as relevant. We currently intend to retain all available funds and any future earnings to fund the development and growth of our business, and therefore do not anticipate declaring or paying any cash dividends on our common stock in the foreseeable future. See “Dividend Policy” and “Risk Factors—Risks Relating to this Offering and Ownership of our Class A common stock—We currently do not intend to declare dividends on our common stock in the foreseeable future and, as a result, your returns on your investment may depend solely on the appreciation of our Class A common stock.”
Registration Rights
Resale Registration Rights
Pursuant to the certificates of designation for our Class A-1 Preferred Stock and Class B Preferred Stock, we have granted the holders of such shares of preferred stock certain resale registration rights with respect to shares of Class A common stock that such holders will receive in the Preferred Stock Recapitalization. In connection with this offering the holders of substantially all of such shares have entered into lock-up agreements described below under the heading “Shares Eligible for Future Sale—Lock-Up Agreements.” The certificates of designation also provide that we will pay certain expenses relating to such registrations.
Piggyback Registration Rights
After the completion of this offering, if we propose to register the offer and sale of any securities under the Securities Act in connection with an opportunity to register any of our securities is given to any other holder of our securities, the holders of warrants to purchase 202,800 shares of Class A common stock will be entitled to certain “piggyback” registration rights allowing such holder include its shares of Class A common stock that it would receive upon exercise of such warrant in such registration. In connection with this offering the holders of substantially all of such shares have entered into lock-up agreements described below under the heading “Shares Eligible for Future Sale—Lock-Up Agreements.”
In addition, after the completion of this offering, if we propose to register the offer and sale of our Class A common stock under the Securities Act, in connection with the public offering of such Class A common stock the holder of warrants to purchase 875,592 shares of our Class A common stock will be entitled to certain “piggyback” registration rights allowing the holder to include its shares of Class A common stock that it would receive upon exercise of such warrant in such registration, subject to certain marketing and other limitations. As a result, whenever we propose to file a registration statement under the Securities Act, other than with respect to (i) a registration related to any employee benefit plan or a corporate reorganization or other transaction covered by Rule 145 promulgated under the Securities Act or (ii) a registration statement on Form S-4, Form S-8, or any successor form thereto or another form not available for the registration of such shares of Class A common stock, the holders of these shares are entitled to notice of the registration and have the right, subject to certain limitations, to include their shares in the registration. In connection with this offering the holders of substantially all of such shares have entered into lock-up agreements described below under the heading “Shares Eligible for Future Sale—Lock-Up Agreements.”
Anti-Takeover Provisions
Our amended and restated certificate of incorporation and amended and restated bylaws, as they will be in effect immediately prior to the consummation of this offering, will contain provisions that may delay, defer or discourage another party from acquiring control of us. We expect that these provisions, which are summarized below, will discourage coercive takeover practices or inadequate takeover bids. These provisions are also designed to encourage persons seeking to acquire control of us to first negotiate with our board of directors, which we believe may result in
an improvement of the terms of any such acquisition in favor of our stockholders. However, they also give our board of directors the power to discourage acquisitions that some stockholders may favor.
Classified Board of Directors
Our amended and restated certificate of incorporation will provide that our board of directors will be divided into three classes, with the number of directors in each class being as nearly equal in number as possible. The directors in each class will serve for a three-year term, one class being elected each year by our stockholders, with staggered terms. Our amended and restated certificate of incorporation will provide that directors may only be removed from our board of directors for cause by the affirmative vote of a majority of the shares entitled to vote. See “Management—Composition of our Board of Directors.” These provisions may have the effect of deferring, delaying or discouraging hostile takeovers, or changes in control of us or our management.
Special Meetings of Stockholders
Our amended and restated bylaws provide that only the chairperson of our board of directors or a majority of our board of directors may call special meetings of our stockholders, thus prohibiting a stockholder from calling a special meeting. These provisions might delay the ability of our stockholders to force consideration of a proposal or for stockholders controlling a majority of our capital stock to take any action, including the removal of directors.
Advance Notice Requirements for Stockholder Proposals and Director Nominations
In addition, our amended and restated bylaws will establish an advance notice procedure for stockholder proposals to be brought before an annual meeting or special meeting of stockholders, including proposed nominations of candidates for election to our board of directors. Generally, in order for any matter to be “properly brought” before a meeting, the matter must be (a) specified in a notice of meeting given by or at the direction of our board of directors, (b) if not specified in a notice of meeting, otherwise brought before the meeting by our board of directors or the chairperson of the meeting, or (c) otherwise properly brought before the meeting by a stockholder present in person who (1) was a stockholder both at the time of giving the notice and at the time of the meeting, (2) is entitled to vote at the meeting, and (3) has complied with the advance notice procedures specified in the amended and restated bylaws or properly made such proposal in accordance with Rule 14a-8 under the Exchange Act and the rules and regulations thereunder, which proposal has been included in the proxy statement for the annual meeting. Further, for business to be properly brought before an annual meeting by a stockholder, the stockholder must (a) provide Timely Notice (as defined below) thereof in writing and in proper form to the secretary and (b) provide any updates or supplements to such notice at the times and in the forms required by our amended and restated bylaws. To be timely, a stockholder’s notice must be delivered to, or mailed and received at, our principal executive offices not less than 90 days nor more than 120 days prior to the one-year anniversary of the preceding year’s annual meeting; provided, however, that if the date of the annual meeting is more than 30 days before or more than 60 days after such anniversary date, to be timely, notice by the stockholder must be so delivered, or mailed and received, not later than the 90th day prior to such annual meeting or, if later, the 10th day following the day on which public disclosure of the date of such annual meeting was first made (such notice within such time periods, “Timely Notice”).
Stockholders at an annual meeting or special meeting may only consider proposals or nominations specified in the notice of meeting or brought before the meeting by or at the direction of our board of directors or by a qualified stockholder of record on the record date for the meeting, who is entitled to vote at the meeting and who has delivered timely written notice in proper form to our secretary of the stockholder’s intention to bring such business before the meeting. These provisions could have the effect of delaying stockholder actions that are favored by the holders of a majority of our outstanding voting securities until the next stockholder meeting.
Elimination of Stockholder Action by Written Consent
Our amended and restated certificate of incorporation and amended and restated bylaws will eliminate the right of stockholders to act by written consent without a meeting following the first date on which we cease to have shares of Class B common stock outstanding.
Amendment of Certificate of Incorporation or Bylaws
Upon consummation of this offering, our amended and restated bylaws may be amended or repealed by a majority vote of our board of directors or by the affirmative vote of two-thirds of the votes which all of our stockholders would be eligible to cast in an election of directors. The affirmative vote of a majority of our board of directors and two-thirds in voting power of the outstanding shares entitled to vote thereon would be required to amend our amended and restated certificate of incorporation.
Section 203 of the DGCL
We will be governed by the provisions of Section 203 of the DGCL. In general, Section 203 prohibits a public Delaware corporation from engaging in a “business combination” with an “interested stockholder” for a period of three years after the time of the transaction in which the person became an interested stockholder, unless:
•the business combination or transaction which resulted in the stockholder becoming an interested stockholder was approved by the board of directors prior to the time that the stockholder became an interested stockholder;
•upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding shares owned by directors who are also officers of the corporation and shares owned by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or
•at or subsequent to the time the stockholder became an interested stockholder, the business combination was approved by the board of directors and authorized at an annual or special meeting of the stockholders, and not by written consent, by the affirmative vote of at least 66⅔% of the outstanding voting stock which is not owned by the interested stockholder.
In general, Section 203 defines a “business combination” to include mergers, asset sales and other transactions resulting in financial benefit to a stockholder and an “interested stockholder” as a person who, together with affiliates and associates, owns, or, if such person is an affiliate or associate of the corporation, within three years did own, 15% or more of the corporation’s outstanding voting stock. These provisions may have the effect of delaying, deferring or preventing changes in control of our Company.
Limitations on Liability and Indemnification of Officers and Directors
Our amended and restated certificate of incorporation and amended and restated bylaws will provide indemnification and advancement of expenses for our directors and officers to the fullest extent permitted by the DGCL, subject to certain limited exceptions. We are a party to indemnification agreements with our directors and, prior to the consummation of this offering, we intend to enter into separate indemnification agreements with each of our executive officers. In some cases, the provisions of our indemnification agreements with our directors and executive officers may be broader than the specific indemnification provisions contained under Delaware law. In addition, as permitted by Delaware law, our amended and restated certificate of incorporation will include provisions that eliminate the personal liability of our directors for monetary damages resulting from breaches of certain fiduciary duties as a director. The effect of this provision is to restrict our rights and the rights of our stockholders in derivative suits to recover monetary damages against a director for breach of fiduciary duties as a director. This provision does not, however, eliminate the personal liability of our directors for monetary damages resulting from: (1) breach of the director’s duty of loyalty, (2) acts or omissions not in good faith that involve intentional misconduct or knowing violation of law, (3) an unlawful payment of dividends or an unlawful stock purchase or redemption, or (4) any transaction from which the director derived an improper personal benefit.
These provisions may be held not to be enforceable for violations of the federal securities laws of the United States.
Dissenters’ Rights of Appraisal and Payment
Under the DGCL, with certain exceptions, our stockholders will have appraisal rights in connection with our merger or consolidation. Pursuant to the Section 262 of the DGCL, stockholders who properly demand and perfect appraisal rights in connection with such merger or consolidation will have the right to receive payment of the fair value of their shares as determined by the Court of Chancery.
Stockholders’ Derivative Actions
Under the DGCL, any of our stockholders may bring an action in our name to procure a judgment in our favor, also known as a derivative action, provided that the stockholder bringing the action is a holder of our shares at the time of the transaction to which the action relates.
Transfer Agent and Registrar
The transfer agent and registrar for our Class A common stock and Class B common stock is Equiniti Trust Company, LLC .
Trading Symbol and Market
After pricing of this offering, we expect shares of our Class A common stock will trade on the New York Stock Exchange under the symbol “VOYG.”
SHARES ELIGIBLE FOR FUTURE SALE
Sale of Restricted Shares
Prior to this offering, there has been no public market for shares of our Class A common stock. The sale of a substantial amount of our Class A common stock in the public market after this offering could adversely affect the prevailing market price of our Class A common stock. Furthermore, the majority of shares outstanding prior to the consummation of this offering will be subject to the contractual and legal restrictions on resale described below. The sale of a substantial amount of Class A common stock in the public market after these restrictions lapse, or the expectation that such a sale may occur, could adversely affect the prevailing market price of our Class A common stock and our ability to raise equity capital in the future.
Upon consummation of this offering and after giving effect to the Stock Split and the IPO Recapitalization Transactions, we expect to have outstanding an aggregate of 49,348,800 shares of our Class A common stock, assuming no exercise of outstanding options and assuming that the underwriters have not exercised their option to purchase additional shares. All of the shares of Class A common stock sold in this offering will be freely transferable without restriction or further registration under the Securities Act by persons other than “affiliates,” as that term is defined in Rule 144 under the Securities Act. Generally, the balance of our outstanding shares of Class A common stock are “restricted securities” within the meaning of Rule 144 under the Securities Act, and the sale of those shares will be subject to the limitations and restrictions that are described below. Shares of our Class A common stock that are not restricted securities and are purchased by our affiliates will be “control securities” under Rule 144. Restricted securities may be sold in the public market only if registered under the Securities Act or if they qualify for an exemption from registration under Rule 144 or Rule 701 under the Securities Act. These rules are summarized below. Control securities may be sold in the public market subject to the restrictions set forth in Rule 144, other than the holding period requirement.
Upon the expiration (or waiver) of the lock-up agreements described below 180 days after the date of this prospectus, and subject to the provisions of Rule 144, an additional 38,348,800 shares of Class A common stock will be available for sale in the public market. The sale of these restricted securities is subject, in the case of shares held by affiliates, to the volume restrictions contained in Rule 144.
Rule 144
After giving effect to this offering, the Stock Split and the IPO Recapitalization Transactions, we expect that 38,348,800 shares of our outstanding Class A common stock will be “restricted” securities under the meaning of Rule 144 under the Securities Act and may not be sold in the absence of registration under the Securities Act unless an exemption from registration is available, including the exemption provided by Rule 144.
In general, under Rule 144 as currently in effect, beginning 90 days after the date of this prospectus, a person who is not deemed to have been an affiliate of ours at any time during the three months preceding a sale and who has beneficially owned shares considered to be restricted securities under Rule 144 for at least six months would be entitled to sell those shares, subject only to the availability of current public information about us. A non-affiliated person who has beneficially owned shares considered to be restricted securities under Rule 144 for at least one year would be entitled to sell those shares without regard to the provisions of Rule 144.
An affiliate of ours who has beneficially owned shares of our Class A common stock for at least six months would be entitled to sell, within any three-month period, a number of shares that does not exceed the greater of:
•1% of the number of shares of our Class A common stock then outstanding, which will equal approximately shares immediately after consummation of this offering; or
•the average weekly trading volume in our Class A common stock on the New York Stock Exchange during the four calendar weeks preceding the filing of a notice on Form 144 with respect to that sale;
provided, in each case, that we are subject to the Exchange Act periodic reporting requirements for at least 90 days before the sale and have filed all required reports during that time period. Such sales by affiliates must also comply with the manner of sale, current public information and notice provisions of Rule 144.
Sales under Rule 144 by our affiliates or persons selling shares on behalf of our affiliates are also subject to manner of sale provisions and notice requirements and to the availability of current public information about us. An “affiliate” is a person that directly, or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with an issuer.
S-8 Registration Statement
We intend to file a registration statement or statements on Form S-8 under the Securities Act covering shares of Class A common stock reserved for issuance under our new omnibus incentive plan, our new employee stock purchase plan and pursuant to all outstanding option grants made prior to this offering. These registration statements are expected to be filed as soon as practicable after the closing date of this offering. Shares issued upon the exercise of stock options after the effective date of the applicable Form S-8 registration statement will be eligible for resale in the public market without restriction, subject to Rule 144 limitations applicable to affiliates and the lock-up agreements described below.
Registration Rights
Resale Registration Rights
Pursuant to the certificates of designation for our Class A-1 Preferred Stock and Class B Preferred Stock, we have granted the holders of such shares of preferred stock certain resale registration rights with respect to shares of Class A common stock that such holders will receive in the Preferred Stock Recapitalization. In connection with this offering the holders of substantially all of such shares have entered into lock-up agreements described below under the heading “—Lock-Up Agreements.” The certificates of designation also provide that we will pay certain expenses relating to such registrations.
Piggyback Registration Rights
After the completion of this offering, if we propose to register the offer and sale of any securities under the Securities Act in connection with an opportunity to register any of our securities is given to any other holder of our securities, the holders of warrants to purchase 202,800 shares of Class A common stock will be entitled to certain “piggyback” registration rights allowing such holder include its shares of Class A common stock that it would receive upon exercise of such warrant in such registration. In connection with this offering the holders of substantially all of such shares have entered into lock-up agreements described below under the heading “—Lock-Up Agreements.”
In addition, after the completion of this offering, if we propose to register the offer and sale of our Class A common stock under the Securities Act, in connection with the public offering of such Class A common stock the holder of warrants to purchase 875,592 shares of our Class A common stock will be entitled to certain “piggyback” registration rights allowing the holder to include its shares of Class A common stock that it would receive upon exercise of such warrant in such registration, subject to certain marketing and other limitations. As a result, whenever we propose to file a registration statement under the Securities Act, other than with respect to (i) a registration related to any employee benefit plan or a corporate reorganization or other transaction covered by Rule 145 promulgated under the Securities Act or (ii) a registration statement on Form S-4, Form S-8, or any successor form thereto or another form not available for the registration of such shares of Class A common stock, the holders of these shares are entitled to notice of the registration and have the right, subject to certain limitations, to include their shares in the registration. In connection with this offering the holders of substantially all of such shares have entered into lock-up agreements described below under the heading “—Lock-Up Agreements.”
Lock-Up Agreements
In connection with this offering, we and all directors and executive officers and the holders of substantially all of our outstanding stock and stock options have agreed that, without the prior written consent of Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC on behalf of the underwriters, we and they will not, and will not publicly disclose an intention to, dispose of or hedge any shares of our Class A common stock or securities convertible into or exchangeable for shares of our Class A common stock during the period ending 180 days after the date of this prospectus, subject to certain exceptions. This lock-up provision applies to Class A common stock and to securities convertible into or exchangeable or exercisable for or repayable with Class A common stock. It also applies to Class A common stock owned now or acquired later by the person executing the agreement or for which the person executing the agreement later acquires the power of disposition.
Rule 701
In general, under Rule 701 as in effect on the date of this prospectus, any of our employees, directors, officers, consultants or advisors who purchased shares from us in reliance on Rule 701 in connection with a compensatory stock or option plan or other written agreement before the effective date of this offering, or who purchased shares from us after that date upon the exercise of options granted before that date, are eligible to resell such shares 90 days after the effective date of this offering in reliance upon Rule 144. If such person is not an affiliate, such sale may be made subject only to the manner of sale provisions of Rule 144. If such a person is an affiliate, such sale may be made under Rule 144 without compliance with the holding period requirement, but subject to the other Rule 144 restrictions described above. However, substantially all Rule 701 shares are subject to lock-up agreements as described above and will become eligible for sale in compliance with Rule 144 only upon the expiration of the restrictions set forth in those agreements.
DESCRIPTION OF CERTAIN INDEBTEDNESS
Term Loan
On June 28, 2024, the Company, the Company’s domestic subsidiaries, excluding Starlab (the “Guarantors”), entered into a $58.0 million Credit Agreement with the lenders party thereto and Hercules Capital, Inc., as administrative agent and collateral agent, which provided for a $58.0 million Term Loan. The Term Loan matures on July 1, 2028. The Term Loan bears interest at a variable annual rate equal to the sum of (a) the greater of (i) the Wall Street Journal Prime Rate or (ii) 8.50%, and (b) 1.25% per annum. The Term Loan bears additional interest, which is equal to 2.50% of the total outstanding principal, computed daily based on the actual number of days elapsed and added to the outstanding principal balance. Interest is due on the first business day of each month (each date, a “Payment Date”). Commencing on July 1, 2026, the Company is required to make payments of $2.6 million each Payment Date, which includes both principal repayment and scheduled interest payments. The two-year interest only period can be extended over the balance of the agreement upon achievement of certain gross profit and EBITDA milestones. The Term Loan is secured by substantially all the assets of the Company and the Guarantors.
The Credit Agreement includes a minimum liquidity threshold, which requires the Company and the Guarantors to, at all times, maintain an aggregate cash balance in all accounts subject to account control agreements in an amount of at least $12.5 million. Additionally, the Credit Agreement contains restrictive covenants and events of default, including the following:
•limitations on dispositions;
•required notifications upon changes in business or business locations;
•limitations on amalgamations;
•limitations on mergers or acquisitions;
•limitations on indebtedness;
•limitations on encumbrance;
•maintenance of collateral accounts;
•limitations on distributions/investments;
•limitations on transactions with affiliates; and
•limitations on incurrence of subordinated debt.
The Company, at its option, may voluntarily prepay the Term Loan. Such prepayments require repayment of all outstanding principal, all accrued and unpaid interest, the end-of-term charge, and a prepayment charge that is equal to 3.00% of outstanding principal if prepaid before June 28, 2025, 2.00% of outstanding principal if prepaid between June 28, 2025 and June 28, 2026, or 1.00% of outstanding principal if prepaid after June 28, 2026, but before the maturity date.
We intend to partially draw on the Revolving Credit Facility to repay in full the Term Loan on or around July 1, 2025. The foregoing is based on information available as of the date of this prospectus and is subject to change. There can be no assurance that we will partially draw on the Revolving Credit Facility to repay in full the Term Loan on or around July 1, 2025 or at all. See “Prospectus Summary—Recent Developments”.
2024 Convertible Notes
At various times during 2024, Starlab JV issued 2024 Convertible Notes for a total principal amount of approximately $10.1 million. The 2024 Convertible Notes bear interest at a rate of 5.0% per annum, payable at maturity, which is on the third anniversary of the issue date if no triggering events occur prior to that date. Starlab Space LLC has the option to prepay all or any of the principal and any accrued and unpaid interest at any time.
The 2024 Convertible Notes are convertible into equity units upon the following: (i) a qualified financing event, defined as a transaction or series of transactions pursuant to which Starlab JV’s issues shares of any class or series of equity securities to one or more investors, including any of the lenders with the principal purpose of raising capital that raises gross proceeds of at least $10.0 million, excluding the amount represented by the conversion of any outstanding indebtedness in accordance with their respective terms; (ii) at the option of the lender upon a nonqualified financing event; (iii) a liquidity event, defined as a consolidation or merger with another corporation, entity, or person or other event through which the unit holders, immediately prior to such consolidation or merger, own less than 50% of the voting power of the surviving entity, immediately prior to such consolidation or merger, a sale or other disposition of substantially all Starlab JV’s assets, or the closing of Starlab JV’s first underwritten public offering; and (iv) the maturity date. Upon a conversion event described in (i) or (ii), the 2024 Convertible Notes will convert into the same class and series of units as those sold as part of the financing event. Upon a conversion event described in (iii) or (iv), the 2024 Convertible Notes will convert into Class A-1 Units of Starlab JV. The number of Class A-1 Units issued will be equal to (1) the outstanding principal balance of the note and all accrued and unpaid interest due, divided by (2) 85% of the price per unit paid by the investors to purchase the new securities in the subsequent financing.
SMI Promissory Notes
In May and June 2023, we acquired additional shares of SMI from certain minority stockholders in exchange for the SMI Promissory Notes. In October 2024, the Promissory Notes were modified for certain shareholders to be payable in our equity securities at the earlier of October 2, 2025 for certain holders or the completion of our initial public offering, or October 2, 2026 or the completion of our initial public offering for other holders. The SMI Promissory Notes bear interest at the Wall Street Journal Prime Rate, calculated quarterly. The SMI Promissory Notes had an outstanding balance of approximately $25.0 million as of March 31, 2025.
Revolving Credit Agreement
On May 30, 2025, we entered into the Revolving Credit Agreement among us, the Guarantors, the lenders party thereto from time to time and JPMorgan Chase Bank, N.A., as the administrative agent, which provides for a (i) $200.0 million senior secured revolving credit facility and an uncommitted incremental facility that permits us to request an increase in the size of the revolving credit facility of up to $150.0 million, subject to certain conditions and lender approvals, (ii) a $25.0 million letter of credit subfacility, and (iii) a $10.0 million swingline loan subfacility. Commitments under the Revolving Credit Facility will become effective upon the consummation of this offering and satisfaction of certain other conditions set forth in the Revolving Credit Agreement. In addition, loans and letters of credit under the Revolving Credit Facility are not available until we satisfy certain additional conditions set forth in the Revolving Credit Agreement, including (i) the refinancing, replacement and repayment of the Term Loan and (ii) pro forma compliance with the financial covenants set forth in the Revolving Credit Agreement, as further described below. The Revolving Credit Facility will mature on May 30, 2029
Borrowings under the Revolving Credit Facility will bear interest at our option at (i) Term SOFR, subject to a 0.00% floor, plus a 0.10% spread adjustment and an applicable rate margin, or (ii) the alternate base rate, subject to a 1.00% floor, plus an applicable rate margin. For Term SOFR borrowings, the applicable rate margin is between 2.25% and 2.75%, depending on our liquidity. For alternate base rate borrowings, the applicable margin is between 1.25% and 1.75%, depending on our liquidity. We are also required to pay a commitment fee on undrawn amounts under the Revolving Credit Facility of between 0.25% and 0.30% per annum, depending on our liquidity, payable quarterly in arrears.
The Revolving Credit Agreement includes two financial covenants: (i) a minimum liquidity threshold, which requires us and the Guarantors to maintain an aggregate cash balance in all accounts subject to account control agreements in an amount, when taken together with the undrawn portion of the Revolving Credit Facility, of no less than the greater of (a) $100.0 million and (b) solely to the extent consolidated EBITDA is negative, the absolute value of consolidated EBITDA, and (ii) a minimum revenue threshold, which requires us and the Guarantors to generate consolidated total revenues in excess of certain amounts set forth in the Revolving Credit Agreement, each
tested as of the last day of each fiscal quarter. Additionally, the Revolving Credit Agreement contains certain affirmative and negative covenants, including but not limited to:
•delivery of certain financial statements;
•notices of certain material events;
•maintenance of collateral accounts;
•limitations on indebtedness;
•limitations on liens;
•limitations on fundamental changes;
•limitations on investments, loans, advances, guarantees and acquisitions;
•limitations on asset sales;
•limitations on swap agreements;
•limitations on restricted payments;
•limitations on transactions with affiliates; and
•limitations on restrictive agreements.
MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES TO NON-U.S. HOLDERS
The following discussion is a summary of the material U.S. federal income tax consequences to Non-U.S. Holders (as defined below) of the purchase, ownership, and disposition of our Class A common stock issued pursuant to this offering, but does not purport to be a complete analysis of all potential tax effects. The effects of other U.S. federal tax laws, such as estate and gift tax laws, and any applicable state, local, or non-U.S. tax laws are not discussed. This discussion is based on the Code, Treasury Regulations promulgated thereunder, judicial decisions, and published rulings and administrative pronouncements of the U.S. Internal Revenue Service (the “IRS”), in each case in effect as of the date hereof. These authorities may change or be subject to differing interpretations. Any such change or differing interpretation may be applied retroactively in a manner that could adversely affect a Non-U.S. Holder. In particular, legislation currently proposed in Congress could affect the tax treatment of certain Non-U.S. Holders in respect of U.S.-source income (including dividends from U.S. corporations) and income effectively connected with a trade or business within the United States. We have not sought and will not seek any rulings from the IRS regarding the matters discussed below. There can be no assurance the IRS or a court will not take a contrary position to that discussed below regarding the tax consequences of the purchase, ownership, and disposition of our Class A common stock.
This discussion is limited to Non-U.S. Holders that hold our Class A common stock as a “capital asset” within the meaning of Section 1221 of the Code (generally, property held for investment). This discussion does not address all U.S. federal income tax consequences relevant to a Non-U.S. Holder’s particular circumstances, including the impact of the Medicare contribution tax on net investment income and the alternative minimum tax. In addition, it does not address consequences relevant to Non-U.S. Holders subject to special rules, including, without limitation:
•U.S. expatriates and former citizens or long-term residents of the United States;
•persons holding our Class A common stock as part of a hedge, straddle, or other risk reduction strategy or as part of a conversion transaction or other integrated investment;
•banks, insurance companies, and other financial institutions;
•brokers, dealers, or traders in securities;
•“controlled foreign corporations,” “passive foreign investment companies,” and corporations that accumulate earnings to avoid U.S. federal income tax;
•partnerships or other entities or arrangements treated as partnerships for U.S. federal income tax purposes (and investors therein);
•tax-exempt organizations or governmental organizations;
•persons deemed to sell our Class A common stock under the constructive sale provisions of the Code;
•persons who hold or receive our Class A common stock pursuant to the exercise of any employee stock option or otherwise as compensation;
•tax-qualified retirement plans;
•“qualified foreign pension funds” as defined in Section 897(l)(2) of the Code and entities all of the interests of which are held by qualified foreign pension funds; and
•persons subject to special tax accounting rules as a result of any item of gross income with respect to the stock being taken into account in an applicable financial statement.
If an entity treated as a partnership for U.S. federal income tax purposes holds our Class A common stock, the tax treatment of a partner in the partnership will depend on the status of the partner, the activities of the partnership, and certain determinations made at the partner level. Accordingly, partnerships holding our Class A common stock
and the partners in such partnerships should consult their tax advisors regarding the U.S. federal income tax consequences to them.
THIS DISCUSSION IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT TAX ADVICE. INVESTORS SHOULD CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE APPLICATION OF THE U.S. FEDERAL INCOME TAX LAWS TO THEIR PARTICULAR SITUATIONS AS WELL AS ANY TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP, AND DISPOSITION OF OUR CLASS A COMMON STOCK ARISING UNDER THE U.S. FEDERAL ESTATE OR GIFT TAX LAWS OR UNDER THE LAWS OF ANY STATE, LOCAL, OR NON-U.S. TAXING JURISDICTION OR UNDER ANY APPLICABLE INCOME TAX TREATY.
Definition of a Non-U.S. Holder
For purposes of this discussion, a “Non-U.S. Holder” is any beneficial owner of our Class A common stock that is neither a “U.S. person” nor an entity treated as a partnership for U.S. federal income tax purposes. A U.S. person is any person that, for U.S. federal income tax purposes, is or is treated as any of the following:
•an individual who is a citizen or resident of the United States;
•a corporation created or organized under the laws of the United States, any state thereof, or the District of Columbia;
•an estate, the income of which is subject to U.S. federal income tax regardless of its source; or
•a trust that (1) is subject to the primary supervision of a U.S. court and the control of one or more “United States persons” (within the meaning of Section 7701(a)(30) of the Code), or (2) has a valid election in effect to be treated as a United States person for U.S. federal income tax purposes.
Distributions
As described in the section entitled “Dividend Policy,” we do not anticipate declaring or paying dividends to holders of our Class A common stock in the foreseeable future. However, if we do make distributions of cash or property on our Class A common stock, such distributions will constitute dividends for U.S. federal income tax purposes to the extent paid from our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Amounts not treated as dividends for U.S. federal income tax purposes will constitute a return of capital and first be applied against and reduce a Non-U.S. Holder’s adjusted tax basis in its Class A common stock, but not below zero. Any excess will be treated as capital gain and will be treated as described below under “—Sale or Other Taxable Disposition.”
Subject to the discussion below on effectively connected income, dividends paid to a Non-U.S. Holder will be subject to U.S. federal withholding tax at a rate of 30% of the gross amount of the dividends (or such lower rate specified by an applicable income tax treaty, provided the Non-U.S. Holder furnishes a valid IRS Form W-8BEN or W-8BEN-E (or other applicable documentation) certifying qualification for the lower treaty rate). A Non-U.S. Holder that does not timely furnish the required documentation, but that qualifies for a reduced treaty rate, may obtain a refund of any excess amounts withheld by timely filing an appropriate claim for refund with the IRS. Non-U.S. Holders should consult their tax advisors regarding their entitlement to benefits under any applicable income tax treaty.
If dividends paid to a Non-U.S. Holder are effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, the Non-U.S. Holder maintains a permanent establishment in the United States to which such dividends are attributable), the Non-U.S. Holder will be exempt from the U.S. federal withholding tax described above. To claim the exemption, the Non-U.S. Holder must furnish to the applicable withholding agent a valid IRS Form W-8ECI, certifying that the dividends are effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States.
Any such effectively connected dividends will be subject to U.S. federal income tax on a net income basis at the regular rates. A Non-U.S. Holder that is a corporation also may be subject to a branch profits tax at a rate of 30% (or
such lower rate specified by an applicable income tax treaty) on such effectively connected dividends, as adjusted for certain items. Non-U.S. Holders should consult their tax advisors regarding any applicable tax treaties that may provide for different rules.
Sale or Other Taxable Disposition
A Non-U.S. Holder will not be subject to U.S. federal income tax on any gain realized upon the sale or other taxable disposition of our Class A common stock unless:
•the gain is effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, the Non-U.S. Holder maintains a permanent establishment in the United States to which such gain is attributable);
•the Non-U.S. Holder is a nonresident alien individual present in the United States for 183 days or more during the taxable year of the disposition and certain other requirements are met; or
•our Class A common stock constitutes a U.S. real property interest (“USRPI”) by reason of our status as a U.S. real property holding corporation (“USRPHC”) for U.S. federal income tax purposes.
Gain described in the first bullet point above generally will be subject to U.S. federal income tax on a net income basis at the regular rates. A Non-U.S. Holder that is a corporation also may be subject to a branch profits tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on such effectively connected gain, as adjusted for certain items.
A Non-U.S. Holder described in the second bullet point above will be subject to U.S. federal income tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on gain realized upon the sale or other taxable disposition of our Class A common stock, which may be offset by U.S. source capital losses of the Non-U.S. Holder (even though the individual is not considered a resident of the United States), provided the Non-U.S. Holder has timely filed U.S. federal income tax returns with respect to such losses.
With respect to the third bullet point above, we believe we currently are not, and do not anticipate becoming, a USRPHC. Because the determination of whether we are a USRPHC depends, however, on the fair market value of our USRPIs relative to the fair market value of our non-U.S. real property interests and our other business assets, there can be no assurance we currently are not a USRPHC or will not become one in the future. Even if we are or were to become a USRPHC, gain arising from the sale or other taxable disposition of our Class A common stock by a Non-U.S. Holder will not be subject to U.S. federal income tax if our Class A common stock is “regularly traded,” as defined by applicable Treasury Regulations, on an established securities market and such Non-U.S. Holder owned, actually and constructively, 5% or less of our Class A common stock throughout the shorter of the five-year period ending on the date of the sale or other taxable disposition or the Non-U.S. Holder’s holding period.
Non-U.S. Holders should consult their tax advisors regarding potentially applicable income tax treaties that may provide for different rules.
Information Reporting and Backup Withholding
Payments of dividends on our Class A common stock will not be subject to backup withholding, provided the applicable withholding agent does not have actual knowledge or reason to know the holder is a United States person and the holder either certifies its non-U.S. status, such as by furnishing a valid IRS Form W-8BEN, W-8BEN-E, or W-8ECI, or otherwise establishes an exemption. However, information returns are required to be filed with the IRS in connection with any distributions on our Class A common stock paid to the Non-U.S. Holder, regardless of whether such distributions constitute dividends or whether any tax was actually withheld. In addition, proceeds of the sale or other taxable disposition of our Class A common stock within the United States or conducted through certain U.S.-related brokers generally will not be subject to backup withholding or information reporting if the applicable withholding agent receives the certification described above and does not have actual knowledge or reason to know that such holder is a United States person or the holder otherwise establishes an exemption. Proceeds
of a disposition of our Class A common stock conducted through a non-U.S. office of a non-U.S. broker generally will not be subject to backup withholding or information reporting.
Copies of information returns that are filed with the IRS may also be made available under the provisions of an applicable treaty or agreement to the tax authorities of the country in which the Non-U.S. Holder resides or is established.
Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against a Non-U.S. Holder’s U.S. federal income tax liability, provided the required information is timely furnished to the IRS.
Additional Withholding Tax on Payments Made to Foreign Accounts
Withholding taxes may be imposed under Sections 1471 to 1474 of the Code (such Sections commonly referred to as the Foreign Account Tax Compliance Act, or “FATCA”) on certain types of payments made to non-U.S. financial institutions and certain other non-U.S. entities. Specifically, a 30% withholding tax may be imposed on dividends on, or (subject to the proposed Treasury Regulations discussed below) gross proceeds from the sale or other disposition of, our Class A common stock paid to a “foreign financial institution” or a “non-financial foreign entity” (each as defined in the Code), unless (1) the foreign financial institution undertakes certain diligence and reporting obligations, (2) the non-financial foreign entity either certifies it does not have any “substantial United States owners” (as defined in the Code) or furnishes identifying information regarding each substantial United States owner, or (3) the foreign financial institution or non-financial foreign entity otherwise qualifies for an exemption from these rules. If the payee is a foreign financial institution and is subject to the diligence and reporting requirements in (1) above, it must enter into an agreement with the U.S. Department of the Treasury requiring, among other things, that it undertake to identify accounts held by certain “specified United States persons” or “United States owned foreign entities” (each as defined in the Code), annually report certain information about such accounts, and withhold 30% on certain payments to non-compliant foreign financial institutions and certain other account holders. Foreign financial institutions located in jurisdictions that have an intergovernmental agreement with the United States governing FATCA may be subject to different rules.
Under the applicable Treasury Regulations and administrative guidance, withholding under FATCA generally applies to payments of dividends on our Class A common stock. While withholding under FATCA would have applied also to payments of gross proceeds from the sale or other disposition of stock, proposed Treasury Regulations eliminate FATCA withholding on payments of gross proceeds entirely. Taxpayers generally may rely on these proposed Treasury Regulations until final Treasury Regulations are issued.
Prospective investors should consult their tax advisors regarding the potential application of withholding under FATCA to their investment in our Class A common stock.
UNDERWRITING
Under the terms and subject to the conditions in an underwriting agreement dated the date of this prospectus, the underwriters named below, for whom Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC are acting as representatives, have severally agreed to purchase, and we have agreed to sell to them, severally, the number of shares indicated below:
| | | | | | | | |
| Name | | Number of Shares |
Morgan Stanley & Co. LLC | |
|
J.P. Morgan Securities LLC | |
|
Barclays Capital Inc. | |
|
Jefferies LLC | | |
BofA Securities, Inc. | | |
KeyBanc Capital Markets Inc. | | |
Nomura Securities International, Inc. | | |
WR Securities, LLC | | |
Total: | | 11,000,000 |
The underwriters and the representatives are collectively referred to as the “underwriters” and the “representatives,” respectively. The underwriters are offering the shares of Class A common stock subject to their acceptance of the shares from us and subject to prior sale. The underwriting agreement provides that the obligations of the several underwriters to pay for and accept delivery of the shares of Class A common stock offered by this prospectus are subject to the approval of certain legal matters by their counsel and to certain other conditions. The underwriters are obligated to take and pay for all of the shares of Class A common stock offered by this prospectus if any such shares are taken. However, the underwriters are not required to take or pay for the shares covered by the underwriters’ over-allotment option described below.
The underwriters initially propose to offer part of the shares of Class A common stock directly to the public at the offering price listed on the cover page of this prospectus and part to certain dealers at a price that represents a concession not in excess of $ per share under the public offering price. After the initial offering of the shares of Class A common stock, the offering price and other selling terms may from time to time be varied by the representatives.
We have granted to the underwriters an option, exercisable for 30 days from the date of this prospectus, to purchase up to 1,650,000 additional shares of Class A common stock at the public offering price listed on the cover page of this prospectus, less underwriting discounts and commissions. The underwriters may exercise this option solely for the purpose of covering over-allotments, if any, made in connection with the offering of the shares of Class A common stock offered by this prospectus. To the extent the option is exercised, each underwriter will become obligated, subject to certain conditions, to purchase about the same percentage of the additional shares of Class A common stock as the number listed next to the underwriter’s name in the preceding table bears to the total number of shares of Class A common stock listed next to the names of all underwriters in the preceding table.
The cornerstone investors have, severally and not jointly, indicated an interest in purchasing up to an aggregate of $60 million in shares of Class A common stock in this offering at the initial public offering price. The shares of Class A common stock to be purchased by the cornerstone investors will not be subject to a lock-up agreement with the underwriters. Because this indication of interest is not a binding agreement or commitment to purchase, the cornerstone investors may determine to purchase more, less or no shares in this offering or the underwriters may determine to sell more, less or no shares to the cornerstone investors. The underwriters will receive the same
underwriting discounts and commissions on any of our shares of Class A common stock purchased by the cornerstone investors as they will from any other shares of Class A common stock sold to the public in this offering.
The following table shows the per share and total public offering price, underwriting discounts and commissions, and proceeds before expenses to us. These amounts are shown assuming both no exercise and full exercise of the underwriters’ option to purchase up to an additional 1,650,000 shares of Class A common stock.
| | | | | | | | | | | | | | | | | |
| Per Share | | Total |
| | No Exercise | | Full Exercise |
Public offering price | $ | | $ | | $ |
Underwriting discounts and commissions to be paid by us | $ | | $ | | $ |
Proceeds, before expenses, to us | $ | | $ | | $ |
The estimated offering expenses payable by us, exclusive of the underwriting discounts and commissions, are approximately $9.3 million. We have agreed to reimburse the underwriters for expenses relating to clearance of this offering with the Financial Industry Regulatory Authority up to $40,000.
The underwriters have informed us that they do not intend sales to discretionary accounts to exceed 5% of the total number of shares of Class A common stock offered by them.
After pricing of this offering, we expect that shares of our Class A common stock will trade on the New York Stock Exchange under the symbol “VOYG”.
We and all directors and executive officers and the holders of substantially all of our outstanding stock and stock options have agreed that, without the prior written consent of Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC on behalf of the underwriters, we and they will not, and will not publicly disclose an intention to, during the period ending 180 days after the date of this prospectus (the “restricted period”):
(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any shares of Class A common stock or any securities convertible into, redeemable for or exercisable or exchangeable for shares of Class A common stock;
(b)enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Class A common stock; or
(c)file any registration statement with the SEC relating to the offering of any shares of Class A common stock or any securities convertible into or exercisable or exchangeable for Class A common stock.
whether any such transaction described above is to be settled by delivery of Class A common stock or such other securities, in cash or otherwise. In addition, we and each such person agrees that, without the prior written consent of Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC on behalf of the underwriters, we or such other person will not, during the restricted period, make any demand for, or exercise any right with respect to, the registration of any shares of Class A common stock or any security convertible into or exercisable or exchangeable for Class A common stock.
With respect to us, the restrictions described in the immediately preceding paragraph do not apply to:
(a)the shares to be sold in this offering;
(b)grants of stock options, stock awards, restricted stock, restricted stock units, securities convertible into or exchangeable for shares of Class A common stock, Class B common stock, or other compensatory equity-based awards and the issuance of shares of Class A common stock or Class B common stock in connection with the exercise, vesting and/or settlement of any of the foregoing to our employees, officers, directors, advisors or consultants pursuant to the terms of an equity compensation plan in effect as of the consummation of this offering and as described herein;
(c)the issuance by us of shares of Class A common stock or Class B common stock upon the exercise of an option or warrant or the conversion or exercise of a security outstanding on the date of this prospectus as described herein;
(d)shares of common stock or any securities exercisable or exchangeable for shares of common stock, or the entrance into an agreement to issue shares of common stock in connection with any merger, joint venture, strategic alliances, commercial or other collaborative transaction or the acquisition or licenses of the business, property, technology or other assets of another individual or entity or the assumption of an employee benefit plan in connection with a merger or acquisition; provided that the aggregate number of shares of common stock or any other securities exercisable or exchangeable for shares of common stock that we may issue or agree to issue pursuant to this clause (d) shall not exceed 10% of our total outstanding share capital immediately following the issuance of the shares; provided further that the issuance of shares of common stock or any securities exercisable or exchange for shares of common stock pursuant to clause (h) below shall not count against the foregoing limit; and provided further that the recipients of any such shares of common stock and securities issued pursuant to this clause (d) during the restricted period shall enter into a lock-up agreement;
(e)facilitating the establishment of a trading plan on behalf of any of our shareholders, officers or directors pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of common stock, provided that (i) such plan does not provide for the transfer of shares of common stock during the restricted period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required of or voluntarily made by us regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of shares of common stock may be made under such plan during the restricted period;
(f)the filing of any registration statement on Form S-8 or amendment thereto relating to securities granted or to be granted pursuant to any plan in effect on the date hereof and described in this prospectus or any assumed benefit plan pursuant to an acquisition or similar strategic transaction;
(g)the issuance of shares of common stock pursuant to an acquisition or similar strategic transaction; or
(h)the issuance of shares of common stock or any securities exercisable or exchangeable for shares of common stock pursuant to the Palantir Agreement and any order forms pursuant thereto.
With respect to our directors, officers and securityholders, the restrictions described above do not apply to transfers of the holder’s securities:
(a)acquired in this offering or in open market transactions after the completion of this offering;
(b)as a bona fide gift or charitable contribution;
(c)if the holder is a corporation, partnership, limited liability company or other business entity, as part of a distribution by the holder to its stockholders, partners, members or other equityholders or to the estate of any such stockholders, partners, members or other equityholders;
(d)to an immediate family member of the holder or any trust or other entity for the direct or indirect benefit of the holder or the immediate family of the holder (for purposes of the lock-up agreement, “immediate family” shall mean any relationship by blood, marriage, or adoption, not more remote than first cousin);
(e)to a corporation, partnership, limited liability company or other entity that (i) controls or is controlled by, or is under common control with, the holder, (ii) is an investment fund managed by the investment manager of the holder or (iii) or is wholly owned by the holder and/or by members of the holder’s immediate family;
(f)by will, other testamentary document or intestate succession upon the death of the holder or for bona fide estate planning purposes;
(g)by operation of law, such as pursuant to an order of a court or regulatory agency (for purposes of the lock-up agreement, a “court or regulatory agency” means any domestic or foreign, federal, state or local government, including any political subdivision thereof, any governmental or quasi-governmental authority, department, agency or official, any court or administrative body or any national securities exchange or similar self-regulatory body or organization, in each case of competent jurisdiction) or pursuant to a domestic order or in connection with a divorce settlement;
(h)to us from any of our employees upon death, disability or termination of employment, in each case, of such employee;
(i)to us or our subsidiaries in connection with the vesting, settlement or exercise of restricted stock units, options, warrants or other rights to purchase shares of common stock (including, in each case, by way of “net” or “cashless” exercise), including any transfer to us for the payment of tax withholdings or remittance payments due as a result of the vesting, settlement or exercise of such restricted stock units, options, warrants or other rights, each as described herein relating to the shares of common stock included herein immediately prior to the time the underwriting agreement is executed and this prospectus;
(j)to us or any of our subsidiaries pursuant to an agreement under which we or any such subsidiary has the option to repurchase shares or a right of first refusal with respect to transfer of such shares;
(k)to us or any of our subsidiaries pursuant to an agreement under which the holder of shares or other securities convertible into or exercisable for shares has the option to require us or such subsidiary to repurchase such shares or other securities convertible into or exercisable for shares
(l)resulting from the conversion of our outstanding preferred stock into shares of common stock prior to or in connection with the consummation of this offering, provided that any such shares received upon such conversion shall remain subject to the provisions of the lock-up agreement;
(m)resulting from conversions or reclassifications of a class or series of common stock into another class or series of common stock (including the conversion of shares of non-voting common stock into shares of voting common stock and vice versa), it being understood that any such shares received by the holder upon such conversion shall be subject to the provisions of the lock-up agreement; or
(n)in connection with a bona fide third-party tender offer, merger, consolidation or other similar transaction that is approved by our board of directors and made to all holders of our capital stock involving a Change of Control (for purposes hereof, “Change of Control” shall mean the transfer (whether by tender offer, merger, consolidation or other similar transaction), in one transaction or a series of related transactions, to a person or group of affiliated persons, of shares of capital stock if, after such transfer, such person or group of affiliated persons would hold at least a majority of our outstanding voting securities (or the surviving entity)); provided that in the event that such tender offer, merger, consolidation or other similar transaction is not completed, the holder’s shares of common stock shall remain subject to the provisions of the lock-up agreement;
provided that (1) in the case of any transfer pursuant to clauses (b), (c), (d), (e) or (f), such transfer shall not involve a disposition for value and each transferee, donee or distributee, as applicable, shall sign and deliver a lock-up agreement for the balance of the restricted period; provided further that in the case of any transfer pursuant to clauses (a), (d) and (e), no filing under Section 16(a) of the Exchange Act, reporting a reduction in beneficial ownership of shares of common stock, shall be required or shall be voluntarily made during the restricted period; provided further that any filing under Section 16(a) of the Exchange Act reporting a transfer pursuant to clause (b) shall clearly indicate in the footnotes thereto that such transfer is not for value, that the shares of common stock subject to such Transfer remain subject to restrictions set forth herein and that the filing relates to the circumstances described in clause (b); provided further that any filing under Section 16(a) of the Exchange Act reporting a reduction in beneficial ownership of shares of common stock resulting from a transfer pursuant to clause (c) shall clearly indicate in the footnotes thereto that such transfer is not for value, that the shares of common stock subject to such transfer remain subject to restrictions set forth herein and that the filing relates to the circumstances described in clause (c), and no other public filing (other than those that might be required during the restricted period pursuant
to Section 13 of the Exchange Act) or announcement shall be required or shall be made voluntarily in connection with such Transfer; provided further that in connection with any filing under Section 16(a) of the Exchange Act reporting a reduction in beneficial ownership of shares of common stock resulting from a transfer pursuant to clause (i), such filing shall indicate that such transfer has been net share settled; and provided further that any filing under Section 16(a) of the Exchange Act reporting a transfer pursuant to clause (k) shall clearly indicate in the footnotes thereto that the filing relates to the circumstances described in clause (k).
The foregoing restrictions shall also not apply to facilitating the establishment of a trading plan on behalf of any of our shareholders, officers or directors pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of common stock, provided that (x) such plan does not provide for the transfer of shares of common stock during the restricted period and (y) to the extent a public announcement or disclosure, or filing under the Exchange Act, regarding the establishment of such plan is required or voluntarily made by or on behalf of the holder or us, such announcement, disclosure or filing shall include a statement to the effect that no transfer of shares of common stock may be made under such plan during the restricted period.
Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC, in their sole discretion, may release the Class A common stock and other securities subject to the lock-up agreements described above in whole or in part at any time.
In order to facilitate the offering of the Class A common stock, the underwriters may engage in transactions that stabilize, maintain or otherwise affect the price of the Class A common stock. Specifically, the underwriters may sell more shares than they are obligated to purchase under the underwriting agreement, creating a short position. A short sale is covered if the short position is no greater than the number of shares available for purchase by the underwriters under the over-allotment option. The underwriters can close out a covered short sale by exercising the over-allotment option or purchasing shares in the open market. In determining the source of shares to close out a covered short sale, the underwriters will consider, among other things, the open market price of shares compared to the price available under the over-allotment option. The underwriters may also sell shares in excess of the over-allotment option, creating a naked short position. The underwriters must close out any naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the Class A common stock in the open market after pricing that could adversely affect investors who purchase in this offering. As an additional means of facilitating this offering, the underwriters may bid for, and purchase, shares of Class A common stock in the open market to stabilize the price of the Class A common stock. These activities may raise or maintain the market price of the Class A common stock above independent market levels or prevent or retard a decline in the market price of the Class A common stock. The underwriters are not required to engage in these activities and may end any of these activities at any time.
We and the underwriters have agreed to indemnify each other against certain liabilities, including liabilities under the Securities Act.
A prospectus in electronic format may be made available on websites maintained by one or more underwriters, or selling group members, if any, participating in this offering. The representatives may agree to allocate a number of shares of Class A common stock to underwriters for sale to their online brokerage account holders. Internet distributions will be allocated by the representatives to underwriters that may make Internet distributions on the same basis as other allocations.
The underwriters and their respective affiliates are full service financial institutions engaged in various activities, which may include securities trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment, hedging, financing and brokerage activities. Certain of the underwriters and their respective affiliates have, from time to time, performed, and may in the future perform, various financial advisory and investment banking services for us or our affiliates, for which they received or will receive customary fees and expenses. In addition, certain of the underwriters and/or their respective affiliates are acting as agents and/or lender under the Revolving Credit Facility and will receive customary fees.
“Wolfe | Nomura Alliance” is the marketing name used by Wolfe Research Securities and Nomura Securities International, Inc. in connection with certain equity capital markets activities conducted jointly by the firms. Both
Nomura Securities International, Inc. and WR Securities, LLC are serving as underwriters in the offering described herein. In addition, WR Securities, LLC and certain of its affiliates may provide sales support services, investor feedback, investor education, and/or other independent equity research services in connection with this offering.
In addition, in the ordinary course of their various business activities, the underwriters and their respective affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers and may at any time hold long and short positions in such securities and instruments. Such investment and securities activities may involve our securities and instruments. The underwriters and their respective affiliates may also make investment recommendations or publish or express independent research views in respect of such securities or instruments and may at any time hold, or recommend to clients that they acquire, long or short positions in such securities and instruments.
Pricing of the Offering
Prior to this offering, there has been no public market for our Class A common stock. The initial public offering price was determined by negotiations between us and the representatives. Among the factors considered in determining the initial public offering price were our future prospects and those of our industry in general, our sales, earnings and certain other financial and operating information in recent periods, and the price-earnings ratios, price-sales ratios, market prices of securities, and certain financial and operating information of companies engaged in activities similar to ours.
Directed Share Program
At our request, the underwriters have reserved up to $20 million of shares of Class A common stock (or up to 727,272 shares of Class A common stock assuming an initial public offering price of $27.50 per share, which is the midpoint of the price range set forth on the cover page of this prospectus)to be issued by us and offered by this prospectus for sale, at the initial public offering price, to certain of our employees and friends and family members of certain of our directors, officers and employees. If purchased by our directors or officers, these shares will be subject to a 180-day lock-up restriction. See “Underwriting” for a description of this lock-up restriction. The number of shares of Class A common stock available for sale to the general public will be reduced to the extent these individuals purchase such reserved shares. Any reserved shares that are not so purchased will be offered by the underwriters to the general public on the same basis as the other shares offered by this prospectus. Morgan Stanley & Co. LLC will administer our directed share program. We will agree to indemnify Morgan Stanley & Co. LLC in connection with the directed share program, including for the failure of any participant to pay for its shares. Other than the underwriting discount described on the front cover of this prospectus, the underwriters will not be entitled to any commission with respect to shares of Class A common stock sold pursuant to the directed share program.
Selling Restrictions
European Economic Area
In relation to each Member State of the European Economic Area (each a “Relevant State”), no shares have been offered or will be offered pursuant to this offering to the public in that Relevant State prior to the publication of a prospectus in relation to the shares which has been approved by the competent authority in that Relevant State or, where appropriate, approved in another Relevant State and notified to the competent authority in that Relevant State, all in accordance with the Prospectus Regulation, except that offers of shares may be made to the public in that Relevant State at any time under the following exemptions under the Prospectus Regulation:
(a)to any legal entity which is a qualified investor as defined under Article 2 of the Prospectus Regulation;
(b)to fewer than 150 natural or legal persons (other than qualified investors as defined under Article 2 of the Prospectus Regulation), subject to obtaining the prior consent of the representatives for any such offer; or
(c)in any other circumstances falling within Article 1(4) of the Prospectus Regulation,
provided that no such offer of shares shall require us or any underwriter to publish a prospectus pursuant to Article 3 of the Prospectus Regulation or supplement a prospectus pursuant to Article 23 of the Prospectus Regulation and each person who initially acquires any shares or to whom any offer is made will be deemed to have represented, acknowledged and agreed to and with each of the underwriters and the Company that it is a “qualified investor” within the meaning of Article 2(e) of the Prospectus Regulation. In the case of any shares being offered to a financial intermediary as that term is used in the Prospectus Regulation, each such financial intermediary will be deemed to have represented, acknowledged and agreed that the shares acquired by it in the offer have not been acquired on a non-discretionary basis on behalf of, nor have they been acquired with a view to their offer or resale to, persons in circumstances which may give rise to an offer of any shares to the public other than their offer or resale in a Relevant State to qualified investors as so defined or in circumstances in which the prior consent of the underwriters have been obtained to each such proposed offer or resale.
For the purposes of this provision, the expression an “offer to the public” in relation to shares in any Relevant State means the communication in any form and by any means of sufficient information on the terms of the offer and any shares to be offered so as to enable an investor to decide to purchase or subscribe for any shares, and the expression “Prospectus Regulation” means Regulation (EU) 2017/1129.
United Kingdom
No shares have been offered or will be offered pursuant to this offering to the public in the United Kingdom prior to the publication of a prospectus in relation to the shares which has been approved by the Financial Conduct Authority, except that the shares may be offered to the public in the United Kingdom at any time:
(a)to any legal entity which is a qualified investor as defined under Article 2 of the UK Prospectus Regulation;
(b)to fewer than 150 natural or legal persons (other than qualified investors as defined under Article 2 of the UK Prospectus Regulation), subject to obtaining the prior consent of the representatives for any such offer; or
(c)in any other circumstances falling within Section 86 of the FSMA;
provided that no such offer of the shares shall require the Company or any underwriter to publish a prospectus pursuant to Section 85 of the FSMA or supplement a prospectus pursuant to Article 23 of the UK Prospectus Regulation. For the purposes of this provision, the expression an “offer to the public” in relation to the shares in the United Kingdom means the communication in any form and by any means of sufficient information on the terms of the offer and any shares to be offered so as to enable an investor to decide to purchase or subscribe for any shares and the expression “UK Prospectus Regulation” means Regulation (EU) 2017/1129 as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018.
In addition, in the United Kingdom, this prospectus is being distributed only to, and is directed only at, and any offer subsequently made may only be directed at persons who are “qualified investors” (as defined in the Prospectus Regulation) (i) who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Order”) and/or (ii) who are high net worth companies (or persons to whom it may otherwise be lawfully communicated) falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”) or otherwise in circumstances which have not resulted and will not result in an offer to the public of the shares in the United Kingdom within the meaning of the Financial Services and Markets Act 2000.
Any person in the United Kingdom that is not a relevant person should not act or rely on the information included in this prospectus or use it as basis for taking any action. In the United Kingdom, any investment or investment activity that this prospectus relates to may be made or taken exclusively by relevant persons.
Canada
The shares may be sold only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined in National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the
Securities Act (Ontario), and are permitted clients, as defined in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any resale of the shares must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus requirements of applicable securities laws.
Securities legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus (including any amendment thereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser’s province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser’s province or territory for particulars of these rights or consult with a legal advisor.
Pursuant to section 3A.3 of National Instrument 33-105 Underwriting Conflicts (NI 33-105), the underwriters are not required to comply with the disclosure requirements of NI 33-105 regarding underwriter conflicts of interest in connection with this offering.
Hong Kong
The shares have not been offered or sold and will not be offered or sold in Hong Kong, by means of any document, other than (a) to “professional investors” as defined in the Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong) (the “SFO”) of Hong Kong and any rules made thereunder; or (b) in other circumstances which do not result in the document being a “prospectus” as defined in the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) of Hong Kong (the “CO”) or which do not constitute an offer to the public within the meaning of the CO. No advertisement, invitation or document relating to the shares has been or may be issued or has been or may be in the possession of any person for the purposes of issue, whether in Hong Kong or elsewhere, which is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to shares which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” as defined in the SFO and any rules made thereunder.
Singapore
This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, the shares were not offered or sold or caused to be made the subject of an invitation for subscription or purchase and will not be offered or sold or caused to be made the subject of an invitation for subscription or purchase, and this prospectus or any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the shares, has not been circulated or distributed, nor will it be circulated or distributed, whether directly or indirectly, to any person in Singapore other than:
(a)to an institutional investor (as defined in Section 4A of the Securities and Futures Act (Chapter 289) of Singapore, as modified or amended from time to time (the “SFA”)) pursuant to Section 274 of the SFA;
(b)to a relevant person (as defined in Section 275(2) of the SFA) pursuant to Section 275(1) of the SFA, or any person pursuant to Section 275(1A) of the SFA, and in accordance with the conditions specified in Section 275 of the SFA; or
(c)otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.
Where the shares are subscribed or purchased under Section 275 of the SFA by a relevant person which is:
(a)a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or
(b)a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary of the trust is an individual who is an accredited investor,
securities or securities-based derivatives contracts (each term as defined in Section 2(1) of the SFA) of that corporation or the beneficiaries’ rights and interest (howsoever described) in that trust shall not be transferred within six months after that corporation or that trust has acquired the shares pursuant to an offer made under Section 275 of the SFA except:
(i)to an institutional investor or to a relevant person, or to any person arising from an offer referred to in Section 275(1A) or Section 276(4)(c)(ii) of the SFA;
(ii)where no consideration is or will be given for the transfer;
(iii)where the transfer is by operation of law;
(iv)as specified in Section 276(7) of the SFA; or
(v)as specified in Regulation 37A of the Securities and Futures (Offers of Investments) (Securities and Securities-based Derivatives Contracts) Regulations 2018.
Japan
The shares have not been and will not be registered pursuant to Article 4, Paragraph 1 of the Financial Instruments and Exchange Act. Accordingly, none of the shares nor any interest therein may be offered or sold, directly or indirectly, in Japan or to, or for the benefit of, any “resident” of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan), or to others for re-offering or resale, directly or indirectly, in Japan or to or for the benefit of a resident of Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the Financial Instruments and Exchange Act and any other applicable laws, regulations and ministerial guidelines of Japan in effect at the relevant time.
Australia
This prospectus:
(a)does not constitute a disclosure document or a prospectus under Chapter 6D.2 of the Corporations Act 2001 (Cth) (the “Corporations Act”);
(b)has not been, and will not be, lodged with the Australian Securities and Investments Commission (“ASIC”), as a disclosure document for the purposes of the Corporations Act and does not purport to include the information required of a disclosure document for the purposes of the Corporations Act; and
(c)may only be provided in Australia to select investors who are able to demonstrate that they fall within one or more of the categories of investors, available under section 708 of the Corporations Act (“Exempt Investors”).
The shares may not be directly or indirectly offered for subscription or purchased or sold, and no invitations to subscribe for or buy the shares may be issued, and no draft or definitive offering memorandum, advertisement or other offering material relating to any shares may be distributed in Australia, except where disclosure to investors is not required under Chapter 6D of the Corporations Act or is otherwise in compliance with all applicable Australian laws and regulations. By submitting an application for the shares, you represent and warrant to us that you are an Exempt Investor.
As any offer of shares under this prospectus will be made without disclosure in Australia under Chapter 6D.2 of the Corporations Act, the offer of those securities for resale in Australia within 12 months may, under section 707 of the Corporations Act, require disclosure to investors under Chapter 6D.2 if none of the exemptions in section 708 applies to that resale. By applying for the shares you undertake to us that you will not, for a period of 12 months
from the date of issue of the shares, offer, transfer, assign or otherwise alienate those shares to investors in Australia except in circumstances where disclosure to investors is not required under Chapter 6D.2 of the Corporations Act or where a compliant disclosure document is prepared and lodged with ASIC.
Dubai International Financial Centre
This prospectus relates to an Exempt Offer in accordance with the Markets Law, DIFC Law No. 1 of 2012, as amended. This prospectus is intended for distribution only to persons of a type specified in the Markets Law, DIFC Law No. 1 of 2012, as amended. It must not be delivered to, or relied on by, any other person. The Dubai Financial Services Authority (DFSA) has no responsibility for reviewing or verifying any documents in connection with Exempt Offers. The DFSA has not approved this prospectus nor taken steps to verify the information set forth herein and has no responsibility for this document. The securities to which this prospectus relates may be illiquid and/or subject to restrictions on their resale. Prospective purchasers of the securities offered should conduct their own due diligence on the securities. If you do not understand the contents of this prospectus you should consult an authorized financial advisor.
In relation to its use in the DIFC, this prospectus is strictly private and confidential and is being distributed to a limited number of investors and must not be provided to any person other than the original recipient, and may not be reproduced or used for any other purpose. The interests in the securities may not be offered or sold directly or indirectly to the public in the DIFC.
Switzerland
This prospectus does not constitute an offer to the public or a solicitation to purchase or invest in any shares. No shares have been offered or will be offered to the public in Switzerland, except that offers of shares may be made to the public in Switzerland at any time under the following exemptions under the Swiss Financial Services Act (“FinSA”):
(a)to any person which is a professional client as defined under the FinSA;
(b)to fewer than 500 persons (other than professional clients as defined under the FinSA), subject to obtaining the prior consent of the lead bookrunner for any such offer; or
(c)in any other circumstances falling within Article 36 FinSA in connection with Article 44 of the Swiss Financial Services Ordinance,
provided that no such offer of shares shall require the Company or any underwriter to publish a prospectus pursuant to Article 35 FinSA.
The shares have not been and will not be listed or admitted to trading on a trading venue in Switzerland.
Neither this document nor any other offering or marketing material relating to the shares constitutes a prospectus as such term is understood pursuant to the FinSA and neither this document nor any other offering or marketing material relating to the shares may be publicly distributed or otherwise made publicly available in Switzerland.
Israel
This document does not constitute a prospectus under the Israeli Securities Law, 5728-1968, or the Securities Law, and has not been filed with or approved by the Israel Securities Authority. In Israel, this prospectus is being distributed only to, and is directed only at, and any offer of the shares is directed only at, (i) a limited number of persons in accordance with the Israeli Securities Law and (ii) investors listed in the first addendum, or the Addendum, to the Israeli Securities Law, consisting primarily of joint investment in trust funds, provident funds, insurance companies, banks, portfolio managers, investment advisors, members of the Tel Aviv Stock Exchange, underwriters, venture capital funds, entities with equity in excess of NIS 50 million and “qualified individuals,” each as defined in the Addendum (as it may be amended from time to time), collectively referred to as qualified investors (in each case, purchasing for their own account or, where permitted under the Addendum, for the accounts of their
clients who are investors listed in the Addendum). Qualified investors are required to submit written confirmation that they fall within the scope of the Addendum, are aware of the meaning of same and agree to it.
LEGAL MATTERS
The validity of the shares of Class A common stock offered by this prospectus will be passed upon for us by Latham & Watkins LLP, New York, New York. Certain legal matters relating to this offering will be passed upon for the underwriters by Simpson Thacher & Bartlett LLP, New York, New York.
EXPERTS
The financial statements as of December 31, 2024 and 2023 and for the years then ended included in this prospectus have been so included in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
We maintain a web site at www.voyagertechnologies.com. Information contained on our web site is not incorporated by reference into this prospectus, and you should not consider information contained on our web site to be part of this prospectus.
We have filed a registration statement on Form S-1, of which this prospectus constitutes a part, with the SEC under the Securities Act with respect to this offering of our Class A common stock. This prospectus does not contain all of the information set forth in the registration statement, which also includes numerous exhibits and schedules. For further information with respect to our Company and the shares of Class A common stock offered hereby, reference is made to the registration statement, including the exhibits and schedules thereto. Statements contained in this prospectus as to the contents of any contract or other document are not necessarily complete, and where such document has been filed as an exhibit to the registration statement, each statement is qualified in all respects by reference to the contents of the full document. Our SEC filings, including our registration statement, are available to you, free of charge, on the SEC’s web site, www.sec.gov.
As a result of this offering, we will become subject to the information and periodic reporting requirements of the Exchange Act, and we will file periodic reports and other information with the SEC. These periodic reports and other information will be available for inspection and copying at the SEC’s public reference facilities and through the SEC’s web site referred to above.
INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
INDEX TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS
Voyager Technologies, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands, except share and per share amounts)
| | | | | | | | | | | |
| March 31,
2025 | | December 31,
2024 |
| ASSETS | | | |
| Current assets: | | | |
| Cash and cash equivalents | $ | 175,488 | | | $ | 55,930 | |
| Accounts receivable, net | 7,832 | | | 15,360 | |
| Contract assets | 18,531 | | | 17,304 | |
| Inventories | 1,242 | | | 1,526 | |
| Prepaid expenses and other current assets | 7,511 | | | 11,461 | |
| TOTAL CURRENT ASSETS | 210,604 | | | 101,581 | |
| Property and equipment, net | 58,620 | | | 49,439 | |
| Operating lease right-of-use assets | 8,892 | | | 8,167 | |
| Intangible assets, net | 33,136 | | | 34,684 | |
| Goodwill | 46,515 | | | 46,515 | |
| Other assets | 7,695 | | | 7,210 | |
TOTAL ASSETS(1) | $ | 365,462 | | | $ | 247,596 | |
| LIABILITIES, MEZZANINE EQUITY, AND EQUITY (DEFICIT) | | | |
| Current liabilities: | | | |
| Accounts payable | $ | 15,236 | | | $ | 22,787 | |
| Contract liabilities | 16,049 | | | 21,365 | |
| Operating lease liabilities | 3,192 | | | 3,000 | |
| | | |
| SMI promissory note, current | 676 | | | 665 | |
| Accrued expenses and other current liabilities | 53,162 | | | 39,594 | |
| TOTAL CURRENT LIABILITIES | 88,315 | | | 87,411 | |
| Term loan, net | 57,633 | | | 56,991 | |
| Operating lease liabilities, non-current | 6,652 | | | 6,205 | |
| Contract liabilities, non-current | 2,820 | | | 2,762 | |
| Convertible notes, net | 7,876 | | | 7,435 | |
| Embedded derivatives | 2,767 | | | 2,723 | |
| Deferred tax liabilities | 178 | | | 112 | |
| Other long-term liabilities | 121 | | | 102 | |
| SMI promissory note | 24,323 | | | 23,928 | |
TOTAL LIABILITIES(1) | $ | 190,685 | | | $ | 187,669 | |
| Mezzanine equity: | | | |
| Class A-1 redeemable preferred stock: $0.0001 par value; 7,500,000 shares authorized; 6,967,720 shares issued and outstanding at March 31, 2025 and December 31, 2024; Redeemable at the option of the holder with a liquidation preference of $109,434 and $105,581 at March 31, 2025 and December 31, 2024, respectively | $ | 97,349 | | | $ | 93,496 | |
| Redeemable noncontrolling interests | 27,595 | | | 32,431 | |
| Equity: | | | |
| Class A preferred stock: $0.0001 par value per share; 1 share authorized, issued, and outstanding; liquidation preference of $1 | — | | | — | |
Class B convertible preferred stock: $0.0001 par value per share; 4,400,000 shares authorized; 3,285,995 shares issued and outstanding at March 31, 2025 and December 31, 2024; Liquidation preference of $148,602 and $146,454 at March 31, 2025 and December 31, 2024, respectively | 134,982 | | | 132,835 | |
Class C preferred stock: $0.0001 par value per share; 4,600,000 shares authorized: 3,853,234 and 1,537,818 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively | 158,311 | | | 63,464 | |
| Common stock: $0.0001 par value per share; 375,000,000 shares authorized; 15,266,853 and 13,297,289 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively | 1 | | | 1 | |
| Additional paid-in capital | 61,822 | | | 15,081 | |
| Accumulated other comprehensive income | 6 | | | 28 | |
| Accumulated deficit | (308,051) | | | (281,113) | |
| Total Voyager Technologies, Inc. equity (deficit) | 47,071 | | | (69,704) | |
| Noncontrolling interests | 2,762 | | | 3,704 | |
| TOTAL EQUITY (DEFICIT) | 49,833 | | | (66,000) | |
| TOTAL LIABILITIES, MEZZANINE EQUITY, AND EQUITY (DEFICIT) | $ | 365,462 | | | $ | 247,596 | |
Voyager Technologies, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands, except share and per share amounts)
________________
(1)Includes balances associated with a consolidated variable interest entity (“VIE”), including amounts reflected in “TOTAL ASSETS” that can only be used to settle obligations of the VIE as well as liabilities of the VIE reflected within “TOTAL LIABILITIES” for which creditors do not have recourse to the general credit of Voyager. Refer to Note 13, “Joint Venture”, for additional information.
The accompanying notes are an integral part of these condensed consolidated financial statements
Voyager Technologies, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands, except share and per share amounts)
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| 2025 | | 2024 | | | | |
| Net sales | $ | 34,507 | | | $ | 30,216 | | | | | |
| Cost of sales | 28,922 | | | 24,035 | | | | | |
| Selling, general, and administrative | 26,286 | | | 15,590 | | | | | |
| Research and development | 4,040 | | | 767 | | | | | |
| | | | | | | |
| Amortization of acquired intangibles | 1,548 | | | 1,744 | | | | | |
| Loss from operations | $ | (26,289) | | | $ | (11,920) | | | | | |
| Other income (expense): | | | | | | | |
| | | | | | | |
| | | | | | | |
| Finance and interest expense, net | $ | (2,729) | | | $ | (2,994) | | | | | |
| Other income, net | 1,137 | | | 210 | | | | | |
| Loss before income taxes | (27,881) | | | (14,704) | | | | | |
| Income tax expense | 48 | | | 248 | | | | | |
| Net loss | (27,929) | | | (14,952) | | | | | |
| Net loss attributable to noncontrolling interests | (991) | | | (129) | | | | | |
| Net loss attributable to Voyager Technologies, Inc. | $ | (26,938) | | | $ | (14,823) | | | | | |
| Less: dividends accrued on preferred stock | 6,001 | | | 5,007 | | | | | |
| Net loss available to common shareholders | $ | (32,939) | | | $ | (19,830) | | | | | |
| | | | | | | |
| Net loss per common share: | | | | | | | |
| Basic | $ | (2.30) | | | $ | (1.59) | | | | | |
| Diluted | $ | (2.30) | | | $ | (1.59) | | | | | |
| Weighted-average shares outstanding | | | | | | | |
| Basic | 14,339,521 | | | 12,497,844 | | | | | |
| Diluted | 14,339,521 | | | 12,497,844 | | | | | |
The accompanying notes are an integral part of these condensed consolidated financial statements
Voyager Technologies, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(Unaudited, in thousands, except share and per share amounts)
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| 2025 | | 2024 | | | | |
| Net loss | $ | (27,929) | | | $ | (14,952) | | | | | |
| Other comprehensive income (loss), net of tax: | | | | | | | |
| Foreign currency translation adjustments | (22) | | | 196 | | | | | |
| Total comprehensive loss | (27,951) | | | (14,756) | | | | | |
| Comprehensive loss attributable to noncontrolling interests | (991) | | | (129) | | | | | |
| Comprehensive loss attributable to Voyager Technologies, Inc. | $ | (26,960) | | | $ | (14,627) | | | | | |
The accompanying notes are an integral part of these condensed consolidated financial statements
Voyager Technologies, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (DEFICIT) and MEZZANINE EQUITY
(Unaudited, in thousands, except share and per share amounts)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | Additional Paid-in Capital | | Accumulated Other Comprehensive Loss | | Accumulated Deficit | | Total Voyager Technologies, Inc. Equity (Deficit) | | Non-controlling Interests | | Total Equity (Deficit) | | | Total Mezzanine Equity |
| Three Months Ended March 31, 2025 | Common Stock | | Preferred Stock | | | | | | | | |
| Shares | | Amount | | Shares | | Amount | | | | | | | | |
| Balance at December 31, 2024 | 13,297 | | | $ | 1 | | | 4,824 | | | $ | 196,299 | | | $ | 15,081 | | | $ | 28 | | | $ | (281,113) | | | $ | (69,704) | | | $ | 3,704 | | | $ | (66,000) | | | | $ | 125,927 | |
| Net loss | — | | | — | | | — | | | — | | | — | | | — | | | (26,938) | | | (26,938) | | | (942) | | | (27,880) | | | | (49) | |
| Foreign currency translation adjustments | — | | | — | | | — | | | — | | | — | | | (22) | | | — | | | (22) | | | — | | | (22) | | | | — | |
| Stock-based compensation | — | | | — | | | — | | | — | | | 1,723 | | | — | | | — | | | 1,723 | | | — | | | 1,723 | | | | — | |
| Options Exercised | 1 | | | — | | | — | | | — | | | 114 | | | — | | | — | | | 114 | | | — | | | 114 | | | | — | |
| Issuance of Common stock, net | 1,611 | | | — | | | — | | | — | | | 43,117 | | | — | | | — | | | 43,117 | | | — | | | 43,117 | | | | — | |
| Issuance of Class C preferred stock, net | — | | | — | | | 2,315 | | | 94,847 | | | — | | | — | | | — | | | 94,847 | | | — | | | 94,847 | | | | — | |
| Dividends accrued on Class B convertible preferred stock | — | | | — | | | — | | | 2,147 | | | (2,147) | | | — | | | — | | | — | | | — | | | — | | | | — | |
| Dividends accrued on Class A-1 redeemable preferred stock | — | | | — | | | — | | | — | | | (3,853) | | | — | | | — | | | (3,853) | | | — | | | (3,853) | | | | 3,853 | |
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | |
| Shares issued for services | 138 | | | — | | | — | | | — | | | 3,000 | | | — | | | — | | | 3,000 | | | — | | | 3,000 | | | | — | |
| Purchase of noncontrolling interest | 220 | | | — | | | — | | | — | | | 4,787 | | | — | | | — | | | 4,787 | | | — | | | 4,787 | | | | (4,787) | |
| | | | | | | | | | | | | | | | | | | | | | |
| Balance at March 31, 2025 | 15,267 | | | $ | 1 | | | 7,139 | | | $ | 293,293 | | | $ | 61,822 | | | $ | 6 | | | $ | (308,051) | | | $ | 47,071 | | | $ | 2,762 | | | $ | 49,833 | | | | $ | 124,944 | |
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | Additional Paid-in Capital | | Accumulated Other Comprehensive Loss | | Accumulated Deficit | | Total Voyager Technologies, Inc. Equity (Deficit) | | Non-controlling Interests | | Total Equity (Deficit) | | | Total Mezzanine Equity |
| Three Months Ended March 31, 2024 | Common Stock | | Preferred Stock | | | | | | | | |
| Shares | | Amount | | Shares | | Amount | | | | | | | | |
| Balance at December 31, 2023 | 12,425 | | | $ | 1 | | | 3,286 | | | $ | 124,367 | | | $ | — | | | $ | (189) | | | $ | (216,802) | | | $ | (92,623) | | | $ | 3 | | | $ | (92,620) | | | | $ | 122,905 | |
| Net loss | — | | | — | | | — | | | — | | | — | | | — | | | (14,823) | | | (14,823) | | | — | | | (14,823) | | | | (129) | |
| Foreign currency translation adjustments | — | | | — | | | — | | | — | | | — | | | 196 | | | — | | | 196 | | | — | | | 196 | | | | — | |
| Stock-based compensation | — | | | — | | | — | | | — | | | 730 | | | — | | | — | | | 730 | | | — | | | 730 | | | | — | |
| Issuance of Class C preferred stock, net | — | | | — | | | 570 | | | 24,750 | | | — | | | — | | | — | | | 24,750 | | | — | | | 24,750 | | | | — | |
| Dividends accrued on Class B convertible preferred stock | — | | | — | | | — | | | 2,047 | | | (2,047) | | | — | | | — | | | — | | | — | | | — | | | | — | |
| Dividends accrued on Class A-1 redeemable preferred stock | — | | | — | | | — | | | — | | | (2,960) | | | — | | | — | | | (2,960) | | | — | | | (2,960) | | | | 2,960 | |
| Warrants issued for common stock | — | | | — | | | — | | | — | | | 2,038 | | | — | | | — | | | 2,038 | | | — | | | 2,038 | | | | — | |
| Negative APIC Reclass | — | | | — | | | — | | | — | | | 2,239 | | | — | | | (2,239) | | | — | | | — | | | — | | | | — | |
| Balance at March 31, 2024 | 12,425 | | | $ | 1 | | | 3,856 | | | $ | 151,164 | | | $ | — | | | $ | 7 | | | $ | (233,864) | | | $ | (82,692) | | | $ | 3 | | | $ | (82,689) | | | | $ | 125,736 | |
The accompanying notes are an integral part of these condensed consolidated financial statements
Voyager Technologies, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in thousands, except share and per share amounts)
| | | | | | | | | | | |
| Three Months Ended March 31, |
| 2025 | | 2024 |
| Cash Flows from Operating Activities: | | | |
| Net loss | $ | (27,929) | | | $ | (14,952) | |
| Adjustments to reconcile net loss to net cash used in operating activities: | | | |
| Depreciation and amortization | 2,602 | | | 2,713 | |
| | | |
| Stock-based compensation | 1,723 | | | 730 | |
| Amortization of operating lease right-of-use assets | 670 | | | 642 | |
| | | |
| Amortization of debt issuance costs and other non-cash interest expense | 1,291 | | | 1,376 | |
| | | |
| Deferred Taxes | 65 | | | 119 | |
| Non-cash services acquired | 10,115 | | | — | |
| Other | (73) | | | 238 | |
| Change in operating assets and liabilities, net of acquisitions: | | | |
| Accounts receivable | 7,528 | | | 3,073 | |
| Prepaid expenses and other current assets | (3,165) | | | 332 | |
| Contract assets | (1,227) | | | 2,213 | |
| Inventory | 284 | | | 207 | |
| Other assets | (485) | | | (2,597) | |
| Accounts payable | (10) | | | (6,696) | |
| Contract liabilities | (5,258) | | | 497 | |
| Accrued expenses | 252 | | | 4,948 | |
| Operating lease liabilities | (756) | | | (704) | |
| Other liabilities | 19 | | | (45) | |
| Net cash used in operating activities | $ | (14,354) | | | $ | (7,906) | |
| | | |
| Cash Flows from Investing Activities: | | | |
| Purchases of property and equipment | $ | (26,970) | | | $ | (16,050) | |
| Grant funding for property and equipment | 18,000 | | | 10,650 | |
| | | |
| | | |
| Net cash used in investing activities | $ | (8,970) | | | $ | (5,400) | |
| | | |
| Cash Flows from Financing Activities: | | | |
| | | |
| Repayment of term loan | $ | — | | | $ | (175) | |
| Proceeds from the exercise of stock options | 114 | | | — | |
| Proceeds from the issuance of Common stock, net | 43,161 | | | — | |
| Proceeds from the issuance of Class C preferred stock, net | 99,449 | | | 24,749 | |
| | | |
| | | |
| | | |
| Proceeds from the convertible note | 130 | | | — | |
| Other | — | | | (34) | |
| Net cash provided by financing activities | $ | 142,854 | | | $ | 24,540 | |
| | | |
| Effect of foreign exchange on cash and cash equivalents | $ | 28 | | | $ | (10) | |
| Net increase in cash and cash equivalents | 119,558 | | | 11,224 | |
| Cash and cash equivalent at the beginning of the period | 55,930 | | | 30,279 | |
| Cash and cash equivalents at the end of the period | $ | 175,488 | | | $ | 41,503 | |
The accompanying notes are an integral part of these condensed consolidated financial statements
Notes to Condensed Consolidated Financial Statements
(Tabular amounts in thousands of dollars, unless otherwise noted)
1. ORGANIZATION
Nature of Business
Voyager Technologies, Inc. (“Voyager” or the “Company”), incorporated in the state of Delaware on August 15, 2019, is a space technology company with over 35 years of spaceflight heritage combined amongst its operating entities. Our business model leverages global public-private partnerships to deliver mission-critical capabilities and on-orbit services to civil and defense government agencies, academic and research institutions, and private sector players. Voyager has enabled thousands of payloads, systems, and hardware elements to enter space while also working to develop next generation space stations. Voyager’s products and capabilities under continuous development include Starlab, a privately owned, free-flying crewed space station; advanced spacecraft communications; and our controllable solid-state propulsion technology.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying condensed consolidated financial statements include the accounts of Voyager and our consolidated subsidiaries and, have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”). In the opinion of management, the condensed consolidated financial statements include all adjustments, consisting of adjustments associated with acquisition accounting and normal recurring adjustments, necessary for the fair statement of the results for the periods presented. All intercompany balances and transactions have been eliminated in consolidation.
These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto included elsewhere in this prospectus. Interim results are not necessarily indicative of the results that may be expected for the full fiscal year. Interim results are not necessarily indicative of the results that may be expected for a full year.
Common Stock Split
On May 30, 2025, the Company effected a 1.5-for-1 forward split of its common stock and a proportionate increase in the number of authorized shares. All share and per share information, including share based compensation, throughout the unaudited interim condensed consolidated financial statements has been retroactively adjusted to reflect the stock split. The shares of common stock retain a par value of $0.0001 per share. Accordingly, an amount equal to the par value of the increased shares resulting from the stock split was reclassified from capital in excess of par value to common stock.
Use of Estimates
The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Some of these judgments can be subjective and complex, and, consequently, actual results may differ from these estimates. On an ongoing basis, management evaluates its estimates, including those related to the valuation of acquired intangibles, intangibles, long-lived assets, redeemable noncontrolling interests, realization of tax assets and estimates of tax liabilities, valuation of equity securities and financial instruments, estimated useful lives of long-lived assets, and reported amounts of revenues and expenses during the reporting period.
Estimates and assumptions are based on current facts, historical experience, and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of revenues and expenses that are not readily apparent from other sources. Actual results may differ materially and adversely from these estimates. To the extent there are material differences between the estimates and actual results, the Company’s future results of operations could be affected.
3. RECENT ACCOUNTING PRONOUNCEMENTS
Reporting Comprehensive Income - Expense Disaggregation Disclosures
In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2024-03 Comprehensive Income (Topic 220): Disaggregation of Income Statement Expenses. The ASU requires a tabular disclosure of the amounts of specified natural expense categories included in each relevant expense caption. Additionally, the amendments require the disclosure of the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. The ASU will be effective for annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027 and will be applied on a prospective basis with the option to apply the standard retrospectively. The Company is currently evaluating the impact on our disclosures of adopting this new pronouncement.
Income Taxes – Disclosure Improvements
In December 2023, the FASB issued ASU No. 2023-09 Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU requires companies to disclose, on an annual basis, specific categories in the effective tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. In addition, the ASU requires companies to disclose additional information about income taxes paid. The ASU will be effective for annual periods beginning January 1, 2025 and will be applied on a prospective basis with the option to apply the standard retrospectively. The Company is evaluating the disclosure impact of ASU 2023-09; however, the standard is not expected to have an impact on the Company’s consolidated financial position, results of operations and/or cash flows.
4. ACCOUNTS RECEIVABLE, NET
| | | | | | | | | | | |
| March 31,
2025 | | December 31,
2024 |
| Accounts receivable, billed | $ | 8,086 | | | $ | 16,015 | |
| Allowance for expected credit losses | (254) | | | (655) | |
| Accounts receivable, net | $ | 7,832 | | | $ | 15,360 | |
5. PROPERTY AND EQUIPMENT, NET
| | | | | | | | | | | |
| March 31,
2025 | | December 31,
2024 |
| Equipment in orbit | $ | 19,533 | | | $ | 19,533 | |
| Machinery and equipment | 4,965 | | | 4,860 | |
| Leasehold improvements | 2,276 | | | 2,276 | |
| Construction in progress | 47,085 | | | 37,251 | |
| IT related equipment | 2,626 | | | 2,441 | |
| Property and equipment, gross | 76,485 | | | 66,361 | |
| Less: Accumulated depreciation | (17,865) | | | (16,922) | |
| Property and equipment, net | $ | 58,620 | | | $ | 49,439 | |
Depreciation expense for property, plant and equipment was $1.1 million and $1.0 million for the three months ended March 31, 2025 and 2024, respectively.
6. ACCRUED EXPENSES
| | | | | | | | | | | |
| March 31,
2025 | | December 31,
2024 |
| Accrued compensation | $ | 9,291 | | | $ | 11,539 | |
| Accrued expenses | 20,976 | | | 10,641 | |
| Accrued taxes | 450 | | | 914 | |
| Accrued earnout | 413 | | | 413 | |
| | | |
| Other current liabilities | 22,032 | | | 16,087 | |
| Total accrued expenses | $ | 53,162 | | | $ | 39,594 | |
7. DEBT
Term Loan
On June 28, 2024, we and our domestic subsidiaries, excluding Starlab, entered into a $58.0 million Loan and Security Agreement (“Credit Agreement”) with the lenders party thereto and Hercules Capital, Inc., as administrative agent and collateral agent, which provided for a $58.0 million term loan (the “Term Loan”). The Term Loan matures on July 1, 2028. The Term Loan bears interest at a variable annual rate equal to the sum of (a) the greater of (i) the Wall Street Journal Prime Rate or (ii) 8.50%, and (b) 1.25% per annum. The Term Loan bears additional interest, which is equal to 2.50% of the total outstanding principal, computed daily based on the actual number of days elapsed and added to the outstanding principal balance. Commencing on July 1, 2026, we are required to make payments of $2.6 million the first business day of each month, which includes both principal repayment and scheduled interest payments. The two-year interest only period can be extended over the balance of the agreement upon achievement of certain gross profit and EBITDA milestones. The Term Loan is secured by substantially all our assets and the assets of the guarantors.
The Credit Agreement includes a minimum liquidity threshold, which requires us and the guarantors to, at all times, maintain an aggregate cash balance in all accounts subject to account control agreements in an amount of at least $12.5 million. Additionally, the Credit Agreement contains restrictive covenants and events of default. See “Description of Certain Indebtedness—Term Loan.” We, at our option, may voluntarily prepay the Term Loan. Such prepayments require repayment of all outstanding principal, all accrued and unpaid interest, the end-of-term charge, and a prepayment charge that is equal to 3.00% of outstanding principal if prepaid before June 28, 2025, 2.00% of outstanding principal if prepaid between June 28, 2025 and June 28, 2026, or 1.00% of outstanding principal if prepaid after June 28, 2026, but before the maturity date.
The Company’s long-term debt associated with the Term Loan consisted of the following (in thousands):
| | | | | | | | | | | |
| March 31, 2025 | | December 31, 2024 |
| Principal | $ | 65,972 | | | $ | 65,972 | |
| | | |
| Less: debt issuance cost & discounts, net of amortization | (8,339) | | | (8,981) | |
| Net carrying amount | 57,633 | | | 56,991 | |
| Less: current portion | — | | | — | |
| Total long-term debt, net | $ | 57,633 | | | $ | 56,991 | |
2024 Convertible Notes
During the year ended December 31, 2024, Starlab Space LLC entered into convertible promissory note agreements (“2024 Convertible Notes”) for a total principal of approximately $10.1 million. In January 2025, Starlab Space LLC raised an additional $0.1 million. As of March 31, 2025, there is a total principal of $10.2 million outstanding under the 2024 Convertible Notes.
The notes bear interest at a rate of 5.0% per annum, payable at maturity, which is on the third anniversary of the issue date if no triggering events occur prior to that date. The Company has the option to prepay all or any of the principal and any accrued and unpaid interest at any time.
The 2024 Convertible Notes are convertible into equity units upon the following: (i) a qualified financing event, defined as a transaction or series of transactions pursuant to which Starlab JV issues shares of any class or series of equity securities to one or more investors, including any of the lenders with the principal purpose of raising capital that raises gross proceeds of at least $10.0 million, excluding the amount represented by the conversion of any outstanding indebtedness in accordance with their respective terms; (ii) at the option of the lender upon a nonqualified financing event; (iii) a liquidity event, defined as a consolidation or merger with another corporation, entity, or person or other event through which the unit holders, immediately prior to such consolidation or merger, own less than 50% of the voting power of the surviving entity, immediately after such consolidation or merger, a sale or other disposition of substantially all Starlab JV’s assets, or the closing of Starlab JV’s first underwritten public offering; and (iv) the maturity date. Upon a conversion event described in (i) or (ii), the notes will convert into the same class and series of units as those sold as part of the financing event. Upon a conversion event described in (iii) or (iv), the notes will convert into Class A-1 Units of Starlab JV. The number of Class A-1 Units issued will be equal to (1) the outstanding principal balance of the note and all accrued and unpaid interest due, divided by (2) 85% of the price per unit paid by the investors to purchase the new securities in the subsequent financing.
The Company evaluated the features of the 2024 Convertible Notes and determined that items (i) and (ii) met the definition of embedded derivatives as they are not clearly and closely related to the debt host instrument and were bifurcated and measured at fair value. The fair value was measured using the scenario based method inside the “with and without” method and resulted in a value of approximately $3.1 million at inception which was recorded as a discount on the convertible notes. The key assumptions utilized in the valuation were the scenario timing, mandatory conversion discount, discount rate, and scenario probabilities.
SMI Promissory Note
In May and June 2023, we acquired additional shares of SMI from certain minority stockholders in exchange for Promissory Notes in aggregate amount of approximately $28.4 million. In October 2024, the Promissory Notes were modified for certain shareholders to be payable in our equity securities at the earlier of October 2, 2025 or the completion of our initial public offering, and for other shareholders at the earlier of October 2, 2026 or the completion of our initial public offering. The Promissory Notes bear interest at the Wall Street Journal Prime Rate, which is accrued in arrears. The Company had an outstanding balance of approximately $25.0 million and $24.6 million as of March 31, 2025 and December 31, 2024, respectively.
8. REDEEMABLE NONCONTROLLING INTERESTS
The following tables present the changes in redeemable noncontrolling interest:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (dollars in thousands) | Altius | | TLC | | XO | | VTS | | SMI | | Total |
| Balance at December 31, 2024 | $ | — | | | $ | — | | | $ | 21,542 | | | $ | 10,889 | | | $ | — | | | $ | 32,431 | |
| Net income (loss) attributable to redeemable noncontrolling interests | — | | | — | | | (136) | | | 87 | | | — | | | (49) | |
| Redemptions of redeemable noncontrolling interests | — | | | — | | | (1,440) | | | (3,347) | | | — | | | (4,787) | |
| Balance at March 31, 2025 | — | | | — | | | 19,966 | | | 7,629 | | | — | | | 27,595 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Altius | | TLC | | XO | | VTS | | SMI | | Total |
| Balance at December 31, 2023 | $ | (885) | | | $ | — | | | $ | 22,014 | | | $ | 20,046 | | | $ | 1,582 | | | $ | 42,757 | |
| Net income (loss) attributable to redeemable noncontrolling interests | (7) | | | — | | | (156) | | | 56 | | | (22) | | | (129) | |
| Balance at March 31, 2024 | $ | (892) | | | $ | — | | | $ | 21,858 | | | $ | 20,102 | | | $ | 1,560 | | | $ | 42,628 | |
As a result of the redemption of redeemable noncontrolling interests at Valley Tech Systems, Inc. ("VTS") during the period ended March 31, 2025, the Company's ownership interest in VTS increased from 84% to 89.5%. The redemption was issued with Voyager equity in a swap of VTS common shares for Voyager common shares.
9. NET SALES
Disaggregation of Net Sales
The following tables present the disaggregation of net sales from contracts with our customers:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, 2025 | Defense & National Security | | Space Solutions | | Starlab Space Stations | | Elims | | Total |
| (dollars in thousands) | | | | |
| US Government | $ | 18,857 | | | $ | 10,669 | | | $ | — | | | $ | — | | | $ | 29,526 | |
| Intl Government | — | | | 96 | | | — | | | — | | | 96 | |
| Commercial | 4,687 | | | 1,539 | | | — | | | (1,341) | | | 4,885 | |
| Total net sales | $ | 23,544 | | | $ | 12,304 | | | $ | — | | | $ | (1,341) | | | $ | 34,507 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, 2024 | Defense & National Security | | Space Solutions | | Starlab Space Stations | | Elims | | Total |
| (dollars in thousands) | | | | |
| US Government | $ | 12,853 | | | $ | 13,803 | | | $ | — | | | $ | — | | | $ | 26,656 | |
| Intl Government | — | | | 80 | | | — | | | — | | | 80 | |
| Commercial | 1,848 | | | 3,160 | | | — | | | (1,528) | | | 3,480 | |
| Total net sales | $ | 14,701 | | | $ | 17,043 | | | $ | — | | | $ | (1,528) | | | $ | 30,216 | |
The approximate revenue based on geographic location of customers is as follows:
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| (dollars in thousands) | 2025 | | 2024 | | | | |
| US | $ | 30,280 | | | $ | 28,873 | | | | | |
| Europe | 3,946 | | | 1,179 | | | | | |
| Middle East | 15 | | | 92 | | | | | |
| Other | 266 | | | 72 | | | | | |
| Total Net Sales | $ | 34,507 | | | $ | 30,216 | | | | | |
Contract Balances
Contract assets arise when revenue has been recognized for amounts which cannot or have not yet been billed under terms of the contract with the customer. Contract liabilities arise when consideration is received from a customer prior to being earned and are recognized as revenue when the Company satisfies the related performance obligation under the terms of the contract. The following table presents the Company’s contract assets and liabilities:
| | | | | | | | | | | |
| (dollars in thousands) | March 31, 2025 | | December 31, 2024 |
| Contract assets (current and non-current) | $ | 25,786 | | | $ | 24,128 | |
| Contract liabilities (current and non-current) | $ | 18,869 | | | $ | 24,127 | |
Contract assets increased primarily due to a difference in timing of billing on cost plus programs and revenue recognition. The increase in contract liabilities was driven primarily by the timing difference of milestone billing and revenue recognition.
The amount of revenue recognized for the three months ended March 31, 2025 that was included in the contract liability balance as of December 31, 2024 was $7.7 million. The amount of revenue recognized for the three months ended March 31, 2024 that was included in the contract liability balance as of December 31, 2023 was $4.8 million.
The below table summarizes the favorable (unfavorable) impact of the net EAC adjustments for the following periods:
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| (dollars in thousands, except per share data) | 2025 | | 2024 | | | | |
| Net EAC Adjustments | $ | (2,150) | | | $ | (1,148) | | | | | |
| Net sales | (1,974) | | | (1,442) | | | | | |
| Basic net loss per share | (0.27) | | | (0.21) | | | | | |
| Diluted net loss per share | $ | (0.27) | | | $ | (0.21) | | | | | |
Performance Obligations
As of March 31, 2025, the Company had approximately $93.1 million of remaining performance obligations associated with contracts with an original duration of one year or greater. The Company will recognize net sales as these obligations are satisfied. The Company expects to recognize net sales relating to existing performance obligations of approximately $81.7 million, $7.9 million, and $3.5 million for the fiscal years 2025, 2026, and thereafter, respectively.
10. SEGMENT REPORTING
The Company’s business is organized into market sectors based on its products and services and has three reportable segments: (i) Defense & National Security; (ii) Space Solutions; and (iii) Starlab Space Stations. The Company organizes its reportable segments based on the nature of the products and services offered.
Transactions between segments are generally negotiated and accounted for under terms and conditions similar to other government and commercial contracts. The reconciling item “corporate expense” includes the portion of corporate costs not considered allocable to the segments, such as legal, management and administration, and other corporate unallocable costs.
The Company’s CODM is our CEO and Chairman. The CODM uses revenue and Segment Adjusted EBITDA to assess segment performance and make decisions regarding the allocation of capital and other investments. Segment Adjusted EBITDA is defined as EBITDA (earnings before interest, taxes, depreciation, and amortization) adjusted for certain items affecting comparability as specified in the calculation. Segment Adjusted EBITDA is used to monitor budget versus actual results. The CODM also uses Segment Adjusted EBITDA in analysis of the operational performance of each reporting segment. The CODM considers budget-to-actual variances on a quarterly basis for both profit measures when making decisions about allocating capital and personnel to the segments. The monitoring of budgeted versus actual results is used in assessing performance of the segments and in establishing management’s compensation. The CODM does not review segment expense items pursuant to ASC 280-10-50-26A. Therefore, the Company does not disclose these expense items by segment. The CODM does not use assets by segment to evaluate performance or allocate resources. Therefore, the Company does not disclose assets by segment.
The following table summarizes the operating performance of the Company’s segments:
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| (dollars in thousands) | 2025 | | 2024 | | | | |
| Net Sales: | | | | | | | |
| Defense & National Security | $ | 23,544 | | | $ | 14,701 | | | | | |
| Space Solutions | 12,304 | | | 17,043 | | | | | |
| Starlab Space Stations | — | | | — | | | | | |
| Total net sales, reportable segments | 35,848 | | | 31,744 | | | | | |
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| (dollars in thousands) | 2025 | | 2024 | | | | |
| Intersegment eliminations | (1,341) | | | (1,528) | | | | | |
| Total Net Sales | 34,507 | | | 30,216 | | | | | |
| | | | | | | |
Other Segment Expenses(1) | | | | | | | |
| Defense & National Security | 23,434 | | | 14,966 | | | | | |
| Space Solutions | 13,482 | | | 18,167 | | | | | |
| Starlab Space Stations | 1,386 | | | 2,478 | | | | | |
| Total other segment expenses, reportable segments | 38,302 | | | 35,611 | | | | | |
| Intersegment eliminations | (1,341) | | | (1,528) | | | | | |
| Corporate and other expenses | 8,787 | | | 3,312 | | | | | |
Total other segment expenses | 45,748 | | | 37,395 | | | | | |
| | | | | | | |
| Segment Adjusted EBITDA: | | | | | | | |
| Defense & National Security | $ | 110 | | | $ | (265) | | | | | |
| Space Solutions | (1,178) | | | (1,124) | | | | | |
| Starlab Space Stations | (1,386) | | | (2,478) | | | | | |
| Total Segment Adjusted EBITDA, reportable segments | (2,454) | | | (3,867) | | | | | |
| Intersegment eliminations | — | | | — | | | | | |
| Corporate and other expenses | (8,787) | | | (3,312) | | | | | |
| Depreciation & amortization | (2,602) | | | (2,713) | | | | | |
| Stock-based compensation | (1,723) | | | (730) | | | | | |
| Impairment | — | | | — | | | | | |
| Finance and interest expense, net | (2,729) | | | (2,994) | | | | | |
| Net loss attributable to noncontrolling interests | (991) | | | (129) | | | | | |
Non-cash services(2) | (10,115) | | | — | | | | | |
| Other | 1,520 | | | (959) | | | | | |
| Loss before taxes | $ | (27,881) | | | $ | (14,704) | | | | | |
________________
(1)Other Segment Expenses consist of cost of sales, research and development, selling, general, and administrative and other income or expense items which are not deducted when calculating Segment Adjusted EBITDA. The CODM does not separately review expenses by nature at the segment reporting level, but reviews the operational performance and health of the segments as revenue less total expenses before interest, taxes, depreciation, amortization, as adjusted for certain items affecting comparability (i.e., Segment Adjusted EBITDA) to manage operations.
(2)Non-cash services were incurred as corporate-level operating expenses and in the Starlab Space Stations segment as a result of services performed by a vendor in exchange for equity ownership in Voyager Technologies, Inc. and Starlab LLC for $3.0 million and $— million respectively during the quarter ended March 31, 2025 and liquidation of prepaid balances of $7.1 and $— million during the quarters ended March 31, 2025 and March 31, 2024, respectively.
The Company’s capital expenditures are as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, 2025 | | Defense & National Security | | Space Solutions | | Starlab Space Stations | | Corporate | | Total |
| Capital expenditures: | | | | | | | | | | |
| Property, plant and equipment | | $ | 637 | | | $ | 404 | | | $ | 25,894 | | | $ | 35 | | | $ | 26,970 | |
| Total | | $ | 637 | | | $ | 404 | | | $ | 25,894 | | | $ | 35 | | | $ | 26,970 | |
| | | | | | | | | | |
| Three Months Ended March 31, 2024 | | Defense & National Security | | Space Solutions | | Starlab Space Stations | | Corporate | | Total |
| Capital expenditures: | | | | | | | | | | |
| Property, plant and equipment | | $ | 500 | | | $ | 360 | | | $ | 15,190 | | | $ | — | | | $ | 16,050 | |
| Total | | $ | 500 | | | $ | 360 | | | $ | 15,190 | | | $ | — | | | $ | 16,050 | |
| | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | | | |
Substantially all of the Company’s long-lived tangible assets were in the United States as of March 31, 2025 and December 31, 2024, respectively.
11. INCOME TAXES
The effective tax rate was (0.2)% and (1.7)% for the three months ended March 31, 2025 and 2024, respectively. The effective tax rates for all periods presented differ from the statutory U.S. federal income tax rate of 21.0% primarily due to estimated permanent differences and changes in the valuation allowance. The Company does not anticipate a significant change to the Company’s gross unrecognized tax benefits within the next 12 months.
The Company assesses the deferred tax assets for recoverability on a quarterly basis. Based upon all available positive and negative evidence, the Company maintains a valuation allowance to reduce the net U.S. deferred tax asset to the amount that is more-likely-than-not realizable.
The Company computes an estimated annual effective tax rate (“AETR”) each quarter based on the current and forecasted continuing operating results. The income tax expense or benefit associated with the interim period is computed using the most recent estimated AETR applied to the year-to-date ordinary income or loss, plus the tax effect of any significant or infrequently occurring items recorded during the interim period. The computation of the estimated AETR at each interim period requires certain estimates and significant judgments including, but not limited to, the expected operating income (loss) for the year, projections of the proportion of income earned and taxed in various jurisdictions, permanent differences and the likelihood of recovering deferred tax assets generated in the current year. The accounting estimates used to compute the provision for income taxes may change as new events occur and additional information becomes known or as the tax environment changes.
12. NET LOSS PER COMMON SHARE
The following table includes the calculation of basic and diluted net loss per common share:
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| (dollars in thousands, except per share data) | 2025 | | 2024 | | | | |
| Numerator: | | | | | | | |
| Net loss attributable to Voyager Technologies, Inc. | $ | (26,938) | | | $ | (14,823) | | | | | |
Accrued value of preferred stock dividends(1) | 6,001 | | | 5,007 | | | | | |
| Net loss attributed to common stockholders | $ | (32,939) | | | $ | (19,830) | | | | | |
| | | | | | | |
| | | | | | | |
| Denominator: | | | | | | | |
| Weighted-Average common shares outstanding, basic | 14,340 | | | 12,498 | | | | | |
| | | | | | | |
| Weighted-Average common shares outstanding, diluted | 14,340 | | | 12,498 | | | | | |
| Net loss per share: | | | | | | | |
| Basic | $ | (2.30) | | | $ | (1.59) | | | | | |
| Diluted | $ | (2.30) | | | $ | (1.59) | | | | | |
________________
(1)During the quarters ended March 31, 2025 and March 31, 2024, the Class A-1 Preferred Stock accrued dividends of approximately $3.9 and $3.0 million, respectively, equal to $0.55 and $0.42 per share, respectfully. During the quarters ended March 31, 2025 and March 31, 2024, the Class B Convertible Preferred Stock accrued dividends of approximately $2.1 and $2.0 million, respectfully, equal to $0.65 and $0.62 per share, respectfully.
The Company’s potentially dilutive securities, which include preferred stock and outstanding awards under the equity plans, have been excluded from the computation of diluted earnings per share as the effect would be anti-dilutive in a net loss position. The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share for the periods indicated:
| | | | | | | | | | | |
| March 31, 2025 | | March 31, 2024 |
| Stock options | 5,539,388 | | | 3,216,233 | |
| Warrants | 974,156 | | | 974,156 | |
| SMI Note | 922,830 | | | 1,461,625 | |
| Preferred stock (as converted to common shares) | 28,124,257 | | | 20,730,507 | |
| Total common stock equivalents | 35,560,631 | | | 26,382,521 | |
13. JOINT VENTURE
The Company is a partial owner of a joint venture company, Starlab Space LLC ("Starlab JV"), which began operating on April 12, 2024 when the Space Act Agreement ("SAA") was novated with National Aeronautical and Space Administration ("NASA"). Through the SAA, the Company will receive financial assistance through Government grants for certain eligible expenses to design, build and maintain a commercial space station. As of March 31, 2025, the Company's ownership stake is 67.0% and the Company's partners, Airbus, Mitsubishi, MDA, and Palantir have ownership stakes of 30.5%, 0.8%, 0.8%, and 1.0%, respectively.
Consolidated Variable Interest Entity
The Company evaluated its interests in Starlab JV and determined that it has a variable interest as of March 31, 2025. Due to the Company’s obligation to absorb losses and the right to receive benefits from the variable interest entity along with the ability to direct the activities that most significantly impact Starlab JV’s economic performance (including control over three of the five seats on the Board of Directors at Starlab JV), the Company was determined to be the primary beneficiary and is therefore consolidating the Starlab JV.
The Company’s consolidated financial statements reflect the performance of the Starlab JV VIE with the Company being the primary beneficiary of the VIE and having incremental power over the Starlab JV. The
Company meets the power and economic criteria for consolidation of the VIE. The Starlab JV is considered a business and therefore no gain or loss was recognized by the Company upon the initial consolidation of the VIE.
The following table presents the assets and liabilities of the Starlab JV included in the Company’s balance sheet, separated by major asset and liability class. These assets can only be used to settle obligations of Starlab JV, and the Company does not have recourse to the liabilities. Creditors of Starlab JV do not have recourse to the Company.
| | | | | | | | | | | |
| ASSETS | March 31,
2025 | | December 31,
2024 |
| Cash and cash equivalents | $ | 8,670 | | | $ | 17,808 | |
| Prepaid expenses and other current assets | 1,542 | | 2,716 |
| Property and equipment, net | 45,422 | | | 36,188 | |
| Operating lease right-of-use assets | 122 | | | 140 | |
| Other assets | 14 | | | 14 | |
| TOTAL ASSETS | $ | 55,770 | | | $ | 56,866 | |
| LIABILITIES | | | |
| Accounts payable | $ | 11,330 | | | $ | 18,781 | |
| Operating lease liabilities | 84 | | | 84 | |
| Accrued expenses and other current liabilities | 14,054 | | | 5,414 | |
| Operating lease liabilities, non-current | 38 | | | 56 | |
| Convertible notes, net | 7,876 | | | 7,435 | |
| Embedded derivatives | 2,767 | | | 2,723 | |
| TOTAL LIABILITIES | $ | 36,149 | | | $ | 34,493 | |
14. COMMITMENTS AND CONTINGENCIES
Non-Cancelable Service Contract Commitments
The Company has a commitment for launch services for the Starlab program. As of March 31, 2025 and December 31, 2024, the Company has a commitment for one launch at a future estimated launch date for $90.0 million. The terms of the arrangement also allow the Company to terminate the agreement for convenience for 25% of the contract value less what has been paid inception to date. If the Company were to cancel the launch services, it would owe $13.5 million to the launch provider.
Non-Cancelable Subscription-Based Services
The Company has a commitment for subscription-based services to assist in payload and launch analyses for the Starlab program and throughout the business units for various contracts. As of March 31, 2025, and December 31, 2024, the Company has a commitment for four annual installments through 2028, totaling $2.0 million.
Litigation
The Company is involved in various legal actions arising in the normal course of business. Based upon the Company’s and its legal counsel’s evaluations of any claims or assessments, management is of the opinion that the outcome of these matters will not have a material adverse effect on the Company’s results of operations, financial position, or cash flows.
15. RELATED PARTIES
The Company had the following balances outstanding from transactions with related parties:
| | | | | | | | | | | |
| |
| March 31,
2025 | | December 31,
2024 |
| Accounts receivable, net- related parties | $ | — | | | $ | — | |
| Accounts payable- related parties | $ | 12 | | | $ | 17 | |
The Company recorded the following amounts from transactions with related parties:
| | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| 2025 | | 2024 | | | | |
| Net sales- related parties | $ | — | | | $ | — | | | | | |
| Expenses- related parties | $ | 164 | | | $ | 140 | | | | | |
16. SUPPLEMENTAL CASH FLOW
Selected cash payments and non-cash activities are as follows:
| | | | | | | | | | | |
| Three Months Ended March 31, |
| (dollars in thousands, except per share data) | 2025 | | 2024 |
| | | |
| | | |
| | | |
| Supplemental non-cash investing and financing activities: | | | |
| Warrants issued for common stock | $ | — | | | $ | 2,039 | |
| Operating lease liabilities arising in exchange for obtaining right-of-use assets | 1,395 | | | 640 | |
| Non-cash services and prepaid expenses contracted in exchange for common stock | $ | 3,000 | | | $ | — | |
17. SUBSEQUENT EVENTS
The Company has evaluated subsequent events through June 2, 2025, the date the Company’s condensed consolidated financial statements were available to be issued based on the retroactive adjustments to the consolidated financial statements to reflect the 1.5-for-1 stock split.
Additional Interest Purchase - Valley Tech Systems, Inc.
On April 11, 2025, the Company purchased the remaining interest in VTS for $7.0 million in cash. As a result, the Company's ownership interest increased from 89.5% to 100%.
Additional Contribution into Starlab JV
On April 8, 2025, the Company contributed an additional $15.0 million into Starlab JV through Voyager Ventures, LLC, a wholly owned subsidiary of the Company. As a result of this qualified financing event, during April the 2024 Convertible Notes converted into Starlab Space LLC equity held by Mercury and Helios. Subsequent to these two transactions, the Company has an ownership interest of 66.7% of Starlab Space LLC, Airbus has an ownership interest of 29.6%, Mitsubishi Corporation has an ownership interest of 0.7%, MDA Space has an ownership interest of 0.7%, Palantir has an ownership interest of 0.9%, Mercury has an ownership interest of 0.7%, and Helios has an ownership interest of 0.6%.
Fundraising
From March 31, 2025 until May 7, 2025 the Company issued approximately 0.4 million and less than 0.1 million shares, respectively, of Class C Preferred Stock and Common Stock for gross proceeds of approximately $19.7 million and $1.1 million, respectively. The gross proceeds are expected to result in $0.4 million of transaction costs associated with the issuance.
Acquisition of Optical Physics Company
On May 2, 2025, the Company acquired Optical Physics Company ("OPC") for a total purchase price of $10.7 million, consisting of $7.0 million in cash and $1.0 million in Common Stock along with contingent consideration of $3.0 million payable in cash upon a significant milestone achievement. The acquisition will be part of the Defense & National Security segment going forward and was a strategic acquisition for program integration.
Additional Contribution into Starlab JV
On May 29, 2025, the Company contributed an additional $35.0 million into Starlab JV through Voyager Ventures, LLC, a wholly owned subsidiary of the Company. Subsequent to this transaction, the Company has an ownership interest of 67.8% of Starlab Space LLC, Airbus has an ownership interest of 28.6%, Mitsubishi Corporation has an ownership interest of 0.7%, MDA Space has an ownership interest of 0.7%, Palantir has an ownership interest of 0.9%, Mercury has an ownership interest of 0.7%, and Helios has an ownership interest of 0.6%.
Credit Facility
On May 30, 2025, we entered into a new senior secured revolving credit facility (the “Credit Facility”) with a syndicate of lenders, led by JP Morgan Chase, providing for aggregate commitments of $200 million. The Credit Facility is intended to be used for working capital and other general corporate purposes. The Credit Facility has an initial maturity of four years from the closing date and includes an uncommitted accordion feature that permits the Company, subject to certain conditions, to request an increase in the aggregate commitments by up to an additional $150 million, for a total potential facility size of $350 million. Borrowings under the Credit Facility bear interest at a variable rate based on Adjusted Term SOFR plus an applicable margin. The applicable margin for borrowings ranges from 2.25% to 2.75%, depending on the Company’s consolidated liquidity levels, as defined in the agreement. In addition, the Company is required to pay an undrawn commitment fee ranging from 0.25% to 0.30% on the unused portion of the Credit Facility, also based on liquidity levels. The Credit Facility contains customary covenants, representations and warranties, and events of default, including, among others, restrictions on the incurrence of additional indebtedness, the creation of liens, certain fundamental changes, and certain restricted payments. The obligations under the Credit Facility are secured by substantially all of the Company’s and its domestic subsidiaries’ assets, with the exception of Starlab, subject to certain customary exceptions.
There were no other material subsequent events which required recognition or additional disclosure as of June 2, 2025.
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders of Voyager Technologies, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Voyager Technologies, Inc. and its subsidiaries (the "Company") as of December 31, 2024 and 2023, and the related consolidated statements of operations, of comprehensive loss, of deficit and mezzanine equity and of cash flows for the years then ended, including the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
/s/ PricewaterhouseCoopers LLP
Denver, Colorado
March 20, 2025, except for the effects of the stock split discussed in Note 2 to the consolidated financial statements, as to which the date is June 2, 2025
We have served as the Company’s auditor since 2022.
Voyager Technologies, Inc.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
| | | | | | | | | | | |
| December 31, |
| 2024 | | 2023 |
| ASSETS | | | |
| Current assets: | | | |
| Cash and cash equivalents | $ | 55,930 | | | $ | 30,279 | |
| Accounts receivable, net | 15,360 | | | 17,078 | |
| Contract assets | 17,304 | | | 15,819 | |
| Inventories | 1,526 | | | 3,102 | |
| Prepaid expenses and other current assets | 11,461 | | | 2,920 | |
| TOTAL CURRENT ASSETS | 101,581 | | | 69,198 | |
| Property and equipment, net | 49,439 | | | 14,006 | |
| Operating lease right-of-use assets | 8,167 | | | 9,530 | |
| Intangible assets, net | 34,684 | | | 44,267 | |
| Goodwill | 46,515 | | | 46,515 | |
| Other assets | 7,210 | | | 5,372 | |
TOTAL ASSETS(1) | $ | 247,596 | | | $ | 188,888 | |
| | | |
| LIABILITIES, MEZZANINE EQUITY, AND EQUITY (DEFICIT) | | | |
| Current liabilities: | | | |
| Accounts payable | $ | 22,787 | | | $ | 13,495 | |
| Contract liabilities | 21,365 | | | 10,301 | |
| Operating lease liabilities | 3,000 | | | 3,278 | |
| Current portion of long-term debt | — | | | 15,334 | |
| SMI promissory note, current | 665 | | | 29,817 | |
| Accrued expenses and other current liabilities | 39,594 | | | 38,993 | |
| TOTAL CURRENT LIABILITIES | 87,411 | | | 111,218 | |
| Term loan, net | 56,991 | | | 30,562 | |
| Operating lease liabilities, non-current | 6,205 | | | 7,337 | |
| Contract liabilities, non-current | 2,762 | | | 6,418 | |
| Convertible notes, net | 7,435 | | | — | |
| Embedded derivatives | 2,723 | | | — | |
| Deferred tax liabilities | 112 | | | 2,672 | |
| SMI promissory note | 23,928 | | | — | |
| Other long-term liabilities | 102 | | | 396 | |
TOTAL LIABILITIES(1) | $ | 187,669 | | | $ | 158,603 | |
| Commitments and Contingencies (Note 20) | | | |
| Mezzanine equity: | | | |
| Class A-1 redeemable preferred stock: $0.0001 par value per share; 7,500,000 shares authorized; 6,967,720 and 6,967,720 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively; Redeemable at the option of the holder with a liquidation preference of $105,581 and $92,233 at December 31, 2024 and December 31, 2023, respectively | $ | 93,496 | | | $ | 80,148 | |
| Redeemable noncontrolling interests | 32,431 | | | 42,757 | |
| Equity (deficit): | | | |
| Class A preferred stock: $0.0001 par value per share; 1 share authorized, issued, and outstanding; liquidation preference of $1 at December 31, 2024 and December 31, 2023, respectively | — | | | — | |
| Class B convertible preferred stock: $0.0001 par value per share; 4,400,000 shares authorized; 3,285,995 and 3,285,995 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively; Redeemable at the option of the holder with a liquidation preference of $146,454 and $137,986 at December 31, 2024 and December 31, 2023, respectively | 132,835 | | | 124,367 | |
| Class C preferred stock: $0.0001 par value per share; 4,600,000 shares authorized; 1,537,818 shares issued and outstanding at December 31, 2024 | 63,464 | | | — | |
| Common stock: $0.0001 par value per share; 375,000,000 shares authorized; 13,297,289 and 12,425,378 shares issued and outstanding at December 31, 2024 and 2023, respectively | 1 | | | 1 | |
| Additional paid-in capital | 15,081 | | | — | |
| Accumulated other comprehensive income (loss) | 28 | | | (189) | |
| Accumulated deficit | (281,113) | | | (216,802) | |
| Total Voyager Technologies, Inc. deficit | (69,704) | | | (92,623) | |
| Noncontrolling interests | 3,704 | | | 3 | |
| TOTAL DEFICIT | (66,000) | | | (92,620) | |
| TOTAL LIABILITIES, MEZZANINE EQUITY, AND DEFICIT | $ | 247,596 | | | $ | 188,888 | |
________________________
(1)Includes balances associated with a consolidated variable interest entity (“VIE”), including amounts reflected in “TOTAL ASSETS” that can only be used to settle obligations of the VIE as well as liabilities of the VIE reflected within “TOTAL LIABILITIES” for which creditors do not have recourse to the general credit of Voyager. Refer to Note 4, “Acquisitions”, for additional information.
The accompanying notes are an integral part of these consolidated financial statements.
Voyager Technologies, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
| | | | | | | | | | | |
| Years Ended December 31, |
| 2024 | | 2023 |
| Net sales | $ | 144,180 | | | $ | 136,062 | |
| Cost of sales | 109,265 | | | 108,277 | |
| Selling, general, and administrative | 62,570 | | | 54,043 | |
| Research and development | 7,611 | | | (18,542) | |
| Impairment losses | 3,594 | | | — | |
| Amortization of acquired intangible assets | 9,582 | | | 6,457 | |
| Loss from operations | $ | (48,442) | | | $ | (14,173) | |
| Other income (expense): | | | |
| Change in fair value of embedded derivatives | $ | 387 | | | $ | — | |
| Loss on debt extinguishment | (9,392) | | | (1,287) | |
| Finance and interest expense | (12,016) | | | (10,590) | |
| Other income, net | 2,127 | | | 1,193 | |
| Loss before income taxes | (67,336) | | | (24,857) | |
| Income tax (benefit) expense | (1,708) | | | 341 | |
| Net loss | (65,628) | | | (25,198) | |
| Net (loss) income attributable to noncontrolling interests | (3,556) | | | 240 | |
| Net loss attributable to Voyager Technologies, Inc. | (62,072) | | | (25,438) | |
| Less: dividends accrued on preferred stock | 21,816 | | | 17,840 | |
| Net loss available to common shareholders | $ | (83,888) | | | $ | (43,278) | |
| | | |
| Net loss per common share: | | | |
| Basic | $ | (6.59) | | | $ | (3.50) | |
| Diluted | $ | (7.01) | | | $ | (3.65) | |
| | | |
| Weighted-average shares outstanding | | | |
| Basic | 12,736,454 | | | 12,361,684 | |
| Diluted | 12,746,375 | | | 12,753,325 | |
The accompanying notes are an integral part of these consolidated financial statements.
Voyager Technologies, Inc.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(in thousands)
| | | | | | | | | | | |
| Years Ended December 31, |
| 2024 | | 2023 |
| Net loss | $ | (65,628) | | | $ | (25,198) | |
| Other comprehensive income (loss), net of tax: | | | |
| Foreign currency translation adjustments | $ | 217 | | | $ | (14) | |
| Total comprehensive loss | (65,411) | | | (25,212) | |
| Comprehensive (loss) income attributable to noncontrolling interests | (3,556) | | | 240 |
| Comprehensive loss attributable to Voyager Technologies, Inc. | $ | (61,855) | | | $ | (25,452) | |
The accompanying notes are an integral part of these consolidated financial statements.
Voyager Technologies, Inc.
CONSOLIDATED STATEMENTS OF DEFICIT and MEZZANINE EQUITY
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Common Stock | | Preferred Stock | | Additional Paid-in Capital | | Accumulated Other Comprehensive Loss | | Accumulated Deficit | | Total Voyager Technologies, Inc. Equity (Deficit) | | Non-controlling Interests | | Total Equity (Deficit) | | | Total Mezzanine Equity |
| Shares | | Amount | | Shares | | Amount | | | | | | | | |
| Balance at December 31, 2022 | 11,771 | | | $ | 1 | | | 3,129 | | | $ | 110,682 | | | $ | — | | | $ | (175) | | | $ | (179,181) | | | $ | (68,673) | | | $ | 436 | | | $ | (68,237) | | | | $ | 145,067 | |
| Net income (loss) | — | | | — | | | — | | | — | | | — | | | — | | | (25,438) | | | (25,438) | | | (60) | | | (25,498) | | | | 300 | |
| Foreign currency translation adjustments | — | | | — | | | — | | | — | | | — | | | (14) | | | — | | | (14) | | | — | | | (14) | | | | — | |
| Stock-based compensation | 178 | | | — | | | — | | | — | | | 2,707 | | | — | | | — | | | 2,707 | | | — | | | 2,707 | | | | — | |
| Options exercised | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | | 5 | |
| Issuance of Class B convertible preferred stock, net | — | | | — | | | 157 | | | 5,917 | | | — | | | — | | | — | | | 5,917 | | | — | | | 5,917 | | | | — | |
| Adjustment to reflect redemption value of redeemable noncontrolling interests | — | | | — | | | — | | | — | | | (3,926) | | | — | | | — | | | (3,926) | | | — | | | (3,926) | | | | 3,926 | |
| Dividends accrued on Class B convertible preferred stock | — | | | — | | | — | | | 7,768 | | | (7,768) | | | — | | | — | | | — | | | — | | | — | | | | — | |
| Dividends accrued on Class A-1 redeemable preferred stock | — | | | — | | | — | | | — | | | (10,072) | | | — | | | — | | | (10,072) | | | — | | | (10,072) | | | | 10,072 | |
| Warrants issued for common stock | — | | | — | | | — | | | — | | | 1,633 | | | — | | | — | | | 1,633 | | | — | | | 1,633 | | | | — | |
| Acquisition of ZIN | 369 | | | — | | | — | | | — | | | 3,485 | | | — | | | — | | | 3,485 | | | — | | | 3,485 | | | | — | |
| Joint venture contribution | — | | | — | | | — | | | — | | | (3) | | | — | | | — | | | (3) | | | 3 | | | — | | | | — | |
| Redemptions of redeemable noncontrolling interests | 107 | | | — | | | — | | | — | | | 1,761 | | | — | | | — | | | 1,761 | | | (376) | | | 1,385 | | | | (36,465) | |
| Reclass of negative additional paid-in capital | — | | | — | | | — | | | — | | | 12,183 | | | — | | | (12,183) | | | — | | | — | | | — | | | | — | |
| Balance at December 31, 2023 | 12,425 | | | $ | 1 | | | 3,286 | | | $ | 124,367 | | | $ | — | | | $ | (189) | | | $ | (216,802) | | | $ | (92,623) | | | $ | 3 | | | $ | (92,620) | | | | $ | 122,905 | |
| Net income (loss) | — | | | — | | | — | | | — | | | — | | | — | | | (62,072) | | | (62,072) | | | (3,822) | | | (65,894) | | | | 266 | |
| Foreign currency translation adjustments | — | | | — | | | — | | | — | | | — | | | 217 | | | — | | | 217 | | | — | | | 217 | | | | — | |
| Stock-based compensation | — | | | — | | | — | | | — | | | 3,761 | | | — | | | — | | | 3,761 | | | — | | | 3,761 | | | | — | |
| Options Exercised | 2 | | | — | | | — | | | — | | | 28 | | | — | | | — | | | 28 | | | — | | | 28 | | | | — | |
| Issuance of Class C preferred stock, net | — | | | — | | | 1,538 | | | 63,464 | | | — | | | — | | | — | | | 63,464 | | | — | | | 63,464 | | | | — | |
| Dividends accrued on Class B convertible preferred stock | — | | | — | | | — | | | 8,468 | | | (8,468) | | | — | | | — | | | — | | | — | | | — | | | | — | |
| Dividends accrued on Class A-1 redeemable preferred stock | — | | | — | | | — | | | — | | | (13,348) | | | — | | | — | | | (13,348) | | | — | | | (13,348) | | | | 13,348 | |
| Warrants issued for common stock | — | | | — | | | — | | | — | | | 1,135 | | | — | | | — | | | 1,135 | | | — | | | 1,135 | | | | — | |
| Warrant reclassification | — | | | — | | | — | | | — | | | (2,546) | | | — | | | — | | | (2,546) | | | — | | | (2,546) | | | | — | |
| Shares issued for services | 600 | | | — | | | — | | | — | | | 12,810 | | | — | | | — | | | 12,810 | | | — | | | 12,810 | | | | — | |
| Sale of noncontrolling interest | — | | | — | | | — | | | — | | | 14,403 | | | — | | | — | | | 14,403 | | | 7,523 | | | 21,926 | | | | — | |
| Redemptions of redeemable noncontrolling interests | 14 | | | — | | | — | | | — | | | (495) | | | — | | | — | | | (495) | | | — | | | (495) | | | | (10,592) | |
| SMI Note Settlement | 256 | | | — | | | — | | | — | | | 5,562 | | | — | | | — | | | 5,562 | | | — | | | 5,562 | | | | — | |
| Reclass of negative additional paid-in capital | — | | | — | | | — | | | — | | | 2,239 | | | — | | | (2,239) | | | — | | | — | | | — | | | | — | |
| Balance at December 31, 2024 | 13,297 | | | $ | 1 | | | 4,824 | | | $ | 196,299 | | | $ | 15,081 | | | $ | 28 | | | $ | (281,113) | | | $ | (69,704) | | | $ | 3,704 | | | $ | (66,000) | | | | $ | 125,927 | |
The accompanying notes are an integral part of these consolidated financial statements
Voyager Technologies, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
| | | | | | | | | | | |
| Years Ended December 31, |
| 2024 | | 2023 |
| Cash Flows from Operating Activities: | | | |
| Net loss | $ | (65,628) | | | $ | (25,198) | |
| Adjustments to reconcile net loss to net cash used in operating activities: | | | |
| Depreciation and amortization | $ | 13,595 | | | $ | 10,294 | |
| Stock-based compensation | 3,761 | | | 2,707 | |
| Impairment losses | 3,594 | | | — | |
| Amortization of operating lease right-of-use assets | 2,782 | | | 2,635 | |
| Loss on debt extinguishment | 9,392 | | | 1,287 | |
| Amortization of debt issuance costs and other non-cash interest expense | 5,667 | | | 4,139 | |
| Reduction in fair value of earnout | (5,659) | | | (3,874) | |
| Deferred taxes | (2,614) | | | (645) | |
| Non-cash services acquired | 12,669 | | | — | |
| Other | (160) | | | 254 | |
| Change in operating assets and liabilities, net of acquisitions: | | | |
| Accounts receivable | (4,432) | | | 526 | |
| Prepaid expenses and other current assets | 101 | | | (261) | |
| Contract assets | (1,485) | | | (1,986) | |
| Inventory | 1,576 | | | 1,487 | |
| Other assets | (5,432) | | | (560) | |
| Accounts payable | (6,070) | | | (1,559) | |
| Contract liabilities | 7,408 | | | (5,754) | |
| Accrued expenses | 8,554 | | | 3,294 | |
| Operating lease liabilities | (2,829) | | | (2,170) | |
| Other liabilities | (292) | | | 3 | |
| Net cash used in operating activities | $ | (25,502) | | | $ | (15,381) | |
| | | |
| Cash Flows from Investing Activities: | | | |
| Purchases of property and equipment | $ | (82,703) | | | $ | (17,210) | |
| Grant funding for property and equipment | 54,930 | | | 26,858 | |
| Acquisitions, net of cash acquired | — | | | 2,050 | |
| Purchases of investment | — | | | (100) | |
| Net cash (used in) provided by investing activities | $ | (27,773) | | | $ | 11,598 | |
| | | |
| Cash Flows from Financing Activities: | | | |
| Proceeds from term loan, net | $ | 57,922 | | | $ | 47,100 | |
| Repayment of term loan | (56,574) | | | (35,275) | |
| Proceeds from the issuance of Class B convertible preferred stock, net | — | | | 3,128 | |
| Proceeds from the issuance of Class C preferred stock, net | 66,598 | | | — | |
| Redemptions of redeemable noncontrolling interests | (10,739) | | | (6,705) | |
| Sale of redeemable noncontrolling interest | 13,425 | | | — | |
| Repayment of line of credit | — | | | (4,339) | |
| Proceeds from the convertible note | 10,097 | | | — | |
| Other | (1,772) | | | (1,978) | |
| Net cash provided by financing activities | $ | 78,957 | | | $ | 1,931 | |
| | | |
| Effect of foreign exchange on cash and cash equivalents | $ | (31) | | | $ | 9 | |
| Net increase (decrease) in cash and cash equivalents | 25,651 | | | (1,843) | |
| Cash and cash equivalent at the beginning of the period | 30,279 | | | 32,122 | |
| Cash and cash equivalents at the end of the period | $ | 55,930 | | | $ | 30,279 | |
The accompanying notes are an integral part of these consolidated financial statements.
Notes to Consolidated Financial Statements
(Tabular amounts in thousands of dollars, unless otherwise noted)
1. ORGANIZATION
Nature of Business
Voyager Technologies, Inc. (“Voyager” or the “Company”), incorporated in the state of Delaware on August 15, 2019, is a space technology company with over 35 years of spaceflight heritage combined amongst its operating entities. Our business model leverages global public-private partnerships to deliver mission-critical capabilities and on-orbit services to civil and defense government agencies, academic and research institutions, and private sector players. Voyager has enabled thousands of payloads, systems, and hardware elements to enter space while also working to develop next generation space stations. Voyager’s products and capabilities under continuous development include Starlab, a privately owned, free-flying crewed space station; advanced spacecraft communications; and our controllable solid-state propulsion technology.
Our growth strategy includes strategic acquisitions that augment our technology and product offerings. The Company has completed seven acquisitions since January 1, 2020, which comprise our three business segments: Defense & National Security, Space Solutions, and Starlab Space Stations. Collectively, these acquisitions have provided us with a wide variety of space technology solutions that enable us to meet our objective of bettering humanity’s future by accelerating the development of a sustainable space economy. Our previous significant acquisitions include XO Markets Holdings, Inc, Valley Tech Systems, Inc, Space Micro, Inc, and ZIN Technologies, Inc, as of December 31, 2024.
Liquidity risks and uncertainties
Since inception, the Company has incurred cumulative losses from operations and has an accumulated deficit of $281.1 million and $216.8 million on December 31, 2024 and 2023, respectively. The Company has funded its operations and capital needs primarily through net proceeds received from the sale of preferred and common stock (Note 14, “Stockholders’ Equity”) and proceeds from term loan (Note 11, “Debt”). The Company will need to raise additional funds to meet its long-term strategic plans and management believes it will be able to obtain additional financing to fund its operations. Management’s plans include, but are not limited to, generating revenue from engineering services and product sales to customers and seeking external sources of liquidity.
The Company believes its existing cash balances and cash from operations will be sufficient to fund ongoing operations through at least one year from the date the financial statements were available to be issued. However, there can be no assurance that the Company will be successful in achieving its strategic plans, that the Company’s cash balance and future capital raises will be sufficient to support its ongoing operations, or that any additional financing will be available in a timely manner or on acceptable terms, if at all. If the Company is unable to raise sufficient financing when needed or events or circumstances occur such that the Company does not meet its strategic plans, the Company may be required to reduce certain discretionary spending and may be unable to develop or enhance new and existing products, which could adversely affect its ability to achieve its intended business objectives. The Company, while made up of businesses that have historical track records of operations, is still in a growth phase and is continuing to make ongoing investments in growth opportunities. Future performance is not guaranteed and there could be factors within or outside the Company’s control that could unfavorably influence the Company’s ability to meet its goals.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying consolidated financial statements include the accounts of Voyager and our consolidated subsidiaries, and have been prepared in conformity with accounting principles generally accepted in the United States (“US GAAP”). The consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. All intercompany amounts have been eliminated in consolidation.
Common Stock Split
On May 30, 2025, the Company effected a 1.5-for-1 forward split of its common stock and a proportionate increase in the number of authorized shares. All share and per share information, including share based compensation, throughout the annual consolidated financial statements has been retroactively adjusted to reflect the stock split. The shares of common stock retain a par value of $0.0001 per share. Accordingly, an amount equal to the par value of the increased shares resulting from the stock split was reclassified from capital in excess of par value to common stock.
Use of Estimates
The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Some of these judgments can be subjective and complex, and, consequently, actual results may differ from these estimates. On an ongoing basis, management evaluates its estimates, including those related to the valuation of acquired intangibles, intangibles, long-lived assets, redeemable noncontrolling interests, realization of tax assets and estimates of tax liabilities, valuation of equity securities and financial instruments, estimated useful lives of long-lived assets, and reported amounts of revenues and expenses during the reporting period.
Estimates and assumptions are based on current facts, historical experience, and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of revenues and expenses that are not readily apparent from other sources. Actual results may differ materially and adversely from these estimates. To the extent there are material differences between the estimates and actual results, the Company’s future results of operations could be affected.
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and trade accounts receivable. The Company maintains cash in demand deposits accounts with high credit quality financial institutions and limits the amount of credit exposure with any one financial institution. The Company performs ongoing credit evaluations of its customers but does not generally require collateral to support customer receivables.
Significant customers are those which represent more than 10 percent of the Company’s total net sales or gross accounts receivable balance at each balance sheet date. Our largest customer is the U.S. government. Sales to the U.S. government accounted for 83.9% and 69.0% of sales during the years ended December 31, 2024 and 2023, respectively. Refer to Note 16, “Net Sales” for additional disaggregation of net sales. The U.S. government accounted for 76.3% and 83.0% of accounts receivable as of December 31, 2024 and 2023, respectively. For purposes of disclosures and evaluation of concentration risk, the Company considers all U.S. government entities to be one customer. Additionally, for determination of commercial or government classification of sales, the Company considers the sales and receivables to be governmental if the source of funding for the project originates from the U.S. government, even if contracting through an intermediary as its direct customer.
Fair Value of Financial Instruments
The Company accounts for certain assets and liabilities at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value guidance establishes a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. An asset or liability’s level is based upon the lowest level of input that is significant to the fair value measurement. The guidance requires that assets and liabilities carried at fair value be classified and disclosed in one of the following three categories:
Level 1Quoted prices in active markets for identical assets or liabilities.
Level 2Inputs other than Level 1 prices for similar assets or liabilities that are directly or indirectly observable in the marketplace.
Level 3Unobservable inputs which are supported by little or no market activity and values determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation.
The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.
The carrying amounts of certain financial instruments, including cash and cash equivalents, accounts payable, and accounts receivable approximate their fair value due to the short-term maturity of such instruments. The carrying value of debt approximates its fair value as interest incurred is variable based on market rates.
The table below provides a summary of the changes in fair value of fair valued instruments using significant unobservable inputs between December 31, 2024 and 2023:
| | | | | | | | | | | |
| (In Thousands) | Embedded derivatives | | Earnout Liability |
| Balance as of December 31, 2023 | $ | — | | | $ | 5,824 | |
| Fair value on issuance of convertible notes | 3,110 | | | — | |
| Accretion of liability recognized as interest expense | — | | | 248 | |
| Payment of earnout liability | — | | | — | |
| Change in fair value | (387) | | | (5,659) | |
| Balance as of December 31, 2024 | $ | 2,723 | | | $ | 413 | |
Fair Value of Financial Instruments: Earnout Liability
Pioneer Earnout Liability
The Pioneer Earnout Liability is related to a contingent consideration arrangement from the acquisition of Pioneer Invention, LLC, which was completed in the year ended December 31, 2020. The arrangement requires additional cash paid to the seller based on a cumulative EBITDA target during the 36-month period following the closing date, up to a maximum of approximately $0.4 million. The fair value of the Pioneer Earnout Liability was estimated using probability-weighted discounted cash flow models with significant inputs that are not observable in the market and thus represents a Level 3 fair value measurement. The discounted cash flows incorporate Level 3 inputs including estimated discount rates that the Company believes market participants would consider relevant in pricing and the projected timing and amount of cash flows, which are estimated and developed, considering the uncertainties associated with the obligations. The Pioneer Earnout Liability was paid for its maximum value during the year ended December 31, 2023.
ZIN Earnout Liability
The ZIN Earnout Liability is related to a contingent consideration arrangement from the acquisition of ZIN Technologies, Inc, which was completed in the year ended December 31, 2023. The arrangement requires additional cash and equity be paid to the seller based upon achievement of a backlog target as of June 30, 2024, up to a maximum of approximately $10.3 million. The fair value of the ZIN Earnout Liability was estimated using probability-weighted discounted cash flow models with significant inputs that are not observable in the market and thus represents a Level 3 fair value measurement. The discounted cash flows incorporate Level 3 inputs including estimated discount rates that the Company believes market participants would consider relevant in pricing and the projected timing and amount of cash flows, which are estimated and developed, considering the uncertainties associated with the obligations. The Earnout Liability was recorded at its maximum and is included in accrued expenses and other current liabilities on the consolidated balance sheets.
ZIN Technologies, Inc’s backlog achievement was less than the $10.3 million target described above, which resulted in a proportional reduction of the total amount to be paid out due to the resulting loss of target achievement that was previously expected to be met. The reduction in fair value of the earnout is recognized in selling, general and administrative expense on the consolidated statements of operations. As of December 31, 2024, the earnout has not been paid.
Fair Value of Financial Instruments: Warrants for Common Stock
The Company’s Common Stock warrants (Note 14, “Stockholders’ Equity”) are either equity-classified and measured at the issuance-date fair value based on Level 3 inputs or liability-classified and measured at fair value based on Level 3 inputs.
Fair Value of Financial Instruments: Embedded Derivatives
The Company analyzed the conversion features of the 2024 Convertible Notes (as defined in Note 11, “Debt”) for derivative accounting treatment and determined that certain embedded conversion features should be classified as a derivative. The Company bifurcated the share-settled redemption feature of the 2024 Convertible Notes and recorded the conversion feature as a $3.1 million derivative liability upon issuance of the 2024 Convertible Notes. The derivative liability related to the 2024 Convertible Notes is recorded as a discount to the convertible notes, net in the consolidated balance sheets. The embedded debt derivative liability is recorded at fair value, and remeasured every reporting period, with changes in fair value recognized as a component of other income (expense), net.
The Company performed a fair value analysis over the embedded derivative feature using the Scenario Based Method utilizing the “with or without method”. The fair value of the embedded derivative feature was determined based on Level 3, unobservable inputs. The estimation process for the fair value of the embedded derivative required the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. The original value of the derivative was $3.1 million based on Level 3 inputs using the scenario based method within the “with and without” method. Measurement was based on probability weighted scenarios including 75.0% probability of qualified financing by June 30th, 2025, a 15.0% mandatory conversion discount, and a 15.8% discount rate.
Foreign Currency Translation and Remeasurement
Assets and liabilities of non-U.S. subsidiaries that operate in a local currency environment, where that local currency is the functional currency, are translated to U.S. dollars at exchange rates at the balance sheet date. Net sales and expenses are translated at monthly average exchange rates. The Company accumulates net translation adjustments in equity as a component of accumulated other comprehensive loss. For non-U.S. subsidiaries whose functional currency is the U.S. dollar, transactions that are denominated in foreign currencies are remeasured in U.S. dollars, and any resulting gains and losses are reported in other income, net on the consolidated statements of operations. For the year ended December 31, 2024, the Company recorded foreign currency transaction gains of less than $0.2 million. For the year ended December 31, 2023, the Company recorded foreign currency transaction losses of less than $0.2 million.
Cash and Cash Equivalents
Cash and cash equivalents consist of highly liquid investments with original maturities of three months or less at the time of purchase. The Company does not have any restricted cash as of December 31, 2024 or 2023.
Accounts Receivable and Allowance for Expected Credit Loss
Accounts receivable consist of amounts due from customers and are recorded at the invoiced amount. The Company assesses the collectability of its outstanding receivables and estimates the need for an allowance by considering historical losses, the age of the receivable balance, credit quality of our customers, current economic conditions, and other factors that may affect the customers’ ability to pay. In the years ended December 31, 2024 and 2023, the Company recorded an allowance for expected credit losses of $0.7 million and $0.5 million,
respectively. During the years ended December 31, 2024 and 2023, less than $0.4 million and $0.3 million of receivables were written off, respectively.
Prepaid Expenses
Prepaid expenses consist of compensation to vendors in advance of products received or services rendered, which are expected to be received or rendered on a later date. Prepaid expenses also consist of compensation in the form of equity holdings for services to be rendered by vendors. As of the years ended December 31, 2024 and 2023, the Company had prepaid expenses of $10.8 million and $2.3 million, respectively. Prepaid expenses for the Company consist of timing differences between payments rendered and products and services received primarily for insurance, rent, software, and vendor related services. As of the year ended December 31, 2024, the Company held $8.5 million in prepaid expenses for services still to be rendered by a vendor in exchange for compensation in the form of equity holdings.
Property and Equipment, Net
Property and equipment are recorded at original cost, less accumulated depreciation. Tangible assets acquired through a business combination are recorded at fair value at the time of acquisition. Costs of additions and improvements are capitalized; maintenance and repairs are charged to expense as incurred. Upon the sale or disposal of property and equipment, the related cost and accumulated depreciation or amortization are written-off and any gain or loss is reported in selling, general, and administrative expenses on the consolidated statements of operations.
Depreciation is based on the estimated useful lives of the assets using the straight-line method and is included in selling, general and administrative expenses or cost of sales based upon the type and use of the asset.
Expected useful lives for property, plant and equipment are reviewed at least annually. Estimated useful lives are as follows:
| | | | | | | | |
| Asset Class | | Estimated useful life |
| Equipment in orbit | | 5-10 years |
| Machinery and equipment | | 5-8 years |
| Leasehold improvements | | Lesser of lease term or useful life |
| IT related equipment | | 2-5 years |
Inventories
Inventories consist primarily of raw materials used to satisfy long-term contracts. Inventories are recorded at actual acquisition costs and adjusted to the lower of cost or estimated net realizable value. Inventories are charged to cost of sales as materials are placed into production on a long-term contract. The Company will assess the inventory carrying value and reduce it, if necessary, to its net realizable value based on forecasted usage. During the years ended December 31, 2024 and 2023, the Company recorded a reduction to the cost basis of inventory (“inventory reserve”) of $0.1 million and $0.2 million, respectively.
Leases
At the inception of a contract, the Company determines whether the contract is, or contains, a lease. A lease is a contract that provides the right to control and obtain substantially all of the economic benefit from an identified asset for a period of time in exchange for consideration. The accounting classification of each lease is based on whether the arrangement is effectively a financed purchase of the underlying asset (finance lease) or not (operating lease). Leases with a term of 12 months or less are considered short-term leases and are not recognized on the balance sheet. For leases other than short-term leases, the Company recognizes right-of-use assets and lease liabilities at the commencement date of the lease, measured based on the present value of minimum lease payments over the lease term. Right-of-use assets represent the Company’s right to use the underlying asset during the lease term and are adjusted for any prepaid or accrued lease payments and unamortized lease incentives or initial direct costs. Lease liabilities represent the Company’s obligation to make future lease payments. The lease term is the non-cancellable
period of the lease and includes options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. The Company’s lease arrangements typically do not have a readily determinable implicit interest rate. In such situations, the Company uses its incremental borrowing rate (“IBR”) in determining the present value of minimum lease payments. The IBR is the estimated rate of interest that the Company would have to pay to borrow the aggregate lease payments on a collateralized basis over the lease term and requires judgment by the Company. Lease agreements with lease and non-lease components are accounted for as a single lease component.
The lease expense for operating leases is recognized on a straight-line basis over the lease term. The associated assets are recorded on the consolidated balance sheets in operating lease right-of-use assets. The associated liabilities are recorded in operating lease liabilities (current portion) and operating lease liabilities (non-current portion).
Business Combinations
Business combinations are accounted for using the acquisition method. The Company allocates the purchase price of acquired entities to the underlying tangible and identifiable intangible assets acquired, liabilities assumed, and any noncontrolling interests assumed based on their respective estimated fair values. The excess purchase price over the fair value of identifiable net assets and intangibles acquired is recorded as goodwill. Buyer acquisition-related expenses incurred in connection with business combinations, other than expenses associated with the issuance of debt or equity securities, are excluded from the purchase consideration in accordance with ASC 805, Business Combinations. These costs are expensed as incurred and recognized in selling, general, and administrative expense on the consolidated statements of operations.
For contingent consideration arrangements, a liability is recognized at fair value as of the acquisition date, with subsequent fair value adjustments recognized in selling, general, and administrative expense on the consolidated statements of operations.
Asset acquisitions are accounted for using a cost accumulation model, with the cost of the acquisition allocated to the acquired assets based on their relative fair values. Assets acquired and liabilities assumed are recognized at cost, which is the consideration the acquirer transfers to the seller, including direct transaction costs, on the acquisition date. Goodwill is not recognized in an asset acquisition.
Redeemable Noncontrolling Interests
Redeemable noncontrolling interests represent minority interests in consolidated entities that may be redeemed by the Company for cash or equity interests in the Company at the option of the minority interest holder.
The redeemable noncontrolling interest is recorded initially at fair value at the time of acquisition through the purchase price allocation (Note 4, “Acquisitions”) and is estimated using the income and market approaches. Subsequently, the value of the redeemable noncontrolling interests is adjusted each reporting period for any income or loss attributable to the noncontrolling interest. After the attribution of the subsidiary’s net income or loss, the Company will adjust by accreting the noncontrolling interests to its redemption value (the “Mezzanine Adjustment”), as applicable, assuming the redeemable noncontrolling interest was redeemable at the reporting date. The carrying amount of noncontrolling interests will equal the higher of the amount resulting from the attribution of net income or loss or the redemption value resulting from the Mezzanine Adjustment. Mezzanine Adjustments are recorded in additional paid-in capital on the consolidated balance sheets and are not reflected in the net losses attributable to Voyager. If the redemption value exceeds the fair value of the noncontrolling interest on a cumulative basis, a Mezzanine Adjustment is recorded in accumulated deficit on the consolidated balance sheets.
Intangible Assets, Net
Intangible assets consist of acquired trade names, customer contracts, and developed technology. Intangible assets with finite lives are amortized based on their pattern of economic benefit over their estimated useful lives and reviewed periodically for impairment.
| | | | | | | | |
| Asset Class | | Estimated useful life |
| Trade name | | 2-11 years |
| Customer relationships | | 1-11 years |
| Developed technology | | 5-11 years |
Impairment of Long-Lived Assets Including Intangible Assets
The Company evaluates the recoverability of its long-lived assets, including intangible assets, whenever events or changes in circumstances indicate the carrying amount of an asset or asset group may not be recoverable. If the Company determines that the carrying amount of an asset or asset group is not recoverable based upon the undiscounted expected future cash flows of the asset or asset group, the Company records an impairment loss, if any, equal to the excess of carrying amount over the estimated fair value of the asset or asset group. There was no impairment recorded for the years ended December 31, 2024 and December 31, 2023.
Goodwill
Goodwill is the amount by which the purchase price exceeded the fair value of the net identifiable assets acquired and liabilities assumed in a business combination on the date of acquisition. The Company tests goodwill for impairment annually as of October 1 or when events and circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying value. The Company has four reporting units that were determined based on similar economic characteristics, financial metrics and product and servicing offerings. In circumstances where a qualitative analysis indicates that the fair value of a reporting unit does not exceed its carrying value, a quantitative analysis is performed using an income approach. The Company performed the qualitative assessment at the reporting unit level as of October 1, 2024 and found that there were no indicators that the fair value is more likely than not below the carrying value for its reporting units.
Investments
Investments in entities in which the Company does not have a controlling interest but does have the ability to exercise significant influence over the investee’s operating and financial matters are accounted for using the equity method. These investments are initially recorded at cost and subsequently adjusted each reporting period to reflect the Company’s proportionate share of the investee’s net earnings or losses, dividends paid, contributions made, and certain other adjustments, as appropriate.
The Company may also invest in entities in which the Company has neither control of nor significant influence over the investee. For such investments without readily available fair values, the Company has elected the measurement alternative to initially recognize them at cost with subsequent adjustments for any impairments and/or observable price changes with a same or similar security from the same issuer recognized within net earnings. These investments are included in other assets on the consolidated balance sheets. The Company’s investments in these equity securities are not classified in the fair value hierarchy due to the use of these measurement methods.
The Company periodically evaluates its investments for impairment due to declines considered to be other than temporary. If the Company determines that a decline in fair value is other than temporary, an impairment is recognized and a new basis in the investment is established. During the year ended December 31, 2024, the Company recorded an impairment loss of $3.6 million. There was no impairment recorded for the year ended December 31, 2023.
Revenue Recognition
The Company accounts for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. The Company recognizes revenue upon satisfying the performance obligations identified in the contract, which is achieved as services are rendered, upon completion of a service, or through the transfer of control of the promised good or service to the customer either at a point-in-time or over time.
Each promised good or service within a contract is accounted for separately under the guidance of ASC 606, Revenue from Contracts with Customers, if they are distinct. Promised goods or services not meeting the criteria for being a distinct performance obligation are bundled into a single performance obligation with other goods or services that together meet the criteria for being distinct. The appropriate allocation of the transaction price and recognition of revenue is then applied for the bundled performance obligation.
Once the Company identifies the performance obligations, the Company determines the transaction price, which includes estimating the amount of variable consideration to be included in the transaction price, if any. The Company’s contracts generally do not contain penalties, credits, price concessions, or other types of potential variable consideration. Prices are fixed at contract inception and are not contingent on performance or any other criteria. On long-term contracts, the portion of the payments retained by the customer is not considered a significant financing component. At contract inception, the Company also expects that the lag period between the transfer of a promised good or service to a customer and when the customer pays for that good or service will not constitute a significant financing component. Many of the Company’s long-term contracts have milestone payments, which align the payment schedule with the progress towards completion on the performance obligation. On some contracts, the Company may be entitled to receive an advance payment, which is not considered a significant financing component because it is used to facilitate inventory demands at the onset of a contract and to safeguard the Company from the failure of the other party to abide by some or all of their obligations under the contract.
Control is transferred over time for: (a) certain contracts under which the Company produces products with no alternative use, and for which it has an enforceable right to recover costs incurred plus a reasonable profit margin for work completed to date; and (b) certain other contracts under which the Company creates or enhances a customer-owned asset while performing design and development services. Under the cost-to-cost method, revenue is recognized for these contracts based on the Company’s efforts toward satisfying a performance obligation relative to the total expected efforts, which is measured using the proportion of costs incurred to date to the total cost estimate-at-completion (EAC) of the performance obligation. Revenue for the current period is recorded at an amount equal to (i) the ratio of costs incurred to date, (ii) divided by total estimated costs, multiplied by (iii) the transaction price, less (iv) cumulative revenue recognized in prior periods. Contract costs include all direct material and labor costs and any indirect costs related to contract performance.
These projections require the Company to make numerous assumptions and estimates when determining the total estimated costs of completion, including items such as development costs, performance of subcontractors, availability and cost of materials, labor productivity and cost, overhead, and capital costs. The Company reviews its cost estimates on a periodic basis, or when circumstances change and warrant a modification to a previous estimate. Cost estimates are largely based on negotiated or estimated purchase contract terms, historical performance trends, and other economic projections. For the year ended December 31, 2024, the Company recorded an aggregate unfavorable EAC adjustment across programs of $5.2 million, which resulted in a $2.2 million reduction of revenue included within the results of operations for the year ended December 31, 2024, which was the result of an aggregation of individually immaterial EAC adjustments on contracts. The reduction of revenue had a negative impact of $(0.58) per share within the 2024 diluted loss per share results. For the year ended December 31, 2023, the Company recorded an aggregate unfavorable EAC adjustment across programs of $3.9 million, which resulted in a $1.7 million reduction of revenue included within the results of operations for the year ended December 31, 2023, which was the result of an aggregation of individually immaterial EAC adjustments on contracts. The reduction of revenue had a negative impact of $(0.47) per share within the 2023 diluted loss per share results. For the years ended December 31, 2024 and 2023 there were no material favorable EAC adjustments, neither individually nor in the aggregate.
When estimates of total costs to be incurred on a contract exceed total estimates of the transaction price, a provision for the entire loss is determined at the contract level and is recorded in the period in which the loss is evident, which the Company refers to as a loss provision. For the years ended December 31, 2024 and 2023 there were no material loss provisions recorded, neither individually nor in the aggregate.
For certain contracts, the Company recognizes revenue in the amount for which the Company has a right to invoice the customer if that amount corresponds directly with the value of our performance completed to date. These contracts are primarily related to agreements that are done with customers on a cost plus or time and materials basis.
For performance obligations in which control does not continuously transfer to the customer, the Company recognizes revenue at the point in time in which each performance obligation is fully satisfied. This coincides with the point in time the customer obtains control of the product or service, which typically occurs upon customer acceptance or receipt of the product or service, given that the Company maintains control of the product or service until that point.
For certain other contracts revenue is recognized over time based on the satisfaction of performance obligations consisting of a series of distinct goods and services, which is evidenced by the shipment or delivery of the product to the customer.
Net sales in the income statement consists entirely of revenue from contracts with customers, net of sales discounts.
Contract Balances
Contract balances result from the timing of revenue recognized, billings and cash collections, and the generation of contract assets and liabilities.
Contract assets reflect revenue recognized and performance obligations satisfied in advance of customer billing. Receivables represent rights to consideration that are unconditional. Such rights are considered unconditional if only the passage of time is required before payment of that consideration is due. Contract assets reflect revenue recognized and performance obligations satisfied or partially satisfied in advance of customer billing.
Contract liabilities primarily consist of advance payments from customers and deferred revenue. Changes in contract liabilities are primarily due to the timing difference between the Company’s performance of services and payments from customers. To determine revenue recognized from contract liabilities during the reporting periods, the Company allocates revenue to individual contract liability balances and applies revenue recognized during the reporting periods first to the beginning balances of contract liabilities until the revenue exceeds the balances.
Debt Issuance Costs and Debt Discounts
Debt discounts and premiums are included as an addition or offset to the carrying value of the related debt and amortized to finance and interest expense, net over the remaining term of the underlying debt.
Debt issuance costs are recognized as a deduction from the carrying amount of the related debt liability, except for debt issuance costs related to line of credit arrangements which are presented as an asset regardless of any outstanding borrowings on the line of credit arrangement. All debt issuance costs are amortized to finance and interest expense, net over the remaining term of the underlying debt using the straight-line method.
Stock-Based Compensation
The Company’s board of directors authorizes and issues stock-based awards consisting of restricted stock awards and stock options to employees and non-employees. Stock-based awards granted to non-employees are accounted for in the same manner as awards granted to employees.
Restricted stock awards are measured at the estimated grant-date fair value of the award and amortized to stock-based compensation expense on a straight-line basis over the requisite service period.
Stock option grants are valued using the Black-Scholes option pricing model. The Company is a private company and lacks company specific historical and implied volatility information; therefore, it estimates its expected stock volatility based on the historical volatility of a set of publicly traded peer companies. Due to the lack of historical exercise data, the expected term of the Company’s stock options for employees has been determined utilizing a weighted average period the Company expects the stock options to remain outstanding, based on the Company’s best estimate of an initial public offering versus staying private. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve. The expected dividend yield is zero as the Company has never paid cash dividends on its common stock and does not expect to pay any cash dividends in the foreseeable future.
Generally, stock-based awards vest either 25% one year after the grant date and the remaining shares thereafter in 36 equal monthly installments, or one-third on each anniversary of the grant date for three years, subject to continuous service with the Company.
The assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. These inputs are subjective and may require significant analysis and judgment to develop, including the underlying fair value of the Company’s Common Stock. The Company accounts for forfeitures as they occur. Stock-based compensation costs are presented in selling, general, and administrative expense on the consolidated statements of operations.
Research and Development Costs
Research and development costs are expensed as incurred. Research and development costs include employee compensation, contractor fees, materials and supplies, and facility costs. For the years ended December 31, 2024 and 2023, gross research and development costs were $13.0 million and $18.5 million, respectively.
Government Grants
The Company recognizes government assistance when there is reasonable assurance that the Company will comply with the conditions of the assistance and that the assistance will be received.
The National Aeronautics and Space Administration (NASA) established the Commercial Low Earth Orbit (LEO) Development program, or the Space Act Agreement (“SAA”) to help facilitate two objectives:
(1)Develop a robust commercial space economy in LEO, including supporting the development of commercially owned and operated LEO destinations from which various customers, including private entities, public institutions, NASA and foreign governments, can purchase services.
(2)Stimulate the growth of commercial activities in LEO.
On December 1, 2021, Nanoracks, LLC, a subsidiary of Voyager Technologies, Inc., entered an agreement under the SAA with NASA (“Agreement”), pertaining to the LEO Development program, to design, build and maintain a commercial space station, known as “Starlab”. The Agreement and its subsequent amendments signed through 2023 provides $217.5 million in funding for the design and manufacture of Starlab, which is earned upon completion of defined milestones. Once a milestone is earned, the Company is under no further obligation to continue work on Starlab. Milestone payments are expected to be earned through December 2025.
When the government grant assistance is related to an asset, the assistance will be deducted from the carrying value of the asset. When the assistance is related to costs incurred, the assistance is deducted from the related expense. For the years ended December 31, 2024 and 2023, $5.4 million and $37.0 million, respectively, were offset against research and development costs. For the year ended December 31, 2024, $54.9 million of assistance was offset against construction in progress. For the year ended December 31, 2023, $26.9 million of assistance was offset against construction in progress assets, along with grant funding for capital expenditures not yet incurred of $6.0 million in accrued expenses and other current liabilities on the consolidated balance sheets.
Marketing Costs
Marketing costs are expensed as incurred. During the years ended December 31, 2024 and 2023, the Company recognized marketing costs of approximately $1.0 million and $0.7 million, which are included in selling, general, and administrative expense on the consolidated statements of operations.
Income Taxes
The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement carrying amount and the tax basis of assets and liabilities, along with net operating loss carryforwards using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are provided if, based upon the weight of available evidence, it is more likely than not that some or all the deferred tax assets will not be realized. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions to the extent that the benefit would more likely than not be realized assuming examination by the taxing authority. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances. The Company recognizes any interest and penalties accrued related to unrecognized tax benefits as income tax expense.
3. RECENT ACCOUNTING PRONOUNCEMENTS
Reporting Comprehensive Income - Expense Disaggregation Disclosures
In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2024-03 Comprehensive Income (Topic 220): Disaggregation of Income Statement Expenses. The ASU requires a tabular disclosure of the amounts of specified natural expense categories included in each relevant expense caption. Additionally, the amendments require the disclosure of the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. The ASU will be effective for annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027 and will be applied on a prospective basis with the option to apply the standard retrospectively. The Company is currently evaluating the impact on our disclosures of adopting this new pronouncement.
Segment Reporting – Improvements to Reportable Segment Disclosures
In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2023-07 Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. Among other new disclosure requirements, the ASU requires companies to disclose significant segment expenses that are regularly provided to the chief operating decision maker. The Company adopted this standard for the year ended December 31, 2024 on a retrospective basis. The Company updated our segment disclosures to comply with the requirements. See “Note 17, “Segment Reporting”. The adoption of the standard did not have an impact on the Company’s financial position, results of operations, or liquidity.
Income Taxes – Disclosure Improvements
In December 2023, the FASB issued ASU No. 2023-09 Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU requires companies to disclose, on an annual basis, specific categories in the effective tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. In addition, the ASU requires companies to disclose additional information about income taxes paid. The ASU will be effective for annual periods beginning January 1, 2025 and will be applied on a prospective basis with the option to apply the standard retrospectively. The Company is evaluating the disclosure impact of ASU 2023-09; however, the standard is not expected to have an impact on the Company’s consolidated financial position, results of operations and/or cash flows.
4. ACQUISITIONS
Business Combinations
ZIN Technologies, Inc.
On March 10, 2023, the Company acquired 100% of the equity securities of ZIN Technologies, Inc. (“ZIN”) for approximately $1.5 million in cash, $3.5 million in equity, $6.9 million in liabilities assumed, and $9.1 million in contingent consideration. ZIN provides systems and highly engineered solutions to multiple launch vehicles, low-Earth orbit infrastructure projects, and spacecraft, develops microgravity research equipment, and brings expertise in the integration of complex space-related hardware and the development of rendezvous, docking, and related capabilities. These solutions have direct applications to Starlab and complement Voyager’s portfolio of space infrastructure and technology capabilities.
The following table presents the total consideration paid by the Company for its acquisitions during the year ended December 31, 2023:
| | | | | |
| ZIN |
| Cash paid | $ | 1,527 | |
| Equity consideration | 3,485 | |
| Contingent consideration | 9,100 | |
| Total consideration paid | $ | 14,112 | |
During the year ended December 31, 2023, the Company expensed as incurred acquisition-related costs of approximately $0.6 million. These costs were not included in the total purchase consideration paid by the Company in connection with the business combination.
The following table presents the net revenue and net income (loss) from the companies acquired during the year ended December 31, 2023 included in the consolidated statements of operations.
| | | | | |
| ZIN |
| Net sales | $ | 53,533 | |
| Consolidated net income (loss) | $ | (53) | |
The following unaudited pro forma summary presents consolidated information of Voyager as if the business combination had occurred on January 1, 2023:
| | | | | | | | | | | | | | | | | | | | | | | |
| VSH | | Elim | | PF Adj (a) | | Total |
| Net sales | $ | 146,396 | | | (334) | | | — | | | $ | 146,062 | |
| Consolidated net income (loss) | $ | (23,510) | | | (135) | | | (550) | | | $ | (24,195) | |
The following unaudited pro forma summary presents information of ZIN as if the business combination had occurred on January 1, 2023:
| | | | | | | | | | | | | | | | | | | | | | | |
| ZIN | | Elim | | PF Adj (a) | | Total |
| Net sales | $ | 63,867 | | | (334) | | | — | | | $ | 63,533 | |
| Consolidated net income (loss) | $ | 1,875 | | | (135) | | | (550) | | | $ | 1,190 | |
__________________
(a)Pro-forma adjustments consist of additional amortization of acquired intangible assets
The following table presents the allocation of the aggregate total consideration for the Company’s acquisition during the year ended December 31, 2023 to the fair values of the tangible and identifiable intangible assets acquired and liabilities and noncontrolling interests assumed, inclusive of all final working capital adjustments:
| | | | | |
| ZIN |
| ASSETS | |
| Cash and cash equivalents | $ | 3,578 | |
| Accounts receivable | 3,036 | |
| Contract assets | 4,279 | |
| Prepaid expenses and other current assets | 213 | |
| Property and equipment | 969 | |
| Operating lease right-of-use assets | 2,182 | |
| Trade names | 1,220 | |
| Customer relationships | 5,350 | |
| Developed technology | 4,800 | |
| Goodwill | 6,966 | |
| Other assets | 118 | |
| TOTAL ASSETS | $ | 32,711 | |
| |
| LIABILITIES | |
| Accounts payable | $ | 1,256 | |
| Contract liabilities | 4,556 | |
| Operating lease liabilities | 823 | |
| Accrued expenses and other current liabilities | 10,273 | |
| Operating lease liabilities, non-current | 1,412 | |
| Other long-term liabilities | 279 | |
| TOTAL LIABILITIES | $ | 18,599 | |
| |
| Net assets acquired | $ | 14,112 | |
The following table presents intangible assets acquired during the year ended December 31, 2023 by class and useful life:
| | | | | |
| ZIN |
| Trade name | 2 years |
| Customer relationships | 5 years |
| Developed technology | 5 years |
The goodwill recognized for each acquisition is attributable to the workforce of the acquired businesses and expected future synergies. The goodwill is not deductible for tax purposes.
The fair value of trade names and developed technology was determined by using the relief-from-royalty method, a form of an income and market approach. Significant assumptions included estimated future revenues, royalty rates, tax rates, discount rates, and economic useful lives. The fair value of customer relationships was estimated using the multi-period excess earnings method, an income approach, which converts projected revenues and costs into cash flows. Significant assumptions used in the discounted cash flow analysis for direct customer relationships were the revenue growth rate, customer attrition rate, earnings before interest, taxes, depreciation, and amortization (“EBITDA”) margins, contributory asset charge, and the discount rate. These assumptions may vary
based on future events, perceptions of different market participants and other factors outside the control of management, and such variations may be significant to estimated values.
Consolidated Variable Interest Entity
Starlab Joint Venture
On December 23, 2023, the Company and Airbus Space and Defence Gmbh (“Airbus”) entered into the Joint Venture Agreement forming Starlab Space LLC (“Starlab JV”). Starlab JV, which among other things, is focused on developing Starlab, which the Company believes will replace the ISS. Following the formation of Starlab JV, pursuant to subscription agreements, each of Mitsubishi, MDA Space and Palantir Technologies acquired minority interests in Starlab JV. As of December 31, 2024, the Company has an ownership interest of 66.9% of Starlab JV, Airbus had an ownership interest of 30.6%, Mitsubishi has an ownership interest of 0.8%, MDA Space has an ownership interest of 0.8%, and Palantir has an ownership interest of 0.9%.
The Starlab program, which is a legacy Voyager program, historically operated under the Company’s ownership for 100% of its activities. Under the joint venture arrangement between Voyager and Airbus, the Company contributed the ongoing Starlab program and operations into the Starlab JV on April 12, 2024, when the NASA SAA was novated from Voyager to the Starlab JV. Through the SAA, the Company receives financial assistance through government grants for certain eligible expenses to design, build and maintain a commercial space station.
During the year ended December 31, 2024, in connection with the minority subscriptions of Mitsubishi, MDA Space and Palantir, Starlab JV received capital contributions in the amount of $6.7 million, from each of Mitsubishi and MDA Space and $8.5 million of current and future contributed services from Palantir.
In accordance with ASC 810, Consolidation, the Company evaluated its equity interest in the Starlab JV as of December 31, 2024 and determined that it has a variable interest in the entity. Due to the Company’s obligation to absorb losses and the right to receive benefits from the variable interest entity along with the ability to direct the activities that most significantly impact Starlab JV’s economic performance (including control over three of the five seats on the Board of Directors at Starlab JV), the Company was determined to be the primary beneficiary and is therefore consolidating the Starlab JV.
The Company’s consolidated financial statements reflect the performance of the Starlab JV VIE with the Company being the primary beneficiary of the VIE and having incremental power over the Starlab JV. The Company meets the power and economic criteria for consolidation of the VIE. The Starlab JV is considered a business and therefore no gain or loss was recognized by the Company upon the initial consolidation of the VIE.
The following table presents the assets and liabilities of the Starlab JV included in the Company’s balance sheet, separated by major asset and liability class. These assets can only be used to settle obligations of Starlab JV, and the Company does not have recourse to the liabilities. Creditors of Starlab JV do not have recourse to the Company.
| | | | | |
| ASSETS | December 31, 2024 |
| Cash and cash equivalents | $ | 17,808 | |
| Prepaid expenses and other current assets | 2,716 | |
| Property and equipment, net | 36,188 | |
| |
| Operating lease right-of-use assets | 140 | |
| Other assets | 14 | |
| TOTAL ASSETS | $ | 56,866 | |
| |
| LIABILITIES | |
| Accounts payable | $ | 18,781 | |
| |
| Operating lease liabilities | 84 | |
| Accrued expenses and other current liabilities | 5,414 | |
| Operating lease liabilities, non-current | 56 | |
| Convertible notes, net | 7,435 | |
| Embedded derivatives | 2,723 | |
| TOTAL LIABILITIES | $ | 34,493 | |
5. ACCOUNTS RECEIVABLE, NET
| | | | | | | | | | | |
| December 31, 2024 | | December 31, 2023 |
| Accounts receivable, billed | $ | 16,015 | | | $ | 17,604 | |
| Allowance for expected credit losses | (655) | | | (526) | |
| Accounts receivable, net | $ | 15,360 | | | $ | 17,078 | |
6. PROPERTY AND EQUIPMENT, NET
| | | | | | | | | | | |
| December 31, 2024 | | December 31, 2023 |
| Equipment in orbit | $ | 19,533 | | | $ | 19,533 | |
| Machinery and equipment | 4,860 | | | 4,371 | |
| Leasehold improvements | 2,276 | | | 1,505 | |
| Construction in progress | 37,251 | | | 357 | |
| IT related equipment | 2,441 | | | 1,246 | |
| Property and equipment, gross | 66,361 | | | 27,012 | |
| Less: Accumulated depreciation | (16,922) | | | (13,006) | |
| Property and equipment, net | $ | 49,439 | | | $ | 14,006 | |
Depreciation expense on property and equipment was $4.0 million and $3.8 million for the years ended December 31, 2024 and 2023, respectively.
A substantial portion of construction in progress relates to our Starlab JV and the development of the Space Station. The JV is currently funded primarily through grants under the SAA with NASA. Considering the immateriality of the net cash outflows during the year that were not funded via grants no interest has been capitalized as of December 31, 2024.
7. GOODWILL AND INTANGIBLE ASSETS, NET
The following table presents changes in the carrying amount of goodwill:
| | | | | | | | | | | | | | | | | | | | | | | |
| Defense & National Security | | Space Solutions | | Starlab Space Stations | | Total |
| Goodwill | $ | 94,728 | | | $ | 46,129 | | | $ | — | | | $ | 140,857 | |
| Accumulated impairment loss | (72,859) | | | (28,449) | | | — | | | (101,308) | |
| Balance as of January 1, 2023 | 21,869 | | | 17,680 | | | — | | | 39,549 | |
| Reallocation of goodwill in segment reorganization | — | | | (4,747) | | | 4,747 | | | — | |
| Zin Acquisition | — | | | 6,966 | | | — | | | 6,966 | |
| Balance as of December 31, 2023 | $ | 21,869 | | | $ | 19,899 | | | $ | 4,747 | | | $ | 46,515 | |
| Balance as of December 31, 2024 | $ | 21,869 | | | $ | 19,899 | | | $ | 4,747 | | | $ | 46,515 | |
| | | | | | | |
| Gross goodwill | $ | 94,728 | | | $ | 48,348 | | | $ | 4,747 | | | $ | 147,823 | |
| Accumulated Impairment | (72,859) | | | (28,449) | | | — | | | (101,308) | |
| Net goodwill | $ | 21,869 | | | $ | 19,899 | | | $ | 4,747 | | | $ | 46,515 | |
Intangible assets, net consists of the following:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Weighted-Average Remaining Life | | December 31, 2024 | | December 31, 2023 |
| | Gross Carrying Amount | | Accumulated Amortization | | Net Carrying Amount | | Gross Carrying Amount | | Accumulated Amortization | | Net Carrying Amount |
| Trade name | 7 years | | $ | 6,288 | | | $ | (3,120) | | | $ | 3,168 | | | $ | 6,288 | | | $ | (1,654) | | | $ | 4,634 | |
| Customer contracts | 7 years | | 35,176 | | | (14,385) | | | 20,791 | | | 35,176 | | | (8,992) | | | 26,184 | |
| Developed technology | 6 years | | 16,750 | | | (6,025) | | | 10,725 | | | 16,750 | | | (3,301) | | | 13,449 | |
| Total intangible assets, net | 7 years | | $ | 58,214 | | | $ | (23,530) | | | $ | 34,684 | | | $ | 58,214 | | | $ | (13,947) | | | $ | 44,267 | |
For the years ended December 31, 2024 and 2023, amortization expense on intangible assets was approximately $9.6 million and $6.5 million, respectively. Amortization expense is presented within amortization of acquired intangibles in the consolidated statements of operations.
The following table presents the future estimated amortization of intangible assets:
| | | | | | | | |
| Year | | Estimated Future Amortization Expense |
| 2025 | | $ | 5,812 | |
| 2026 | | 5,685 | |
| 2027 | | 5,647 | |
| 2028 | | 4,311 | |
| 2029 | | 3,966 | |
| Thereafter | | 9,263 | |
Total | | $ | 34,684 | |
8. INVESTMENTS
Investment in Atomos Nuclear and Space Corporation
The Company accounts for its investment in Atomos under the cost method as the Company does not have the ability to exercise significant influence over Atomos. As of December 31, 2024, the Company has a 17.5% fully diluted investment in Atomos. The investment in Atomos was included in other assets in the consolidated balance sheets.
During 2024, the Company noted an observable price change related to its investment in Atomos and, as a result, fully impaired the investment for a total of $3.6 million, which was recorded in Impairment losses.
9. LEASES
The Company’s operating leases consist of office lease rentals with remaining terms of 1 to 39 years, subject to certain renewal options for a further 1 to 5 years. Renewal options, which the Company is reasonably certain to exercise are included in the lease term. The Company has $0.1 million of finance leases as of the years ended December 31, 2024 and 2023.
For the year ended December 31, 2024, the Company’s total lease cost was $4.1 million, consisting of operating lease expense of $3.6 million and short-term lease expense of $0.5 million. For the year ended December 31, 2023, the Company’s total lease cost was $3.6 million, consisting of operating lease expense of $3.4 million and short-term lease expense of $0.2 million. The lease cost is presented within selling, general, and administrative and cost of sales in the consolidated statements of operations.
The following table presents the future maturities of the operating lease liabilities as of December 31, 2024:
| | | | | |
| 2025 | $ | 3,125 | |
| 2026 | 3,326 | |
| 2027 | 2,902 | |
| 2028 | 1,165 | |
| 2029 | 165 | |
| Thereafter | 3,691 | |
| Total future minimum lease payments | 14,374 | |
| Less: interest | (5,169) | |
| Present value of future minimum lease payments | $ | 9,205 | |
The weighted average remaining lease term related to operating leases was 3.5 and 3.8 years as of December 31, 2024 and 2023, respectively. The weighted average discount rate related to operating leases was 9.0% and 7.0% as of December 31, 2024 and 2023, respectively.
10. ACCRUED EXPENSES
| | | | | | | | | | | |
| December 31, 2024 | | December 31, 2023 |
| Accrued compensation | $ | 11,539 | | | $ | 10,006 | |
| Accrued expenses | 10,641 | | | 9,477 | |
| Accrued taxes | 914 | | | 216 | |
| Accrued earnout | 413 | | | 5,824 | |
| Deferred government grant | — | | | 5,956 | |
| Other current liabilities | 16,087 | | | 7,514 | |
| Total accrued expenses | $ | 39,594 | | | $ | 38,993 | |
11. DEBT
2023 Term Note
During December 2021, the Company entered a $35.0 million credit agreement (“Credit Agreement”) maturing December 2025. The Company may borrow under: (i) a Commercial Bank Floating Rate (“CBFR”) borrowing at 8.00% per annum plus a variable rate per annum based on the greater of the Prime Rate or 2.50% or (ii) a Secured Overnight Financing Rate (“SOFR”) borrowing at 9.10% per annum plus a variable rate per annum based on the greater of the Federal Funds Effective Rate or the Overnight Bank Funding Rate. The obligations under the Credit Agreement are secured by substantially all the assets of the Company and certain of its subsidiaries, including pledges of equity in certain of the Company’s subsidiaries.
During March 2023, the Company entered into a $50.0 million senior secured note (“Term Note”) maturing March 2026. The Term Note bears interest at a rate equal to the greater of 4% plus 4.5% or the prime rate plus 4.5% per annum. The obligations under the Term Loan are secured by substantially all the assets of the Company and certain of its subsidiaries, including pledges of equity in certain of the Company’s subsidiaries. As part of the Term Note, the Company must pay a collateral monitoring charge of 0.35% of the outstanding principal balance semi-annually to the lender. The Company used the proceeds from the Term Note to retire the Credit Agreement resulting in a loss on debt extinguishment of $1.3 million.
Monthly interest payments commenced April 2023; a monthly principal payment of $3.0 million is due April 2024 and subsequent monthly principal payments are $1.5 million. In connection with the term note, the Company must maintain a compensating cash balance of $12.5 million. As of December 31, 2024 and 2023, the Company was in compliance with its financial debt covenants.
The Company incurred approximately $3.4 million of debt issuance costs and recorded a debt discount of approximately $3.0 million.
Separately, but concurrently with the issuance of the 2023 Term Note, the Company issued 699,743 shares of warrants convertible into the Company’s common stock at an initial strike price $26.09 per share (the “Warrants”) to the same bank counterparty as the Term Note (the “Holder”). The $1.4 million initial fair value of the warrants was recognized as an additional debt discount and is amortized to interest expense over the term of the Term Note.
On March 29, 2024, the Company amended the terms of its 2023 Term Note agreement (“Amendment 1”). As part of Amendment 1, the Company agreed to pay the lender a $3.0 million dollar fee which is incorporated in the 2023 Term Note’s outstanding principal balance. Amendment 1 extended the maturity of the 2023 Term Note to March 2027 and delayed the first monthly principal payment of $3.0 million to July 2024 and subsequent monthly payments are $1.5 million. In June 2024, the Company raised $30.0 million in Series C proceeds and as such, the first monthly principal payment was extended to April 30, 2025.
In connection with Amendment 1, the Company issued 175,850 shares of warrants convertible into the Company’s common stock at an initial strike price $26.88 per share to the same bank counterparty as the 2023 Term Note. The $1.1 million fair value of the warrants was recognized as an additional debt discount and is amortized to interest expense over the new term of the 2023 Term Note.
Term Loan
During June 2024, the Company entered into a $58.0 million term loan (“Term Loan”) maturing July 1, 2028. The Term Loan bears interest at a variable annual rate equal to the sum of (a) the greater of (i) the Wall Street Journal Prime Rate or (ii) 8.50%, and (b) 1.25% per annum. In addition, the Company will pay additional interest at 2.50% per annum of the total outstanding principle of the Term Loan. The additional interest is included within the total principal to be paid back to the lender. Commencing on July 1, 2026, the Company is required to make payments of $2.6 million the first business day of each month, which includes both principal repayment and scheduled interest payments. As part of the Term Loan, the Company must pay an end of term fee of 5.50% of the $58.0 million initial principle, or $3.2 million. The end of term fee is included within the total principal to be paid
back to the lender. The Company used the proceeds from the Term Loan to retire the 2023 Term Note resulting in a loss on debt extinguishment of $10.7 million.
In connection with the Term Loan, the Company is required to maintain a compensating cash balance of $12.5 million.
The Company incurred approximately $1.7 million of debt issuance costs and recorded a debt discount of approximately $8.5 million.
The Company’s long-term debt associated with the term loan consisted of the following (in thousands):
| | | | | | | | | | | |
| December 31, 2024 | | December 31, 2023 |
| Principal | $ | 65,972 | | | $ | 50,000 | |
| Collateral Obligation | — | | | 1,613 | |
| Less: debt issuance cost & discounts, net of amortization | (8,981) | | | (5,717) | |
| Net carrying amount | 56,991 | | | 45,896 | |
| Less: current portion | — | | | 15,334 | |
| Total long-term debt, net | $ | 56,991 | | | $ | 30,562 | |
Lines of Credit
On June 27, 2022, a subsidiary of the Company entered into new revolving line of credit agreements. The new agreements increased the limit of the line of credit from $3.0 million to $6.0 million and extended the maturity to June 27, 2024. Interest is due monthly at the SOFR reference rate plus 2.25%.
In conjunction with the March 2023 Term Note agreement, the outstanding $4.3 million balance on the line of credit agreements was retired and the line of credit was extinguished.
2024 Convertible Notes
At various times during 2024, Starlab JV issued convertible promissory notes (“2024 Convertible Notes”) for a total principal amount of approximately $10.1 million. The notes bear interest at a rate of 5.0% per annum, payable at maturity, which is on the third anniversary of the issue date if no triggering events occur prior to that date. Starlab JV has the option to prepay all or any of the principal and any accrued and unpaid interest at any time.
The 2024 Convertible Notes are convertible into equity units upon the following: (i) a qualified financing event, defined as a transaction or series of transactions pursuant to which Starlab JV issues shares of any class or series of equity securities to one or more investors, including any of the lenders with the principal purpose of raising capital that raises gross proceeds of at least $10.0 million, excluding the amount represented by the conversion of any outstanding indebtedness in accordance with their respective terms; (ii) at the option of the lender upon a nonqualified financing event; (iii) a liquidity event, defined as a consolidation or merger with another corporation, entity, or person or other event through which the unit holders, immediately prior to such consolidation or merger, own less than 50% of the voting power of the surviving entity, immediately after such consolidation or merger, a sale or other disposition of substantially all Starlab JV’s assets, or the closing of Starlab JV’s first underwritten public offering; and (iv) the maturity date. Upon a conversion event described in (i) or (ii), the notes will convert into the same class and series of units as those sold as part of the financing event. Upon a conversion event described in (iii) or (iv), the notes will convert into Class A-1 Units of Starlab JV. The number of Class A-1 Units issued will be equal to (1) the outstanding principal balance of the note and all accrued and unpaid interest due, divided by (2) 85% of the price per unit paid by the investors to purchase the new securities in the subsequent financing.
The Company evaluated the features of the 2024 Convertible Notes and determined that items (i) and (ii) met the definition of embedded derivatives as they are not clearly and closely related to the debt host instrument and were bifurcated and measured at fair value. The fair value was measured using the scenario based method inside the “with and without” method and resulted in a value of approximately $3.1 million at inception which was recorded as
a discount on the convertible notes. The key assumptions utilized in the valuation were the scenario timing, mandatory conversion discount, discount rate, and scenario probabilities.
Interest expense on the 2024 Convertible Notes totaled $0.2 million for the year ended December 31, 2024 and amortization of the debt discount was $0.3 million for the year ended December 31, 2024.
SMI Promissory Note
In May and June 2023, the Company acquired additional shares of SMI from certain minority stockholders in exchange for Promissory Notes in aggregate amount of approximately $28.4 million. In October 2024, the Promissory Notes were modified for certain shareholders to be payable in our equity securities at the earlier of October 2, 2025 or the completion of our initial public offering, and for other shareholders at the earlier of October 2, 2026 or the completion of our initial public offering. The Promissory Notes bear interest at the Wall Street Journal Prime Rate, which is accrued in arrears. The Company had an outstanding balance of approximately $24.6 million and $29.8 million for the years ended December 31, 2024 and 2023.
Debt Repayment Schedule
The Company will be required to repay the following principal amounts in connection with its debt obligations (in thousands):
| | | | | |
| Term loan |
| 2025 | $ | — | |
| 2026 | 12,663 | |
| 2027 | 27,202 | |
| 2028 | 26,107 | |
| Thereafter | — | |
| Total future principal payments | 65,972 | |
| Less unamortized debt issuance costs and debt discounts (non-cash) | (8,981) | |
| Total debt, net | $ | 56,991 | |
12. REDEEMABLE PREFERRED STOCK
Class A-1 Redeemable Preferred Stock
The Company’s Certificate of Incorporation of the Corporation was amended to create and designate 7.5 million authorized shares of Class A-1 redeemable preferred stock (the “Class A-1 Preferred Stock”) with a par value of $0.0001 per share that were issued in February 2021.
The Class A-1 Preferred Stock (i) rank, with respect to the payment of dividends and distributions upon liquidation, dissolution or winding-up, senior to Company common stock, on parity with the Class B convertible preferred stock (“Class B Preferred Stock”), and junior to Class A preferred stock (“Class A Preferred Stock”) and Class C convertible preferred stock (“Class C Preferred Stock”); the liquidation preference is $6.67 per share, subject to an additional amount for any accrued and unpaid dividends (ii) accrue dividends at an initial rate of 8% per annum, increasing annually by 2%, up to maximum rate of 16% per annum, payable when, as and if declared by the Board, and shall be cumulative; (iii) may be redeemed, at the option of the holder, for cash on or after the fifth anniversary of the issuance of the shares at a redemption price equal to the then applicable accrued value per share; (iv) may be converted by the holder at any time into Company common stock or by the Company upon a qualifying public offering by the Company or prior to a fundamental change, as defined; and (v) have voting rights with respect to certain Company matters, as defined.
The initial carrying amount of the Class A-1 Preferred Stock was recorded at its fair value at the date of issuance, net of issuance costs. The carrying amount is periodically increased by amounts representing dividends not currently declared or paid but which ultimate payment is not solely within the control of the Company. Therefore, the Class A-1 Preferred Stock is held at carrying value. During the year ended December 31, 2024, the Class A-1
Preferred Stock accrued dividends of approximately $13.3 million, equal to $1.92 per share. During the year ended December 31, 2023, the Class A-1 Preferred Stock accrued dividends of approximately $10.1 million, equal to $1.45 per share.
The table below is a summary of the shares of Class A-1 Preferred Stock at December 31, 2024 (in thousands, except for shares and per share):
| | | | | | | | | | | | | | | | | | | | | | | |
| Shares Issued | | Carrying Value | | Average Issue Price | | Liquidation preference |
| Balance at December 31, 2022 | 6,967,720 | | | $ | 70,076 | | | $ | 8.83 | | | $ | 82,161 | |
| Dividends accrued on Class A-1 redeemable preferred stock | — | | | 10,072 | | | — | | | 10,072 | |
| Balance at December 31, 2023 | 6,967,720 | | | $ | 80,148 | | | $ | 8.83 | | | $ | 92,233 | |
| Dividends accrued on Class A-1 redeemable preferred stock | — | | | 13,348 | | | — | | | 13,348 | |
| Balance at December 31, 2024 | 6,967,720 | | | $ | 93,496 | | | $ | 8.83 | | | $ | 105,581 | |
13. REDEEMABLE NONCONTROLLING INTERESTS
The Company acquired controlling interest in certain entities whose minority interest holders have the right, at certain times, to require the Company to acquire their ownership interest. As a result of these redemption features, the Company recorded the respective redeemable noncontrolling interests within temporary, or mezzanine, equity on the consolidated balance sheets. The following presents the rights of the redemption minority interest of the respective acquired entities.
Altius Space Machines, Inc.
In each calendar year beginning on or after December 31, 2020, each minority interest holder in Altius shall have the right to require the Company to acquire up to one-third of the shares held by minority interest holders following the acquisition. The purchase price of share held by the Altius minority interest holders is equal to four times Altius’s EBITDA for the fiscal year immediately prior to the applicable year of the redemption, divided by the number of issued and outstanding shares of Altius as of the acquisition.
During the year ended December 31, 2024, the Company redeemed the remaining interest in Altius with insignificant cash impact and increased its ownership interest to 100%.
The Launch Company, LLC
At any time on or following April 1, 2022, the TLC minority interest holders will have the right to sell to Voyager all or any portion of the outstanding minority interests. The purchase price per share held by TLC minority interest holders is equal to five times TLC’s EBITDA for its preceding fiscal year, minus TLC’s indebtedness as of the date of the redemption, divided by the aggregate number of equity interests issued and outstanding at the conclusion of the preceding fiscal year.
On June 9, 2023, the Company entered into a Membership Interest Transfer Agreement, via its acquisition call notice, with the sole remaining minority shareholder of The Launch Company, LLC to acquire the remaining 49% of the total outstanding ownership of The Launch Company, LLC for $0.1 million.
XO Markets Holdings, Inc.
At any time following May 6, 2022, each XO minority interest holder who is an employee may elect to put to Voyager up to one-third of shares held in each 12-month period between anniversaries of the acquisition if the put is exercised between the first and fourth anniversaries of the acquisition, or up to 100% of the shares if exercised after May 6, 2025 at a price per share equal to the Fair Market Value (as defined in the purchase agreement). For minority interest holders that are not employees of XO, including former employees of XO, up to 100% may be exercised following May 6, 2022 at a price per share equal to the Fair Market Value (as defined in the purchase agreement).
During the year ended December 31, 2023, the Company exchanged Voyager’s common shares and rights for additional interest in XO’s ownership. As a result of transactions that occurred in 2023, the Company’s ownership interest in XO increased from 70.2% to 91.5%.
During the year ended December 31, 2024, the Company purchased additional interest in XO’s ownership for $0.4 million. As a result of the transactions that occurred in 2024, the Company’s ownership interest in XO increased from 91.5% to 92.2%.
Valley Tech Systems, Inc.
At any time on or after January 1, 2023, each VTS minority interest holder may elect to require Voyager to purchase all or any portion of the NCI shares that have vested for purposes of redemption at a price per share equal to the Fair Market Value (as defined in the purchase agreement). The minority interest shares vest and become exercisable over a period of 39 months, with the first one-third vesting on January 1, 2023, and an additional one-third vesting on each January 1, 2024, and January 1, 2025.
During the year ended December 31, 2023, the Company purchased additional interest in VTS’s ownership for $5.7 million. As a result of the transactions that occurred in 2023, the Company’s ownership interest in VTS increased from 58.9% to 69.7%.
During the year ended December 31, 2024, the Company purchased additional interest in VTS’s ownership for $9.5 million. As a result of the transactions that occurred in 2024, the Company’s ownership interest in VTS increased from 69.7% to 84.0%.
Space Micro Inc.
All remaining minority interest shares will be mandatorily redeemed at the earlier of a qualified Initial Public Offering (IPO) or October 1, 2024, in accordance with the first amendment to the stockholder’s agreement entered into on September 26, 2022. All shares will be purchased at the price outlined in the amendment.
In May and June 2023, the Company entered into Membership Interest Transfer Agreements via promissory notes with a significant portion of the remaining minority shareholders of Space Micro Inc. to increase its ownership over Space Micro Inc to 98% of the total outstanding ownership. These promissory notes carry a principal balance of $28.4 million and were based on the pricing on the predefined agreement.
On October 1, 2024, the Company acquired the remaining SMI interest for $0.9 million in cash and $0.6 million in shares.
The following table presents the changes in redeemable noncontrolling interest:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Altius | | TLC | | XO | | VTS | | SMI | | Total |
| Balance at December 31, 2022 | $ | (770) | | | $ | 1,043 | | | $ | 23,258 | | | $ | 21,509 | | | $ | 29,951 | | | $ | 74,991 | |
| Net income (loss) attributable to redeemable noncontrolling interests | (115) | | | (44) | | | 150 | | | 776 | | | (467) | | | 300 | |
| Redemptions of redeemable noncontrolling interests | — | | | (999) | | | (1,399) | | | (5,698) | | | (28,369) | | | (36,465) | |
| Options Exercised | — | | | — | | | 5 | | | — | | | — | | | 5 | |
| Adjustment to reflect redemption value of redeemable noncontrolling interests | — | | | — | | | — | | | 3,459 | | | 467 | | | 3,926 | |
| Balance at December 31, 2023 | $ | (885) | | | $ | — | | | $ | 22,014 | | | $ | 20,046 | | | $ | 1,582 | | | $ | 42,757 | |
| Net income (loss) attributable to redeemable noncontrolling interests | 2 | | | — | | | (37) | | | 335 | | | (34) | | | 266 | |
| Redemptions of redeemable noncontrolling interests | 883 | | | — | | | (435) | | | (9,492) | | | (1,548) | | | (10,592) | |
| Balance at December 31, 2024 | $ | — | | | $ | — | | | $ | 21,542 | | | $ | 10,889 | | | $ | — | | | $ | 32,431 | |
14. STOCKHOLDERS’ EQUITY
The total number of shares of all classes of stock for which the Company shall have authority to issue is 375.0 million shares of common stock, par value of $0.0001 per share (“Common Stock”) and 22.0 million shares of preferred stock, par value of $0.0001 per share (“Preferred Stock”).
Common Stock
During the year ended December 31, 2024, the Company issued 0.9 million shares of the Company’s common stock related to the SMI Promissory Note settlement, non-cash services acquired and redemption of noncontrolling interest in SMI. During the year ended December 31, 2023, the Company issued 0.5 million shares of the Company’s common stock related to the ZIN acquisition and redemption of noncontrolling interest in XO.
Class A Preferred Stock
At inception, the Company sold one share of Class A Preferred Stock to the Company’s CEO and represents the sole outstanding share as of December 31, 2024.
The Class A Preferred Stock entitles the holder to a number of votes at any time equal to (i) the number of votes then held or entitled to be made by all other equity securities of the Company, including, without limitation, the common stock of the Company, debt securities of the Company or pursuant to any other agreement, contract or understanding of the Company, plus (ii) one. Other than the super- majority voting right, there are no other rights that the holder of the Class A Preferred Stock is entitled to, including dividends, conversion rights or preferences upon liquidation.
Class B Convertible Preferred Stock
During the year ended December 31, 2024, the Company did not issue shares of the Company’s Class B Convertible Preferred stock. During the year ended December 31, 2023, the Company issued approximately 0.2 million shares of Class B Preferred Stock for gross proceeds of approximately $6.1 million, for which it incurred approximately $0.2 million of transaction costs recorded as an offset to the gross proceeds.
The Class B Preferred Stock (i) rank, with respect to the payment of dividends and distributions upon liquidation, dissolution or winding-up, on a parity with the Class A-1 Preferred Stock, senior to Company common stock, but junior to Class A Preferred Stock and Class C Preferred Stock; (ii) receive cash dividends only when, as and if declared by the Board of Directors, at an annual rate equal to 6.0% per annum (iii) may be converted by the holder at any time into Company common stock or by the Company upon a qualifying public offering by the Company or prior to a fundamental change, as defined; (iv) convert at a rate equal to the then accrued value per share, divided by the original issue price per share; and (v) have voting rights with respect to certain Company matters, as defined.
The preferred stock and dividends will be payable, in cash or in kind, at the Corporation’s option, only when, as and if declared by the Board of Directors, at an annual rate equal to 6.0% per annum of the Accrued Value of such share of Class B Preferred Stock. The dividends are featured to accrete upwards to the redemption value and initiate starting at the time of equity infusion by the individual shareholder.
The table below is a summary of the shares of Class B Preferred Stock at December 31, 2024 (in thousands, except for shares and per share amounts):
| | | | | | | | | | | | | | | | | | | | | | | |
| Shares Issued | | Carrying Value | | Average Issue Price | | Liquidation preference |
| Balance at December 31, 2022 | 3,128,801 | | | $ | 110,682 | | | $ | 37.29 | | | $ | 124,080 | |
| Issuance of Class B convertible preferred stock, net | 157,194 | | | 5,917 | | | 39.05 | | | 6,138 | |
| Dividends accrued on Class B convertible preferred stock | — | | | 7,768 | | | — | | | 7,768 | |
| Balance at December 31, 2023 | 3,285,995 | | | $ | 124,367 | | | $ | 37.29 | | | $ | 137,986 | |
| | | | | | | |
| Dividends accrued on Class B convertible preferred stock | — | | | 8,468 | | | — | | | 8,468 | |
| Balance at December 31, 2024 | 3,285,995 | | | $ | 132,835 | | | $ | 37.29 | | | $ | 146,454 | |
Class C Preferred Stock
During the year ended December 31, 2024, the Company issued approximately 1.5 million shares of the Class C Preferred Stock for gross proceeds of approximately $67.4 million, for which it incurred approximately $3.9 million of transaction costs recorded as an offset to the gross proceeds.
The Class C preferred stock (i) rank, with respect to the payment of dividends and distributions upon liquidation, dissolution or winding-up, senior to Class A-1 redeemable preferred stock, Class B convertible preferred stock and Company common stock; (ii) convert by the Company upon a qualifying public offering by the Company or immediately prior to a fundamental change, as defined; (iii) have voting rights with respect to certain Company matters, as defined.
The table below is a summary of the shares of Class C preferred stock at December 31, 2024 (in thousands, except for shares and per share amounts):
| | | | | | | | | | | | | | | | | | | | | | | |
| Shares Issued | | Carrying Value | | Average Issue Price | | Liquidation preference |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| Balance at December 31, 2023 | — | | | — | | | — | | | — | |
| Issuance of Class C preferred stock, net | 1,537,818 | | | $ | 63,464 | | | $ | 43.82 | | | $ | 67,387 | |
| Balance at December 31, 2024 | 1,537,818 | | | $ | 63,464 | | | $ | 43.82 | | | $ | 67,387 | |
Warrants
In conjunction with the 2021 Credit Agreement, the Company issued 72,467 of warrants convertible into the Company’s common stock at an exercise price of less than $0.01 per share to the same bank counterparty as the Credit Agreement (the “Holder”).
On March 10, 2023, separately, but concurrently with the issuance of the Term Note (See Note 11, “Debt”), the Company issued 699,743 of warrants convertible into the Company’s common stock at an exercise price of $26.09 per share to the same bank counterparty as the Term Note (the “Term Note Holder”).
On July 28, 2023, the Company issued an additional 98,564 warrants convertible into the Company’s common stock at an exercise price of $25.37 per share with a preferred equity holder.
On March 29, 2024, in connection with Amendment 1 to the 2023 Term Note (See Note 11, “Debt”), the Company issued 175,850 warrants convertible into the Company’s common stock at an exercise price of $26.88 per share to the same bank counterparty as the 2023 Term Note.
At any time, if the current fair value of a Warrant is greater than its exercise price, the Holder may elect to receive a number of shares equal to the fair value of the Warrant less the exercise price. The current fair value of a Warrant is determined by the Company and Term Note Holder or, if the Company’s Common Stock is traded on a securities exchange, the average of the closing or last reported sale prices over the ten consecutive trading days immediately preceding the date of determination of the fair market value.
At its election, the holder may exercise the Warrants upon, and effective immediately prior to, consummation of an initial public offering of securities of the Company or a change of control.
Upon issuance, each of the warrants was valued using a Black-Scholes pricing model and included within additional paid-in capital on the consolidated balance sheets and as a debt discount on the 2023 Term Note (See Note 11, “Debt”). The Warrants related to Amendment 1 to the 2023 Term Note were valued using a Black-Scholes pricing model at $6.45 per warrant, for a total fair value of approximately $1.1 million. The Warrants related to the 2021 Term Note were valued at $2.02 per warrant, for a total fair value of approximately $1.4 million. The Warrants related to the July 2023 raise were valued at $2.45 per warrant, for a total fair value of approximately $0.2 million. The fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement. Because the amount related to the Warrants is classified as equity, subsequent changes to the fair value are not recognized.
The following table presents the Black-Scholes option pricing model assumptions used to estimate the warrant grant date fair values:
| | | | | | | | | | | |
| 2024 | | 2023 |
| Common stock price | $20.80 | | $8.02 - $9.48 |
| Exercise price | $26.88 | | $25.37 - $26.09 |
| Expected term (years) | 2.2 | | 2.0 - 2.3 |
| Expected volatility | 63.7% | | 90.4% - 91.6% |
| Expected dividend yield | — | | — |
| Risk-free interest rate | 4.6% | | 4.5% - 4.9% |
Separately, but concurrently with the borrowing of the Term Loan, the Company retired the 2023 Term Note. The retirement of the 2023 Term Note triggered a potential put provision on the warrants issued to the lender of the 2023 Term Note. The holders of the warrants now have the right to exercise the warrants for a price equal to $4.60 per share beginning on July 1, 2025 or upon a change in control for up to six months. The warrants went from equity-classified to liability-classified. The Company reclassified the equity to liability warrants from additional paid-in capital to accrued expenses and other current liabilities for $2.5 million and recorded an additional expense of $1.5 million into gain (loss) on debt extinguishment based on the fair value of the warrants.
15. STOCK-BASED COMPENSATION
2020 Incentive Plan
In 2020, the Company adopted the 2020 Incentive Plan (as amended, the “2020 Plan”), under which the Board of Directors of the Company, as the Plan Administrator, may authorize and grant permitted awards which include, but are not limited to, stock options, stock appreciation rights, restricted stock awards, performance awards, and other cash and stock-based awards to employees, directors, consultants and independent contractors, and advisors who provide services to the Company. In general, if shares awarded are forfeited or repurchased without cancellation, those options or shares will again be available for grant.
On November 27, 2024, the board of directors of the Company authorized and adopted an amendment to the Plan to increase the aggregate number of shares that may be issued under the Plan from approximately 4.95 million shares of the Company’s common stock to approximately 6.6 million shares of common stock. As of December 31, 2024 and 2023, approximately 2.0 million and 1.1 million shares, respectively, were available for grant under the 2020 Plan.
The following table presents the Company’s employee and non-employee stock option activity (in thousands, except for shares and per share amounts):
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Number of Shares | | Weighted-Average Exercise Price | | Weighted Average Grant Date Fair value | | Weighted-Average Remaining Contractual Term (Years) | | Aggregate Intrinsic Value |
| Outstanding as of December 31, 2022 | 1,512,058.5 | | | $ | 10.39 | | | $ | 4.09 | | | 8.4 | | $ | 3,939 | |
| Granted | 1,369,500 | | | 12.99 | | | 3.29 | | | 9.6 | | |
| Forfeited | (76,498.5) | | | 9.65 | | | 3.85 | | | 7.3 | | |
| Outstanding as of December 31, 2023 | 2,805,060 | | | $ | 11.69 | | | $ | 3.71 | | | 8.5 | | $ | 4,324 | |
| Granted | 1,024,230 | | | 13.64 | | | 9.73 | | | 9.4 | | |
| Forfeited | (234,892.5) | | | 16.01 | | | 8.43 | | | 7.9 | | |
| Exercised | (1,935) | | | 11.01 | | | 5.13 | | | 8.3 | | |
| Outstanding as of December 31, 2024 | 3,592,462.5 | | | $ | 11.97 | | | $ | 5.12 | | | 8.0 | | | $ | 36,002 | |
| Options vested and exercisable as of December 31, 2024 | 1,628,239.5 | | | $ | 9.65 | | | $ | 3.35 | | | 6.9 | | |
| Nonvested as of December 31, 2024 | 1,964,223 | | | $ | 13.88 | | | $ | 6.59 | | | 8.9 | | |
As of December 31, 2024 and 2023, total unrecognized compensation expense was approximately $11.5 million and $6.6 million, respectively, which is expected to be recognized over a weighted-average period of approximately 2.0 years and 2.4 years, respectively.
Stock-based compensation expense for the 2020 Plan options was approximately $3.8 million and $2.1 million for the years ended December 31, 2024 and 2023, respectively.
The following table presents the Black-Scholes option pricing model assumptions used to estimate grant date fair values:
| | | | | | | | | | | |
| Years Ended December 31, |
| 2024 | | 2023 |
| Common stock price | $8.71 - $21.37 | | $8.02 - $9.48 |
| Exercise price | $9.48 - $26.88 | | $9.48 - $23.12 |
| Expected term (years) | 1.7 - 2.2 | | 1.9 - 2.3 |
| Expected volatility | 64.0% - 75.0% | | 75.0% - 92.0% |
| Expected dividend yield | — | | | — | |
| Risk-free interest rate | 4.1% - 4.8% | | 3.9% - 4.9% |
2020 Plan Restricted Stock Awards
The following table presents the Company’s restricted stock award (“RSA”) activity under the 2020 Plan
| | | | | | | | | | | |
| RSA Awards | | Weighted-Average Grant Date Fair value |
| Outstanding as of December 31, 2022 | 179,685 | | | $ | 3.17 | |
| Vested | (179,685) | | | 3.17 | |
| Outstanding as of December 31, 2023 | — | | | $ | — | |
The fair value of RSAs granted was determined to be $3.17 per share. All RSAs granted to employees are considered legally issued and outstanding. However, for accounting purposes, only vested awards are considered issued and outstanding.
Stock-based compensation expense related to restricted stock awards for the year ended December 31, 2023 was $0.6 million. There was no stock-based compensation expense in the year ended December 31, 2024.
XO Markets Holdings 2013 Equity Incentive Plan
Options to purchase XO common stock shares may be granted pursuant the XO Markets’ 2013 Equity Incentive Plan (“2013 XO Plan”) and are exercisable for not more than 10 years. In general, if options or shares awarded are forfeited or repurchased without cancellation, those options or shares will again be available for grant. The 2013 XO Plan also provides for the issuance of restricted stock, which may be issued alone or in conjunction with other awards.
No shares were available for grant under the 2013 XO Plan. No awards were issued in 2024 or 2023.
The following table presents stock option activity (in thousands, except for years, shares and per share amounts):
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Number of Shares | | Weighted Average Exercise Price | | Average Grant Date Fair value | | Remaining Contractual Term (Years) | | Aggregate Intrinsic Value |
| Outstanding as of December 31, 2022 | 329,450 | | | $ | 7.56 | | | $ | 1.27 | | | 5.4 | | $ | 3,582 | |
| Forfeited | (62,273) | | | 9.12 | | | 2.77 | | | 7.0 | | |
| Exercised | (107,150) | | | 4.50 | | | 0.67 | | | 1.1 | | |
| Outstanding as of December 31, 2023 | 160,028 | | | $ | 9.15 | | | $ | 1.64 | | | 6.8 | | $ | 901 | |
| Exercised | (750) | | | 9.78 | | | 1.40 | | | 6.1 | | |
| Outstanding as of December 31, 2024 | 159,278 | | | 9.15 | | | 1.64 | | | 5.8 | | $ | 1,175 | |
| Options vested and exercisable as of December 31, 2024 | 159,278 | | | $ | 9.15 | | | $ | 1.64 | | | 5.8 | | $ | 1,175 | |
As of December 31, 2024 and 2023, there was no unrecognized compensation expense.
Stock-based compensation expense related to stock options for the year ended December 31, 2023 was $0.1 million. There was no expense in 2024.
16. NET SALES
Disaggregation of Net Sales
The following tables present the disaggregation of net sales from contracts with our customers:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Year Ended December 31, 2024 | | Defense & National Security | | Space Solutions | | Starlab Space Stations | | Elims | | Total |
| US Government | | $ | 58,839 | | | $ | 62,186 | | | $ | — | | | $ | — | | | $ | 121,025 | |
| International Government | | — | | | 2,347 | | | — | | | — | | | 2,347 | |
| Commercial | | 18,631 | | | 10,060 | | | — | | | (7,883) | | | 20,808 | |
| Total net sales | | $ | 77,470 | | | $ | 74,593 | | | $ | — | | | $ | (7,883) | | | $ | 144,180 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Year Ended December 31, 2023 | | Defense & National Security | | Space Solutions | | Starlab Space Stations | | Elims | | Total |
| US Government | | $ | 52,476 | | | $ | 40,997 | | | $ | — | | | $ | — | | | $ | 93,473 | |
| International Government | | — | | | 1,044 | | | — | | | — | | | 1,044 | |
| Commercial | | 10,678 | | | 34,730 | | | — | | | (3,863) | | | 41,545 | |
| Total net sales | | $ | 63,154 | | | $ | 76,771 | | | $ | — | | | $ | (3,863) | | | $ | 136,062 | |
The approximate revenue based on geographic location of customers is as follows:
| | | | | | | | | | | |
| Years Ended December 31, |
| 2024 | | 2023 |
| US | $ | 128,869 | | | $ | 133,328 | |
| Europe | 14,468 | | | 614 | |
| Middle East | 41 | | | 1,017 | |
| Other | 802 | | | 1,103 | |
| Total Net Sales | $ | 144,180 | | | $ | 136,062 | |
The Company recognizes the material portion of our sales based on an over time revenue recognition criteria. For the year ended December 31, 2024, the Company recognized approximately 2.6% of our sales using the point in time methodology, with the majority of our sales using the over time revenue recognition criteria. For the comparative period ended December 31, 2023 the Company recognized approximately 1.3% of sales under the point in time recognition criteria.
Contract Balances
Contract assets arise when revenue has been recognized for amounts which cannot or have not yet been billed under terms of the contract with the customer. Contract liabilities arise when consideration is received from a customer prior to being earned and are recognized as revenue when the Company satisfies the related performance obligation under the terms of the contract. The following table presents the Company’s contract assets and liabilities:
| | | | | | | | | | | |
| December 31, 2024 | | December 31, 2023 |
| Contract assets (current and non-current) | $ | 24,128 | | | $ | 17,261 | |
| Contract liabilities (current and non-current) | $ | 24,127 | | | $ | 16,719 | |
Contract assets increased primarily due to a difference in timing of billing on cost plus programs and revenue recognition. The increase in contract liabilities was driven primarily by the timing difference of milestone billing and revenue recognition.
The amount of revenue recognized for the years ended December 31, 2024 and 2023 that was included in the contract liability balance at the beginning of the year was $8.2 million and $9.2 million, respectively.
Performance Obligations
As of December 31, 2024 and 2023, the Company had approximately $101.7 million and $86.5 million, respectively, of remaining performance obligations associated with contracts with an original duration of one year or greater. The Company will recognize net sales as these obligations are satisfied. The Company expects to recognize net sales relating to existing performance obligations of approximately $89.9 million and $11.8 million for the fiscal years 2025 and 2026 respectively.
17. SEGMENT REPORTING
The Company’s business is organized into market sectors based on its products and services and has three reportable segments: (i) Defense & National Security; (ii) Space Solutions; and (iii) Starlab Space Stations. The Company organizes its reportable segments based on the nature of the products and services offered and the economic characteristics of its operating businesses.
On September 30, 2024, the Company re-organized itself and its operations as a result of strategic movements within the business. This included the alignment of segment reporting presidents into a consolidating structure of operations under Defense & National Security, Space Solutions, and Starlab Space Stations. As a result of the strategic re-alignment within the Company and the development of the new structure for decision making by the Company’s Chief Operating Decision Maker (“CODM”), the Company’s segments changed during the year ended December 31, 2024. The resulting segment change was made retroactive to the beginning of our fiscal year starting January 1, 2023.
Transactions between segments are generally negotiated and accounted for under terms and conditions similar to other government and commercial contracts. The reconciling item “corporate expense” includes the portion of corporate costs not considered allocable to the segments, such as legal, management and administration, and other corporate unallocable costs.
The Company’s CODM is our CEO and Chairman. The CODM uses revenue and Segment Adjusted EBITDA to assess segment performance and make decisions regarding the allocation of capital and other investments. Segment Adjusted EBITDA is defined as EBITDA (earnings before interest, taxes, depreciation, and amortization) adjusted for certain items affecting comparability as specified in the calculation. Segment Adjusted EBITDA is used to monitor budget versus actual results. The CODM also uses Segment Adjusted EBITDA in analysis of the operational performance of each reporting segment. The CODM considers budget-to-actual variances on a quarterly basis for both profit measures when making decisions about allocating capital and personnel to the segments. The monitoring of budgeted versus actual results is used in assessing performance of the segments and in establishing management’s compensation. The CODM does not review segment expense items pursuant to ASC 280-10-50-26A. Therefore, the Company does not disclose these expense items by segment. The CODM does not use assets by segment to evaluate performance or allocate resources. Therefore, the Company does not disclose assets by segment.
The following table summarizes the operating performance of the Company’s segments:
| | | | | | | | | | | |
| Years Ended December 31, |
| 2024 | | 2023 |
| Net sales: | | | |
| Defense & National Security | $ | 77,470 | | | $ | 63,154 | |
| Space Solutions | 74,593 | | | 76,771 | |
| Starlab Space Stations | — | | | — | |
| Total net sales, reportable segments | 152,063 | | | 139,925 | |
| Intersegment eliminations | (7,883) | | | (3,863) | |
| Total net sales | $ | 144,180 | | | $ | 136,062 | |
| | | |
Other Segment Expenses(1) | | | |
| Defense & National Security | $ | 75,290 | | | $ | 63,544 | |
| Space Solutions | 71,873 | | | 71,994 | |
| Starlab Space Stations | 8,315 | | | (12,569) | |
| Total other segment expenses, reportable segments | 155,478 | | | 122,969 | |
| Intersegment eliminations | (7,883) | | | (3,863) | |
| Corporate and other expenses | 13,899 | | | 15,535 | |
Total other segment expenses | $ | 161,494 | | | $ | 134,641 | |
| | | |
| Segment Adjusted EBITDA: | | | |
| Defense & National Security | $ | 2,180 | | | $ | (390) | |
| Space Solutions | 2,720 | | | 4,777 | |
| Starlab Space Stations | (8,315) | | | 12,569 | |
| Total Segment Adjusted EBITDA, reportable segments | (3,415) | | | 16,956 | |
| Corporate and other expenses | (13,899) | | | (15,535) | |
| Depreciation and amortization | (13,595) | | | (10,294) | |
| Stock-based compensation | (3,761) | | | (2,707) | |
| Impairment | (3,594) | | | — | |
| Finance and interest expense | (12,016) | | | (10,590) | |
| Net loss (income) attributable to noncontrolling interests | (3,556) | | | 240 | |
Non-cash services(2) | (12,669) | | | — | |
| Other | (831) | | | (2,927) | |
| Loss before income taxes | $ | (67,336) | | | $ | (24,857) | |
________________(1)Other Segment Expenses consist of cost of sales, research and development, selling, general, and administrative and other income or expense items which are not deducted when calculating Segment Adjusted EBITDA. The CODM does not separately review expenses by nature at the segment reporting level, but reviews the operational performance and health of the segments as revenue less total expenses before interest, taxes, depreciation, amortization, as adjusted for certain items affecting comparability (i.e., Segment Adjusted EBITDA) to manage operations.
(2)Non-cash services were incurred as corporate-level operating expenses and in the Starlab Space Stations segment for $6.9 million and $5.8 million respectively as a result of services performed by a vendor in exchange for equity ownership in Voyager Technologies, Inc. and Starlab LLC respectively.
The Company’s capital expenditures and depreciation or amortization expenses are as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| For the year ended December 31, 2024 | | Defense & National Security | | Space Solutions | | Starlab Space Stations | | Corporate and eliminations | | Total |
| Capital expenditures: | | | | | | | | | | |
| Property and equipment | | $ | 1,547 | | | $ | 1,775 | | | $ | 79,381 | | | $ | — | | | $ | 82,703 | |
| Total capital expenditures | | $ | 1,547 | | | $ | 1,775 | | | $ | 79,381 | | | $ | — | | | $ | 82,703 | |
| | | | | | | | | | |
| Depreciation and amortization expense | | $ | 6,207 | | | $ | 7,307 | | | $ | — | | | $ | 81 | | | $ | 13,595 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| For the year ended December 31, 2023 | | Defense & National Security | | Space Solutions | | Starlab Space Stations | | Corporate and eliminations | | Total |
| Capital expenditures: | | | | | | | | | | |
| Property and equipment | | $ | 881 | | | $ | 578 | | | $ | 15,691 | | | $ | 60 | | | $ | 17,210 | |
| Total capital expenditures | | $ | 881 | | | $ | 578 | | | $ | 15,691 | | | $ | 60 | | | $ | 17,210 | |
| | | | | | | | | | |
| Depreciation and amortization expense | | $ | 4,773 | | | $ | 5,445 | | | $ | — | | | $ | 76 | | | $ | 10,294 | |
Substantially all of the Company’s long-lived tangible assets were in the United States as of December 31, 2024 and 2023.
18. INCOME TAXES
(Benefit) Provision for Income Taxes
The components of the (benefit) provision for income taxes are as follows:
| | | | | | | | | | | |
| Years Ended December 31, |
| 2024 | | 2023 |
| Current: | | | |
| Federal | $ | 773 | | | $ | 933 | |
| State | 133 | | | 408 | |
| Total current income tax expense | $ | 906 | | | $ | 1,341 | |
| Deferred: | | | |
| Federal | $ | (2,213) | | | $ | (648) | |
| State | (401) | | | (352) | |
| Total deferred tax benefit | $ | (2,614) | | | $ | (1,000) | |
| | | |
| Total income tax (benefit) expense | $ | (1,708) | | | $ | 341 | |
The income tax benefit related to continuing operations differs from the amounts computed by applying the statutory income tax rate of 21% to pre-tax loss as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, |
| 2024 | | 2023 |
| Amount | | Percentage | | Amount | | Percentage |
| Income tax (benefit) expense | | | | | | | |
| At statutory rate | $ | (14,140) | | | 21.0 | % | | $ | (5,220) | | | 21.0 | % |
| State tax net of federal benefit | (813) | | | 1.2 | % | | (438) | | | 1.8 | % |
| Foreign rate differential | (4) | | | — | % | | 142 | | | (0.6) | % |
| Change in valuation allowance (“VA”) | 12,865 | | | (19.1) | % | | 5,832 | | | (23.5) | % |
| Nontaxable or Nondeductible items | | | | | | | |
| Stock based compensation | 469 | | | (0.7) | % | | 293 | | | (1.2) | % |
| FMV adjustment | (1,188) | | | 1.8 | % | | — | | | — | % |
| Transaction costs/perm adjustments | 140 | | | (0.2) | % | | (456) | | | 1.8 | % |
| Non-controlling interest | 803 | | | (1.2) | % | | | | — | % |
| Other | 160 | | | (0.2) | % | | 188 | | | (0.8) | % |
| Total income tax (benefit) expense | $ | (1,708) | | | 2.5 | % | | $ | 341 | | | (1.4) | % |
During the years ended December 31, 2024 and 2023, there was no impact to the income tax rate as a result of effects of changes in tax laws or rates enacted in the current period, effects of cross-border tax laws, or tax credits.
The effective tax rate for the Company differs from the U.S. federal income tax rate of 21% primarily due to the offset of the tax benefits associated with losses of the consolidated group by the valuation allowance. Additionally, there were reconciling items related to a permanent fair market value adjustment and non-controlling interest in the Company's ownership in the pass-through investment, Starlab Space, LLC. Lastly, the Company reported a portion of its net tax benefit generated from Valley Tech Systems, a subsidiary of the Company, which reported seven months of activity stand-alone from the consolidated group, before meeting the 80% consolidated group ownership rules.
Deferred Tax Assets and Liabilities
The Company applies the asset and liability method to account for income taxes, under which deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to be recovered or settled.
The components of net deferred tax assets and liabilities are as follows:
| | | | | | | | | | | |
| Years Ended December 31, |
| 2024 | | 2023 |
| Deferred Tax Assets: | | | |
| Net operating losses | $ | 23,278 | | | $ | 25,468 | |
| Research and other credit carryforwards | 3,104 | | | 2,851 | |
| Accruals and reserves | 1,411 | | | 1,523 | |
| Deferred revenue | 1,219 | | | 1,757 | |
| Capitalized research and development | 13,457 | | | 5,769 | |
| Lease liabilities | 2,148 | | | 2,625 | |
| Interest | 4,554 | | | 3,165 | |
| Other | 1,766 | | | 633 | |
| Total gross deferred tax assets | 50,937 | | | 43,791 | |
| Less: Valuation allowance | (40,257) | | | (23,297) | |
| Total deferred tax assets | $ | 10,680 | | | $ | 20,494 | |
| | | |
| Deferred Tax Liabilities: | | | |
| Property, plant, & equipment | $ | (1,118) | | | $ | (1,321) | |
| Intangible assets | (7,710) | | | (10,413) | |
| Lease assets | (1,901) | | | (2,310) | |
| Sec 460 – long term contract manufacturing income | — | | | (9,013) | |
| Investment in subsidiaries | 1,076 | | | — | |
| Method change §481(a) adjustment | (1,062) | | | — | |
| Unrealized gains and losses | (77) | | | (109) | |
| Total gross deferred tax liabilities | $ | (10,792) | | | $ | (23,166) | |
| | | |
| Net deferred tax liabilities | $ | (112) | | | $ | (2,672) | |
For the years ended December 31, 2024 and 2023, the Company had approximately $98.2 million and $108.6 million of federal net operating loss carryforwards, of which $0.5 million and $0.5 million are subject to expiration beginning in 2035.
For the years ended December 31, 2024 and 2023, the Company had approximately $49.6 million and $48.3 million of post-apportionment state net operating loss carryforwards, of which $39.3 million and $44.3 million are subject to expiration beginning in 2035.
For the years ended December 31, 2024 and 2023, the Company had approximately $2.7 million and $3.0 million of federal research and development credit carryforwards, of which the full balances are subject to expiration beginning in 2033.
For the years ended December 31, 2024 and 2023, the Company had approximately $0.8 million and $1.0 million of state research and development credit carryforwards, of which the full balances are subject to expiration beginning in 2035.
The Company has indefinite life deferred tax assets associated with net operating losses that are subject to Section 382 limitation of usefulness in applicable annual periods. The Company has assessed the realizability associated with the potential limitations around these net operating losses and assessed no significant risk of net operating losses (“NOLs”) going unutilized.
In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during periods in which those temporary differences become deductible. Management considers historical operating results and tax planning strategies in making this assessment. As of December 31, 2024 and 2023, it has been determined that it was more likely than not that a portion of the net deferred tax asset would not be realized, and a valuation allowance of $40.2 million and $23.3 million, respectively, was maintained.
The following table summarizes the activity related to our unrecognized tax benefits for the year ended December 31, 2024 and 2023, excluding interest and penalties. The unrecognized tax benefits are recorded in other long-term liabilities. The Company does not anticipate that a material change of unrecognized tax benefits will occur within the next twelve months.
| | | | | | | | | | | |
| Years Ended December 31, |
| 2024 | | 2023 |
| Balance - Beginning of Year | $ | 1,072 | | | $ | 1,589 | |
| Gross decreases related to current year tax positions | — | | | (517) | |
| Gross decreases related to prior year tax positions | (1,072) | | | — | |
| Balance - End of Year | $ | — | | | $ | 1,072 | |
The Company includes interest and penalties related to unrecognized tax benefits in our current provision for income taxes in the accompanying statements of operations. As of December 31, 2024 and 2023, the Company has recognized no liability for interest and penalties related to unrecognized tax benefits.
The Company’s Federal and State income tax returns are subject to examination by the Internal Revenue Service and state jurisdictions, generally for three years after they are filed, however, returns can remain open for a longer period due to net operating loss carryforwards.
19. NET LOSS PER COMMON SHARE
The following table includes the calculation of basic and diluted net loss income per common share:
| | | | | | | | | | | |
| Years Ended December 31, |
| 2024 | | 2023 |
| Numerator: | | | |
| Net loss attributable to Voyager Technologies, Inc. | $ | (62,072) | | | $ | (25,438) | |
| Less: accrued preferred stock dividends | 21,816 | | | 17,840 | |
| Net loss attributed to common stockholders, basic | (83,888) | | | (43,278) | |
| Accretion and fair value adjustment on ZIN earnout | (5,411) | | | (3,276) | |
| Net loss attributed to common stockholders, diluted | $ | (89,299) | | | $ | (46,554) | |
| | | |
| Denominator: | | | |
| Weighted-Average common shares outstanding, basic | 12,736 | | | 12,362 | |
| Shares issuable assuming ZIN earnout | 10 | | | 392 | |
| Weighted-Average common shares outstanding, diluted | 12,746 | | | 12,754 | |
| | | |
| Net loss per share: | | | |
| Basic | $ | (6.59) | | | $ | (3.50) | |
| Diluted | $ | (7.01) | | | $ | (3.65) | |
The Company’s potentially dilutive securities, which include preferred stock and outstanding awards under the equity plans, have been excluded from the computation of diluted earnings per share as the effect would be anti-dilutive in a net loss position. The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share for the periods indicated:
| | | | | | | | | | | |
| (in shares of common stock) | December 31, 2024 | | December 31, 2023 |
| Stock options | 3,592,463 | | | 2,805,060 | |
| Warrants | 974,156 | | | 798,306 | |
| SMI Promissory Note | 1,130,195 | | | 3,421,960 | |
| Preferred stock (as converted to common shares) | 23,989,872 | | | 19,352,707 | |
| Total common stock equivalents | 29,686,686 | | | 26,378,033 | |
20. COMMITMENTS AND CONTINGENCIES
Non-Cancelable Service Contract Commitments
The Company has a commitment for launch services for the Starlab program. As of December 31, 2024 and 2023, the Company has a commitment for one launch at a future estimated launch date for $90.0 million. The terms of the arrangement also allow the Company to terminate the agreement for convenience for 25% of the contract value less what has been paid inception to date. If the Company were to cancel the launch services, it would owe $13.5 million to the launch provider.
Non-Cancelable Subscription-Based Services
The Company has a commitment for subscription-based services to assist in payload and launch analyses for the Starlab program and throughout the business units for various contracts. As of December 31, 2024, the Company has a commitment for four annual installments through 2028, totaling $2.0 million.
Litigation
The Company is involved in various legal actions arising in the normal course of business. Based upon the Company’s and its legal counsel’s evaluations of any claims or assessments, management is of the opinion that the outcome of these matters will not have a material adverse effect on the Company’s results of operations, financial position, or cash flows.
21. RELATED PARTIES
The Company had the following balances outstanding from transactions with related parties:
| | | | | | | | | | | |
| December 31, 2024 | | December 31, 2023 |
| Accounts receivable, net- related parties | $ | — | | | $ | — | |
| Accounts payable- related parties | $ | 17 | | | $ | 5 | |
The Company recorded the following amounts from transactions with related parties:
| | | | | | | | | | | |
| Years Ended December 31, |
| 2024 | | 2023 |
| Net sales- related parties | $ | — | | | $ | 170 | |
| Expenses- related parties | $ | 1,106 | | | $ | 508 | |
22. SUPPLEMENTAL CASH FLOW
Selected cash payments and non-cash activities are as follows:
| | | | | | | | | | | |
| Years Ended December 31, |
| 2024 | | 2023 |
| Supplemental cash flow information: | | | |
| Cash paid for interest | $ | 5,890 | | | $ | 6,072 | |
| Cash paid for income taxes | $ | 374 | | | $ | 1,356 | |
| Supplemental non-cash investing and financing activities: | | | |
| Warrants issued for common stock | $ | 1,135 | | | $ | 1,633 | |
| Operating lease liabilities arising in exchange for obtaining right-of-use assets | $ | 1,419 | | | $ | 572 | |
| Non-cash services and prepaid expenses in exchange for common stock | $ | 12,798 | | | $ | — | |
| Non-cash services and prepaid expenses in exchange for Starlab equity | $ | 8,500 | | | $ | — | |
23. SUBSEQUENT EVENTS
The Company has evaluated subsequent events through March 20, 2025, the date the consolidated financial statements were available to be issued.
Fundraising
From January 1, 2025 until March 20, 2025 the Company issued approximately 2.2 million shares of Class C Preferred Stock for gross proceeds of approximately $96.9 million. The gross proceeds are expected to result in $6.9 million of transaction costs associated with the issuance. Additionally, from January 1, 2025 until March 20, 2025 the Company issued approximately 1.2 million shares of the Company’s common stock for gross proceeds of approximately $34.7 million.
There were no other material subsequent events which required recognition or additional disclosure.
11,000,000 shares
Class A common stock
Preliminary Prospectus
| | | | | | | | | | | | | | | | | | | | |
| MORGAN STANLEY | | | | J.P. MORGAN | |
| | | | | | | | | | | | | | |
| | | | |
| Barclays | Jefferies | BofA Securities | KeyBanc Capital Markets | Wolfe | Nomura Alliance |
, 2025
Through and including , 2025 (the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.
PART II-INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution.
The following table sets forth the various expenses, other than the underwriting discounts and commissions, payable by us in connection with the sale of the securities being registered hereby. All amounts shown are estimates except the SEC registration fee, the FINRA filing fee and the exchange listing fee.
| | | | | |
| Payable by the registrant |
SEC registration fee | $ | 56,195 | |
FINRA filing fee | 54,878 | |
New York Stock Exchange Initial listing fee | 325,000 | |
Printing and engraving expenses | 400,000 | |
Legal fees and expenses | 5,000,000 | |
Accounting fees and expenses | 1,900,000 | |
Transfer agent and registrar fees and expenses | 75,000 | |
Miscellaneous fees and expenses | 1,500,000 | |
Total | $ | 9,311,073 | |
Item 14. Indemnification of Directors and Officers.
Subsection (a) of Section 145 of the General Corporation Law of the State of Delaware, or the DGCL, empowers a corporation to indemnify any person who was or is a party or who is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the person’s conduct was unlawful.
Subsection (b) of Section 145 empowers a corporation to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person acted in any of the capacities set forth above, against expenses (including attorneys’ fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.
Section 145 further provides that to the extent a director or officer of a corporation has been successful on the merits or otherwise in the defense of any action, suit or proceeding referred to in subsections (a) and (b) of Section 145, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith; that indemnification provided for by Section 145 shall not be deemed exclusive of any other rights to which the indemnified party may be entitled; and the indemnification provided for by Section 145 shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of such person’s heirs, executors and administrators. Section 145 also empowers
the corporation to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of his status as such, whether or not the corporation would have the power to indemnify such person against such liabilities under Section 145.
Section 102(b)(7) of the DGCL provides that a corporation’s certificate of incorporation may contain a provision eliminating or limiting the personal liability of a director to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, provided that such provision shall not eliminate or limit the liability of a director (i) for any breach of the director’s duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the DGCL, or (iv) for any transaction from which the director derived an improper personal benefit.
Any underwriting agreement or distribution agreement that the registrant enters into with any underwriters or agents involved in the offering or sale of any securities registered hereby may require such underwriters or dealers to indemnify the registrant, some or all of its directors and officers and its controlling persons, if any, for specified liabilities, which may include liabilities under the Securities Act of 1933, as amended.
We have in effect insurance policies for general officers’ and directors’ liability insurance covering all of our officers and directors. In addition, we have entered into indemnification agreements with our directors and officers. These indemnification agreements may require us, among other things, to indemnify each such director or officer for certain expenses, including attorneys’ fees, judgments, fines and settlement amounts incurred by such director or officer in any action or proceeding arising out of his or her service as one of our directors or officers.
Item 15. Recent Sales of Unregistered Securities.
The following sets forth information regarding all unregistered securities we have issued in the last three years. Unless stated otherwise, the sale of the securities listed below were deemed to be exempt from registration pursuant to Section 4(a)(2) of the Securities Act, including Regulation D and Rule 506 promulgated thereunder, as transactions by an issuer not involving a public offering.
Common Stock
In September, December 2024 and February 2023 we issued an aggregate of 737,807 shares of our common stock as payment for services to one of our service providers.
In October 2024, we issued to the former stockholders of Space Micro, Inc.an aggregate of 270,038 shares of our common stock as deferred consideration in connection with our acquisition of Space Micro, Inc.
In January 2023, March 2023, July 2023, and February 2025 we issued an aggregate of 173,241 shares of our common stock in exchange for shares held by minority holders of our subsidiary XO Markets Holdings, Inc.
In March 2023, we issued an aggregate of 367,647 shares of our common stock as consideration in connection with our acquisition of ZIN Technologies, Inc.
In August 2022 and February 2025, we issued an aggregate of 200,135 shares of our common stock in exchange for shares held by minority holders of our subsidiary Valley Tech Systems, Inc.
In February through April 2025, we issued an aggregate of 1,572,843 shares of common stock to investors in private placements at a price of $29.21 per share.
In April 2025, we issued an aggregate of 22,821 shares of common stock in connection with our acquisition of Optical Physics Company.
Class B Preferred Stock
Between September 2021 and December 2023, we issued an aggregate of 3,285,995 shares of our Class B Convertible Preferred Stock to investors in private placements, at a price of $39.05 per share.
Class C Preferred Stock
Between February 2024 and May 2025, we issued an aggregate of 4,302,905 shares of our Class C Convertible Preferred Stock to investors in private placements, at a price of $43.82 per share.
Warrants
In March 2023, in connection with our term loan facility, we issued warrants to purchase up to 466,425 shares of our common stock with an exercise price of $39.13 per share to the members of the lending consortium for no additional consideration.
In March 2024, in connection with the amendment of our term loan facility, we issued warrants to purchase up to 117,233 shares of our common stock with an exercise price of $40.32 per share to the members of the lending consortium for no additional consideration.
In July of 2023, we issued a warrant to purchase up to 65,709 shares of our common stock with an exercise price of $38.05 per share to a purchaser of our Class B Preferred Stock.
In May of 2025, we issued a warrant to purchase up to 86,889 shares of our common stock with an exercise price of $43.82 as consideration to a broker-dealer in connection with our Class C Preferred Stock offering.
Convertible Notes
In May 2023, we issued promissory notes, in aggregate principal amount of $28,369,350 payable in either cash or common stock, to certain minority shareholders of Space Micro, Inc. in connection with our acquisition of Space Micro, Inc. In October 2024, we extended the term of certain of such notes with aggregate principal amount of $21,657,675.
Item 16. Exhibits and Financial Statement Schedules.
(a)Exhibits.
The following exhibits are filed as part of, or incorporated by reference into, this registration statement:
| | | | | | | | |
| Exhibit No. | | Description of Exhibit |
1.1 | | |
3.1 | | |
3.2 | | |
3.3 | | |
4.1 | | |
5.1 | | |
10.1 | | |
10.2 | | |
10.3† | | |
10.4† | | |
| | | | | | | | |
10.5† | | |
10.6† | | |
10.7† | | |
10.8† | | |
10.9† | | |
10.10† | | |
10.11 | | |
10.12#* | | |
10.13#* | | |
10.14#* | | |
10.15#* | | |
10.16† | | |
10.17† | | |
10.18† | | |
10.19† | | |
10.20† | | |
10.21† | | |
10.22 | | |
10.23 | | |
10.24 | | Form of Warrant to Purchase Common Stock between Voyager Technologies, Inc. and each of JGB Partners, LP, JGB Capital, LP, JGB (Cayman) Lakenvelder, Ltd., Chicago Atlantic Credit Opportunities, LLC, Chicago Atlantic Credit Company, LLC and Midtown Madison Management LLC. |
10.25 | | Warrant Amendment Agreement, dated as of July 12, 2024, by and among Voyager Space Holdings, Inc. and each of Chicago Atlantic Credit Opportunities, LLC, Chicago Atlantic Credit Company, LLC, Chicago Atlantic Portfolio, LP, Midtown Madison Management, LLC, JGB Capital, LP, JGB Partners, LP and JGB (Cayman) Lakenvelder Ltd. |
10.26 | | |
10.27 | | |
10.28 | | |
21.1 | | |
23.1 | | |
23.2 | | |
24.1* | | |
107 | | |
________________
*Previously filed.
†Indicates a management contract or compensatory plan.
# Portions of this exhibit (indicated by “[***]”) have been omitted as the registrant has determined that (i) the omitted information is not material and (ii) the omitted information is the type that the registrant treats as private or confidential.
(b)Financial Statement Schedules.
None.
Item 17. Undertakings.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
The undersigned Registrant hereby undertakes that:
(1)For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.
(2)For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Denver, State of Colorado, on June 2, 2025.
| | | | | |
| Voyager Technologies, Inc. |
| |
| /s/ Dylan Taylor |
| Dylan Taylor |
| Chief Executive Officer |
Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.
| | | | | | | | | | | | | | |
| Signature | | Title | | Date |
/s/ Dylan Taylor | | Chief Executive Officer and Chairman (Principal Executive Officer) | | June 2, 2025 |
Dylan Taylor | | |
| | | | |
/s/ Filipe De Sousa | | Chief Financial Officer (Principal Financial Officer) | | June 2, 2025 |
Filipe De Sousa | | |
| | | | |
* | | Chief Accounting Officer (Principal Accounting Officer) | | June 2, 2025 |
Lance Weber | | |
| | | | |
* | | President and Director | | June 2, 2025 |
Matthew Kuta | | |
| | | | |
* | | Director | | June 2, 2025 |
Alan Stern | | |
| | | | |
* | | Director | | June 2, 2025 |
Cheryl Shavers | | |
| | | | |
* | | Director | | June 2, 2025 |
Gabe Finke | | |
| | | | |
* | | Director | | June 2, 2025 |
Marian Joh | | |
| | | | |
* | | Director | | June 2, 2025 |
William Shelton | | |
| | | | | |
*By: | /s/ Filipe De Sousa |
| Filipe De Sousa |
| Attorney-in-fact |
[●] Shares
VOYAGER TECHNOLOGIES, INC.
CLASS A COMMON STOCK, PAR VALUE $0.0001 PER SHARE
UNDERWRITING AGREEMENT
[●], 2025
[●], 2025
Morgan Stanley & Co. LLC
J.P. Morgan Securities LLC
c/o Morgan Stanley & Co. LLC
1585 Broadway
New York, New York 10036
c/o J.P. Morgan Securities LLC
383 Madison Avenue
New York, New York 10179
Ladies and Gentlemen:
Voyager Technologies, Inc., a Delaware corporation (the “Company”), proposes to issue and sell to the several Underwriters named in Schedule I hereto (the “Underwriters”) [●] shares of its Class A common stock, par value $0.0001 per share (the “Firm Shares”). The Company also proposes to issue and sell to the several Underwriters not more than an additional [●] shares of its Class A common stock, par value $0.0001 per share (the “Additional Shares”), if and to the extent that Morgan Stanley & Co. LLC (“Morgan Stanley”) and J.P. Morgan Securities LLC (“J.P. Morgan” and, together with Morgan Stanley, the “Representatives”), as representatives of the offering, shall have determined to exercise, on behalf of the Underwriters, the right to purchase such shares of Class A common stock granted to the Underwriters in Section 2 hereof. The Firm Shares and the Additional Shares are hereinafter collectively referred to as the “Shares.” The shares of Class A common stock, par value $0.0001 per share, of the Company to be outstanding after giving effect to the sales contemplated hereby are hereinafter referred to as the “Common Stock.”
The Company has filed with the Securities and Exchange Commission (the “Commission”) a registration statement on Form S-1 (File No. 333-287354), including a preliminary prospectus, relating to the Shares. The registration statement as amended at the time it becomes effective, including the information (if any) deemed to be part of the registration statement at the time of effectiveness pursuant to Rule 430A under the Securities Act of 1933, as amended (the “Securities Act”), is hereinafter referred to as the “Registration Statement”; the prospectus in the form first used to confirm sales of Shares (or in the form first made available to the Underwriters by the Company to meet requests of purchasers pursuant to Rule 173 under the Securities Act) is hereinafter referred to as the “Prospectus.” If the Company has filed an abbreviated registration statement to register additional shares of Common Stock pursuant to Rule 462(b) under the Securities Act (a “Rule 462 Registration Statement”), then any reference herein to the term “Registration Statement” shall be deemed to include such Rule 462 Registration Statement.
For purposes of this Agreement, “free writing prospectus” has the meaning set forth in Rule 405 under the Securities Act, “preliminary prospectus” shall mean each prospectus used prior to the effectiveness of the Registration Statement, and each prospectus that omitted information pursuant to Rule 430A under the Securities Act that was used after such effectiveness and prior to the execution and delivery of this Agreement, “Time of Sale Prospectus” means the preliminary prospectus contained in the Registration Statement at the time of its effectiveness together with the documents and pricing information set forth in Schedule II hereto, and “broadly available road show” means a “bona fide electronic road show” as defined in Rule 433(h)(5) under the Securities Act that has been made available without restriction to any person. As used herein, the terms “Registration Statement,” “preliminary prospectus,” “Time of Sale Prospectus” and “Prospectus” shall include the documents, if any, incorporated by reference therein as of the date hereof.
Morgan Stanley has agreed to reserve a portion of the Shares to be purchased by it under this Agreement for sale to certain of the Company’s employees and friends and family members of certain of the Company’s directors, officers and employees (collectively, “Participants”), as set forth in each of the Time of Sale Prospectus and the Prospectus under the heading “Underwriting” (the “Directed Share Program”). The Shares to be sold by Morgan Stanley and its affiliates pursuant to the Directed Share Program, at the direction of the Company, are referred to hereinafter as the “Directed Shares”. Any Directed Shares not orally confirmed for purchase by any Participant by the end of the business day on which this Agreement is executed will be offered to the public by the Underwriters as set forth in the Prospectus.
1. Representations and Warranties. The Company represents and warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop order suspending the effectiveness of the Registration Statement is in effect, and no proceedings for such purpose or pursuant to Section 8A under the Securities Act are pending before or, to the Company’s knowledge, threatened by the Commission.
(b) (i) The Registration Statement, when it became effective, did not contain and, as amended or supplemented, if applicable, will not, as of the date of such amendment or supplement, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the Registration Statement and the Prospectus comply and, as amended or supplemented, if applicable, will, as of the date of such amendment or supplement, comply in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder, (iii) the Time of Sale Prospectus does not, and at the time of each sale of the Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers and at the Closing Date (as defined in Section 4), the Time of Sale Prospectus, as then amended or supplemented by the Company, if applicable, will not, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (iv) each broadly available
road show, if any, when considered together with the Time of Sale Prospectus, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading and (v) the Prospectus, as of its date, does not contain and, as amended or supplemented, if applicable, will not contain, as of the date of such amendment or supplement, any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this paragraph do not apply to statements or omissions in the Registration Statement, the Time of Sale Prospectus or the Prospectus based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use therein.
(c) The Company is not an “ineligible issuer” in connection with the offering pursuant to Rules 164, 405 and 433 under the Securities Act. Any free writing prospectus that the Company is required to file pursuant to Rule 433(d) under the Securities Act has been, or will be, filed with the Commission in accordance with the requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder. Each free writing prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act or that was prepared by or on behalf of or used or referred to by the Company complies or will comply, as of the date of such filing, in all material respects with the requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder. Except for the free writing prospectuses, if any, identified in Schedule II hereto, and electronic road shows, if any, each furnished to the Representatives before first use, the Company has not prepared, used or referred to, and will not, without the Representatives’ prior consent, prepare, use or refer to, any free writing prospectus.
(d) The Company has been duly incorporated, is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, has the corporate power and authority to own or lease its property and to conduct its business as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus and is duly qualified to transact business and is in good standing in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(e) (i) Each “significant subsidiary” (as such term is defined in Rule 1-02 of Regulation S-X under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of the Company has been duly incorporated, organized or formed, is validly existing as a corporation or other business entity in good standing under the laws of the jurisdiction of its incorporation, organization or formation (to the extent the concept of good standing or an equivalent concept is applicable in such jurisdiction), has the corporate or other business entity power and authority to own or lease its property and to
conduct its business as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus and is duly qualified to transact business and is in good standing in each jurisdiction (to the extent the concept of good standing or an equivalent concept is applicable in such jurisdiction) in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; and (ii) except as described in the Registration Statement, the Time of Sale Prospectus, and the Prospectus, all of the issued shares of capital stock or other equity interests of each significant subsidiary of the Company have been duly and validly authorized and issued, are fully paid and non-assessable and are owned directly or indirectly by the Company, free and clear of all liens, encumbrances, equities or claims.
(f) This Agreement has been duly authorized, executed and delivered by the Company.
(g) The authorized capital stock of the Company conforms as to legal matters in all material respects to the description thereof contained in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus.
(h) The shares of Common Stock outstanding prior to the issuance of the Shares have been duly authorized and are validly issued, fully paid and non-assessable.
(i) The Shares have been duly authorized and, when issued, delivered and paid for in accordance with the terms of this Agreement, will be validly issued, fully paid and non-assessable, and the issuance of the Shares will not be subject to any preemptive or similar rights.
(j) The execution and delivery by the Company of, and the performance by the Company of its obligations under, this Agreement will not contravene (i) any provision of applicable law, (ii) the certificate of incorporation or by-laws of the Company, (iii) any agreement or other instrument binding upon the Company or any of its subsidiaries that is material to the Company and its subsidiaries, taken as a whole, or (iv) any judgment, order or decree of any governmental body, agency or court having jurisdiction over the Company or any subsidiary, except in the case of clauses (i), (iii) and (iv), where such contravention would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, and no consent, approval, authorization or order of, or qualification with, any governmental body, agency or court is required for the performance by the Company of its obligations under this Agreement, except such as have been obtained or waived or as may be required by the securities or Blue Sky laws of the various states or foreign jurisdictions or the rules and regulations of the Financial Industry Regulatory Authority (“FINRA”) in connection with the offer and sale of the Shares.
(k) There has not occurred any material adverse change, or any development involving a prospective material adverse change, in the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus.
(l) There are no legal or governmental proceedings pending or, to the Company’s knowledge, threatened to which the Company or any of its subsidiaries is a party or to which any of the properties of the Company or any of its subsidiaries is subject (i) other than proceedings accurately described in all material respects in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus and proceedings that would not reasonably be expected, singly or in the aggregate, to have a material adverse effect on the Company and its subsidiaries, taken as a whole, or on the power or ability of the Company to perform its obligations under this Agreement or to consummate the transactions contemplated by each of the Registration Statement, the Time of Sale Prospectus and the Prospectus or (ii) that are required to be described in the Registration Statement, the Time of Sale Prospectus or the Prospectus and are not so described in all material respects; and there are no statutes, regulations, contracts or other documents that are required to be described in the Registration Statement, the Time of Sale Prospectus or the Prospectus or to be filed as exhibits to the Registration Statement that are not described in all material respects or filed as required.
(m) Each preliminary prospectus filed as part of the Registration Statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the Securities Act, complied when so filed in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder.
(n) The Company is not, and after giving effect to the offering and sale of the Shares and the application of the proceeds thereof as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus will not be, required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.
(o) The Company and each of its subsidiaries (i) are in compliance with any and all applicable foreign, federal, state and local laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants (“Environmental Laws”), (ii) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses and (iii) are in compliance with all terms and conditions of any such permit, license or approval, except where such noncompliance with Environmental Laws, failure to receive required permits, licenses or other approvals or failure to comply with the terms and conditions of such permits, licenses or approvals would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(p) There are no costs or liabilities associated with Environmental Laws (including, without limitation, any capital or operating expenditures required for clean-
up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties) which would, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(q) Except as described in the Registration Statement, the Time of Sale Prospectus and the Prospectus, there are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Securities Act with respect to any securities of the Company or to require the Company to include such securities with the Shares registered pursuant to the Registration Statement.
(r) Neither the Company nor any of its subsidiaries is a “covered foreign person,” as that term is defined in 31 C.F.R. § 850.209. The transactions contemplated by each of the Registration Statement, the Time of Sale Prospectus and the Prospectus will not result in the establishment of a covered foreign person or the engagement by a “person of a country of concern,” as defined in 31 C.F.R. § 850.221, in a covered activity, as that term is defined in 31 C.F.R. § 850.208. Neither the Company nor any of its subsidiaries currently engages, or has plans to engage, directly or indirectly, in a “covered activity.”
(s) (i) None of the Company or any of its subsidiaries or affiliates, or any director or officer thereof, or, to the Company’s knowledge, any employee, agent or representative of the Company or of any of its subsidiaries or affiliates, has taken or will take any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the payment, giving or receipt of money, property, gifts or anything else of value, directly or indirectly, to any person to improperly influence official action by that person for the benefit of the Company or its subsidiaries or affiliates, or to otherwise secure any improper advantage, or to any person in violation of any applicable provision of (a) the U.S. Foreign Corrupt Practices Act of 1977, (b) the UK Bribery Act 2010, and (c) any other applicable law, regulation, order, decree or directive having the force of law and relating to bribery or corruption (collectively, the “Anti-Corruption Laws”). The Company and its subsidiaries have conducted and will conduct their businesses in compliance in all material respects with the Anti-Corruption Laws and (ii) no investigation, inquiry, action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Anti-Corruption Laws is pending or, to the knowledge of the Company, threatened.
(t) The operations of the Company and each of its subsidiaries are and have been conducted at all times in material compliance with all applicable anti-money laundering laws, rules, and regulations, including the financial recordkeeping and reporting requirements contained therein, and including the Bank Secrecy Act of 1970, applicable provisions of the USA PATRIOT Act of 2001, the Money Laundering Control Act of 1986, and the Anti-Money Laundering Act of 2020 (collectively, the “Anti-
Money Laundering Laws”). No investigation, inquiry, action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(u) (i) None of the Company, any of its subsidiaries, or any director, officer, nor to the Company’s knowledge, any employee, agent, affiliate or representative of the Company or any of its subsidiaries, is an individual or entity (“Person”) that is, or is owned or controlled by one or more Persons that are:
(A) the subject or target of any sanctions administered or enforced by the United States Government (including the U.S. Department of the Treasury’s Office of Foreign Assets Control and the U.S. Department of State), the United Nations Security Council, the European Union, His Majesty’s Treasury, or any other relevant sanctions authority (collectively, “Sanctions”), or
(B) located, organized or resident in a country or territory that is the subject of comprehensive territorial Sanctions (which are, as of the date of this Agreement, the so-called Donetsk People’s Republic, the so-called Luhansk People’s Republic, or any other Covered Region of Ukraine identified pursuant to Executive Order 14065, Crimea, Cuba, Iran, North Korea and Syria) (each a “Sanctioned Country”).
(ii) (A) Since April 24, 2019, the Company and each of its subsidiaries, (a) have not knowingly engaged in, and (b) are not now knowingly engaged in any dealings or transactions with any Person that at the time of the dealing or transaction is or was the subject of Sanctions, or in any Sanctioned Country. The Company and its subsidiaries have conducted and will conduct their businesses in compliance in all material respects with Sanctions and (B) no investigation, inquiry, action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to Sanctions is pending or, to the knowledge of the Company, threatened.
(v) The Company will not, directly or knowingly indirectly, use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person;
to fund or facilitate any activities or business of or with any Person that, at the time of such funding or facilitation, is the subject of Sanctions or with a Sanctioned Country;
in any other manner that would cause or result in a violation of Sanctions by any Person (including any Person participating in the offering, whether as underwriter, advisor, investor or otherwise).
(w) (i) Except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, the Company and its subsidiaries have conducted and will conduct their businesses in compliance with Export Controls, and (ii) no investigation, inquiry, action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to Export Controls is pending or, to the knowledge of the Company, threatened. The Company and its subsidiaries have instituted and maintained and will continue to maintain and enforce policies and procedures reasonably designed to promote compliance with applicable Anti-Corruption Laws, Anti-Money Laundering Laws, Export Controls and Sanctions.
As used in this Section 1(v), “Export Controls” means applicable export controls implemented by the United States, European Union or other jurisdictions to which the Company or any of its subsidiaries are subject, including any export controls administered by the Bureau of Industry Security of the U.S. Department of Commerce, the U.S. Department of State, and any export control measures under any statute, executive order, directive or regulation pursuant to the authority of any of the foregoing, or any orders or licenses issued thereunder.
(x) (i) Neither the Company nor any of its subsidiaries are in breach of or default under any current Government Contract in any material respect, and no event has occurred which would constitute such a breach or default by the Company or any of its subsidiaries; (ii) the Company and its subsidiaries are in compliance with all applicable laws, including the Federal Acquisition Regulation (“FAR”), Cost Accounting Standards, Service Contract Act of 1963, as amended (including requirements for paying applicable Service Contract Act wage rate and fringe benefit rates), the Truth in Negotiations Act, the Procurement Integrity Act and the Anti-Kickback Act, where and as applicable to each current Government Contract or Government Bid in all material respects; (iii) to the knowledge of the Company, no reasonable basis exists to give rise to a claim for fraud (as such concept is defined under the laws of the United States) in connection with any Government Contract under the False Claims Act; and (iv) no current Government Contract or Government Bid is currently the subject of any bid protest before any Governmental Authority. For the past three years, the Company and its subsidiaries have not (i) been the subject or target of any audit (other than pre-award, post-award or indirect rate audits by the Defense Contract Audit Agency or the Defense Contract Management Agency or other Governmental Authorities performing a similar function in the ordinary course of business), subpoena, investigation, prosecution or administrative proceeding related to any Government Contract or Government Bid, nor (ii) made any voluntary or mandatory disclosure to any Governmental Authority with respect to any alleged material irregularity, misstatement, noncompliance or omission arising under or relating to a Government Contract or Government Bid. The Company and its subsidiaries are not, nor, to the knowledge of the Company in the past three years, have not been, (i) debarred or suspended from participation in, or the award of, contracts with any Governmental Authority, nor (ii) the subject of any debarment or suspension inquiry.
As used in this Section 1(w):
“Governmental Authority” means any federal, state, local or foreign court or governmental agency, authority, instrumentality or regulatory or legislative body.
“Government Bid” means any outstanding quotation, bid or proposal by the Company that, if accepted or awarded, would lead to a Government Contract.
“Government Contract” means any contract, including any purchase order or other transaction authority agreement, entered into between the Company and (i) any Governmental Authority; (ii) any prime contractor to any Governmental Authority (in its capacity as such); or (iii) any subcontractor (of any tier) with respect to any contract described in clauses (i) and (ii).
(y) Subsequent to the respective dates as of which information is given in, and except as otherwise disclosed in, each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, (i) the Company and its subsidiaries, taken as a whole, have not incurred any material liability or obligation, direct or contingent, nor entered into any material transaction; (ii) the Company has not purchased any of its outstanding capital stock, nor declared, paid or otherwise made any dividend or distribution of any kind on its capital stock other than ordinary and customary dividends; and (iii) there has not been any material change in the capital stock, short-term debt or long-term debt of the Company and its subsidiaries, taken as a whole.
(z) Except as otherwise disclosed in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, the Company and each of 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, taken as a whole, in each case free and clear of all liens, encumbrances and defects except such as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and its subsidiaries; and any real property and buildings held under lease by the Company and its subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as are not material and do not materially interfere with the use made and proposed to be made of such property and buildings by the Company and its subsidiaries (subject to the effects of (i) bankruptcy, insolvency, fraudulent conveyance, fraudulent transfer, reorganization, moratorium or other similar laws related to or affecting the rights or remedies of creditors generally, (ii) the application of general principles of equity (including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing, regardless of whether enforcement is considered in proceedings at law or in equity) and (iii) applicable law and public policy with respect to rights to indemnity and contribution).
(aa) Except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, (i)
the Company and its subsidiaries own or have a right to use all patents, inventions, copyrights, know how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks and trade names, and all other worldwide intellectual property rights (whether registered or unregistered) (collectively, “Intellectual Property Rights”) used in or reasonably necessary for the conduct of their businesses as described in the Registration Statement, the Time of Sale Prospectus and the Prospectus; (ii) the registered Intellectual Property Rights owned by the Company and its subsidiaries are subsisting and to the Company’s knowledge, valid and enforceable; (iii) there is no pending or, to the Company’s knowledge, threatened action, suit, proceeding or claim by others (x) challenging the validity, scope or enforceability of any registered Intellectual Property Rights owned by the Company or any of its subsidiaries, or (y) alleging any infringement, misappropriation or other violation of Intellectual Property Rights of others by the Company or any of its subsidiaries; (iv) to the Company’s knowledge, no third party is infringing, misappropriating or otherwise violating, or has infringed, misappropriated or otherwise violated, any Intellectual Property Rights owned by the Company or any of its subsidiaries; (v) neither the Company nor any of its subsidiaries infringes, misappropriates or otherwise violates, or has infringed, misappropriated or otherwise violated, any Intellectual Property Rights of any third party; and (vi) the Company and its subsidiaries use commercially reasonable efforts to maintain and protect their rights in the confidentiality of all of their information intended to be maintained as a trade secret.
(bb) Except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole neither the Company nor any of its subsidiaries uses or distributes or has used or distributed any software that is distributed under a “free,” “open source,” or similar licensing model (including, but not limited to, the MIT License, Apache License, GNU General Public License, GNU Lesser General Public License and GNU Affero General Public License) (“Open Source Software”) in any manner that requires or has required any software owned by the Company or any of its subsidiaries to be (1) disclosed or distributed in source code form, (2) licensed for the purpose of making derivative works or (3) redistributed at no charge.
(cc) Except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole: (i) the Company and each of its subsidiaries have complied and are presently in compliance with all external privacy policies, contractual obligations, and applicable industry standards, laws, statutes, judgments, orders, rules and regulations of any court or arbitrator or other governmental or regulatory authority that are binding on the Company or any of its subsidiaries, in each case, relating to the collection, use, transfer, import, export, storage, protection, disposal and disclosure by the Company or any of its subsidiaries of personal, personally identifiable or confidential data or data regulated by data privacy laws applicable to the Company or any of its subsidiaries (“Data Security Obligations”, and such data, “Data”); (ii) the Company and each of its subsidiaries have not received any written notification of or written complaint regarding and are unaware of
any other facts that would reasonably indicate non-compliance with any Data Security Obligation. Except as described in the Registration Statement, Time of Sale Prospectus, and the Prospectus, there is no action, suit or proceeding by or before any court or governmental agency, authority or body pending or threatened against the Company, any of its subsidiaries, any of their respective service providers or customers (in the case of service providers, relating to the service provider’s processing of Data on behalf of the Company or such subsidiary, and in the case of customers, relating to the products or services specifically provided by the Company or such subsidiary or such service provider to the customer) alleging non-compliance with any Data Security Obligation.
(dd) Except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, the Company and its subsidiaries’ information technology systems are adequate for, and operate and perform in all material respects as required in connection with, the operation of the business of the Company and its subsidiaries as currently conducted and, to the Company’s knowledge, are free and clear of all bugs, errors, defects, Trojan horses, time bombs, malware and other corruptants. The Company and each of its subsidiaries have taken technical and organizational measures designed to protect their trade secrets and confidential information and the integrity, confidentiality, continuous operation, redundancy and security of the information technology systems and Data used in connection with the operation of the Company’s and its subsidiaries’ businesses, with such measures being, as a whole, commercially reasonable. The Company and its subsidiaries have used commercially reasonable efforts to establish, maintain, implement and comply with commercially reasonable information technology, information security, cyber security and data protection controls, policies and procedures, including access controls, encryption, technological and physical safeguards and business continuity and disaster recovery plans and processes that are designed to protect against and reasonably prevent breach, destruction, loss or unauthorized distribution, use, access, disablement, misappropriation or modification or misuse of any information technology system or Data used in connection with the operation of the Company’s and its subsidiaries’ businesses (“Breach”). There has been no Breach, except those that have been remedied without material cost or liability or the duty to notify any person, and the Company and its subsidiaries have not been notified of any such suspected Breach.
(ee) (i) Each employee benefit plan, within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), whether or not subject to ERISA, for which the Company or any member of its “Controlled Group” (defined as any entity, whether or not incorporated, that is under common control with the Company within the meaning of Section 4001(a)(14) of ERISA or any entity that would be regarded as a single employer with the Company under Section 414(b), (c), (m) or (o) of the Internal Revenue Code of 1986, as amended (the “Code”)) could have any liability (each, a “Plan”) has been maintained in compliance with its terms and the requirements of any applicable statutes, orders, rules and regulations, including, but not limited to, ERISA and the Code; (ii) no prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code, has occurred with
respect to any Plan, excluding transactions effected pursuant to a statutory or administrative exemption; (iii) there are and have been no Plans subject to Title IV of ERISA, and there are and have been no conditions pursuant to which the Company or any member of its Controlled Group is or could be subject to liability under Title IV of ERISA in respect of any Plan (including a “multiemployer plan,” within the meaning of Section 4001(a)(3) of ERISA) (“Multiemployer Plan”); (iv) no Multiemployer Plan is expected to be “insolvent” (within the meaning of Section 4245 of ERISA), or in “endangered status” or “critical status” (within the meaning of Sections 304 and 305 of ERISA); and (v) each Plan that is intended to be qualified under Section 401(a) of the Code has received a favorable determination letter from the Internal Revenue Service or is the subject of a favorable opinion letter from the Internal Revenue Service, and, to the knowledge of the Company, nothing has occurred, whether by action or by failure to act, which could reasonably be expected to cause the loss of such qualification, except, with respect each of the events or conditions set forth in (i) through (v) hereof, as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(ff) Except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, (i) no labor dispute with the employees of the Company or any of its subsidiaries exists, or, to the knowledge of the Company, is imminent; and (ii) the Company is not aware of any existing, threatened or imminent labor disturbance by the employees of any of its principal suppliers, manufacturers or contractors.
(gg) The Company and each of its subsidiaries, taken as a whole, are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts in the Company’s reasonable judgment as are prudent and customary in the businesses in which they are engaged, except where the failure to be insured would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; neither the Company nor any of its subsidiaries has been refused any insurance coverage sought or applied for; and neither the Company nor any of its subsidiaries has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(hh) The Company and each of 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 obtain such certificates, authorizations or permits would not reasonably be expected to, singly or in the aggregate, have a material adverse effect on the Company or its subsidiaries, taken as a whole, and neither the Company nor any of its subsidiaries has received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(ii) The financial statements included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, together with the related schedules and notes thereto, comply as to form in all material respects with the applicable accounting requirements of the Securities Act and present fairly in all material respects the consolidated financial position of the Company and its consolidated subsidiaries as of the dates shown and its results of operations and cash flows for the periods shown, and such financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”) applied on a consistent basis throughout the periods covered thereby except for any normal year-end adjustments in the Company’s quarterly financial statements. The other financial information included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus has been derived from the accounting records of the Company and its consolidated subsidiaries and presents fairly in all material respects the information shown thereby. The statistical, industry-related and market-related data included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus are based on or derived from sources that the Company reasonably and in good faith believes are reliable and accurate and such data is consistent with the sources from which they are derived, in each case in all material respects.
(jj) PricewaterhouseCoopers LLP, who have certified certain financial statements of the Company and its subsidiaries and delivered its report with respect to the audited consolidated financial statements and schedules filed with the Commission as part of the Registration Statement and included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, is an independent registered public accounting firm with respect to the Company within the meaning of the Securities Act and the applicable rules and regulations thereunder adopted by the Commission and the Public Company Accounting Oversight Board (United States).
(kk) The Company and its consolidated subsidiaries maintain a system of internal accounting controls 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 U.S. GAAP and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. Except as otherwise disclosed in the Registration Statement, the Time of Sale Prospectus and the Prospectus, since the end of the Company’s most recent audited fiscal year, there has been (i) no material weakness in the Company’s internal control over financial reporting (whether or not remediated) and (ii) no change in the Company’s internal control over financial reporting that has materially and adversely affected, or is reasonably likely to materially and adversely affect, the Company’s internal control over
financial reporting (it being understood that these clauses (i) and (ii) shall not require the Company to comply with Section 404 of the Sarbanes-Oxley Act of 2002, as amended, and the rules and regulations promulgated in connection therewith as of an earlier date than it would otherwise be required to do so under applicable law).
(ll) Except as disclosed in the Registration Statement, the Time of Sale Prospectus and the Prospectus, the Company has not sold, issued or distributed any shares of Common Stock during the six-month period preceding the date hereof, including any sales pursuant to Rule 144A under, or Regulation D or S of, the Securities Act, other than shares issued pursuant to employee or director benefit plans, equity incentive plans or other employee compensation plans or pursuant to outstanding equity-based awards, rights or warrants.
(mm) The Registration Statement, the Prospectus, the Time of Sale Prospectus and any preliminary prospectus comply, and any amendments or supplements thereto will comply, with any applicable laws or regulations of foreign jurisdictions in which the Prospectus, the Time of Sale Prospectus or any preliminary prospectus, as amended or supplemented, if applicable, are distributed in connection with the Directed Share Program.
(nn) No consent, approval, authorization or order of, or qualification with, any governmental body or agency, other than those obtained, is required in connection with the offering of the Directed Shares in any jurisdiction where the Directed Shares are being offered.
(oo) The Company has not offered, or caused Morgan Stanley or any Morgan Stanley Entity as defined in Section 9 to offer, Shares to any person pursuant to the Directed Share Program with the specific intent to unlawfully influence (i) any purchaser of Directed Shares or any of such purchaser’s respective affiliates to alter such party’s level or type of business with the Company, or (ii) a trade journalist or publication to write or publish favorable information about the Company or any of its affiliates, or their respective businesses or products.
(pp) The Company and each of its subsidiaries have filed all U.S. federal, state, local and foreign tax returns required by law to be filed through the date of this Agreement or have requested extensions thereof (except where the failure to file would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole) and have paid all taxes required to be paid thereon (except for cases in which the failure to file or pay would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, or, except as currently being contested in good faith and for which reserves required by U.S. GAAP have been created in the financial statements of the Company), and no tax deficiency has been determined adversely to the Company or any of its subsidiaries which, singly or in the aggregate, has had (nor does the Company nor any of its subsidiaries have any notice or knowledge of any tax deficiency which could reasonably be expected to be determined adversely to the
Company or its subsidiaries and which could reasonably be expected to have) a material adverse effect on the Company and its subsidiaries, taken as a whole.
(qq) Neither the Company nor any of its subsidiaries has any securities rated by any “nationally recognized statistical rating organization,” as such term is defined in Section 3(a)(62) of the Exchange Act.
(rr) From the time of initial confidential submission of the Registration Statement to the Commission through the date hereof, the Company has been and is an “emerging growth company,” as defined in Section 2(a) of the Securities Act (an “Emerging Growth Company”).
(ss) The Company (i) has not alone engaged in any Testing-the-Waters Communication with any person other than Testing-the-Waters Communications with the consent of Morgan Stanley, J.P. Morgan and BofA Securities, Inc. with entities that are reasonably believed to be qualified institutional buyers within the meaning of Rule 144A under the Securities Act or institutions that are reasonably believed to be accredited investors within the meaning of Rule 501 under the Securities Act and (ii) has not authorized anyone other than Morgan Stanley, J.P. Morgan and BofA Securities, Inc. to engage in Testing-the-Waters Communications. The Company reconfirms that Morgan Stanley, J.P. Morgan and BofA Securities, Inc. have been authorized to act on its behalf in undertaking Testing-the-Waters Communications. The Company has not distributed any Testing-the-Waters Communication that is a written communication within the meaning of Rule 405 under the Securities Act other than those listed on Schedule III hereto. “Testing-the-Waters Communication” means any communication with potential investors undertaken in reliance on Section 5(d) or Rule 163B of the Securities Act.
(tt) As of the time of each sale of the Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers, none of (A) the Time of Sale Prospectus, (B) any free writing prospectus, when considered together with the Time of Sale Prospectus, and (C) any individual Testing-the-Waters Communication, when considered together with the Time of Sale Prospectus, included, includes or will include an untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, however, that this representation and warranty does not apply to any statements or omissions based upon information relating to any Underwriter furnished to the Company in writing by or on behalf of such Underwriter through the Representatives expressly for use therein, it being understood and agreed that the only such information is that described in Section 8(b).
2. Agreements to Sell and Purchase. The Company hereby agrees to sell to the several Underwriters, and each Underwriter, upon the basis of the representations and warranties herein contained, but subject to the terms and conditions hereinafter stated, agrees, severally and not jointly, to purchase from the Company the respective numbers of Firm Shares set forth in Schedule I hereto opposite its name at $[●] a share (the “Purchase Price”).
On the basis of the representations and warranties contained in this Agreement, and subject to its terms and conditions, the Company agrees to sell to the Underwriters the Additional Shares, and the Underwriters shall have the right to purchase, severally and not jointly, up to [●] Additional Shares at the Purchase Price, provided, however, that the amount paid by the Underwriters for any Additional Shares shall be reduced by an amount per share equal to any dividends declared by the Company and payable on the Firm Shares but not payable on such Additional Shares. The Representatives may exercise this right on behalf of the Underwriters in whole or from time to time in part by giving written notice to the Company not later than 30 days after the date of this Agreement. Any exercise notice shall specify the number of Additional Shares to be purchased by the Underwriters and the date on which such shares are to be purchased. Each purchase date must be at least one business day after the written notice is given and may not be earlier than the closing date for the Firm Shares or later than ten business days after the date of such notice. As used herein, “business day” means a day on which the New York Stock Exchange (the “NYSE”) is open for trading and on which banks in New York are open for business and are not permitted by law or executive order to be closed. Additional Shares may be purchased as provided in Section 4 hereof solely for the purpose of covering over-allotments made in connection with the offering of the Firm Shares. On each day, if any, that Additional Shares are to be purchased (an “Option Closing Date”), each Underwriter agrees, severally and not jointly, to purchase the number of Additional Shares (subject to such adjustments to eliminate fractional shares as the Representatives may determine) that bears the same proportion to the total number of Additional Shares to be purchased on such Option Closing Date as the number of Firm Shares set forth in Schedule I hereto opposite the name of such Underwriter bears to the total number of Firm Shares.
3. Terms of Public Offering. The Company is advised by the Representatives that the Underwriters propose to make a public offering of their respective portions of the Shares as soon after the Registration Statement and this Agreement have become effective as in the Representatives’ judgment is advisable. The Company is further advised by the Representatives that the Shares are to be offered to the public initially at $[●] a share (the “Public Offering Price”) and to certain dealers selected by the Representatives at a price that represents a concession not in excess of $[●] a share under the Public Offering Price, and that any Underwriter may allow, and such dealers may reallow, a concession, not in excess of $[●] a share, to any Underwriter or to certain other dealers.
4. Payment and Delivery. Payment for the Firm Shares shall be made to the Company in Federal or other funds immediately available in New York City against delivery of such Firm Shares for the respective accounts of the several Underwriters at 10:00 a.m., New York City time, on [●], 2025, or at such other time on the same or such other date, not later than [●], 2025, as shall be designated in writing by the Representatives. The time and date of such payment are hereinafter referred to as the “Closing Date.”
Payment for any Additional Shares shall be made to the Company in Federal or other funds immediately available in New York City against delivery of such Additional Shares for the respective accounts of the several Underwriters at 10:00 a.m., New York City time, on the date specified in the corresponding notice described in Section 2 or at such other time on the same or
on such other date, in any event not later than [●], 2025, as shall be designated in writing by the Representatives.
The Firm Shares and Additional Shares shall be registered in such names and in such denominations as the Representatives shall request not later than one full business day prior to the Closing Date or the applicable Option Closing Date, as the case may be. The Firm Shares and Additional Shares shall be delivered to the Representatives on the Closing Date or an Option Closing Date, as the case may be, for the respective accounts of the several Underwriters, with any transfer taxes payable in connection with the transfer of the Shares to the Underwriters duly paid, against payment of the Purchase Price therefor.
5. Conditions to the Underwriters’ Obligations. The obligations of the Company to sell the Shares to the Underwriters and the several obligations of the Underwriters to purchase and pay for the Shares on the Closing Date are subject to the condition that the Registration Statement shall have become effective not later than [●] (New York City time) on the date hereof.
The several obligations of the Underwriters are subject to the following further conditions:
(a) Subsequent to the execution and delivery of this Agreement and prior to the Closing Date:
(i) no order suspending the effectiveness of the Registration Statement shall be in effect, and no proceeding for such purpose or pursuant to Section 8A under the Securities Act shall be pending before or, to the knowledge of the Company, threatened by the Commission; and
(ii) there shall not have occurred any change, or any development involving a prospective change, in the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus that, in the Representatives’ judgment, is material and adverse and that makes it, in the Representatives’ judgment, impracticable to market the Shares on the terms and in the manner contemplated in the Time of Sale Prospectus.
(b) The Underwriters shall have received on the Closing Date a certificate, dated the Closing Date and signed by an executive officer of the Company, to the effect set forth in Sections 5(a)(i) and 5(a)(ii) above and to the effect that the representations and warranties of the Company contained in this Agreement are true and correct as of the Closing Date and that the Company has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied hereunder on or before the Closing Date.
The officer signing and delivering such certificate may rely upon the best of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an opinion and negative assurance letter of Latham & Watkins LLP, outside counsel for the Company, dated the Closing Date, in form and substance reasonably satisfactory to the Representatives to the effect set forth in Annex A.
(d) The Underwriters shall have received on the Closing Date an opinion and negative assurance letter of Simpson Thacher & Bartlett LLP, counsel for the Underwriters, dated the Closing Date, in form and substance reasonably satisfactory to you.
(e) The Underwriters shall have received, on each of the date hereof and the Closing Date, a letter dated the date hereof or the Closing Date, as the case may be, in form and substance satisfactory to the Underwriters, from PricewaterhouseCoopers LLP, independent public accountants, containing statements and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained in the Registration Statement, the Time of Sale Prospectus and the Prospectus; provided that the letter delivered on the Closing Date shall use a “cut-off date” not earlier than the date hereof.
(f) The Underwriters shall have received, on each of the date hereof and the Closing Date, a certificate dated the date hereof or the Closing Date, as the case may be, and signed by the chief financial officer of the Company, in his capacity as such, with respect to certain financial and accounting information in the Registration Statement, the Time of Sale Prospectus and the Prospectus, in form and substance reasonably satisfactory to the Representatives.
(g) The “lock-up” agreements, each substantially in the form of Exhibit A hereto, between the Representatives and the shareholders, officers and directors of the Company listed on Schedule IV relating to restrictions on sales and certain other dispositions of shares of Common Stock or certain other securities, delivered to the Representatives on or before the date hereof (the “Lock-up Agreements”), shall be in full force and effect on the Closing Date.
(h) The several obligations of the Underwriters to purchase Additional Shares hereunder are subject to the delivery to the Representatives on the applicable Option Closing Date of the following:
(i) a certificate, dated the Option Closing Date and signed by an executive officer of the Company, confirming that the certificate delivered on the Closing Date pursuant to Section 5(b) hereof remains true and correct as of such Option Closing Date;
(i) an opinion and negative assurance letter of Latham & Watkins LLP, outside counsel for the Company, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 5(c) hereof;
(ii) an opinion and negative assurance letter of Simpson Thacher & Bartlett LLP, counsel for the Underwriters, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 5(d) hereof;
(iii) a letter dated the Option Closing Date, in form and substance satisfactory to the Underwriters, from PricewaterhouseCoopers LLP, independent public accountants, substantially in the same form and substance as the letter furnished to the Underwriters pursuant to Section 5(e) hereof; provided that the letter delivered on the Option Closing Date shall use a “cut-off date” not earlier than two business days prior to such Option Closing Date;
(iv) a certificate, dated the Option Closing Date and signed by the chief financial officer of the Company, substantially in the same form and substance as the certificate delivered to the Underwriters pursuant to Section 5(f) hereof; and
(v) such other documents as the Representatives may reasonably request with respect to the good standing of the Company, the due authorization and issuance of the Additional Shares to be sold on such Option Closing Date and other matters related to the issuance of such Additional Shares.
6. Covenants of the Company. The Company covenants with each Underwriter as follows:
(a) To furnish to the Representatives an electronic copy of the Registration Statement (including exhibits thereto) and for delivery to each other Underwriter a conformed copy of the Registration Statement (without exhibits thereto) (which may be an electronic facsimile), the Time of Sale Prospectus, the Prospectus and any supplements and amendments thereto or to the Registration Statement.
(b) Before amending or supplementing the Registration Statement, the Time of Sale Prospectus or the Prospectus, to furnish to the Representatives a copy of each such proposed amendment or supplement and not to file any such proposed amendment or supplement to which the Representatives reasonably object, and to file with the Commission within the applicable period specified in Rule 424(b) under the Securities Act any prospectus required to be filed pursuant to such Rule.
(c) To furnish to the Representatives a copy of each proposed free writing prospectus to be prepared by or on behalf of, used by, or referred to by the Company and not to use or refer to any proposed free writing prospectus to which the Representatives reasonably object.
(d) Not to take any action that would result in an Underwriter or the Company being required to file with the Commission pursuant to Rule 433(d) under the Securities
Act a free writing prospectus prepared by or on behalf of the Underwriter that the Underwriter otherwise would not have been required to file thereunder.
(e) If the Time of Sale Prospectus is being used to solicit offers to buy the Shares at a time when the Prospectus is not yet available to prospective purchasers and any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Time of Sale Prospectus in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if any event shall occur or condition exist as a result of which the Time of Sale Prospectus conflicts with the information contained in the Registration Statement then on file, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Time of Sale Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to any dealer upon request, either amendments or supplements to the Time of Sale Prospectus so that the statements in the Time of Sale Prospectus as so amended or supplemented will not, in the light of the circumstances when the Time of Sale Prospectus is delivered to a prospective purchaser, be misleading or so that the Time of Sale Prospectus, as amended or supplemented, will no longer conflict with the Registration Statement, or so that the Time of Sale Prospectus, as amended or supplemented, will comply with applicable law.
(f) If, during such period after the first date of the public offering of the Shares as in the opinion of counsel for the Underwriters the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is required by law to be delivered in connection with sales by an Underwriter or dealer, any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is delivered to a purchaser, not misleading, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to the dealers (whose names and addresses the Representatives will furnish to the Company) to which Shares may have been sold by the Representatives on behalf of the Underwriters and to any other dealers upon request, either amendments or supplements to the Prospectus so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is delivered to a purchaser, be misleading or so that the Prospectus, as amended or supplemented, will comply with applicable law.
(g) To endeavor to qualify the Shares for offer and sale under the securities or Blue Sky laws of such jurisdictions as the Representatives shall reasonably request, provided that the Company shall not be required to (i) qualify as a foreign corporation or other entity as a dealer in securities in any such jurisdiction where it would not otherwise be required to so qualify, (ii) file any general consent to service of process in any such
jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it is not otherwise so subject.
(h) To make generally available (which may be satisfied by filing with the Commission on its Electronic Data Gathering, Analysis and Retrieval System) to the Company’s security holders and to the Representatives as soon as practicable an earnings statement covering a period of at least twelve months beginning with the first fiscal quarter of the Company occurring after the date of this Agreement which shall satisfy the provisions of Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder.
(i) To comply with all applicable securities and other laws, rules and regulations in each jurisdiction in which the Directed Shares are offered in connection with the Directed Share Program.
(j) Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, to pay or cause to be paid all expenses incident to the performance of its obligations under this Agreement, including: (i) the fees, disbursements and expenses of the Company’s counsel and the Company’s accountants in connection with the registration and delivery of the Shares under the Securities Act and all other fees or expenses in connection with the preparation and filing of the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, any free writing prospectus prepared by or on behalf of, used by, or referred to by the Company and amendments and supplements to any of the foregoing, including all printing costs associated therewith, and the mailing and delivering of copies thereof to the Underwriters and dealers, in the quantities hereinabove specified, (ii) all costs and expenses related to the transfer and delivery of the Shares to the Underwriters, including any transfer or similar taxes payable thereon, (iii) the cost of printing or producing any Blue Sky or Legal Investment memorandum in connection with the offer and sale of the Shares under state securities laws and all expenses in connection with the qualification of the Shares for offer and sale under state securities laws as provided in Section 6(g) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky or Legal Investment memorandum, (iv) all filing fees and the reasonable fees and disbursements of counsel to the Underwriters incurred in connection with the review and qualification of the offering of the Shares by FINRA; provided that the amount payable by the Company with respect to such fees and expenses of counsel pursuant to clauses (iii) and (iv) shall not, in the aggregate, exceed $40,000, (v) all fees and expenses in connection with the preparation and filing of the registration statement on Form 8-A relating to the Common Stock and all costs and expenses incident to listing the Shares on the NYSE, (vi) the cost of printing certificates representing the Shares, (vii) the costs and charges of any transfer agent, registrar or depositary, (viii) the costs and expenses of the Company relating to investor presentations on any “road show” undertaken in connection with the marketing of the offering of the Shares, including, without limitation, expenses associated with the preparation or dissemination of any
electronic road show, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations with the prior approval of the Company, travel and lodging expenses of the representatives and officers of the Company and any such consultants, and 50% of the cost of any aircraft or ground transportation chartered in connection with the road show (with the remaining 50% of such cost to be paid by the Underwriters), (ix) the document production charges and expenses associated with printing this Agreement, (x) all fees and disbursements of counsel incurred by the Underwriters in connection with the Directed Share Program and transfer taxes, stamp duties, similar taxes or duties, if any, incurred by the Underwriters in connection with the Directed Share Program and (xi) all other costs and expenses incident to the performance of the obligations of the Company hereunder for which provision is not otherwise made in this Section. It is understood, however, that except as provided in this Section 6, Section 8 entitled “Indemnity and Contribution”, Section 9 entitled “Directed Share Program Indemnification” and the last paragraph of Section 11 below, the Underwriters will pay all of their costs and expenses, including fees and disbursements of their counsel, transfer and similar taxes payable on resale of any of the Shares by them, any advertising expenses connected with any offers they may make, and all travel (except as set forth in clause (viii) above), lodging and other expenses of the Underwriters, any of their employees, their representatives and counsel.
(k) The Company will promptly notify the Representatives if the Company ceases to be an Emerging Growth Company at any time prior to the later of (i) completion of the distribution of the Shares within the meaning of the Securities Act and (ii) completion of the Restricted Period (as defined in this Section 6).
(l) If at any time following the distribution of any Testing-the-Waters Communication that is a written communication within the meaning of Rule 405 under the Securities Act there occurred or occurs an event or development as a result of which such Testing-the-Waters Communication, as then amended or supplemented, included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company will promptly notify the Representatives and will promptly amend or supplement, at its own expense, such Testing-the-Waters Communication to eliminate or correct such untrue statement or omission.
(m) The Company will deliver to each Underwriter (or its agent), on the date of execution of this Agreement, a properly completed and executed Certification Regarding Beneficial Owners of Legal Entity Customers, together with copies of identifying documentation, and the Company undertakes to provide such additional supporting documentation as each Underwriter may reasonably request in connection with the verification of the foregoing Certification.
The Company also covenants with each Underwriter that, without the prior written consent of the Representatives on behalf of the Underwriters, it will not, and will not publicly
disclose an intention to, during the period ending 180 days after the date of the Prospectus (the “Restricted Period”), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Class A common stock or any securities convertible into or exercisable or exchangeable for Class A common stock or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Class A common stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Class A common stock or such other securities, in cash or otherwise or (3) file any registration statement with the Commission relating to the offering of any shares of Class A common stock or any securities convertible into or exercisable or exchangeable for Class A common stock.
The restrictions contained in the preceding paragraph shall not apply to (A) the Shares to be sold hereunder, (B) grants of stock options, stock awards, restricted stock, restricted stock units, securities convertible into or exchangeable for shares of Class A common stock, Class B common stock, or other compensatory equity-based awards and the issuance of shares of Class A common stock or Class B common stock in connection with the exercise, vesting and/or settlement of any of the foregoing to the Company’s employees, officers, directors, advisors, or consultants pursuant to the terms of an equity compensation plan in effect as of the Closing Date and described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, (C) the issuance by the Company of shares of Class A common stock or Class B common stock upon the exercise of an option or warrant or the conversion or exercise of a security outstanding on the date hereof as described in each of the Registration Statement, Time of Sale Prospectus and Prospectus, (D) shares of Common Stock or any securities exercisable or exchangeable for shares of Common Stock, or the entrance into an agreement to issue shares of Common Stock, in connection with any merger, joint venture, strategic alliances, commercial or other collaborative transaction or the acquisition or licenses of the business, property, technology or other assets of another individual or entity or the assumption of an employee benefit plan in connection with a merger or acquisition; provided that the aggregate number of shares of Common Stock or any other securities exercisable or exchangeable for shares of Common Stock that the Company may issue or agree to issue pursuant to this clause (D) shall not exceed 10% of the total outstanding share capital of the Company immediately following the issuance of the Shares; provided further that the issuance of shares of Common Stock or any securities exercisable or exchangeable for shares of Common Stock pursuant to clause (H) below shall not count against the foregoing limit; and provided further that the recipients of any such shares of Common Stock and securities issued pursuant to this clause (D) during the Restricted Period shall enter into an agreement substantially in the form of Exhibit A hereto on or prior to such issuance, (E) facilitating the establishment of a trading plan on behalf of a shareholder, officer or director of the Company pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of Common Stock; provided that (i) such plan does not provide for the transfer of shares of Common Stock during the Restricted Period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required of or voluntarily made by the Company regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of shares of Common Stock may be made under such plan during the Restricted Period, (F) the filing of any registration statement on Form S-8 or amendment thereto
relating to securities granted or to be granted pursuant to any plan in effect on the date hereof and described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus or any assumed benefit plan pursuant to an acquisition or similar strategic transaction or (G) the issuance of shares of Common Stock or any securities exercisable or exchangeable for shares of Common Stock pursuant to the terms of service, dated April 1, 2024 between the Company and Palantir Technologies Inc, and any order forms pursuant to such terms of service.
If the Representatives, in their sole discretion, agree to release or waive the restrictions on the transfer of Shares set forth in a Lock-up Agreement for an officer or director of the Company and provide the Company with notice of the impending release or waiver at least three business days before the effective date of the release or waiver substantially in the form of Exhibit B, the Company agrees to announce the impending release or waiver by a press release substantially in the form of Exhibit B hereto through a major news service at least two business days before the effective date of the release or waiver.
7. Covenants of the Underwriters. Each Underwriter, severally and not jointly, covenants with the Company not to take any action that would result in the Company being required to file with the Commission under Rule 433(d) a free writing prospectus prepared by or on behalf of such Underwriter that otherwise would not be required to be filed by the Company thereunder, but for the action of the Underwriter.
8. Indemnity and Contribution.
(a) The Company agrees to indemnify and hold harmless each Underwriter, each person, if any, who controls any Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act and each affiliate of any Underwriter within the meaning of Rule 405 under the Securities Act from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) that arise out of, or are based upon, any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus or any amendment or supplement thereto, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any Company information that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act, any “road show” as defined in Rule 433(h) under the Securities Act (a “road show”), the Prospectus or any amendment or supplement thereto, or any Testing-the-Waters Communication, or arise out of, or are based upon, any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any such untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to any Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use therein, it being understood
and agreed that the only such information furnished by the Underwriters through the Representatives consists of the information described as such in paragraph (b) below.
(b) Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, its directors, its officers who sign the Registration Statement and each person, if any, who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the foregoing indemnity from the Company to such Underwriter, but only with reference to information relating to such Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use in the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, any issuer free writing prospectus, road show or the Prospectus or any amendment or supplement thereto, it being understood and agreed that the only such information consists of the following: information relating to the concession amount in the third paragraph under the caption “Underwriting” in the Prospectus, information concerning sales to discretionary accounts in the eighth paragraph under the caption “Underwriting” in the Prospectus and the first, second and ninth sentences of the fifteenth paragraph under the caption “Underwriting” in the Prospectus.
(c) In case any proceeding (including any governmental investigation) shall be instituted involving any person in respect of which indemnity may be sought pursuant to Section 8(a) or 8(b), such person (the “indemnified party”) shall promptly notify the person against whom such indemnity may be sought (the “indemnifying party”) in writing and the indemnifying party, upon request of the indemnified party, shall retain counsel reasonably satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the reasonable and documented fees and disbursements of such counsel related to such proceeding. In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. It is understood that the indemnifying party shall not, in respect of the legal expenses of any indemnified party in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all such indemnified parties and that all such fees and expenses shall be reimbursed as they are incurred. Such firm shall be designated in writing by the Representatives, in the case of parties indemnified pursuant to Section 8(a), and by the Company, in the case of parties indemnified pursuant to Section 8(b). 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 a final judgment 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. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for the fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement (i) includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding and (ii) does not include any statement as to or any admission of wrongdoing, culpability or a failure to act by or on behalf of any indemnified party.
(d) To the extent the indemnification provided for in Section 8(a) or 8(b) is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other hand from the offering of the Shares or (ii) if the allocation provided by clause 8(d)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 8(d)(i) above but also the relative fault of the Company on the one hand and of the Underwriters on the other hand in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other hand in connection with the offering of the Shares shall be deemed to be in the same respective proportions as the net proceeds from the offering of the Shares (before deducting expenses) received by the Company and the total underwriting discounts and commissions received by the Underwriters, in each case as set forth in the table on the cover of the Prospectus, bear to the aggregate Public Offering Price of the Shares. The relative fault of the Company on the one hand and the Underwriters on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Underwriters’ respective obligations to contribute pursuant to this Section 8 are several in proportion to the respective number of Shares they have purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be just or equitable if contribution pursuant to this Section 8 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in Section 8(d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages and liabilities referred to in Section 8(d) shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Shares underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages that such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The remedies provided for in this Section 8 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in this Section 8 and the representations, warranties and other statements of the Company contained in this Agreement shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Underwriter, any person controlling any Underwriter or any affiliate of any Underwriter or by or on behalf of the Company, its officers or directors or any person controlling the Company and (iii) acceptance of and payment for any of the Shares.
9. Directed Share Program Indemnification.
(a) In connection with the offer and sale of the Directed Shares, the Company agrees to indemnify and hold harmless Morgan Stanley, each person, if any, who controls Morgan Stanley within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act and each affiliate of Morgan Stanley within the meaning of Rule 405 of the Securities Act (“Morgan Stanley Entities”) from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) (i) that arise out of, or are based upon, any untrue statement or alleged untrue statement of a material fact contained in any material prepared by or with the consent of the Company for distribution to Participants in connection with the Directed Share Program or arise out of, or are based upon, any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading; (ii) that arise out of, or are based upon, the failure of any Participant to pay for and accept delivery of Directed Shares that the Participant agreed to purchase; (iii) related to, arising out of, or in connection with the Directed Share Program, other than losses, claims, damages or liabilities (or expenses relating
thereto) that are finally judicially determined to have resulted from the bad faith or gross negligence of Morgan Stanley Entities or (iv) that arise out of the violation of any applicable laws or regulations of foreign jurisdictions where the Directed Shares have been offered.
(b) In case any proceeding (including any governmental investigation) shall be instituted involving any Morgan Stanley Entity in respect of which indemnity may be sought pursuant to Section 9(a), the Morgan Stanley Entity seeking indemnity, shall promptly notify the Company in writing and the Company, upon request of the Morgan Stanley Entity, shall retain counsel reasonably satisfactory to the Morgan Stanley Entity to represent the Morgan Stanley Entity and any others the Company may designate in such proceeding and shall pay the fees and disbursements of such counsel related to such proceeding. In any such proceeding, any Morgan Stanley Entity shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such Morgan Stanley Entity unless (i) the Company shall have agreed to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the Company and the Morgan Stanley Entity and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. The Company shall not, in respect of the legal expenses of the Morgan Stanley Entities in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all Morgan Stanley Entities. Any such separate firm for the Morgan Stanley Entities shall be designated in writing by Morgan Stanley. The Company 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 a final judgment for the plaintiff, the Company agrees to indemnify the Morgan Stanley Entities from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time a Morgan Stanley Entity shall have requested the Company to reimburse it for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the Company agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by the Company of the aforesaid request and (ii) the Company shall not have reimbursed the Morgan Stanley Entity in accordance with such request prior to the date of such settlement. The Company shall not, without the prior written consent of Morgan Stanley, effect any settlement of any pending or threatened proceeding in respect of which any Morgan Stanley Entity is or could have been a party and indemnity could have been sought hereunder by such Morgan Stanley Entity, unless such settlement includes an unconditional release of the Morgan Stanley Entities from all liability on claims that are the subject matter of such proceeding.
(c) To the extent the indemnification provided for in Section 9(a) is unavailable to a Morgan Stanley Entity or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then the Company in lieu of indemnifying the Morgan Stanley Entity thereunder, shall contribute to the amount paid or payable by the Morgan Stanley Entity as a result of such losses, claims, damages or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Morgan Stanley Entities on the other hand from the offering of the Directed Shares or (ii) if the allocation provided by clause 9(c)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 9(c)(i) above but also the relative fault of the Company on the one hand and of the Morgan Stanley Entities on the other hand in connection with any statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Morgan Stanley Entities on the other hand in connection with the offering of the Directed Shares shall be deemed to be in the same respective proportions as the net proceeds from the offering of the Directed Shares (before deducting expenses) and the total underwriting discounts and commissions received by the Morgan Stanley Entities for the Directed Shares, bear to the aggregate Public Offering Price of the Directed Shares. If the loss, claim, damage or liability is caused by an untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact, the relative fault of the Company on the one hand and the Morgan Stanley Entities on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement or the omission or alleged omission relates to information supplied by the Company or by the Morgan Stanley Entities and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
(d) The Company and the Morgan Stanley Entities agree that it would not be just or equitable if contribution pursuant to this Section 9 were determined by pro rata allocation (even if the Morgan Stanley Entities were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in Section 9(c). The amount paid or payable by the Morgan Stanley Entities as a result of the losses, claims, damages and liabilities referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by the Morgan Stanley Entities in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 9, no Morgan Stanley Entity shall be required to contribute any amount in excess of the amount by which the total price at which the Directed Shares distributed to the public were offered to the public exceeds the amount of any damages that such Morgan Stanley Entity has otherwise been required to pay. The remedies provided for in this Section 9 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.
(e) The indemnity and contribution provisions contained in this Section 9 shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Morgan Stanley Entity or the Company, its officers or directors or any person controlling the Company and (iii) acceptance of and payment for any of the Directed Shares.
10. Termination. The Underwriters may terminate this Agreement by written notice given by the Representatives to the Company, if after the execution and delivery of this Agreement and prior to or on the Closing Date or any Option Closing Date, as the case may be, (i) trading generally shall have been suspended or materially limited on, or by, as the case may be, any of the NYSE, the NYSE American or the NASDAQ Global Market, (ii) trading of any securities of the Company shall have been suspended on any exchange or in any over-the-counter market, (iii) a material disruption in securities settlement, payment or clearance services in the United States shall have occurred, (iv) any moratorium on commercial banking activities shall have been declared by Federal or New York State authorities or (v) there shall have occurred any outbreak or escalation of hostilities, or any change in financial markets or any calamity or crisis that, in the Representatives’ judgment, is material and adverse and which, singly or together with any other event specified in this clause (v), makes it, in the Representatives’ judgment, impracticable or inadvisable to proceed with the offer, sale or delivery of the Shares on the terms and in the manner contemplated in the Time of Sale Prospectus or the Prospectus.
11. Effectiveness; Defaulting Underwriters. This Agreement shall become effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date or an Option Closing Date, as the case may be, any one or more of the Underwriters shall fail or refuse to purchase Shares that it has or they have agreed to purchase hereunder on such date, and the aggregate number of Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase is not more than one-tenth of the aggregate number of the Shares to be purchased on such date, the other Underwriters shall be obligated severally in the proportions that the number of Firm Shares set forth opposite their respective names in Schedule I bears to the aggregate number of Firm Shares set forth opposite the names of all such non-defaulting Underwriters, or in such other proportions as the Representatives may specify, to purchase the Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase on such date; provided that in no event shall the number of Shares that any Underwriter has agreed to purchase pursuant to this Agreement be increased pursuant to this Section 11 by an amount in excess of one-ninth of such number of Shares without the written consent of such Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Firm Shares and the aggregate number of Firm Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Firm Shares to be purchased on such date, and arrangements satisfactory to the Representatives and the Company for the purchase of such Firm Shares are not made within 36 hours after such default, this Agreement shall terminate without liability on the part of any non-defaulting Underwriter or the Company. In any such case either the Representatives or the Company shall have the right to postpone the Closing Date, but in no event for longer than seven days, in order that the required changes, if any, in the Registration Statement, in the Time of Sale Prospectus, in the Prospectus or in any other documents or arrangements may be effected. If, on an Option Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Additional Shares and the aggregate number of Additional Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Additional Shares to be purchased on such Option Closing Date, the non-defaulting Underwriters shall have the option to (i) terminate their obligation hereunder to purchase the Additional Shares to be sold on such
Option Closing Date or (ii) purchase not less than the number of Additional Shares that such non-defaulting Underwriters would have been obligated to purchase in the absence of such default. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them, because of any failure or refusal on the part of the Company to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason the Company shall be unable to perform its obligations under this Agreement, the Company will reimburse the Underwriters or such Underwriters as have so terminated this Agreement with respect to themselves, severally, for all out-of-pocket expenses (including the reasonable and documented fees and disbursements of their counsel) reasonably incurred by such Underwriters in connection with this Agreement or the offering contemplated hereunder.
12. Entire Agreement. (a) This Agreement, together with any contemporaneous written agreements and any prior written agreements (to the extent not superseded by this Agreement) that relate to the offering of the Shares, represents the entire agreement between the Company and the Underwriters with respect to the preparation of any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, the conduct of the offering, and the purchase and sale of the Shares.
(b) The Company acknowledges that in connection with the offering of the Shares: (i) the Underwriters have acted at arm’s length, are not agents of, and owe no fiduciary duties to, the Company or any other person, (ii) the Underwriters owe the Company only those duties and obligations set forth in this Agreement, any contemporaneous written agreements and prior written agreements (to the extent not superseded by this Agreement), if any, (iii) the Underwriters and their respective affiliates may have interests that differ from those of the Company, and (iv) none of the activities of the Underwriters in connection with the transactions contemplated herein constitutes a recommendation, investment advice, or solicitation of any action by the Underwriters with respect to any entity or natural person. The Company waives to the full extent permitted by applicable law any claims it may have against the Underwriters arising from an alleged breach of fiduciary duty in connection with the offering of the Shares.
13. Recognition of the U.S. Special Resolution Regimes. (a) In the event that any Underwriter that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Underwriter of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.
(b) In the event that any Underwriter that is a Covered Entity or a BHC Act Affiliate of such Underwriter becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Underwriter are permitted to be exercised to no greater extent than such Default
Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.
For purposes of this Section 13: “BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k). “Covered Entity” means any of the following: (i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b). “Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable. “U.S. Special Resolution Regime” means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.
14. Counterparts. This Agreement may be signed in two or more counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. Counterparts may be delivered via facsimile, electronic mail (including any electronic signature complying with the U.S. federal ESIGN Act of 2000, Uniform Electronic Transactions Act, the Electronic Signatures and Records Act or other applicable law, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.
15. Applicable Law. This Agreement, any claim, controversy or disputes arising under or related to this Agreement and any transaction contemplated by this shall be governed by and construed in accordance with the internal laws of the State of New York.
16. Headings. The headings of the sections of this Agreement have been inserted for convenience of reference only and shall not be deemed a part of this Agreement.
17. Notices. All communications hereunder shall be in writing and effective only upon receipt and if to the Underwriters shall be delivered, mailed or sent to the Representatives in care of Morgan Stanley & Co. LLC, 1585 Broadway, New York, New York 10036, Attention: Equity Syndicate Desk, with a copy to the Legal Department; J.P. Morgan Securities LLC at 383 Madison Avenue, New York, New York 10179, Attention: Equity Syndicate Desk Fax: (212) 633-8358; and if to the Company shall be delivered, mailed or sent to Voyager Technologies, Inc., 1225 17th Street, Suite 1100, Denver, CO 80202; Attention: Meg Vernal, with a copy to Latham & Watkins LLP, 1271 Avenue of the Americas, New York, New York 10020, Attention: Michael Benjamin and Lewis Kneib.
[Signature Pages Follow]
| | | | | | | | | | | |
| Very truly yours, |
| | | |
| VOYAGER TECHNOLOGIES, INC. |
| | | |
| | | |
| | | |
| By: | | |
| | Name: |
| | Title: |
[Signature Page to Underwriting Agreement]
| | | | | | | | |
| Accepted as of the date hereof | |
| | |
| Morgan Stanley & Co. LLC | |
| J.P. Morgan Securities LLC | |
| | |
| | |
Acting severally on behalf of themselves and the several Underwriters named in Schedule I hereto. | |
| | |
| By: | Morgan Stanley & Co. LLC |
| | | | | | | | | | | |
| By: | | J.P. Morgan Securities LLC | |
| | | |
| | | |
| | | |
| By: | | | |
| Name: | |
| Title: | |
[Signature Page to Underwriting Agreement]
SCHEDULE I
| | | | | |
| Underwriter | Number of Firm Shares To Be Purchased |
| |
Morgan Stanley & Co. LLC | |
| |
J.P. Morgan Securities LLC | |
| |
Barclays Capital Inc. | |
| |
Jefferies LLC | |
| |
BofA Securities, Inc. | |
| |
KeyBanc Capital Markets Inc. | |
| |
Nomura Securities International, Inc. | |
| |
WR Securities, LLC | |
| |
Total: | |
SCHEDULE II
Time of Sale Prospectus
1. Preliminary Prospectus issued [date]
2. [identify all free writing prospectuses filed by the Company under Rule 433(d) of the Securities Act]
3. [The initial public offering price per share to the public for the Shares is $[ ● ]. The number of Firm Shares purchased by the Underwriters is [ ● ] shares. The Additional Shares option is [ ● ] shares.]
SCHEDULE III
Testing-the-Waters Communications
[●]
SCHEDULE IV
The following persons shall execute a lock-up agreement in the form set forth on Exhibit A hereto:
[●]
EXHIBIT A
FORM OF LOCK-UP AGREEMENT
_____________, 20__
Morgan Stanley & Co. LLC
J.P. Morgan Securities LLC
c/o Morgan Stanley & Co. LLC
1585 Broadway
New York, NY 10036
c/o J.P. Morgan Securities LLC
383 Madison Avenue
New York, New York 10179
To the addressee set forth above:
The undersigned understands that Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC (together, the “Representatives”) propose to enter into an Underwriting Agreement (the “Underwriting Agreement”) with Voyager Technologies, Inc., a Delaware corporation (the “Company”), providing for the public offering (the “Public Offering”) by the several Underwriters, including the Representatives (the “Underwriters”), of [●] shares (the “Shares”) of common stock, par value $0.0001 per share, of the Company (the “Common Stock”).
To induce the Underwriters that may participate in the Public Offering to continue their efforts in connection with the Public Offering, the undersigned hereby agrees that, without the prior written consent of the Representatives on behalf of the Underwriters, it will not, and will not publicly disclose an intention to, during the period commencing on the date hereof and ending 180 days after the date of the final prospectus (the “Restricted Period”) relating to the Public Offering (the “Prospectus”), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock beneficially owned (as such term is used in Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), by the undersigned or any other securities so owned convertible into, redeemable for or exercisable or exchangeable for Common Stock (collectively, the “Restricted Securities”) or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (1) or (2) above (any transaction described in clause (1) or (2) above, collectively, “Transfers”) is to be settled by delivery of Common Stock or such other securities, in cash or otherwise. The undersigned acknowledges and agrees that the foregoing precludes the undersigned from engaging in any hedging or other transaction designed or intended, or which could reasonably be expected to lead to or result in, a
sale or disposition of any securities of the Company, even if any such sale or disposition transaction or transactions would be made or executed by or on behalf of someone other than the undersigned.
The foregoing restrictions shall not apply to Transfers of Restricted Securities:
(a) acquired in the Public Offering (other than, for officers and directors of the Company, any issuer-directed Shares purchased in the Public Offering) or in open market transactions after the completion of the Public Offering;
(b) as a bona fide gift or charitable contribution;
(c) if the undersigned is a corporation, partnership, limited liability company or other business entity, as part of a distribution by the undersigned to its stockholders, partners, members or other equityholders or to the estate of any such stockholders, partners, members or other equityholders;
(d) to an immediate family member of the undersigned or any trust or other entity for the direct or indirect benefit of the undersigned or the immediate family of the undersigned (for purposes of this lock-up agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than first cousin);
(e) to a corporation, partnership, limited liability company or other entity that (i) controls or is controlled by, or is under common control with, the undersigned, (ii) is an investment fund managed by the investment manager of the undersigned or (iii) or is wholly owned by the undersigned and/or by members of the undersigned’s immediate family;
(f) by will, other testamentary document or intestate succession upon the death of the undersigned or for bona fide estate planning purposes;
(g) by operation of law, such as pursuant to an order of a court or regulatory agency (for purposes of this lock-up agreement, a “court or regulatory agency” means any domestic or foreign, federal, state or local government, including any political subdivision thereof, any governmental or quasi-governmental authority, department, agency or official, any court or administrative body or any national securities exchange or similar self-regulatory body or organization, in each case of competent jurisdiction) or pursuant to a domestic order or in connection with a divorce settlement;
(h) any transfers to the Company from an employee of the Company upon death, disability or termination of employment, in each case, of such employee;
(i) to the Company or its subsidiaries in connection with the vesting, settlement or exercise of restricted stock units, options, warrants or other rights to purchase shares of Common Stock (including, in each case, by way of “net” or “cashless” exercise), including any transfer to the Company for the payment of tax withholdings or
remittance payments due as a result of the vesting, settlement or exercise of such restricted stock units, options, warrants or other rights, each as described in the Registration Statement, the preliminary prospectus relating to the Shares included in the Registration Statement immediately prior to the time the Underwriting Agreement is executed and the Prospectus;
(j) to the Company or any of the Company’s subsidiaries pursuant to an agreement under which the Company or any such subsidiary has the option to repurchase shares or a right of first refusal with respect to transfer of such shares;
(k) to the Company or any of the Company’s subsidiaries pursuant to an agreement under which the holder of shares or other securities convertible into or exercisable for shares has the option to require the Company or such subsidiary to repurchase such shares or other securities convertible into or exercisable for shares;
(l) resulting from the conversion of outstanding preferred stock of the Company into shares of Common Stock prior to or in connection with the consummation of the Public Offering, provided that any such shares received upon such conversion shall remain subject to the provisions of this lock-up agreement;
(m) resulting from conversions or reclassifications of a class or series of Common Stock into another class or series of Common Stock (including the conversion of shares of non-voting Common Stock into shares of voting Common Stock and vice versa), it being understood that any such shares received by the undersigned upon such conversion shall be subject to the provisions of this lock-up agreement;
(n) in connection with a bona fide third-party tender offer, merger, consolidation or other similar transaction that is approved by the Board of Directors of the Company and made to all holders of the Company’s capital stock involving a Change of Control (as defined below) of the Company (for purposes hereof, “Change of Control” shall mean the Transfer (whether by tender offer, merger, consolidation or other similar transaction), in one transaction or a series of related transactions, to a person or group of affiliated persons, of shares of capital stock if, after such Transfer, such person or group of affiliated persons would hold at least a majority of the outstanding voting securities of the Company (or the surviving entity)); provided that in the event that such tender offer, merger, consolidation or other similar transaction is not completed, the undersigned’s shares of Common Stock shall remain subject to the provisions of this lock-up agreement;
provided that in the case of any Transfer pursuant to clauses (b), (c), (d), (e) or (f), such transfer shall not involve a disposition for value and each transferee, donee or distributee, as applicable, shall sign and deliver a lock-up agreement substantially in the form of this agreement for the balance of the Restricted Period; provided further that in the case of any Transfer pursuant to clauses (a), (d) and (e), no filing under Section 16(a) of the Exchange Act, reporting a reduction in beneficial ownership of shares of Common Stock, shall be required or shall be voluntarily made during the Restricted Period; provided further that any filing under Section 16(a) of the Exchange Act reporting a Transfer pursuant to clause (b) shall clearly indicate in the footnotes
thereto that such Transfer is not for value, that the shares of Common Stock subject to such Transfer remain subject to restrictions set forth herein and that the filing relates to the circumstances described in clause (b); provided further that any filing under Section 16(a) of the Exchange Act reporting a reduction in beneficial ownership of shares of Common Stock resulting from a Transfer pursuant to clause (c) shall clearly indicate in the footnotes thereto that such Transfer is not for value, that the shares of Common Stock subject to such Transfer remain subject to restrictions set forth herein and that the filing relates to the circumstances described in clause (c), and no other public filing (other than those that might be required during the Restricted Period pursuant to Section 13 of the Exchange Act) or announcement shall be required or shall be made voluntarily in connection with such Transfer; provided further that in connection with any filing under Section 16(a) of the Exchange Act reporting a reduction in beneficial ownership of shares of Common Stock resulting from a Transfer pursuant to clause (i), such filing shall indicate that such Transfer has been net share settled; and provided further that any filing under Section 16(a) of the Exchange Act reporting a Transfer pursuant to clause (k) shall clearly indicate in the footnotes thereto that the filing relates to the circumstances described in clause (k).
The foregoing restrictions shall also not apply to facilitating the establishment of a trading plan on behalf of a shareholder, officer or director of the Company pursuant to Rule 10b5-1 under the Exchange Act for the Transfer of shares of Common Stock, provided that (x) such plan does not provide for the Transfer of shares of Common Stock during the Restricted Period and (y) to the extent a public announcement or disclosure, or filing under the Exchange Act, regarding the establishment of such plan is required or voluntarily made by or on behalf of the undersigned or the Company, such announcement, disclosure or filing shall include a statement to the effect that no Transfer of shares of Common Stock may be made under such plan during the Restricted Period.
In addition, the undersigned agrees that, without the prior written consent of the Representatives on behalf of the Underwriters, it will not, during the Restricted Period, make any demand for or exercise any right with respect to, the registration of any shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock. The undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar against the transfer of the undersigned’s shares of Common Stock except in compliance with the foregoing restrictions.
In addition, the provisions of this lock-up agreement shall not be deemed to restrict or prohibit the undersigned from exercising any option to purchase any shares of Common Stock pursuant to any stock incentive plan or stock purchase plan of the Company on a cash basis, provided that the underlying shares of Common Stock shall continue to be subject to the restrictions on transfer set forth in this lock-up agreement.
If the undersigned is an officer or director of the Company, the undersigned further agrees that the foregoing restrictions shall be equally applicable to any issuer-directed Shares the undersigned may purchase in the offering.
[If the undersigned is an officer or director of the Company, (i) the Representatives agree that, at least three business days before the effective date of any release or waiver of the foregoing restrictions in connection with a transfer of shares of Common Stock, the Representatives will notify the Company of the impending release or waiver, and (ii) the Company has agreed in the Underwriting Agreement to announce the impending release or waiver by press release through a major news service at least two business days before the effective date of the release or waiver. Any release or waiver granted by the Representatives hereunder to any such officer or director shall only be effective two business days after the publication date of such press release. The provisions of this paragraph will not apply if (a) the release or waiver is effected solely to permit a transfer not for consideration and (b) the transferee has agreed in writing to be bound by the same terms described in this lock-up agreement to the extent and for the duration that such terms remain in effect at the time of the transfer.]1
The undersigned understands that the Company and the Underwriters are relying upon this lock-up agreement in proceeding toward consummation of the Public Offering. The undersigned further understands that this lock-up agreement is irrevocable and shall be binding upon the undersigned’s heirs, legal representatives, successors and assigns.
The undersigned acknowledges and agrees that the Underwriters have not provided any recommendation or investment advice nor have the Underwriters solicited any action from the undersigned with respect to the Public Offering of the Shares and the undersigned has consulted their own legal, accounting, financial, regulatory and tax advisors to the extent deemed appropriate. The undersigned further acknowledges and agrees that, although the Underwriters may provide certain Regulation Best Interest and Form CRS disclosures or other related documentation to you in connection with the Public Offering, the Underwriters are not making a recommendation to you to participate in the Public Offering or sell any Shares at the price determined in the Public Offering, and nothing set forth in such disclosures or documentation is intended to suggest that any Underwriter is making such a recommendation.
This lock-up agreement shall automatically terminate and the undersigned shall be released from all of his, her or its obligations hereunder upon the earlier of (i) the date of the filing with the Securities and Exchange Commission of a notice of withdrawal of the Registration Statement on Form S-1 (which covers Shares) pursuant to Rule 477 promulgated under the Securities Act, (ii) the date on which for any reason the Underwriting Agreement is terminated (other than the provisions thereof that survive termination) prior to payment for and delivery of the Shares to be sold thereunder (other than pursuant to the Underwriters’ option thereunder to purchase additional Shares), (iii) the date on which the Company notifies the Representatives, in writing and prior to the execution of the Underwriting Agreement, that it does not intend to proceed with the Public Offering and (iv) October 15, 2025, in the event that the Underwriting Agreement has not been executed by such date (provided, however, that the Company may, by written notice to the undersigned prior to such date, extend such date by a period of up to an additional three months).
1 To be included for D&Os of the Company.
Whether or not the Public Offering actually occurs depends on a number of factors, including market conditions. Any Public Offering will only be made pursuant to an Underwriting Agreement, the terms of which are subject to negotiation between the Company and the Underwriters.
This lock-up agreement may be delivered via facsimile, electronic mail (including any electronic signature complying with the U.S. federal ESIGN Act of 2000, Uniform Electronic Transactions Act, the Electronic Signatures and Records Act or other applicable law, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.
This lock-up agreement shall be governed by and construed in accordance with the laws of the State of New York.
| | | | | | | | |
| | Very truly yours, |
| | |
| | |
| | [NAME OF STOCKHOLDER OR DIRECTOR/OFFICER] |
| | |
| | |
| | |
| Name: |
| Title: |
EXHIBIT B
FORM OF WAIVER OF LOCK-UP
_____________, 20__
[Name and Address of
Officer or Director
Requesting Waiver]
Dear Mr./Ms. [Name]:
This letter is being delivered to Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC (collectively, the “Representatives”) in connection with the offering by Voyager Technologies, Inc., a Delaware corporation (the “Company”), of [●] shares of Class A common stock, par value $0.0001 per share (the “Common Stock”), of the Company and the lock-up agreement dated [●], 2025 (the “Lock-up Agreement”), executed by you in connection with such offering, and your request for a [waiver] [release] dated [●], 20[●] with respect to [●] shares of Common Stock (the “Shares”).
The Representatives hereby agree to [waive] [release] the transfer restrictions set forth in the Lock-up Agreement, but only with respect to the Shares, effective [●], 2025; provided, however, that such [waiver] [release] is conditioned on the Company announcing the impending [waiver] [release] by press release through a major news service at least two business days before effectiveness of such [waiver] [release]. This letter will serve as notice to the Company of the impending [waiver] [release].
Except as expressly [waived] [released] hereby, the Lock-up Agreement shall remain in full force and effect.
| | | | | | | | | | | | | | |
| Very truly yours, | |
| | | | |
| Morgan Stanley & Co. LLC J.P. Morgan Securities LLC Acting severally on behalf of themselves and the several Underwriters named in Schedule I hereto | |
| | | | |
| | | | |
| By: | | | |
| | Name: | |
| | Title: | |
cc: Company
FORM OF PRESS RELEASE
Voyager Technologies, Inc.
[Date]
Voyager Technologies, Inc. (the “Company”) announced today that Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC , the lead book-running managers in the Company’s recent public sale of [●] shares of its common stock is [waiving][releasing] a lock-up restriction with respect to [●] shares of the Company’s common stock held by [certain officers or directors] [an officer or director] of the Company. The [waiver][release] will take effect on [●], 20[●], and the shares may be sold on or after such date.
This press release is not an offer for sale of the securities in the United States or in any other jurisdiction where such offer is prohibited, and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the United States Securities Act of 1933, as amended.
CERTIFICATE OF INCORPORATION
OF
Voyager Space Holdings, Inc.
The undersigned incorporator, in order to form a corporation under the General Corporation Law of the State of Delaware (the “DGCL”), certifies as follows:
Section 1. Name. The name of the corporation is Voyager Space Holdings, Inc. (the “Corporation”).
Section 2. Incorporator; Registered Office and Agent
(a)Incorporator. The name and mailing address of the incorporator are: Dylan Taylor, 1401 17th Street, 12th Floor, Denver Co 80202. The powers of the incorporator are to terminate upon the filing of this Certificate of Incorporation with the Secretary of State of the State of Delaware, and the initial director of the Corporation shall be as set forth in Section 7.
(b)Registered Agent. The name and address of the registered agent of the Corporation in the State of Delaware is Corporate Creations NetworkInc., 3411 Silverside Road Tatnall Building #104, Wilmington, DE 19810, New Castle County, or such other agent and address as the Board of Directors of the Corporation (the “Board”) shall from time to time select.
Section 3. Purpose and Business. The purpose of the Corporation is to engage in any lawful act or activity for which corporations may now or hereafter be organized under the DGCL, including, but not limited to the following:
(a)The Corporation may at any time exercise such rights, privileges, and powers, when not inconsistent with the purposes and object for which this Corporation is organized.
(b)The Corporation shall have power to have succession by its corporate name in perpetuity, or until dissolved and its affairs wound up according to law.
(c)The Corporation shall have power to sue and be sued in any court of law or equity.
(d)The Corporation shall have power to make contracts.
(e)The Corporation shall have power to hold, purchase and convey real and personal estate and to mortgage or lease any such real and personal estate with its franchises. The power to hold real and personal estate shall include the power to take the same by devise or bequest in the State of Delaware, or in any other state, territory or country.
(f)The Corporation shall have power to appoint such officers and agents as the affairs of the Corporation shall requite and allow them suitable compensation.
(g)The Corporation shall have power to make bylaws not inconsistent with the constitution or laws of the United States, or of the State of Delaware, for the management, regulation and government of its affairs and property, the transfer of its stock, the transaction of its business and the calling and holding of meetings of stockholders.
(h)The Corporation shall have the power to wind up and dissolve itself, or be wound up or dissolved.
(i)The Corporation shall have the power to adopt and use a common seal or stamp, or to not use such seal or stamp and if one is used, to alter the same. The use of a seal or stamp by the Corporation on any corporate documents is not necessary. The Corporation may use a seal or stamp, if it desires, but such use or non-use shall not in any way affect the legality of the document.
(j)The Corporation shall have the power to borrow money and contract debts when necessary for the transaction of its business, or for the exercise of its corporate rights, privileges or franchises, or for any other lawful purpose of its incorporation; to issue bonds, promissory notes, bills of exchange, debentures and other obligations and evidence of indebtedness, payable at a specified time or times, or payable upon the happening of a specified event or events, whether secured by mortgage, pledge or otherwise, or unsecured, for money borrowed, or in payment for property purchased, or acquired, or for another lawful object.
(k)The Corporation shall have the power to guarantee, purchase, hold, sell, assign, transfer, mortgage, pledge or otherwise dispose of the shares of the capital stock of, or any bonds, securities or evidence in indebtedness created by any other corporation or corporations in the State of Delaware, or any other state or government and, while the owner of such stock, bonds, securities or evidence of indebtedness, to exercise all the rights, powers and privileges of ownership, including the right to vote, if any.
(l)The Corporation shall have the power to purchase, hold, sell and transfer shares of its own capital stock and use therefore its capital, capital surplus, surplus or other property or fund.
(m)The Corporation shall have to conduct business, have one or more offices and hold, purchase, mortgage and convey real and personal property in the State of Delaware and in any of the several states, territories, possessions and dependencies of the United States, the District of Columbia and in any foreign country.
(n)The Corporation shall have the power to do all and everything necessary and proper for the accomplishment of the objects enumerated in its Certificate of Incorporation, or any amendments thereof, or necessary or incidental to the protection and benefit of the Corporation and, in general, to carry on any lawful business necessary or incidental to the attainment of the purposes of the Corporation, whether or not such business is similar in nature to the purposes set forth in the Certificate of Incorporation of the Corporation, or any amendment thereof.
(o)The Corporation shall have the power to make donations for the public welfare or for charitable, scientific or educational purposes.
(p)The Corporation shall have the power to enter partnerships, general or limited, or joint ventures, in connection with any lawful activities.
Section 4. Capital Stock.
(a)Classes and Number of Shares. The total number of shares of all classes of stock, which the Corporation shall have authority to issue shall be Two Hundred and Fifty Million (250,000,000) shares of common stock, par value of $0.0001 per share (the “Common Stock”) and Ten Million (10,000,000) shares of preferred stock, par value of $0.0001 per share (the “Preferred Stock”).
(b)Powers and Rights of Common Stock.
(i)Preemptive Right. No shareholders of the Corporation holding Common Stock shall have any preemptive or other right to subscribe for any additional unissued or treasury shares of stock or for other securities of any class, or for rights, warrants or options to purchase stock, or for scrip, or for securities of any kind convertible into stock or carrying stock purchase warrants or privileges unless so authorized by the Corporation.
(ii)Voting Rights and Powers. With respect to all matters upon which stockholders are entitled to vote or to which stockholders are entitled to give consent, the holders of the outstanding shares of the Common Stock shall be entitled to cast thereon one (1) vote in person or by proxy for each share of the Common Stock standing in his/her name.
(iii)Dividends and Distributions.
(A)Cash Dividends. Subject to the rights of holders of Preferred Stock, holders of Common Stock shall be entitled to receive such cash dividends as may be declared thereon by the Board from time to time out of assets of funds of the Corporation legally available therefore; and
(B)Other Dividends and Distributions. The Board may issue shares of the Common Stock in the form of a distribution or distributions pursuant to a stock dividend or split-up of the shares of the Common Stock.
(iv)Other Rights. Except as otherwise required by the DGCL and as may otherwise be provided in this Certificate of Incorporation, each share of the Common Stock shall have identical powers, preferences and rights, including rights in liquidation.
(c)Classes of Preferred Stock. The powers, preferences, rights, qualifications, limitations and restrictions pertaining to the Preferred Stock, or any series thereof, shall be such as may be fixed, from time to time, by the Board in its sole discretion, authority to do so being hereby expressly vested in the Board. The authority of the Board with respect to each such series of Preferred Stock will include, without limiting the generality of the foregoing, the determination of any or all of the following:
(i)The number of shares of any series and the designation to distinguish the shares of such series from the shares of all other series;
(ii)the voting powers, if any, of the shares of such series and whether such voting powers are full or limited;
(iii)the redemption provisions, if any, applicable to such series, including the redemption price or prices to be paid;
(iv)whether dividends, if any, will be cumulative or noncumulative, the dividend rate or rates of such series and the dates and preferences of dividends on such series;
(v)the rights of such series upon the voluntary or involuntary dissolution of, or upon any distribution of the assets of, the Corporation;
(vi)the provisions, if any, pursuant to which the shares of such series are convertible into, or exchangeable for, shares of any other class or classes or of any other series of the same or any other class or classes of stock, or any other security, of the Corporation or any other corporation or other entity, and the rates or other determinants of conversion or exchange applicable thereto;
(vii)the right, if any, to subscribe for or to purchase any securities of the Corporation or any other corporation or other entity;
(viii)the provisions, if any, of a sinking fund applicable to such series; and
(ix)any other relative, participating, optional or other powers, preferences or rights, and any qualifications, limitations or restrictions thereof, of such series.
(d)Issuance of the Common Stock and the Preferred Stock. The Board may from time to time authorize by resolution the issuance of any or all shares of the Common Stock and the Preferred Stock herein authorized in accordance with the terms and conditions set forth in this Certificate of Incorporation for such purposes, in such amounts, to such persons, corporations, or entities, for such consideration and in the case of the Preferred Stock, in one or more series, all as the Board in its discretion may determine and without any vote or other action by the stockholders, except as otherwise required by law. The Board, from time to time, also may authorize, by resolution, options, warrants and other rights convertible into Common or Preferred stock (collectively “securities”). The securities must be issued for such consideration, including cash, property, or services, as the Board may deem appropriate, subject to the requirement that the value of such consideration be no less than the par value of the shares issued. Any shares issued for which the consideration so fixed has been paid or delivered shall be fully paid stock and the holder of such shares shall not be liable for any further call or assessment or any other payment thereon, provided that the actual value of such consideration is not less that the par value of the shares so issued. The Board may issue shares of the Common Stock in the form of a distribution or distributions pursuant to a stock dividend or split-up of the shares of the Common Stock only to the then holders of the outstanding shares of the Common Stock.
(e)Cumulative Voting. Except as otherwise required by applicable law, there shall be no cumulative voting on any matter brought to a vote of stockholders of the Corporation.
(f)One Class. Except as otherwise required by the DGCL, this Certificate of Incorporation, or any designation for a class of Preferred Stock (which may provide
that an alternate vote is required), (i) all shares of capital stock of the Corporation shall vote together as one class on all mattes submitted to a vote of the shareholders of the Corporation; and (ii) the affirmative vote of a majority of the voting power of all outstanding shares of voting stock entitled to vote in connection with the applicable matter shall be required for approval of such matter.
Section 5. Adoption of Bylaws. In the furtherance and not in limitation of the powers conferred by statute and subject to Section 6, the Board is expressly authorized to adopt, repeal, rescind, alter or amend in any respect the bylaws of the Corporation (the “Bylaws”).
Section 6. Shareholder Amendment of Bylaws. Notwithstanding Section 5, the Bylaws may also be adopted, repealed, rescinded, altered or amended in any respect by the stockholders of the Corporation, but only by the affirmative vote of the holders of not less than fifty-one percent (51%) of the voting power of all outstanding shares of voting stock, regardless of class and voting together as a single voting class.
Section 7. Board of Directors. The business and affairs of the Corporation shall be managed by and under the direction of the Board. The first Board shall initially consist of one (1) person. The initial director of the Corporation shall be as follows, and his mailing addresses is as follows: Dylan Taylor, 1401 17th Street, 12th Floor, Denver Co 80202. Except as may otherwise be provided in connection with rights to elect additional directors under specified circumstances, which may be granted to the holders of any class or series of Preferred Stock, the number of directors of the Corporation may be amended from time to time as set forth in the Bylaws. The exact number of directors shall be fixed from time to time by the Board pursuant to resolution adopted by a majority of the full Board. Directors need not be stockholders.
Section 8. Powers of Board. In furtherance and not in limitation of the powers conferred by the laws of the DGCL, the Board is expressly authorized and empowered:
(a)To make, alter, amend, and repeal the Bylaws;
(b)Subject to the applicable provisions of the Bylaws then in effect, to determine, from time to time, whether and to what extent, and at what times and places, and under what conditions and regulations, the accounts and books of the Corporation, or any of them, shall be open to stockholder inspection, provided that no stockholder shall have any right to inspect any of the accounts, books or documents of the Corporation, except as permitted by law, unless and until authorized to do so by resolution of the Board or of the stockholders of the Corporation;
(c)To authorize and issue, without stockholder consent, obligations of the Corporation, secured and unsecured, under such terms and conditions as the Board, in its sole discretion, may determine, and to pledge or mortgage, as security therefore, any real or personal property of the Corporation, including after-acquired property;
(d)To determine whether any and, if so, what part of the earned surplus of the Corporation shall be paid in dividends to the stockholders, and to direct and determine other use and disposition of any such earned surplus;
(e)To fix, from time to time, the amount of the profits of the Corporation to be reserved as working capital or for any other lawful purpose;
(f)To establish bonus, profit-sharing, stock option, or other types of incentive compensation plans for the employees, including officers and directors, of the Corporation, and to fix the amount of profits to be shared or distributed, and to determine the persons to participate in any such plans and the amount of their respective participations;
(g)to designate, by resolution or resolutions passed by a majority of the whole Board, one or more committees, each consisting of two or more directors, which, to the extent permitted by law and authorized by the resolution or the Bylaws, shall have and may exercise the powers of the Board; and
(h)To provide for the reasonable compensation of its own members by Bylaw, and to fix the terms and conditions upon which such compensation will be paid; and
In addition to the powers and authority hereinbefore, or by statute, expressly conferred upon it, the Board may exercise all such powers and do all such acts and things as may be exercised or done by the Corporation, subject, nevertheless, to the provisions of the laws of the State of Delaware, of this Certificate of Incorporation, and of the Bylaws of the Corporation.
Section 9. Interested Directors. No contract or transaction between this Corporation and any of its directors, or between this Corporation and any other corporation, firm, association, or other legal entity shall be invalidated by reason of the fact that the director of the Corporation has a direct or indirect interest, pecuniary or otherwise, in such corporation, firm, association, or legal entity, or because the interested director was present at the meeting of the Board which acted upon or in reference to such contract or transaction, or because he participated in such action, provided that: (1) the interest of each such director shall have been disclosed to or known by the Board and a disinterested majority of the Board shall have, nonetheless, ratified and approved such contract or transaction (such interested director or directors may be counted in determining whether a quorum is present for the meeting at which such ratification or approval is given); or (2) the conditions of DGCL Title 8, Section 144 are met.
Section 10. Term of Board of Directors. Except as otherwise required by applicable law, each director shall serve for a term ending on the date of the third Annual Meeting of Stockholders of the Corporation (the “Annual Meeting”) following the Annual Meeting at which such director was elected. All directors shall have equal standing. Notwithstanding the foregoing provisions of this Section 10 each director shall serve until their successor is elected and qualified or until his death, resignation or removal; no decrease in the authorized number of directors shall shorten the term of any incumbent director; and additional directors, elected in connection with rights to elect such additional directors under specified circumstances, which may be granted to the holders of any class or series of Preferred Stock, shall not be included in any class, but shall serve for such term or terms and pursuant to such other provisions as are specified in the resolution of the Board establishing such class or series.
Section 11. Vacancies on Board of Directors. Except as may otherwise be provided in connection with rights to elect additional directors under specified circumstances, which may be granted to the holders of any class or series of Preferred Stock, newly created directorships resulting from any increase in the number of directors, or any vacancies on the Board resulting from death, resignation, removal, or other causes, shall be filled solely by the quorum of the Board. Any director elected in accordance with the preceding sentence shall hold office for the
remainder of the full term of directors in which the new directorship was created or the vacancy occurred and until such director’s successor shall have been elected and qualified or until such director’s death, resignation or removal, whichever first occurs.
Section 12. Removal of Directors. Except as may otherwise be provided in connection with rights to elect additional directors under specified circumstances, which may be granted to the holders of any class or series of Preferred Stock, any director may be removed from office only by the affirmative vote of the holders of not less than two-thirds (2/3) of the voting power of the issued and outstanding stock entitled to vote. Failure of an incumbent director to be nominated to serve an additional term of office shall not be deemed a removal from office requiring any stockholder vote.
Section 13. Stockholder Action. Any action required or permitted to be taken by the stockholders of the Corporation must be effective at a duly called Annual Meeting or at a special meeting of stockholders of the Corporation, unless such action requiring or permitting stockholder approval is approved by a majority of the directors, in which case such action may be authorized or taken by the written consent of the holders of outstanding shares of voting stock having not less than the minimum voting power that would be necessary to authorize or take such action at a meeting of stockholders at which all shares entitled to vote thereon were present and voted, provided all other requirements of applicable law and this Certificate of Incorporation have been satisfied.
Section 14. Special Stockholder Meetings. Special meetings of the stockholders of the Corporation for any purpose or purposes may be called at any time by a majority of the Board. Special meetings may not be called by any other person or persons. Each special meeting shall be held at such date and time as is requested by Board, within the limits fixed by law.
Section 15. Location of Stockholder Meetings. Meetings of stockholders of the Corporation may be held within or without the State of Delaware, as the Bylaws may provide. The books of the Corporation may be kept (subject to any provision of the DGCL) outside the State of Delaware at such place or places as may be designated from time to time by the Board or in the Bylaws.
Section 16. Private Property of Stockholders. The private property of the stockholders shall not be subject to the payment of corporate debts to any extent whatever and the stockholders shall not be personally liable for the payment of the Corporation’s debts.
Section 17. Amendments. The Corporation reserves the right to adopt, repeal, rescind, alter or amend in any respect any provision contained in this Certificate of Incorporation in the manner now or hereafter prescribed by applicable law and all rights conferred on stockholders herein granted subject to this reservation.
Section 18. Term of Existence. The Corporation is to have perpetual existence.
Section 19. Liability of Directors. No director of this Corporation shall have personal liability to the Corporation or any of its stockholders for monetary damages for breach of fiduciary duty as a director or officers involving any act or omission of any such director or officer. The foregoing provision shall not eliminate or limit the liability of a director (i) for any breach of the director’s duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or, which involve intentional misconduct or a knowing violation of
law, (iii) under applicable sections of the DGCL, (iv) the payment of dividends in violation of the DGCL or, (v) for any transaction from which the director derived an improper personal benefit. Any repeal or modification of this Section 19 by the stockholders of the Corporation shall be prospective only and shall not adversely affect any limitation on the personal liability of a director or officer of the Corporation for acts or omissions prior to such repeal or modification.
Section 20. Indemnification.
(a)Each person (including here and hereinafter, the heirs, executors, administrators or estate of such person) (1) who is or was a director or officer of the Corporation or who is or was serving at the request of the Corporation in the position of a director, officer, trustee, partner, agent or employee of another corporation, partnership, joint venture, trust or other enterprise, or (2) who is or was an agent or employee (other than an officer) of the Corporation and as to whom the Corporation has agreed to grant such indemnity, shall be indemnified by the Corporation as of right to the fullest extent permitted or authorized by current or future legislation or by current or future judicial or administrative decision (but, in the case of any future legislation or decision, only to the extent that it permits the Corporation to provide broader indemnification rights than permitted prior to the legislation or decision), against all fines, liabilities, settlements, costs and expenses, including attorneys’ fees, asserted against him or incurred by him in his capacity as such director, officer, trustee, partner, agent or employee, or arising out of his status as such director, officer, trustee, partner, agent or employee. The foregoing right of indemnification shall not be exclusive of other rights to which those seeking indemnification may be entitled. The Corporation may maintain insurance, at its expense, to protect itself and any such person against any such fine, liability, cost or expense, including attorney’s fees, whether or not the Corporation would have the legal power to directly indemnify him against such liability.
(b)The rights granted under Section 20(a) shall include the right to be paid by the Corporation the expenses (including, without limitation, attorneys’ fees and expenses) incurred in defending any such proceeding in advance of its final disposition (an “advancement of expenses”); except that, if the DGCL so requires, an advancement of expenses incurred by an beneficiary in his or her capacity as a director or officer (and not in any other capacity in which service was or is rendered by such beneficiary, including, without limitation, service to an employee benefit plan) shall be made only upon delivery to the Corporation of an undertaking, by or on behalf of such beneficiary, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right to appeal that such beneficiary is not entitled to be indemnified for such expenses under this Section 20 or otherwise. The rights to indemnification and to the advancement of expenses conferred in this Section 20 shall be contract rights and such rights shall continue as to a beneficiary who has ceased to be a director or officer and shall inure to the benefit of the beneficiary’s heirs, executors and administrators. No amendment to this Section 20 that limits the Corporation’s obligation regarding advancement of expenses shall have any effect on that right for a claim arising out of an act or omission that occurs prior to the date of the amendment.
(c)The Corporation may, to the extent authorized from time to time by the Board, grant rights to indemnification and to the advancement of expenses to any employee or agent
of the Corporation or an administrator or fiduciary with respect to any employee benefit plan to the fullest extent of the provisions of this Section 20 with respect to the indemnification and advancement of expenses of directors and officers of the Corporation.
(d)Any indemnification or advancement of expenses made pursuant to this Section 20 shall not be exclusive of any other right that any person may have or hereafter acquire under any statute, this Certificate of Incorporation, the Bylaws or any agreement, vote of stockholders or disinterested directors or otherwise.
(e)If this Section 20 or any portion of it is invalidated on any ground by a court of competent jurisdiction, the Corporation shall nevertheless indemnify each director and officer of the Corporation to the fullest extent permitted by all portions of this Section 20 that has not been invalidated and to the fullest extent permitted by law.
Section 21. Forum Selection. Unless the Corporation consents in writing to the selection of an alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Corporation to the Corporation or the Corporation’s stockholders, (iii) an action asserting a claim arising pursuant to any provision of the DGCL, or (iv) any action asserting a claim governed by the internal affairs doctrine shall be a state or federal court located within the state of Delaware, in all cases subject to the court’s having personal jurisdiction over the indispensable parties named as defendants.
Section 22. Headings. The headings contained herein are for convenience only, do not constitute a part of this Certificate of Incorporation and shall not be deemed to limit or affect any of the provisions hereof.
IN WITNESS WHEREOF, the undersigned has executed this Certificate of Incorporation as of August 15, 2019.
| | | | | | | | | | | |
| Sole Incorporator | |
| | | |
| | | |
| | | |
| By: | /s/ Dylan Taylor | |
| Dylan Taylor | |
| Sole Incorporator | |
CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
OF
VOYAGER SPACE HOLDINGS, INC.
Voyager Space Holdings, Inc., a corporation organized and existing under the laws of the State of Delaware, hereby certifies that:
1. The name of the corporation is Voyager Space Holdings, Inc. The corporation was incorporated under the name Voyager Space Holdings, Inc. and the original Certificate of Incorporation was filed with the Delaware Secretary of State on August 15, 2019.
2. This Certificate of Amendment has been duly adopted in accordance with the provisions of Section 242 and Section 228 of the General Corporation Law of the State of Delaware by the directors and stockholders of the corporation.
3. This Certificate of Amendment hereby amends the Certificate of Incorporation by amending and restating Section 4(a) in its entirety to read as follows:
“Section 4. Capital Stock.
(a) Classes and Number of Shares. The total number of shares of capital stock that the Corporation shall have authority to issue shall consist of (i) 250,000,000 shares of common stock, par value of $0.0001 per share (the “Common Stock”), and (ii) 10,000,000 shares of preferred stock, par value of $0.0001 per share (the “Preferred Stock”). Upon the filing and effectiveness (the “Effective Time”) pursuant to the Delaware General Corporation Law of this Certificate of Amendment to the Certificate of Incorporation of the Corporation, the shares of Common Stock issued and outstanding immediately prior to the Effective Time and any shares of Common Stock issued and held in the treasury of the Corporation immediately prior to the Effective Time shall be reclassified as, and shall be combined and changed into, a smaller number of shares such that each 7.65335 shares of issued Common Stock immediately prior to the Effective Time shall be reclassified into, and shall, automatically and without any action on the part of the Corporation or the respective holders thereof, be combined and changed into and become, one (1) validly issued, fully-paid and nonassessable share of Common Stock without increasing or decreasing the par value of each share of Common Stock (the “Reverse Stock Split”). Notwithstanding the foregoing, no fractional shares of Common Stock shall be issued as a result of the Reverse Stock Split and, in lieu thereof, upon, receipt after the Effective Time by the Corporation’s transfer agent of a properly completed and duly executed transmittal letter and, where shares are held in certificated form, upon surrender after the Effective Time of a certificate which formerly represented shares of Common Stock that were issued and outstanding immediately prior to the Effective Time, any person who would otherwise be entitled to a fractional share of Common Stock as a result of the Reverse Stock Split, following the Effective Time (after taking into account all fractional shares of post-Reverse Stock Split Common Stock otherwise issuable to such holder), shall be entitled to receive cash (without interest) for such holder’s fractional share in an amount equal to the respective pro rata share of then then-prevailing fair market value for a whole share of Common Stock. From and after the Effective Time, certificates representing Common Stock outstanding immediately prior to the Effective Time shall, automatically and without any action on the part of the Corporation or the respective holders thereof, represent the number of whole shares of
post-Reverse Stock Split Common Stock into which the shares of pre-Reverse Stock Split Common Stock shall have been reclassified (as well as the right to receive cash in lieu of any fractional shares of post-Reverse Stock Split Common Stock) pursuant to the foregoing provisions; provided, however, that each holder of record of a certificate that represented shares of pre-Reverse Stock Split Common Stock shall receive, upon surrender of such certificate, a new certificate delivered electronically representing the number of whole shares of post-Reverse Stock Split Common Stock into which the shares of pre-Reverse Stock Split Common Stock represented by such certificate shall have been combined pursuant to the Reverse Stock Split, as well as any cash in lieu of fractional shares of post-Reverse Stock Split Common Stock to which such holder may be entitled as set forth above; provided further, that any dividends or other distributions that may be declared after the Effective Time with respect to the number of post-Reverse Stock Split shares of Common Stock represented by that certificate will be withheld by the Corporation until that certificate has been properly presented for exchange, at which time all such withheld dividends that have not yet been paid to a public official pursuant to relevant abandoned property or escheat laws will be paid to the holder thereof or the holder’s designee, without interest. The Reverse Stock Split shall be effected on a record holder-by-record holder basis, such that any fractional shares of post-Reverse Stock Split Common Stock resulting from the Reverse Stock Split and held by a single record holder shall be aggregated.”
4. Except as herein amended, the Certificate of Incorporation of the Corporation shall remain in full force and effect.
IN WITNESS WHEREOF, the Corporation has caused this Certificate of Amendment to be signed by its duly authorized officer this 18th day of February 2021.
| | | | | | | | |
| VOYAGER SPACE HOLDINGS, INC. | |
| | |
| | |
| /s/ Dylan Taylor | |
| Name: Dylan Taylor | |
| Title: Chief Executive Officer | |
CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
OF
VOYAGER SPACE HOLDINGS, INC.
Voyager Space Holdings, Inc. (the “Corporation”), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify that:
FIRST: The name of the Corporation is Voyager Space Holdings, Inc.
SECOND: The Corporation’s Certificate of Incorporation was filed with the Secretary of State of the State of Delaware on August 15, 2019.
THIRD: That this Certificate of Amendment has been duly adopted in accordance with the provisions of Section 242 and Section 228 of the General Corporation Law of the State of Delaware by the directors and stockholders of the corporation,
FOURTH: That the first sentence of Section 4(a) of the Certificate of Incorporation shall be deleted in its entirety and inserted in lieu thereof shall be the following:
The total number of shares of all classes of stock that the Corporation shall have authority to issue shall be Two Hundred and Fifty Million (250,000,000) shares of common stock, par value of $0.0001 per share (the “Common Stock”), and Twelve Million (12,000,000) shares of preferred stock, par value of $0.0001 per share (the “Preferred Stock”).
FIFTH: Except as herein amended, the Certificate of Incorporation of the Corporation shall remain in full force and effect.
[Signature page follows]
IN WITNESS WHEREOF, VOYAGER SPACE HOLDINGS, INC. has caused this Certificate of Amendment to the Certificate of Incorporation to be signed by a duly authorized officer this 7th day of February, 2022.
| | | | | | | | |
| VOYAGER SPACE HOLDINGS, INC. |
| | |
| | |
| | |
| By: | /s/ Dylan Taylor |
| | Name: Dylan Taylor |
| | Title: Chief Executive Officer |
AMENDED AND RESTATED
CERTIFICATE OF DESIGNATIONS OF PREFERENCES AND RIGHTS OF
SERIES A PREFERRED STOCK
OF
Voyager Space Holdings, Inc.
a Delaware corporation
The undersigned Chief Executive Officer of Voyager Space Holdings, Inc. (the "Corporation"), a corporation organized and existing under the laws of the State of Delaware, does hereby file this Amended and Restated Certificate of Designations of Preferences and Rights of Series A Preferred Stock (this "Certificate of Designations") and DOES HEREBY CERTIFY pursuant to the authority contained in the Corporation's Certificate of Incorporation, and pursuant to the General Corporation Law of the State of Delaware, as follows:
FIRST: The name of the Corporation is Voyager Space Holdings, Inc.
SECOND: The Corporation's Certificate of Designations of Preferences and Rights of Series A Preferred Stock was filed with the Secretary of State of the State of Delaware on August 15, 2019.
THIRD: There is one share of Series A Preferred Stock issued and outstanding as of the date hereof.
FOURTH: This Amended and Restated Certificate of Designations of Preferences and Rights of Series A Preferred Stock was unanimously approved by the Board of Directors of the Corporation by a unanimous written consent of the Board of Directors of the Corporation dated March 2, 2020.
FIFTH: This Amended and Restated Certificate of Designations of Preferences and Rights of Series A Preferred Stock was unanimously approved by the holder of the one share of Series A Preferred Stock by a unanimous written consent of such stockholder dated March 2, 2020.
SIXTH: The Certificate of Incorporation of the Corporation authorizes the issuance by the Corporation of 250,000,000 shares of common stock, $0.0001 par value per share (the "Common Stock") and 10,000,000 shares of preferred stock, parvalue$0.0001 per share (the "Preferred Stock"), and, further, authorizes the Board of Directors of the Corporation, by resolution or resolutions, at any time and from time to time, to divide and establish any or all of the unissued shares of Preferred Stock not then allocated to any series into one or more series and, without limiting the generality of the foregoing, to fix and determine the designation of each such share, the number of shares which shall constitute such series and certain preferences, limitations and relative rights of the shares of each series so established.
SEVENTH: The Board of Directors of the Corporation, acting in accordance with the provision of Sections 141 and 242 of the Delaware General Corporation Law by unanimous written consent of the Board of Directors of the Corporation dated March 2, 2020, the Board of Directors adopted resolutions, and such resolutions were approved by the holder of the sole share of Series A Preferred Stock via a written consent dated March 2, 2020, in each case to amend the Certificate of Designation of Preferences and Rights of Series A Preferred Stock to read in its entirety as follows:
CLASS A PREFERRED STOCK
Section 1. Powers and Rights of Class A Preferred Stock. There is hereby designated a class of Preferred Stock of the Corporation as the Class A Preferred Stock, par value $0.0001 per share of the Corporation (the "Class A Preferred Stock"). The number of shares, powers, terms, conditions, designations, preferences and privileges, relative, participating, optional and other special rights, and qualifications, limitations and restrictions, if any, of the Class A Preferred Stock shall be as set forth in this Certificate of Designations of Preferences and Rights of Class A Preferred Stock (this "Certificate of Designations"). For purposes hereon, the holder of the share of Class A Preferred Stock shall be referred to as a "Class A Holder."
(a) Number. The number of authorized shares of the Class A Preferred Stock is one (1) share.
(b) Vote. Other than as set forth in Section 1(h) and Section 1(i), the share of Class A Preferred Stock shall have a number of votes at any time equal to (i) the number of votes then held or entitled to be made by all other equity securities of the Corporation, including, without limitation, the common stock, par value $0.0001 per share, of the Corporation (the "Common Stock"), debt securities of the Corporation or pursuant to any other agreement, contract or understanding of the Corporation, plus (ii) one (1). The Class A Preferred Stock shall vote on any matter submitted to the holders of the Common Stock, or any class thereof, for a vote, and shall vote together with the Common Stock, or any class thereof, as applicable, on such matter for as long as the share of Class A Preferred Stock is issued and outstanding. The Class A Preferred Stock shall not have the right to vote on any matter as to which solely another class of Preferred Stock of the Corporation is entitled to vote pursuant to the certificate of designations of such other class of Preferred Stock of the Corporation.
(c) No Transfer. The share of Class A Preferred Stock may not be transferred by the original Class A Holder to whom the share of Class A Preferred Stock is initially issued by the Corporation, and any attempted transfer of such shares of Class A Preferred Stock, whether voluntary or by operation of law or otherwise, shall be void ab initio and of no force or effect and the Corporation shall not recognize the purposed transferee thereof as the holder of the share of Class A Preferred Stock, and such share of Class A Preferred Stock shall be deemed automatically redeemed by the Corporation as of immediately prior to any such transfer or attempted transfer, and the Class A Holder shall thereafter be entitled to receive solely a redemption price of $ 1.00 therefor.
(d) No Conversion. The Class A Preferred Stock shall not be convertible into shares of any other class of stock of the Corporation.
(e) No Dividends. The Class A Preferred Stock shall not be entitled to receive any dividends paid on any other class of stock of the Corporation.
(f) No Preferences upon Liquidation. In the event of any liquidation, dissolution or winding up of the Corporation, either voluntarily or involuntarily, a merger or consolidation of the Corporation wherein the Corporation is not the surviving entity, or a sale of all or substantially all of the assets of the Corporation, the Class A Preferred Stock shall not be entitled to receive any distribution of any of the assets or surplus funds of the Corporation and shall not participate with the Common Stock or any other class of stock of the Corporation therein.
(g) No Participation. The Class A Preferred Stock shall not participate in any distributions or payments to the holders of the Common Stock or any other class of stock of the Corporation.
(h) Amendment. The Corporation may not, and shall not, amend this Certificate of Designations without the prior written consent of the Class A Holder, voting separately as a single class, in person or by proxy, either in writing without a meeting or at an annual or a special meeting of the Class A Holder.
(i) Protective Provisions. In addition to any other rights and restrictions provided under applicable law, without first obtaining the affirmative vote or written consent of the Class A Holder, with the share of Class A Preferred Stock having one vote on such matter, the Corporation shall not amend or repeal any provision of this Certificate of Designations, including by merger, consolidation or otherwise, and any such act or transaction entered into without such vote or consent shall be null and void ab initio, and of no force or effect. In addition to any other rights and restrictions provided under applicable law, without first obtaining the affirmative vote or written consent Class A Holder, with the share of Class A Preferred Stock having one vote on such matter, the Corporation shall not amend or repeal any provision of, or add any provision to, the Corporation's Certificate of Incorporation or bylaws if such action would adversely alter or change the preferences, rights, privileges, or powers of, or restrictions provided for the benefit of, the Class A Preferred Stock, as reasonably determined by the Class A Holder, and any such act or transaction entered into without such vote or consent shall be null and void ab initio, and of no force or effect.
Section 2. Miscellaneous.
(a) Legend. Any certificates representing the Class A Preferred Stock shall bear 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 AGREEMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, NOR REGISTERED NOR QUALIFIED UNDER ANY STATE SECURITIES LAWS. SUCH SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, DELIVERED AFTER SALE, TRANSFERRED, PLEDGED, OR HYPOTHECATED UNLESS QUALIFIED AND REGISTERED UNDER APPLICABLE STATE AND FEDERAL SECURITIES LAWS OR UNLESS, IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY, SUCH QUALIFICATION AND REGISTRATION IS NOT REQUIRED. ANY TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS FURTHER SUBJECT TO OTHER RESTRICTIONS, TERMS AND CONDITIONS WHICH ARE SET FORTH HEREIN.
(b) Lost or Mutilated Class A Preferred Stock Certificate. If the certificate for the Class A Preferred Stock held by the Class A Holder shall be mutilated, lost, stolen or destroyed, the Corporation shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated certificate, or in lieu of or in substitution for a lost, stolen or destroyed certificate, a new certificate for the share of Class A Preferred Stock so mutilated, lost, stolen or destroyed but only upon receipt of evidence of such loss, theft or destruction of such certificate, and of the ownership hereof, and indemnity, if requested, all reasonably satisfactory to the Corporation.
(c) Interpretation.If the Class A Holder shall commence an action or proceeding to enforce any provisions of this Certificate of Designations, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorney's fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding.
(d) Waiver. Any waiver by the Corporation or the Class A Holder of a breach of any provision of this Certificate of Designations shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Certificate of Designations. The failure of the Corporation or the Class A Holder to insist upon strict adherence to any term of this Certificate of Designations on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Certificate of Designations. Any waiver must be in writing.
(e) Severability. If any provision of this Certificate of Designations is invalid, illegal or unenforceable, the balance of this Certificate of Designations shall remain in effect, and if any provision is inapplicable to any person or circumstance, it shall nevertheless remain applicable to all other persons and circumstances. If it shall be found that any interest or other amount deemed interest due hereunder violates applicable laws governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum permitted rate of interest.
IN WITNESS WHEREOF, Voyager Space Holdings, Inc. has caused this Amended and Restated Certificate of Designations to be signed by a duly authorized officer on this 2nd day of March, 2020.
| | | | | | | | | | | |
| Voyager Space Holdings, Inc. |
| | | |
| | | |
| | | |
| By: | /s/ Dylan Taylor | |
| Name: Dylan Taylor |
| Title: Chief Executive Officer |
VOYAGER SPACE HOLDING, INC.
CERTIFICATE OF DESIGNATIONS
Pursuant to Section 151 of the General Corporation Law of the State of Delaware
CLASS A-1 CONVERTIBLE PREFERRED STOCK
(par value $0.0001 per share)
Voyager Space Holdings, Inc. (the “Corporation”), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify that:
The Board of Directors of the Corporation, in accordance with the resolutions of the Board of Directors of the Corporation dated February 15, 2021, the Certificate of Incorporation of the Corporation, as amended from time to time (the “Certificate of Incorporation”), the Bylaws of the Corporation (the “Bylaws”) and applicable law, adopted the following resolution on such date creating a series of 7,500,000 shares of preferred stock, par value $0.0001 per share, of the Corporation designated as “Class A-1 Preferred Stock”:
RESOLVED that, pursuant to the Certificate of Incorporation, the Bylaws and applicable law, a series of preferred stock, par value $0.0001 per share, of the Corporation be, and hereby is, created and designated as the “Class A-1 Preferred Stock” and the Board of Directors hereby fixes and determines the number of shares, the designations, voting power, preferences, participations, optional, relative or special rights, and the qualifications, limitations and restrictions thereof, of the shares of such series as set forth below:
Section 1. Designation of Series and Number of Shares. The shares of such series of preferred stock shall be designated “Class A-1 Preferred Stock” (the “Class A-1 Preferred”), and the authorized number of shares that shall constitute such series shall be 7,500,000 shares, which may be decreased (but not below the number of shares of Class A-1 Preferred then issued and outstanding) from time to time by the Board of Directors. Shares of outstanding Class A-1 Preferred that are purchased or otherwise acquired by the Corporation shall be cancelled and shall revert to authorized but unissued shares of preferred stock of the Corporation undesignated as to series.
Section 2. Ranking. The Class A-1 Preferred will rank, with respect to the payment of dividends and distributions upon liquidation, dissolution or winding-up, (1) on a parity with each class or series of capital stock the Corporation may issue in the future the terms of which expressly provide that such class or series will rank on a parity with the Class A-1 Preferred as to payment of dividends and distributions upon liquidation, winding up or dissolution of the Corporation (collectively, the “Parity Securities”), (2) senior to the Common Stock and each other class or series of capital stock the Corporation may issue in the future the terms of which do not expressly provide that it ranks on a parity with or senior to the Class A-1 Preferred as to payment of dividends and distributions upon liquidation, winding-up or dissolution of the Corporation (the “Junior Securities”), and (3) junior to the shares of such series of preferred stock of the Corporation designated “Class A Preferred” and each class or series of capital stock the Corporation may issue in the future the terms of which expressly provide that such class or series will rank senior to the Class A-1 Preferred as to payment of dividends and distributions upon liquidation, winding up or dissolution of the Corporation (“Senior Securities”).
Section 3. Definitions. As used herein with respect to the Class A-1 Preferred:
“Accrued Value” means, with respect to each share of Class A-1 Preferred, the sum of (i) the Original Liquidation Preference plus (ii) an additional amount equal to the dollar value of any accrued dividends on such share of Class A-1 Preferred which have not been paid in accordance with the provisions of Section 4. Any increase in the Accrued Value shall take effect on the Dividend Accrual Date on which a dividend payment, or any portion thereof, is not paid in accordance with the provisions of Section 4.
“Acquisition Price” means the consideration paid per share of Common Stock in a Fundamental Change.
“Affiliate” has the meaning specified in Rule 15b-2 under the Exchange Act.
“Applicable Annual Rate” means a per annum rate equal to 8.0%.
“Board of Directors” means the board of directors of the Corporation or any committee thereof duly authorized to act on behalf of such board of directors.
“Business Day” means any day that is not Saturday or Sunday and that, in New York City, is not a day on which banking institutions generally are authorized or obligated by law or executive order to be closed.
“Bylaws” means the Bylaws of the Corporation, as may be amended from time to time.
“Certificate of Designations” means this Certificate of Designations relating to the Class A-1 Preferred, as it may be amended from time to time.
“Certification of Incorporation” means the Certificate of Incorporation of the Corporation, as it may be amended from time to time, and shall include this Certificate of Designations.
“Closing” means the closing of the sale and issuance of shares of the Class A-1 Preferred in a private placement.
“Common Stock” means the Common Stock, par value $0.0001 per share, of the Corporation.
“Conversion Agent” means the Transfer Agent acting in its capacity as conversion agent for the Class A-1 Preferred, and its successors and assigns or any successor Conversion Agent appointed by the Corporation.
“Conversion Date” has the meaning set forth in Section 9(e)(ii).
“Conversion Price” means, for the Class A-1 Preferred, initially, $10.00 per share, subject to adjustment in accordance with the provisions of Section 11 of this Certificate of Designations.
“Conversion Rate” means, for each share of Class A-1 Preferred, a rate equal to the quotient of (i) the Accrued Value of such share of Class A-1 Preferred divided by (ii) the Conversion Price.
“Corporation” means Voyager Space Holdings, Inc., a Delaware corporation.
“Depositary” means DTC or its nominee or any successor depositary appointed by the Corporation.
“Dividend Accrual Date” has the meaning set forth in Section 4(b).
“Dividend Period” has the meaning set forth in Section 4(b).
“DTC” means The Depository Trust Company and its successors or assigns.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Ex-Date,” when used with respect to any issuance or distribution, means the first date on which the Common Stock or other securities trade without the right to receive such issuance or distribution.
“Fundamental Change” means the consummation of any consolidation or merger of the Corporation or similar transaction or any sale, lease or other transfer in one transaction or a series of transactions of all or substantially all the assets of the Corporation and its subsidiaries, taken as a whole (whether by means of a sale of the common equity of the Corporation or otherwise), to any Person other than one of the Corporation’s wholly-owned subsidiaries, in each case pursuant to which the Common Stock will be converted into, or receive a distribution of the proceeds in, cash, securities or other property, other than pursuant to a transaction in which the Persons that “beneficially owned” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, voting shares of the Corporation immediately prior to such transaction beneficially own, directly or indirectly, voting shares representing a majority of the total voting power of all outstanding classes of voting shares of the continuing or surviving Person immediately after the transaction.
“GAAP” means accounting principles generally accepted in the United States of America.
“Holder” means the Person in whose name the shares of the Class A-1 Preferred are registered, which may be treated by the Corporation as the absolute owner of the shares of Class A-1 Preferred for the purpose of making payment and settling any conversions and for all other purposes.
“Holder Redemption Date” has the meaning set forth in Section 7(a).
“Independent Investment Bank” means a nationally recognized independent U.S. investment bank.
“Issue Date” means the date on which shares of the Class A-1 Preferred are first issued.
“Junior Securities” has the meaning set forth in Section 2.
“Liquidation Event” has the meaning set forth in Section 5(a).
“Mandatory Conversion Date” means the date on which each outstanding share of Class A-1 Preferred automatically converts into shares of Common Stock in accordance with the provisions of Section 10(a) or 10(b).
“Original Liquidation Preference” means, as to the Class A-1 Preferred, $ 10.00 per share.
“Parity Securities” has the meaning set forth in Section 2.
“Person” means a legal person, including any individual, corporation, estate, partnership, joint venture, association, joint-stock company, limited liability company or trust.
“Per Share FMV” of the Common Stock or any other security on any date means:
(i) the volume weighted average price per share of the Common Stock or per unit of such other security (in each case, determined by the Corporation using customary methods) on the Principal Stock Exchange for the 10 consecutive Trading Days immediately prior to such date; or
(ii) if the Common Stock or such other security is not listed for trading on a U.S. national or regional securities exchange on the relevant date, the fair market value per share of the Common Stock or such other security, as determined reasonably and in good faith by the Board of Directors, who may take into account various factors in its determination, including (1) the last quoted bid price for the Common Stock or such other security in the over-the-counter market as reported by OTC Link LLC or a similar organization over a period of Trading Days deemed reasonable and advisable by the Board of Directors, (2) if the Common Stock or such other security is not so quoted, the bid and ask prices for the Common Stock or such other security on the relevant date from Independent Investment Banks over a period of Trading Days deemed reasonable and advisable by the Board of Directors, (3) the opinion or appraisal of an Independent Investment Bank or a U.S. nationally recognized valuation firm, (4) the circumstances of any proposed transaction, including the availability of willing third party buyers or the financial condition or liquidity requirements of the Corporation, (5) the lack of a market for the Common Stock and the limited liquidity with respect thereto, and (6) any other factors deemed relevant by the Board of Directors in its reasonable judgment.
The Per Share FMV of the Common Stock or such other security shall be determined without reference to extended or after-hours trading.
“Principal Stock Exchange” means, with respect to a security, the primary U.S. national or regional stock exchange on which such security is listed for trading.
“Public Offering Price” means the price per share at which Common Stock is offered and sold to the public pursuant to a Qualifying Public Offering.
“Qualifying Public Offering” means a firm-commitment underwritten public offering of Common Stock listed on a national securities exchange, whether primary or secondary, registered with the Securities and Exchange Commission, the gross proceeds of which exceed $50.0 million, which amount may be lowered by the Corporation upon receiving approval of a majority of the then-outstanding shares of the Class A-1 Preferred.
“Record Date” has the meaning set forth in Section 4(b).
“Reference Property” has the meaning set forth in Section 12(a).
“Registrar” means the Transfer Agent acting in its capacity as registrar for the Class A-1 Preferred, and its successors and assigns or any successor registrar duly appointed by the Corporation.
“Reorganization Event” has the meaning set forth in Section 12(a).
“Securities Act” has the meaning set forth in Section 16(d).
“Senior Securities” has the meaning set forth in Section 2.
“Trading Day” means any day during which all of the following conditions are satisfied: (i) trading in the Common Stock generally occurs on the Principal Stock Exchange and (ii) a closing sale price for the Common Stock is provided on the Principal Stock Exchange or, if the shares of Common Stock are not listed on a U.S. national or regional securities exchange, on the principal other market on which the shares of Common Stock are then traded; provided that if the Common Stock is not publicly listed or traded on any exchange or market, “Trading Day” means Business Day.
“Transfer Agent” means the Person acting as Transfer Agent and paying agent for the Class A-1 Preferred in accordance with the provisions of Section 15, and its successors and assigns, including any successor transfer agent appointed by the Corporation.
Section 4. Dividends.
(a) Subject to the provisions of the following sentence, cumulative dividends will be payable, in cash or in kind, at the Corporation’s option, on each outstanding share of Class A-1 Preferred when, as and if declared by the Board of Directors, at an annual rate equal to the Applicable Annual Rate of the Accrued Value of such share of Class A-1 Preferred, which shall be increased annually on each anniversary of the Closing by 2.0% per annum up to a maximum dividend rate of 16.0% per annum. Notwithstanding the foregoing, to the extent the Board of Directors does not declare a dividend in respect of all or any portion of a dividend accrued on a Dividend Accrual Date, the Accrued Value of each share of Class A-1 Preferred shall be increased by an amount equal to the dollar value of all or such portion, as the case may be, of such dividend that would otherwise have been paid on such Dividend Accrual Date had the Board of Directors declared a full dividend on such Dividend Accrual Date.
Any increase in the Accrued Value of the Class A-1 Preferred shall take effect on the Dividend Accrual Date on which the Corporation does not pay all or any portion of the dividend accrued during the preceding Dividend Period. It is understood that where this Certificate of Designations refers to an amount including “dividends accrued and unpaid” (or language of similar import) on a share of Class A-1 Preferred as of a date, such reference shall be understood to mean the amount of dividends that would accrue if such dividends were declared by the Board of Directors on such date, calculated based on the portion of the then current Dividend Period actually elapsed as of such date.
(b) Subject to Section 4(a), dividends shall accrue and, if declared in cash, be payable quarterly in arrears on February 15, May 15, August 15 and November 15 of each year (each, a “Dividend Accrual Date”) commencing on May 15, 2021. If a cash dividend is declared by the Board of Directors for a Dividend Accrual Date, such cash dividend will be payable to Holders of record as they appear in the stock register of the Corporation at the close of business on the first day of the month, whether or not a Business Day, in which the relevant Dividend Accrual Date occurs (each, a “Record Date”), Each period from and including a Dividend Accrual Date (or the date of the issuance of the Class A-1 Preferred) to but excluding the following Dividend Accrual Date is herein referred to as a “Dividend Period.”
(c) Dividends payable or accrued for a Dividend Period will be computed on the basis of a 360-day year of twelve 30-day months. If a Dividend Accrual Date falls on a day that is not a Business Day, and if a cash dividend is declared by the Board of Directors for such Dividend Accrual Date, the dividend will be paid on the next Business Day as if it were paid on the Dividend Accrual Date, and no interest or other amount will accrue on the dividend so payable for the period from and after such Dividend Accrual Date to the date the dividend is paid. No interest or sum of money in lieu of interest will be paid on any dividend payment on shares of Class A-1 Preferred paid later than the scheduled Dividend Accrual Date.
(d) Dividends on the Class A-1 Preferred are cumulative. Dividends on each share of Class A-1 Preferred shall accrue daily from and after the Issue Date, whether or not earned or declared, and whether or not there are earnings or profits, surplus or other funds or assets of the Corporation legally available for the payment of dividends.
(e) Upon a conversion or redemption of the Class A-1 Preferred, the Accrued Value shall be increased by any accrued and unpaid dividends to, but excluding, the applicable Conversion Date or redemption date and the number of shares of Common Stock issuable upon such conversion, or the consideration amount payable upon redemption, shall be increased in order to give effect to the related increase in the Accrued Value.
Section 5. Liquidation.
(a) In the event the Corporation voluntarily or involuntarily liquidates, dissolves or winds up (a “Liquidation Event”), the Holders at the time shall be entitled to receive a liquidating distribution in the amount of the Accrued Value per share of Class A-1 Preferred at the time of such Liquidation Event, out of assets legally available for distribution to the Corporation’s stockholders, before any distribution of assets is made to the holders of the Common Stock or any other Junior Securities. After payment of the full amount of such liquidating distributions, the Holders will not be entitled to any further participation in any distribution of assets by, and shall have no right or claim to any remaining assets of, the Corporation. The Corporation shall give the Holders written notice of any Liquidation Event not later than 15 days prior to the expected date of such Liquidation Event (or, if such Liquidation Event is involuntary and such prior written notice is not practicable, as early as practicable prior to the occurrence of such Liquidation Event), which notice shall set forth in reasonable detail the nature and expected timing of the Liquidation Event and the expected amount of assets of the Corporation available for distribution to holders of Common Stock and Preferred Stock.
(b) In the event the assets of the Corporation available for distribution to stockholders upon any liquidation, dissolution or winding-up of the affairs of the Corporation, whether voluntary or involuntary, shall be insufficient to pay in full the amounts payable with respect to all outstanding shares of the Class A-1 Preferred and the corresponding amounts payable on any Parity Securities, Holders and the holders of such Parity Securities shall share ratably in any distribution of assets of the Corporation in proportion to the full respective liquidating distributions to which they would otherwise be respectively entitled.
(c) The Corporation’s consolidation or merger with or into any other entity, the consolidation or merger of any other entity with or into the Corporation, or the sale of all or substantially all the Corporation’s property or business will not constitute its liquidation, dissolution or winding up.
Section 6. Maturity. The Class A-1 Preferred shall be perpetual unless converted or redeemed in accordance with this Certificate of Designations.
Section 7. Redemption.
(a) Each Holder of shares of Class A-1 Preferred have the right, at such Holder’s option, to require the Corporation to redeem for cash all or any portion of such Holder’s shares on or after the fifth anniversary of the Closing (the “Holder Redemption Date”), at a redemption price equal to the then applicable Accrued Value per share.
In order to exercise the right to require the Corporation to redeem such Holder’s Class A-1 Preferred pursuant to this Section 7(a), the Holder of such Class A-1 Preferred must complete and manually sign and deliver a notice (a “Holder Redemption Notice”), or a facsimile of such Holder Redemption Notice, to the Corporation not later than 15 Business Days prior to the Business Day selected by such Holder for such Holder Redemption Date. Such Holder Redemption Notice shall state (1) the Holder Redemption Date, (2) the number of shares of Class A-1 Preferred to be redeemed, and (3) that shares of such holder’s Class A-1 Preferred are to be redeemed in whole or in part by the Corporation pursuant to the applicable provisions of this Certificate of Designations. A holder of Class A-1 Preferred who delivers a Notice of Redemption shall surrender the shares of Class A-1 Preferred to be redeemed to the Transfer Agent and, if required, furnish appropriate endorsements and transfer documents prior to the Business Day prior to the Holder Redemption Date.
A Holder Redemption Notice may be withdrawn, in whole or in part with the consent of the Corporation, by means of a written notice of withdrawal (a “Holder Notice of Withdrawal”) delivered to the Transfer Agent at any time until the related Holder Redemption Date, specifying: (i) the number of whole shares of Class A-1 Preferred with respect to which such Holder Notice of Withdrawal is being submitted, (ii) if such Class A-1 Preferred are in certificated form, the certificate numbers of the withdrawn Class A-1 Preferred, and (iii) the number of whole shares of Class A-1 Preferred, if any, that remain subject to the original Holder Redemption Notice.
(b) If the Corporation ceases to be in compliance with the provisions of Section 16(a), each Holder shall have the right, at such Holder’s option, to require the Corporation to redeem for cash all or any portion of such Holder’s shares of Class A-1 Preferred at a price per share equal to the then applicable Accrued Value per share.
(c) Other than in accordance with this Section 7, the Class A-1 Preferred shall not be subject to any sinking fund or other similar obligation to redeem, repurchase or retire the Class A-1 Preferred.
Section 8. Right to Convert. Each Holder shall have the right, at such Holder’s option, at any time and from time to time, to convert all or any portion of such Holder’s shares of Class A-1 Preferred into shares of Common Stock at the then applicable Conversion Rate per share of Class A-1 Preferred.
Holders of Class A-1 Preferred subject to redemption at the option of the Holder shall not have the right to convert such shares unless the related Holder Redemption Notice is withdrawn by the Holder in accordance with the provisions of Section 7(a).
Section 9. Conversion Procedures; Reservation of Shares of Common Stock.
(a) Effective immediately prior to the close of business on the Mandatory Conversion Date or any applicable Conversion Date, dividends shall no longer accrue or accumulate on any shares of Class A-1 Preferred converted on such Conversion Date and such shares of Class A-1 Preferred shall cease to be outstanding, subject to the right of Holders to receive the shares of Common Stock due upon conversion.
(b) Except as provided in Section 11 hereto, no allowance or adjustment shall be made in respect of dividends payable to holders of the Common Stock of record as of any date prior to the close of business on the Mandatory Conversion Date or any applicable Conversion Date. Prior to the close of business on the Mandatory Conversion Date or any applicable Conversion Date, shares of Common Stock issuable upon conversion of any shares of Class A-1 Preferred shall not be deemed outstanding for any purpose, and Holders shall have no rights with respect to the Common Stock issuable upon conversion
(including voting rights and rights to receive any dividends or other distributions on the Common Stock issuable upon conversion) by virtue of holding shares of Class A-1 Preferred.
(c) Shares of Class A-1 Preferred duly converted in accordance with this Certificate of Designations will resume the status of authorized and unissued serial preferred stock, undesignated as to series and available for future issuance. The Corporation may from time to time take such appropriate action as may be necessary to reduce the authorized number of shares of Class A-1 Preferred, but not below the number of shares of Class A-1 Preferred then outstanding.
(d) The Person or Persons entitled to receive the Common Stock issuable upon conversion of Class A-1 Preferred shall be treated for all purposes as the record holder(s) of such shares of Common Stock as of the close of business on the Mandatory Conversion Date or any applicable Conversion Date. In the event that a Holder shall not by written notice designate the name in which shares of Common Stock to be issued or paid upon conversion of shares of Class A-1 Preferred should be registered or paid or the manner in which such shares should be delivered, the Corporation shall be entitled to register and deliver such shares in the name of the Holder and in the manner shown on the records of the Corporation.
(e) The conversion of shares of Class A-1 Preferred into shares of Common Stock will occur on the Mandatory Conversion Date or any applicable Conversion Date as follows:
(i) On the Mandatory Conversion Date, shares of Common Stock shall be issued to a Holder or its designee upon presentation and surrender of the certificate evidencing the Class A-1 Preferred to the Corporation if shares of the Class A-1 Preferred are held in certificated form, and, if required, the furnishing of appropriate endorsements and transfer documents and the payment of all transfer and similar taxes. If a Holder’s interest is a beneficial interest in a global certificate representing Class A-1 Preferred, a book-entry transfer through the Depositary will be made by or at the direction of the Corporation upon compliance with the Depositary’s procedures for converting a beneficial interest in a global security.
(ii) On the date of any conversion at the option of a Holder, if a Holder’s interest is in certificated form, in order to convert Class A-1 Preferred, a Holder must:
(A) complete and manually sign an irrevocable notice of conversion and deliver such notice to the Corporation;
(B) surrender the shares of Class A-1 Preferred to the Corporation;
(C) if required by the Corporation, furnish appropriate endorsements and transfer documents; and
(D) if required by the Corporation, pay all transfer or similar taxes.
If a Holder’s interest is a beneficial interest in a global certificate representing Class A-1 Preferred, in order to convert, such Holder must comply with paragraphs (C) and (D) of this clause (ii) and comply with the Depositary’s procedures for converting a beneficial interest in a global security. The date on which a Holder complies with the procedures in this clause (ii) is the “Conversion Date.” The Corporation shall deliver the shares of Common Stock due upon conversion at the option of the Holder to such converting Holder by the second Business Day following the Conversion Date.
(f) The Corporation shall at all times reserve and keep available out of its authorized but unissued Common Stock solely for the purpose of issuance upon the conversion of the Class A-1 Preferred as herein provided, such number of shares of Common Stock as shall then be issuable upon the conversion of all outstanding shares or fractions of shares of Class A-1 Preferred. All shares of Common Stock which shall be so issued shall be duly and validly issued and fully paid and non-assessable.
Section 10. Mandatory Conversion.
(a) The Corporation shall have the right, in its sole discretion, to cause all outstanding shares of Class A-1 Preferred to convert, without any action by any Holder, into shares of Common Stock on the closing date of the Qualifying Public Offering at a price per share of Class A-1 Preferred that is equal to the lower of the then current Conversion Price or the Public Offering Price discounted by 15.0%.
(b) Immediately prior to the effective date of a Fundamental Change, each outstanding share of Class A-1 Preferred shall automatically, without any action by the Corporation or any Holder, convert into shares of Common Stock at a conversion rate per share of Class A-1 Preferred equal to the then current Accrued Value of such share divided by the lower of (i) the Acquisition Price discounted by 15.0% and (ii) the Conversion Price as of the effective date of the Fundamental Transaction.
The Corporation shall give the Holders of the Class A-1 Preferred prompt written notice of the Corporation’s execution of any binding definitive agreement expected by the Corporation to result in a Fundamental Change, which notice shall describe in reasonable detail the nature of the Fundamental Change (including, without limitation, the nature and amount of any consideration to be paid to holders of Common Stock), the expected date of completion of the Fundamental Change. Such written notice shall be provided to Holders of Class A-1 Preferred not less than 30 calendar days prior to the anticipated effective date of the Fundamental Change.
Section 11. Anti-Dilution Adjustments.
(a) The Conversion Rate shall be subject to the following adjustments (and the Conversion Price shall be adjusted simultaneously with any adjustment to the Conversion Rate):
(i) If the Corporation issues Common Stock as a dividend or distribution on the Common Stock, or if the Corporation effects a share split or share combination, then the Conversion Rate in effect immediately prior to the Ex-Date for such dividend or distribution or
the open of business on the effective date of such share split or share combination, as the case may be, will be multiplied by the following fraction:
OS1
___________
OS0
Where,
OS0 = the number of shares of Common Stock outstanding immediately prior to the Ex-Date for such dividend or distribution or the open of business on the effective date of such share split or share combination, as the case may be.
OS1 = the number of shares of Common Stock that will be outstanding immediately after giving effect to such dividend or distribution or such share split or share combination, as the case may be.
Any adjustment made pursuant to this Section 11(a)(i) shall be effective as of immediately after the open of business on such Ex-Date (in the case of a dividend or distribution) or immediately after the open of business on such effective date (in the case of a share split or share combination). If any dividend or distribution or share split or share combination described in this clause (i) is authorized and declared but not so paid or made or share split or share combination is announced but the outstanding shares of Common Stock are not split or combined, as the case may be, the Conversion Price shall be readjusted, effective as of the date the Board of Directors announces its decision not to make such dividend, distribution, share split or share combination to such Conversion Rate that would be in effect if such dividend, distribution, share split or share combination had not been declared.
(ii) If the Corporation issues additional shares of Common Stock (including through the issuance, either as a dividend or distribution on shares of Common Stock or otherwise, of derivative securities with respect to the Common Stock that will result in the issuance of additional shares of Common Stock upon the exercise or conversion thereof), other than the issuance of Common Stock as a dividend or distribution for which an adjustment is required to be made pursuant to clause (i) above, without consideration or for a consideration per share less than the Per Share FMV as of the Trading Day immediately preceding (A) in the case of an issuance of rights, options or warrants to subscribe for additional shares of Common Stock as a dividend or distribution to substantially all holders of Common Stock (each, a “Rights Distribution”), the Ex-Date with respect to such Rights Distribution, or (B) in the case of all other issuances of additional shares of Common Stock or derivative securities, the date of announcement of such
issue (the time described in subclause (A) or (B), the “Additional Issuance Time”), the Conversion Rate will be multiplied by the following fraction:
OS0 + X
___________
OS0 + Y
Where,
OS0 = the number of shares of Common Stock outstanding immediately prior to the Additional Issuance Time.
X = the total number of additional shares of Common Stock to be issued (calculated on an as converted or as exercised basis, in the case of derivative securities).
Y = the number of shares of Common Stock equal to the quotient of (x) the aggregate amount of consideration received by the Corporation for such additional shares of Common Stock (and/or derivative securities), divided by (y) the Per Share FMV calculated as of the Trading Day immediately preceding the Corporation’s announcement of such issuance.
The Conversion Rate, as adjusted as provided above, shall be further adjusted to equal the quotient of (x) $1.00 divided by (y) the consideration per share received by the Corporation for such issue of such additional shares of Common Stock, if such quotient is higher than the Conversion Rate as adjusted as provided above; provided that if the relevant issuance of additional shares of Common Stock or derivative securities was without consideration, then the Board of Directors, acting reasonably and in good faith, after consultation with an Independent Investment Bank, shall determine the appropriate adjustment to the Conversion Rate, including, without limitation, making an adjustment as provided in clause (ii) above.
In determining whether an issuance of additional shares of Common Stock for a consideration per share less than the Per Share FMV calculated as of the Trading Day immediately preceding the date of announcement of such issue, there shall be taken into account any consideration received by the Corporation for additional shares of Common Stock or derivative securities and any amount payable on exercise or conversion of any such derivative securities, the value of such consideration, if other than cash, to be determined reasonably and in good faith, after consultation with an Independent Investment Bank, by the Board of Directors.
Any adjustment in the Conversion Rate pursuant to this Section 11(a)(ii) shall take effect as of the Additional Issuance Time.
Any adjustment made under this Section 11(a)(ii) with respect a Rights Distribution shall be made successively whenever any additional Rights Distributions occur and shall become effective immediately after the open of business on the Ex-Date for such Rights Distribution. The Corporation shall not make a Rights Distribution in respect of Common Stock held in treasury by the Corporation. To the extent that Common Stock is not delivered after the expiration of such rights, options or warrants issued in a Rights Distribution, the Conversion Rate shall be readjusted to the Conversion Rate that would then be in effect had the adjustment with respect to the Rights Distribution been made on the basis of delivery of only the number of shares of Common Stock actually delivered. If such rights, options or warrants subject to Rights Distribution are not so distributed, the Conversion Rate shall be readjusted to be the
Conversion Rate that would then be in effect if such Ex-Date for such Rights Distribution had not occurred.
(iii) If the Corporation distributes shares of its capital stock, evidences of its indebtedness or other of its assets, securities or property, but excluding (A) dividends or distributions for which an adjustment was made under Section 11(a)(i) or (ii), (B) dividends or distributions paid exclusively in cash (which shall be governed by Section 11(a)(iv)) and (C) Spin-Offs (which shall be governed by the provisions set forth below) (any of such shares of capital stock, indebtedness or other assets or property, the “Distributed Property”), to all or substantially all holders of Common Stock, the Conversion Rate will be multiplied by the following fraction:
SP0
___________
SP0 - FMV
Where,
SP0 = the Per Share FMV of the Common Stock calculated as of the Trading Day immediately preceding the Ex-Date for such distribution of Distributed Property.
FMV = the fair market value (as determined reasonably and in good faith by the Board of Directors) of the shares of capital stock, evidences of its indebtedness or other of its assets, securities or property, expressed as an amount per share of Common Stock distributable with respect to each outstanding share of Common Stock as of the open of business on the Ex-Date for such distribution.
Notwithstanding the foregoing, if “FMV” (as defined above) is equal to or greater than the “SP0” (as defined above), in lieu of the foregoing adjustment, each Holder shall receive, at the same time and upon the same terms as the holders of the Common Stock, the amount and kind of Distributed Property that such Holder would have received as if such Holder owned a number of shares of Common Stock equal to the Conversion Rate in effect on the Ex-Date for such distribution (without giving effect to such adjustment).
Any increase made under the portion of this Section 11(a)(iii) above shall become effective immediately after the open of business on the Ex-Date for such distribution of Distributed Property. If such distribution is not so paid or made, the Conversion Rate shall be readjusted to be the Conversion Rate that would then be in effect if such dividend or distribution had not been declared.
With respect to a payment of a dividend or other distribution on the Common Stock of any class or series, or similar equity interest, of or relating to a subsidiary or other business unit of the Corporation, where such capital stock or similar equity interest is listed or quoted (or will be listed or quoted upon consummation of the Spin-Off) on a U.S. national securities exchange (a “Spin-Off”), the Conversion Rate will be multiplied by the following fraction:
MP0 + FMV
___________
MP0
Where,
MP0 = the Per Share FMV of the Common Stock calculated as of the 10th Trading Day immediately following, and excluding, the Ex-Date for the Spin-Off.
FMV = the Per Share FMV of the capital stock or similar equity interest distributed to holders of the Common Stock applicable to one share of Common Stock calculated as of the 10th Trading Day immediately following, and excluding, the Ex-Date for the Spin-Off (the “Valuation Period”).
The adjustment to the Conversion Rate under the preceding paragraph with respect to a Spin-Off shall be determined as of the close of business on the last Trading Day of the Valuation Period but shall be given retroactive effect as of the open of business on the Ex-Date for the Spin-Off; provided that, for purposes of determining the Conversion Rate in respect of any conversion during the Valuation Period, references in the portion of this Section 11(a)(iii) related to Spin-Offs to the Valuation Period shall be deemed replaced with such lesser number of consecutive Trading Days as have elapsed between the Ex-Date for such Spin-Off and the Conversion Date for such conversion.
Rights, options or warrants distributed by the Corporation to all holders of its shares of Common Stock entitling the holders thereof to subscribe for or purchase shares of the Corporation’s capital stock, including Common Stock (either initially or under certain circumstances), which rights, options or warrants, until the occurrence of a specified event or events (“Trigger Event”): (A) are deemed to be transferred with such Common Stock; (B) are not exercisable; and (C) are also issued in respect of future issuances of the shares Common Stock, shall be deemed not to have been distributed for purposes of this Section 11(a)(iii) (and no adjustment to the Conversion Rate under this Section 11(a)(iii) will be required) until the occurrence of the earliest Trigger Event, whereupon such rights, options or warrants shall be deemed to have been distributed and an appropriate adjustment (if any is required) to the Conversion Rate shall be made under this Section 11(a)(iii). If any such right, option or warrant, including any such existing rights, options or warrants distributed prior to the Issue Date, are subject to events, upon the occurrence of which such rights, options or warrants become exercisable to purchase evidences of indebtedness or other assets, then the date of the occurrence of any and each such event shall be deemed to be the date of distribution and Ex-Date with respect to new rights, options or warrants with such rights (and a termination or expiration of the existing rights, options or warrants without exercise by any of the holders thereof. In addition, in the event of any distribution (or deemed distribution) of rights, options or warrants, or any Trigger Event or other event (of the type described in the preceding sentence) with respect thereto that was counted for purposes of calculating a distribution amount for which an adjustment to the Conversion Rate under this Section 11(a)(iii) was made, (1) in the case of any such rights, options or warrants that shall all have been redeemed or repurchased without exercise by any holders thereof, the Conversion Rate shall be readjusted upon such final redemption or repurchase to give effect to such distribution or Trigger Event, as the case may be, as though it were a cash distribution, equal to the per share redemption or repurchase price received by a holder or holders of shares of Common Stock with respect to such rights, options or warrants (assuming such holder had retained such rights, options or warrants), made to all holders of shares of Common Stock as of the date of such redemption or repurchase, and (2) in the case of such rights, options or warrants that shall have expired or been terminated without exercise by any holders thereof, the Conversion Rate shall be readjusted as if such rights, options or warrants had not been issued.
In no event shall the Conversion Rate be decreased pursuant to this Section 11(a)(iii).
(iv) If any cash dividend or distribution is made to all or substantially all holders of shares of Common Stock, the Conversion Rate will be multiplied by the following fraction:
SP0
___________
SP0 - C
Where,
SP0 = the Per Share FMV of the Common Stock as of the Ex-Date for such dividend or distribution.
C = the amount in cash per share of Common Stock the Corporation distributes to holders of its Common Stock.
Such adjustment shall become effective immediately after the open of business on the Ex-Date for such dividend or distribution. If such dividend or distribution is not so paid, the Conversion Rate shall be readjusted to be the Conversion Rate that would then be in effect if such dividend or distribution had not been declared.
Notwithstanding the foregoing, if “C” (as defined above) is equal to or greater than “SP0” (as defined above), in lieu of the foregoing increase, each Holder shall receive, at the same time and upon the same terms as holders of the Common Stock, the amount of cash such Holder would have received as if such Holder owned a number of Common Stock equal to the Conversion Rate on the Ex-Date for such dividend or distribution.
In no event shall the Conversion Rate be decreased pursuant to this Section 11(a)(iv).
(v) If the Corporation or any of its subsidiaries makes a payment in respect of a tender offer or exchange offer for the Common Stock, if the cash and value of any other consideration included in the payment per share of Common Stock exceeds the Per Share FMV of the Common Stock as of the close of business on the 10th Trading Day after the last date on which tenders or exchanges may be made pursuant to such tender or exchange offer (such 10th Trading Day, the “Tender Determination Date”), the Conversion Rate will be multiplied by the following fraction:
AC + (SP1 X OS1)
__________
OS0 X SP1
Where,
AC = the aggregate value of all cash and any other consideration (as determined by the Board of Directors) paid or payable for Common Stock purchased in such tender or exchange offer.
OS0 = the number of shares of Common Stock outstanding immediately prior to the date such tender or exchange offer expires (prior to giving effect to the purchase or exchange of shares in such tender offer or exchange offer).
OS1 = the number of shares of Common Stock outstanding immediately after the date such tender or exchange offer expires (after giving effect to the purchase or exchange of shares in such tender offer or exchange offer).
SP1 = the Per Share FMV of the Common Stock as of the Tender Determination Date.
The adjustment to the Conversion Rate under this Section 11(a)(v) shall be determined on the Tender Determination Date but shall be given retroactive effect as of the open of business on the Trading Day immediately after the last date on which tenders or exchanges may be made pursuant to such tender or exchange offer; provided that, for purposes of determining the Conversion Rate, in respect of any conversion during the 10 Trading Days immediately following, but excluding, the date that any such tender or exchange offer expires, references in this Section 11(a)(v) or in the definition of Per Share FMV to 10 Trading Days shall be deemed replaced with such lesser number of Trading Days as have elapsed between the date that such tender or exchange offer expires and the Conversion Date for such conversion. In no event shall the Conversion Rate be decreased pursuant to this Section 11(a)(v).
(b) Notwithstanding this Section 11, if a Conversion Rate adjustment becomes effective on any Ex-Date, and a Holder that has converted its Class A-1 Preferred on or after such Ex-Date and on or prior to the related record date would be treated as the record holder of Common Stock as of the related Conversion Date based on an adjusted Conversion Rate for such Ex-Date, then, notwithstanding the Conversion Rate adjustment provisions in this Section 11, the Conversion Rate adjustment relating to such Ex-Date (other than a Conversion Rate adjustment made pursuant to the second paragraph of Section 11(a)(ii)) shall not be made for such converting Holder. Instead, such Holder shall be treated as if such Holder were the record owner of the Common Stock on an unadjusted basis and participate, following conversion, as a holder of Common Stock of the Corporation, in the related dividend, distribution or other event giving rise to such adjustment.
(c) The Corporation may make such decreases in the Conversion Price, in addition to any other increases required by this Section 11, if the Board of Directors deems it to be in the best interests of the Corporation or otherwise advisable to avoid or diminish any income tax to holders of the Common Stock resulting from any dividend or distribution of shares of Common Stock (or issuance of rights or warrants to acquire shares of Common Stock) or from any event treated as such for income tax purposes or for any other reason.
(d) All adjustments to the Conversion Rate shall be calculated to the nearest 1/10,000th of a share of Common Stock. No adjustment in the Conversion Rate shall be required unless such adjustment would require an increase or decrease of at least one percent thereof; provided, however, that any adjustments which by reason of this subparagraph are not required to be made shall be carried forward and taken into account in any subsequent adjustment; provided further that on the Mandatory Conversion Date or any Conversion Date relating to a conversion at the option of the Holder, adjustments to the Conversion Rate will be made with respect to any such adjustment carried forward and which has not been taken into account before such date.
(e) No adjustment to the Conversion Price shall be made if Holders may participate in the transaction that would otherwise give rise to an adjustment, as a result of holding the Class A-1 Preferred, without having to convert the Class A-1 Preferred, as if they held the full number of shares of Common Stock into which a share of the Class A-1 Preferred may then be converted.
(f) The applicable Conversion Price shall not be adjusted:
(i) upon the issuance of any shares of the Common Stock pursuant to any present or future plan providing for the reinvestment of dividends or interest payable on the Corporation’s securities and the investment of additional optional amounts in shares of Common Stock under any plan;
(ii) upon the issuance of any shares of the Common Stock or rights or warrants to purchase those shares pursuant to any present or future employee, director or consultant benefit plan or program of or assumed by the Corporation or any of its subsidiaries;
(iii) upon the issuance of any shares of the Common Stock pursuant to any option, warrant, right or exercisable, exchangeable or convertible security outstanding as of the Issue Date;
(iv) for a change in the par value of the Common Stock; or
(v) for accumulated and unpaid dividends on the Class A-1 Preferred or for any increase in the Accrued Value.
(g) Whenever the Conversion Price is to be adjusted in accordance with Section 11(a) or Section 11(c), the Corporation shall as soon as practicable following the determination of the revised Conversion Price provide, or cause to be provided, a written notice to the holders of Class A-1 Preferred setting forth in reasonable detail the method by which the adjustment to the Conversion Price was determined and setting forth the revised Conversion Price.
Section 12. Reorganization Events.
(a) In the event of:
(i) any reclassification of the Common Stock into securities including securities other than the Common Stock; or
(ii) any statutory exchange of the Corporation’s securities (other than in connection with a merger or any Fundamental Change);
(each of the foregoing events, a “Reorganization Event”) pursuant to which the Common Stock is exchanged for securities, cash or other property (“Reference Property” and the kind and amount of Reference Property received by a holder of one share of Common Stock, a “unit of Reference Property” ), the Class A-1 Preferred outstanding immediately prior to such Reorganization Event will thereafter, and without the consent of Holders, become convertible into Reference Property, and each share of Class A-1 Preferred will be convertible into a number of units of Reference Property equal to the Conversion Rate then applicable at the time of any such conversion. If holders of Common Stock are permitted to elect to receive more than one form of Reference Property in connection with a Reorganization Event, the Class A-1 Preferred shall become convertible into the Reference Property elected by a plurality of the holders of Common Stock.
(b) The above provisions of this Section 12 shall similarly apply to successive Reorganization Events and the provisions of Section 11 shall apply to any shares of capital stock of the Corporation received by the holders of the Common Stock in any such Reorganization Event.
(c) The Corporation shall, not later than three (3) Business Days following the date on which a definitive agreement is executed by the Corporation that would give rise to a Reorganization Event, provide written notice to the Holders of such anticipated Reorganization Event. Not later than three (3) Business Days following the date such Reorganization Event occurs, the Corporation shall provide written notice to the Holders of the occurrence of such Reorganization Event and of the kind and amount of the cash, securities or other property or assets that constitutes the Reference Property and a unit of Reference Property. Failure to deliver such notice shall not affect the operation of this Section 12. To the extent any amendments are necessary to this Certificate of Designations to effectuate the intent of this Section 12, the Corporation shall, as promptly as practicable, make such amendments.
Section 13. Voting Rights.
(a) So long as any shares of Class A-1 Preferred are outstanding, in addition to any other vote or consent of stockholders required by law or by the Certificate of Incorporation, the vote or consent of the holders of at least two-thirds of the outstanding shares of Class A-1 Preferred then outstanding, voting separately as a class, given in person or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose, shall be necessary for (i) the issuance of Senior Equity Securities, (ii) effecting or validating any amendment, alteration or repeal of any provision of the Certificate of Incorporation or this Certificate of Designations, whether by merger, consolidation or otherwise, so as to materially and adversely affect the special rights, preferences, privileges, conversion right or voting powers of the Class A-1 Preferred, taken as a whole, and (iii) the payment of any dividends on any series or class or classes of Parity Securities or Junior Securities for any period unless dividends have been declared and paid or are contemporaneously declared and paid or declared and a sum sufficient for the payment thereof set apart for such payment on the Class A-1 Preferred for all prior dividend periods in accordance with Section 4; provided, however, that for all purposes of this Section 13(a), but subject to the provisions of Section 16,
(i) any increase in the amount of the Corporation’s authorized but unissued shares of preferred stock, including any shares of preferred stock which would rank equal with or senior to the Class A-1 Preferred with respect to either or both of the payment of dividends or the distribution of assets upon liquidation or dissolution or winding up of the Corporation,
(ii) any increase in the amount of the Corporation’s authorized or issued Class A-1 Preferred,
(iii) the creation and issuance, or an increase in the authorized or issued amount, of other series of preferred stock of the Corporation ranking equally with or junior to the Class A-1 Preferred either or both with respect to the payment of dividends (whether such dividends are cumulative or non-cumulative) and/or the distribution of assets upon the liquidation, dissolution or winding up of the Corporation, and
(iv) a Fundamental Change
will not be deemed to materially and adversely affect the special rights, preferences, privileges or voting powers of the Class A-1 Preferred.
(b) Without the consent of the holders of the Class A-1 Preferred, so long as such action does not adversely affect the special rights, preferences, privileges and voting powers, and limitations and
restrictions thereof, taken as a whole, of the Class A-1 Preferred, the Corporation may amend, alter, supplement or repeal any terms of the Class A-1 Preferred:
(i) to cure any ambiguity, or to cure, correct or supplement any provision contained in this Certificate of Designations that may be ambiguous, defective or inconsistent; or
(ii) to make any provision with respect to matters or questions relating to the Class A-1 Preferred that is not inconsistent with the provisions of this Certificate of Designations.
(c) On each matter on which holders of Class A-1 Preferred are entitled to vote, each share of Class A-1 Preferred will be entitled to one vote, and when shares of any other class or series of the Corporation’s preferred stock have the right to vote with the Class A-1 Preferred as a single class on any matter, the Class A-1 Preferred and the shares of each such other class or series will have one vote for each $10.00 of liquidation preference (which in the case of the Class A-1 Preferred shall be determined by reference to the Accrued Value).
(d) In addition to the voting rights specified in Sections 13(a), (b) and (c), Holders of Class A-1 Preferred shall have the right to vote, together with holders of the outstanding shares of Common Stock as a single class, on any and all matters requiring the vote of common stockholders under applicable law and on any other matter put before holders of the Common Stock for a vote. Any such vote shall be on an “as converted” basis such that Holders of the Class A-1 Preferred shall, with respect to each share of Class A-1 Preferred, be entitled to the vote that a holder of a number of shares of Common Stock equal to the Conversion Rate then in effect at the time of such vote would be.
Section 14. Fractional Shares.
(a) No fractional shares of Common Stock will be issued as a result of any conversion of shares of Class A-1 Preferred.
(b) In lieu of any fractional share of Common Stock otherwise issuable upon conversion of the Class A-1 Preferred, the Holder shall be entitled to receive one full share of Common Stock.
(c) If more than one share of the Class A-1 Preferred is surrendered for conversion at one time (or within 30 days of a conversion) by or for the same Holder, the number of full shares of Common Stock issuable upon conversion thereof shall be computed on the basis of the aggregate number of shares of the Class A-1 Preferred so surrendered.
Section 15. Transfer Agent, Registrar, Paying Agent and Conversion Agent. The duly appointed Transfer Agent, Registrar, paying agent and Conversion Agent for the Class A-1 Preferred shall be a Person appointed by the Corporation, which may include the Corporation. American Stock Transfer will initially act as the Transfer Agent, Registrar, paying agent and Conversion Agent for the Class A-1 Preferred. The Corporation may, in its sole discretion, appoint any other Person as Transfer Agent, Registrar, paying agent and Conversion Agent for the Class A-1 Preferred.
Section 16. Additional Provisions Relating to the Class A-1 Preferred.
(a) Until the earlier to occur of (i) no shares of Class A-1 Preferred remain outstanding and (ii) a Qualifying Public Offering has been completed, (A) no dividend shall be declared and paid or set aside for payment and no distribution shall be declared and made or set aside for payment on any Junior Securities (other than a dividend payable solely in shares of Junior Securities) and (B) no purchase,
redemption, repurchase or other acquisition for value of Junior Securities shall be made or be permitted to be made.
(b) Each Holder of Class A-1 Preferred hereby agrees, with respect to the shares of Common Stock issuable upon conversion of the Class A-1 Preferred and any other shares of Common Stock that it may hold at the time of a Qualifying Public Offering, not to transfer such shares of Common Stock during such periods as reasonably requested by the representatives of the underwriters in the Qualifying Public Offering (but in no event for longer than 30 days prior to or 90 days following the effective date of the registration statement filed in connection with the Qualifying Public Offering of Common Stock).
(c) (i) From the date of this Certificate of Designations until the date upon which the Corporation completes a Qualifying Public Offering, the Corporation shall not consummate an offering or offerings (excluding any issuances of securities to employees in connections with bona fide compensation arrangements) of any class or series of (1) equity securities of the Corporation, (2) securities convertible into, exchangeable for, redeemable for or otherwise linked to the issuance of any equity security of the Corporation or (3) subordinated debt securities of the Corporation, in each case whether in a public or private offering (any such security, a “New Security,” and the issuance of any New Security, an “Equity Issuance”), for aggregate gross proceeds in excess of $10.0 million, unless the Corporation gives each Holder of Class A-1 Preferred written notice of the planned Equity Issuance at least ten (10) Business Days prior to the closing of such Equity Issuance, which notice shall include (A) the terms of the New Security in reasonable detail, including but not limited to rights upon liquidation, winding-up or dissolution, dividend rights, conversion rights, and the ranking of the security relative to other securities of the Corporation, as applicable, (B) an offer by the Corporation to each Holder to exchange all, but not less than all, of such Holder’s outstanding shares of Class A-1 Preferred for the New Security at an exchange ratio equal to (x) the then current Accrued Value divided by (y) the offering price of the New Security, and (C) instructions to the Holder regarding how such Holder may exercise its option to exchange its shares of Class A-1 Preferred for the New Security, provided that the deadline for exercising such option shall be no less than five (5) Business Days prior to the closing date of the Equity Issuance.
(ii) If a Holder of Class A-1 Preferred exercises its option to exchange all of its shares of Class A-1 Preferred for the New Security, (A) the Holder shall surrender its shares of Class A-1 Preferred to the Transfer Agent and, if required, furnish appropriate endorsements, transfer and other documents to the Transfer Agent and the Corporation, (B) the Corporation shall deliver the New Security to such Holder no more than two (2) Business Days following the closing of the Equity Issuance, and (C) the shares of Class A-1 Preferred duly exchanged in accordance with the terms of this Section 16(c) will resume the status of authorized and unissued serial preferred stock, undesignated as to series and available for future issuance.
(iii) In the event that the calculation of the number of shares of the New Security issuable upon the exchange in accordance with the terms of clause (i) of this Section 16(c) would result in the issuance of fractional shares of the New Security, no fractional shares shall be issued and the Corporation shall pay the Holder an amount in cash equal to (A) the fraction of the share that is not issuable in New Securities multiplied by (B) the offering price of the New Security.
(iv) In the event that the Corporation does not consummate the closing of the Equity Issuance, all rights of the Holder to any New Security under this Section 16(c) shall terminate; provided that if the Corporation at any time decides to issue such New Security, the Holder shall have all rights set forth in this Section 16(c) with respect to the New Security and shall have at
least two (2) Business Days prior to the closing of the Equity Issuance to exercise its option to exchange its Class A-1 Preferred for such New Security.
(v) The Corporation and the Holder shall take all such other actions as are necessary and appropriate to effect the exchange of the securities as set forth in this Section 16.
(d) From the date of this Certificate of Designations until the date upon which the Corporation completes a Qualifying Public Offering, no Holder may make any disposition of all or any portion of the Class A-1 Preferred held by such Holder unless and until such Holder shall have notified the Corporation of the proposed disposition and shall have furnished the Corporation with information reasonably requested by the Corporation to allow the Corporation to (i) determine that such transfer would not result in potential restriction by the Committee on Foreign Investment in the United States or other regulatory restriction that could negatively impact the ability of the Corporation to conduct its business, (ii) determine whether such transfer would be to a direct competitor of the Corporation and (iii) verify, including by requesting the furnishing of an opinion of counsel reasonably satisfactory to the Corporation (other than for dispositions in compliance with Rule 144), that such transfer would be made pursuant to an exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”), and any applicable state or other securities laws. Notwithstanding the provisions of this Section 16(d), no such prior notice shall be necessary for a transfer by such Holder to a partner (or retired partner) or member (or retired member) of such Holder in accordance with partnership or limited liability company interests, or transfers by gift, will or intestate succession to any spouse or lineal descendants or ancestors, if all transferees agree in writing to be subject to the terms hereof to the same extent as if they were Holders hereunder.
(e) The Corporation shall use its commercially reasonable efforts to file, within 90 days after the completion of a Qualifying Public Offering, a registration statement covering the sale or distribution from time to time by the Holders, on a delayed or continuous basis pursuant to Rule 415 of the Securities Act of all of the shares of Common Stock into which any outstanding shares of Class A-1 Preferred convert upon a Qualifying Public Offering on Form S- 3 (except if the Corporation is not then eligible to register for resale the shares of Common Stock on Form S-3, then such registration shall be on another appropriate form and shall provide for the registration of such shares of Common Stock for resale by such Holders in accordance with any reasonable method of distribution elected by the Holders). The Holder or Holders of such shares of Common Stock included in any registration shall furnish to the Corporation such information regarding such Holder or Holders and their Affiliates, the shares of Common Stock held by them and the distribution proposed by such Holder or Holders and their Affiliates as the Corporation may reasonably request in writing and as shall be required in connection with any registration, qualification or compliance with applicable law or regulation, and during such time as such Holder or Holders and their respective Affiliates may be engaged in a distribution of such securities, such Holder or Holders will, and they will cause their Affiliates to, comply with all laws applicable to such distribution. The obligations of the Corporation under this Section 16(e) are conditioned on the timely provisions of the foregoing information by such Holder or Holders and, without limitation of the foregoing, will be conditioned on compliance by such Holder or Holders with the foregoing. All reasonable and documented fees and expenses incident to the registration, qualification, listing and filing fees, printing expenses, escrow fees, fees and disbursements of counsel for the Corporation, fees and disbursements of all independent certified public accountants, blue sky fees and expenses, expenses of the Corporation incurred in connection with any road show and the expense of any special audits incident to or required by any such registration shall be borne by the Corporation. All fees and expenses of any counsel to the Holders, all underwriting discounts, selling commissions and stock transfer taxes relating to securities
registered on behalf of the Holders shall be borne by the Holders of the registered securities included in such registration.
Section 17. Tax Withholding. The Corporation may withhold tax from any payment or distribution (or deemed distribution for federal income tax purposes) made hereunder as required by law. In the case of distributions that are deemed to occur for federal income tax purposes where no cash or property is being distributed or paid to the Holder, the Corporation may, at its election, either withhold the tax from any other cash or property otherwise payable to the applicable Holder (including from any future distributions or from any Common Stock receivable by such Holder upon the conversion of the Class A-1 Preferred), or require the Holder to indemnify the Corporation for any such withholding tax, in which case the Holder shall pay the Corporation the amount of such tax within five Business Days of being requested to do so. Any amount of tax (or property) withheld by the Corporation under the terms of this Section 17 shall be promptly paid to the applicable tax authorities and shall be treated as having being paid to the applicable Holder in accordance with the terms of this Certificate of Designations.
Section 18. Miscellaneous. All notices referred to herein shall be in writing, and, unless otherwise specified herein, all notices hereunder shall be deemed to have been given upon the earlier of receipt thereof or three Business Days after the mailing thereof if sent by registered or certified mail (unless first-class mail shall be specifically permitted for such notice under the terms of this Certificate of Designations) with postage prepaid, addressed: (i) if to the Corporation, to the principal executive office of the Corporation or to the Transfer Agent at its principal office in the United States of America, or other agent of the Corporation designated as permitted by this Certificate of Designations, or (ii) if to any Holder or holder of shares of Common Stock, as the case may be, to such Holder at the address of such Holder as listed in the stock record books of the Corporation (which may include the records of any transfer agent for the Class A-1 Preferred or the Common Stock, as the case may be), or (iii) to such other address as the Corporation or any such Holder, as the case may be, shall have designated by notice similarly given.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, VOYAGER SPACE HOLDINGS, INC. has caused this Certificate of Designations to be signed by a duly authorized office this 19th day of February, 2021.
| | | | | | | | |
| VOYAGER SPACE HOLDINGS, INC. |
| | |
| | |
| By: | /s/ Dylan Taylor |
| | Name: Dylan Taylor |
| | Title: Chief Executive Officer |
VOYAGER SPACE HOLDINGS, INC.
AMENDED AND RESTATED CERTIFICATE OF DESIGNATIONS
Pursuant to Section 151 of the General Corporation Law of the State of Delaware
CLASS B NON-CUMULATIVE CONVERTIBLE PREFERRED STOCK
(par value $0.0001 per share)
Voyager Space Holdings, Inc. (the “Corporation”), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify that:
FIRST: The name of the Corporation is Voyager Space Holdings, Inc.
SECOND: The Corporation’s Certificate of Designations of Class B Non-Cumulative Convertible Preferred Stock (the “Class B Certificate of Designations”) was filed with the Secretary of State of the State of Delaware on September 24, 2021.
THIRD: This Amended and Restated Certificate of Designations of Class B Non-Cumulative Convertible Preferred Stock was approved by resolution of the Board of Directors of the Corporation at a meeting held on January 31, 2022.
FOURTH: That in accordance with Section 13 of the Class B Certificate of Designations, the approval of the holders of Class B Non-Cumulative Convertible Preferred Stock is not required to amend and restate the Certificate of Designations.
FIFTH: The Board of Directors of the Corporation adopted resolutions, dated January 31, 2022, to amend and restate the Certificate of Designations of the Class B Non-Cumulative Convertible Preferred Stock to read in its entirety as follows:
Section 1. Designation of Series and Number of Shares. The shares of such series of preferred stock shall be designated “Class B Preferred Stock” (the “Class B Preferred”), and the authorized number of shares that shall constitute such series shall be 4,400,000 shares, which may be decreased (but not below the number of shares of Class B Preferred then issued and outstanding) from time to time by the Board of Directors. Shares of outstanding Class B Preferred that are purchased or otherwise acquired by the Corporation shall be cancelled and shall revert to authorized but unissued shares of preferred stock of the Corporation undesignated as to series.
Section 2. Ranking. The Class B Preferred will rank, with respect to the payment of dividends and distributions upon liquidation, dissolution or winding-up, (1) on a parity with the Class A-1 Convertible Preferred Stock of the Corporation and each class or series of capital stock the Corporation may issue in the future the terms of which expressly provide that such class or series will rank on a parity with the Class B Preferred as to payment of dividends and distributions upon liquidation, winding up or dissolution of the Corporation (collectively, the “Parity Securities”), (2) senior to the Common Stock and each other class or series of capital stock the Corporation may issue in the future the terms of which do not expressly provide that it ranks on a parity with or senior to the Class B Preferred as to payment of dividends and distributions upon liquidation, winding-up or dissolution of the Corporation (the “Junior Securities”), and (3) junior to the shares of such series of preferred stock of the Corporation designated “Class A Preferred” and each class or series of capital stock the Corporation may issue in the future the terms of which expressly provide that such class or series will rank senior to the Class B Preferred as to
payment of dividends and distributions upon liquidation, winding up or dissolution of the Corporation (“Senior Securities”).
Section 3. Definitions. As used herein with respect to the Class B Preferred:
“Accrued Value” means, with respect to each share of Class B Preferred, the sum of (i) the Original Liquidation Preference plus (ii) an additional amount equal to the dollar value of any accrued dividends on such share of Class B Preferred which have not been paid in accordance with the provisions of Section 4. Any increase in the Accrued Value shall take effect on the Dividend Payment Date on which a dividend payment, or any portion thereof, is not paid in accordance with the provisions of Section 4.
“Affiliate” has the meaning specified in Rule 15b-2 under the Exchange Act.
“Board of Directors” means the board of directors of the Corporation or any committee thereof duly authorized to act on behalf of such board of directors.
“Business Day” means any day that is not Saturday or Sunday and that, in New York City, is not a day on which banking institutions generally are authorized or obligated by law or executive order to be closed.
“Bylaws” means the Bylaws of the Corporation, as may be amended from time to time.
“Certificate of Designations” means this Certificate of Designations relating to the Class B Preferred, as it may be amended from time to time.
“Certification of Incorporation” means the Certificate of Incorporation of the Corporation, as it may be amended from time to time, and shall include this Certificate of Designations.
“Class B Original Issue Price” means the price per share at which the applicable shares of Class B Preferred were originally issued on. the applicable Issue Date.
“Closing” means the closing of the sale and issuance of shares of the Class B Preferred in a private placement.
“Common Stock” means the Common Stock, par value $0.0001 per share, of the Corporation.
“Conversion Agent” means the Transfer Agent acting in its capacity as conversion agent for the Class B Preferred, and its successors and assigns or any successor Conversion Agent appointed by the Corporation.
“Conversion Date” has the meaning set forth in Section 9(e)(ii).
“Conversion Price” means, for the Class B Preferred, Class B Original Issue Price per share, subject to adjustment in accordance with the provisions of Section 11 of this Certificate of Designations.
“Conversion Rate” means, for each share of Class B Preferred, a rate equal to the quotient of (i) the Accrued Value of such share of Class B Preferred divided by (ii) the Conversion Price.
“Corporation” means Voyager Space Holdings, Inc., a Delaware corporation.
“Depositary” means DTC or its nominee or any successor depositary appointed by the Corporation.
“Dividend Payment Date” has the meaning set forth in Section 4(b).
“Dividend Period” has the meaning set forth in Section 4(b).
“DTC” means The Depository Trust Company and its successors or assigns.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Ex-Date,” when used with respect to any issuance or distribution, means the first date on which the Common Stock or other securities trade without the right to receive such issuance or distribution.
“Fundamental Change” means the consummation of any consolidation or merger of the Corporation or similar transaction or any sale, lease or other transfer in one transaction or a series of transactions of all or substantially all the assets of the Corporation and its subsidiaries, taken as a whole (whether by means of a sale of the common equity of the Company or otherwise), to any person other than one of the Corporation's wholly-owned subsidiaries, in each case pursuant to which the Corporation’s common stock will be converted into, or receive a distribution of the proceeds in, cash, securities or other property, other than pursuant to a transaction in which the persons that “beneficially owned” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, voting shares of the Company immediately prior to such transaction beneficially own, directly or indirectly, voting shares representing a majority of the total voting power of all outstanding classes of voting shares of the continuing or surviving entity immediately after the transaction; provided that a “fundamental change” will not include any transaction constituting a “Qualifying Public Offering” (as defined below).
“GAAP” means accounting principles generally accepted in the United States of America.
“Holder” means the Person in whose name the shares of the Class B Preferred are registered, which may be treated by the Corporation as the absolute owner of the shares of Class B Preferred for the purpose of making payment and settling any conversions and for all other purposes.
“Independent Investment Bank” means a nationally recognized independent U.S. investment bank.
“Issue Date” means the date on which shares of the Class B Preferred are first issued.
“Junior Securities” has the meaning set forth in Section 2.
“Liquidation Event” has the meaning set forth in Section 5(a).
“Mandatory Conversion Date” means the date on which each outstanding share of Class B Preferred automatically converts into shares of Common Stock in accordance with the provisions of Section 10(a) or 10(b).
“Original Liquidation Preference” means, as to the Class B Preferred, the Class B Original Issue Price per share.
“Parity Securities” has the meaning set forth in Section 2.
“Person” means a legal person, including any individual, corporation, estate, partnership, joint venture, association, joint-stock company, limited liability company or trust.
“Per Share FMV” of the Common Stock or any other security on any date means:
(i) the volume weighted average price per share of the Common Stock or per unit of such other security (in each case, determined by the Corporation using customary methods) on the Principal Stock Exchange for the 10 consecutive Trading Days immediately prior to such date; or
(ii) if the Common Stock or such other security is not listed for trading on a U.S, national or regional securities exchange on the relevant date, the fair market value per share of the Common Stock or such other security, as determined reasonably and in good faith by the Board of Directors, who may take into account various factors in its determination, including (1) the last quoted bid price for the Common Stock or such other security in the over-the-counter market as reported by OTC Link LLC or a similar organization over a period of Trading Days deemed reasonable and advisable by the Board of Directors, (2) if the Common Stock or such other security is not so quoted, the bid and ask prices for the Common Stock or such other security on the relevant date from Independent Investment Banks over a period of Trading Days deemed reasonable and advisable by the Board of Directors, (3) the opinion or appraisal of an Independent Investment Bank or a U.S. nationally recognized valuation firm, (4) the circumstances of any proposed transaction, including the availability of willing third party buyers or the financial condition or liquidity requirements of the Corporation, (5) the lack of a market for the Common Stock and the limited liquidity with respect thereto, and (6) any other factors deemed relevant by the Board of Directors in its reasonable judgment.
The Per Share FMV of the Common Stock or such other security shall be determined without reference to extended or after-hours trading.
“Principal Stock Exchange” means, with respect to a security, the primary U.S. national or regional stock exchange on which such security is listed for trading.
“Public Offering Price” means the price per share at which Common Stock is offered and sold to the public pursuant to a Qualifying Public Offering.
“Qualifying Public Offering” means a (i) firm-commitment underwritten public offering of Common Stock listed on a national securities exchange, whether primary or secondary, (ii) a direct listing of Common Stock listed on a national securities exchange, or (iii) an acquisition through a de-SPAC transaction, in each case registered with the Securities and Exchange Commission, the gross proceeds of which exceed $50.0 million, which amount may be lowered by the Corporation upon receiving approval of a majority of the then-outstanding shares of the Class B Preferred.
“Record Date” has the meaning set forth in Section 4(b).
“Reference Property” has the meaning set forth in Section 12(a).
“Registrar” means the Transfer Agent acting in its capacity as registrar for the Class B Preferred, and its successors and assigns or any successor registrar duly appointed by the Corporation.
“Reorganization Event” has the meaning set forth in Section 12(a).
“Securities Act” has the meaning set forth in Section 16(c).
“Senior Securities” has the meaning set forth in Section 2.
“Trading Day” means any day during which all of the following conditions are satisfied: (i) trading in the Common Stock generally occurs on the Principal Stock Exchange and (ii) a closing sale price for the Common Stock is provided on the Principal Stock Exchange or, if the shares of Common Stock are not listed on a U.S. national or regional securities exchange, on the principal other market on which the shares of Common Stock are then traded; provided that if the Common Stock is not publicly listed or traded on any exchange or market, “Trading Day” means Business Day.
“Transfer Agent” means the Person acting as Transfer Agent and paying agent for the Class B Preferred in accordance with the provisions of Section 15, and its successors and assigns, including any successor transfer agent appointed by the Corporation.
Section 4. Dividends.
(a) Subject to the provisions of the following sentence, non-cumulative dividends will be payable, in cash or in kind, at the Corporation’s option, on each outstanding share of Class B Preferred only when, as and if declared by the Board of Directors, at an annual rate equal to 6.0% per annum of the Accrued Value of such share of Class B Preferred.
Any increase in the Accrued Value of the Class B Preferred shall take effect on the Dividend Payment Date on which the Corporation does not pay all or any portion of the dividend accrued during the preceding Dividend Period.
(b) The right to such dividends on the Class B Preferred shall be non-cumulative and rights shall not accrue to holders of the Class B Preferred by reason of the fact that dividends on the Class B Preferred are not declared in any prior quarterly period. Subject to Section 4(a), dividends so declared shall be paid and, if declared in cash, be payable quarterly in arrears on February 15, May 15, August 15 and November 15 of each year (each, a “Dividend Payment Date”) commencing on November 15, 2021. If a cash dividend is declared by the Board of Directors for a Dividend Payment Date, such cash dividend will be payable to Holders of record as they appear in the stock register of the Corporation at the close of business on the first day of the month, whether or not a Business Day, in which the relevant Dividend Payment Date occurs (each, a “Record Date”). Each period from and including a Dividend Payment Date (or the date of the issuance of the Class B Preferred) to but excluding the following Dividend Payment Date is herein referred to as a “Dividend Period.”
(c) Dividends payable or accrued for a Dividend Period will be computed on the basis of a 360-day year of twelve 30-day months. If a Dividend Payment Date falls on a day that is not a Business Day, and if a cash dividend is declared by the Board of Directors for such Dividend Payment Date, the dividend will be paid on the next Business Day as if it were paid on the Dividend Payment Date, and no interest or other amount will accrue on the dividend so payable for the period from and after such Dividend Payment Date to the date the dividend is paid. No interest or sum of money in lieu of interest will be paid on any dividend payment on shares of Class B Preferred paid later than the scheduled Dividend Payment Date.
(d) Upon a conversion or redemption of the Class B Preferred, the Accrued Value shall be increased by any accrued and unpaid dividends to, but excluding, the applicable Conversion Date or redemption date and the number of shares of Common Stock issuable upon such conversion, or the consideration amount payable upon redemption, shall be increased in order to give effect to the related increase in the Accrued Value.
Section 5. Liquidation.
(a) In the event the Corporation voluntarily or involuntarily liquidates, dissolves or winds up (a “Liquidation Event”), the Holders at the time shall be entitled to receive a liquidating distribution in the amount of the Accrued Value per share of Class B Preferred at the time of such Liquidation Event, out of assets legally available for distribution to the Corporation’s stockholders, before any distribution of assets is made to the holders of the Common Stock or any other Junior Securities. After payment of the full amount of such, liquidating distributions, the Holders will not be entitled to any further participation in any distribution of assets by, and shall have no right or claim to any remaining assets of, the Corporation, The Corporation shall give the Holders written notice of any liquidation Event not later than 15 days prior to the expected date of such Liquidation Event (or, if such Liquidation Event is involuntary and such prior written notice is not practicable, as early as practicable prior to the occurrence of such liquidation Event), which notice shall set forth in reasonable detail the nature and expected timing of the Liquidation Event and the expected amount of assets of the Corporation available for distribution to holders of Common Stock and Preferred Stock.
(b) In the event the assets of the Corporation available for distribution to stockholders upon any liquidation, dissolution or winding-up of the affairs of the Corporation, whether voluntary or involuntary, shall be insufficient to pay in full the amounts payable with respect to all outstanding shares of the Class B Preferred and the corresponding amounts payable on any Parity Securities, Holders and the holders of such Parity Securities shall share ratably in any distribution of assets of the Corporation in proportion to the full respective liquidating distributions to which they would otherwise be respectively entitled.
(c) The Corporation’s consolidation or merger with or into any other entity, the consolidation or merger of any other entity with or into the Corporation, or the sale of all or substantially all the Corporation’s property or business will not constitute its liquidation, dissolution or winding up.
Section 6. Maturity. The Class B Preferred shall be perpetual unless converted or redeemed in accordance with this Certificate of Designations.
Section 7. [RESERVED].
Section 8. Right to Convert. Each Holder shall have the right, at such Holder’s option, at any time and from time to time, to convert all or any portion of such Holder’s shares of Class B Preferred into shares of Common Stock at the then applicable Conversion Rate per share of Class B Preferred.
Section 9. Conversion Procedures; Reservation of Shares of Common Stock.
(a) Effective immediately prior to the close of business on the Mandatory Conversion Date or any applicable Conversion Date, dividends shall no longer accrue on any shares of Class B Preferred converted on such Conversion Date and such shares of Class B Preferred shall cease to be outstanding, subject to the right of Holders to receive the shares of Common Stock due upon conversion.
(b) Except as provided in Section 11 hereto, no allowance or adjustment shall be made in. respect of dividends payable to holders of the Common Stock of record as of any date prior to the close of business on the Mandatory Conversion Date or any applicable Conversion Date. Prior to the close of business on the Mandatory Conversion Date or any applicable Conversion Date, shares of Common Stock issuable upon conversion of any shares of Class B Preferred shall not be deemed outstanding for any purpose, and Holders shall have no rights with respect to the Common Stock issuable upon conversion
(including voting rights and rights to receive any dividends or other distributions on the Common Stock issuable upon conversion) by virtue of holding shares of Class B Preferred.
(c) Shares of Class B Preferred duly converted in accordance with this Certificate of Designations will resume the status of authorized and unissued serial preferred stock, undesignated as to series and available for future issuance. The Corporation may from time to time take such appropriate action as may be necessary to reduce the authorized number of shares of Class B Preferred, but not below the number of shares of Class B Preferred then outstanding.
(d) The Person or Persons entitled to receive the Common Stock issuable upon conversion of Class B Preferred shall be treated for all purposes as the record holder(s) of such shares of Common Stock as of the close of business on the Mandatory Conversion Date or any applicable Conversion Date. In the event that a Holder shall not by written notice designate the name in which shares of Common Stock to be issued or paid upon conversion of shares of Class B Preferred should be registered or paid or the manner in which such shares should be delivered, the Corporation shall be entitled to register and deliver such shares in the name of the Holder and in the manner shown on the records of the Corporation.
(e) The conversion of shares of Class B Preferred into shares of Common Stock will occur on the Mandatory Conversion Date or any applicable Conversion Date as follows:
(i) On the Mandatory Conversion Date, shares of Common Stock shall be issued to a Holder or its designee upon presentation and surrender of the certificate evidencing the Class B Preferred to the Corporation if shares of the Class B Preferred are held in certificated form, and, if required, the furnishing of appropriate endorsements and transfer documents and the payment of all transfer and similar taxes. If a Holder’s interest is a beneficial interest in a global certificate representing Class B Preferred, a book-entry transfer through the Depositary will be made by or at the direction of the Corporation upon compliance with the Depositary’s procedures for converting a beneficial interest in a global security.
(ii) On the date of any conversion at the option of a Holder, if a Holder’s interest is in certificated form, in order to convert Class B Preferred, a Holder must:
(A) complete and manually sign an irrevocable notice of conversion and deliver such notice to the Corporation;
(B) surrender the shares of Class B Preferred to the Corporation;
(C) if required by the Corporation, furnish appropriate endorsements and transfer documents; and
(D) if required by the Corporation, pay all transfer or similar taxes.
If a Holder’s interest is a beneficial interest in a global certificate representing Class B Preferred, in order to convert, such Holder must comply with paragraphs (C) and (D) of this clause (ii) and comply with the Depositary’s procedures for converting a beneficial interest in a global security. The date on which a Holder complies with the procedures in this clause (ii) is the “Conversion Date.” The Corporation shall deliver the shares of Common Stock due upon conversion at the option of the Holder to such converting Holder by the second Business Day following the Conversion Date.
(f) The Corporation shall at all times reserve and keep available out of its authorized but unissued Common Stock solely for the purpose of issuance upon the conversion of the Class B Preferred as herein provided, such number of shares of Common Stock as shall then be issuable upon the conversion of all outstanding shares or fractions of shares of Class B Preferred. All shares of Common Stock which shall be so issued shall be duly and validly issued and fully paid and non-assessable.
Section 10. Mandatory Conversion.
(a) The Corporation shall have the right, in its sole discretion, to cause all outstanding shares of Class B Preferred to convert, without any action by any Holder, into shares of Common Stock on the closing date of the Qualifying Public Offering at a price per share of Class B Preferred that is equal to the then current Conversion Price.
(b) Immediately prior to the effective date of a Fundamental Change, each outstanding share of Class B Preferred shall automatically, without any action by the Corporation or any Holder, convert into shares of Common Stock at a conversion rate per share of Class B Preferred equal to the then current Accrued Value of such share divided by the Conversion Price as of the effective date of the Fundamental Transaction.
The Corporation shall give the Holders of the Class B Preferred prompt written notice of the Corporation’s execution of any binding definitive agreement expected by the Corporation to result in a Fundamental Change, which notice shall describe in reasonable detail the nature of the Fundamental Change (including, without limitation, the nature and amount of any consideration to be paid to holders of Common Stock), the expected date of completion of the Fundamental Change. Such written notice shall be provided to Holders of Class B Preferred not less than 30 calendar days prior to the anticipated effective date of the Fundamental Change.
Section 11. Anti-Dilution Adjustments.
(a) The Conversion Rate shall be subject to the following adjustment (and the Conversion Price shall be adjusted simultaneously with any adjustment to the Conversion Rate):
If the Corporation issues Common Stock as a dividend or distribution on the Common Stock, or if the Corporation effects a share split or share combination, then the Conversion Rate in effect immediately prior to the Ex-Date for such dividend or distribution or the open of business on the effective date of such share split or share combination, as the case may be, will be multiplied by the following fraction:
Where,
OS0 = the number of shares of Common Stock outstanding immediately prior to the Ex-Date for such dividend or distribution or the open of business on the effective date of such share split or share combination, as the case may be.
OS1 = the number of shares of Common Stock that will be outstanding immediately after giving effect to such dividend or distribution or such share split or share combination, as the case may be.
Any adjustment made pursuant to this Section 11(a) shall be effective as of immediately after the open of business on such Ex-Date (in the case of a dividend or distribution) or immediately after the open of business on such effective date (in the case of a share split or share combination). If any dividend or distribution or share split or share combination described in this clause (a) is authorized and declared but not so paid or made or share split or share combination is announced but the outstanding shares of Common Stock are not split or combined, as the case may be, the Conversion Price shall be readjusted, effective as of the date the Board of Directors announces its decision not to make such dividend, distribution, share split or share combination to such Conversion Rate that would be in effect if such dividend, distribution, share split or share combination had not been declared.
(b) Notwithstanding this Section 11, if a Conversion Rate adjustment becomes effective on any Ex-Date, and a Holder that has converted its Class B Preferred on or after such Ex-Date and on or prior to the related record date would be treated as the record holder of Common Stock as of the related Conversion Date based on an adjusted Conversion Rate for such Ex-Date, then, notwithstanding the Conversion Rate adjustment provisions in this Section 11, the Conversion Rate adjustment relating to such Ex-Date shall not be made for such converting Holder. Instead, such Holder shall be treated as if such Holder were the record owner of the Common Stock on an unadjusted basis and participate, following conversion, as a holder of Common Stock of the Corporation, in the related dividend, distribution or other event giving rise to such adjustment.
(c) The Corporation may make such decreases in the Conversion Price, in addition to any other increases required by this Section 11, if the Board of Directors deems it to be in the best interests of the Corporation or otherwise advisable to avoid or diminish any income tax to holders of the Common Stock resulting from any dividend or distribution of shares of Common Stock (or issuance of rights or warrants to acquire shares of Common Stock) or from any event treated as such for income tax purposes or for any other reason.
(d) All adjustments to the Conversion Rate shall be calculated to the nearest 1/10,000th of a share of Common Stock. No adjustment in the Conversion Rate shall be required unless such adjustment would require an increase or decrease of at least one percent thereof; provided, however, that any adjustments which by reason of this subparagraph are not required to be made shall be carried forward and taken into account in any subsequent adjustment; provided further that on the Mandatory Conversion Date or any Conversion Date relating to a conversion at the option of the Holder, adjustments to the Conversion Rate will be made with respect to any such adjustment carried forward and which has not been taken into account before such date.
(e) No adjustment to the Conversion Price shall be made if Holders may participate in the transaction that would otherwise give rise to an adjustment, as a result of holding the Class B Preferred, without having to convert the Class B Preferred, as if they held the full number of shares of Common Stock into which a share of the Class B Preferred may then be converted.
(f) The applicable Conversion Price shall not be adjusted:
(i) upon the issuance of any shares of the Common Stock pursuant to any present or future plan providing for the reinvestment of dividends or interest payable on the Corporation’s securities and the investment of additional optional amounts in shares of Common Stock under any plan;
(ii) upon the issuance of any shares of the Common Stock or rights or warrants to purchase those shares pursuant to any present or future employee, director or consultant benefit plan or program of or assumed by the Corporation or any of its subsidiaries;
(iii) upon the issuance of any shares of the Common Stock pursuant to any option, warrant, right or exercisable, exchangeable or convertible security outstanding as of the Issue Date;
(iv) for a change in the par value of the Common Stock; or
(v) for accrued and unpaid dividends on the Class B Preferred or for any increase in the Accrued Value.
(g) Whenever the Conversion Price is to be adjusted in accordance with Section 11 (a) or Section 11(c), the Corporation shall as soon, as practicable following the determination of the revised Conversion Price provide, or cause to be provided, a written notice to the holders of Class B Preferred setting forth in reasonable detail the method by which the adjustment to the Conversion Price was determined and setting forth the revised Conversion Price.
Section 12. Reorganization Events.
(a) In the event of:
(i) any reclassification of the Common Stock into securities including securities other than the Common Stock; or
(ii) any statutory exchange of the Corporation’s securities (other than in connection with a merger or any Fundamental Change);
(each of the foregoing events, a “Reorganization Event”) pursuant to which the Common Stock is exchanged for securities, cash or other property (“Reference Property” and the kind and amount of Reference Property received by a holder of one share of Common. Stock, a “unit of Reference Property”), the Class B Preferred outstanding immediately prior to such Reorganization Event will thereafter, and without the consent of Holders, become convertible into Reference Property, and each share of Class B Preferred, will be convertible into a number of units of Reference Property equal to the Conversion Rate then applicable at the time of any such conversion. If holders of Common Stock are permitted to elect to receive more than one form of Reference Property in connection with a Reorganization Event, the Class B Preferred shall become convertible into the Reference Property elected by a plurality of the holders of Common Stock,
(b) The above provisions of this Section 12 shall similarly apply to successive Reorganization Events and the provisions of Section 11 shall apply to any shares of capital stock of the Corporation received by the holders of the Common Stock in any such Reorganization Event.
(c) The Corporation shall, not later than three (3) Business Days following the date on which a definitive agreement is executed by the Corporation that would give rise to a Reorganization Event, provide written notice to the Holders of such anticipated Reorganization Event. Not later than three (3) Business Days following the date such Reorganization Event occurs, the Corporation shall provide written notice to the Holders of the occurrence of such Reorganization Event and of the kind and amount of the cash, securities or other property or assets that constitutes the Reference Property and a unit of Reference Property. Failure to deliver such notice shall not affect the operation of this Section 12. To the
extent any amendments are necessary to this Certificate of Designations to effectuate the intent of this Section 12, the Corporation shall, as promptly as practicable, make such amendments.
Section 13. Voting Rights.
(a) So long as any shares of Class B Preferred are outstanding, in addition to any other vote or consent of stockholders required by law or by the Certificate of Incorporation, the vote or consent of the holders of at least a majority of the outstanding shares of Class B Preferred then outstanding, voting separately as a class, given in person or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose, shall be necessary for (i) the issuance of Senior Securities, (ii) effecting or validating any amendment, alteration or repeal of any provision of the Certificate of Incorporation or this Certificate of Designations, whether by merger, consolidation or otherwise, so as to materially and adversely affect the special rights, preferences, privileges, conversion right or voting powers of the Class B Preferred, taken as a whole, and (iii) the payment of any dividends on any series or class or classes of Parity Securities or Junior Securities for any period unless dividends have been declared and paid or are contemporaneously declared and paid or declared and a sum sufficient for the payment thereof set apart for such payment on the Class B Preferred for all prior dividend periods in accordance with Section 4; provided, however, that for all purposes of this Section 13(a), but subject to the provisions of Section 16,
(i) any increase in the amount of the Corporation’s authorized but unissued shares of preferred stock, including any shares of preferred stock which would rank equal with or senior to the Class B Preferred with respect to either or both of the payment of dividends or the distribution of assets upon liquidation or dissolution or winding up of the Corporation,
(ii) any increase in the amount of the Corporation’s authorized or issued Class B Preferred,
(iii) the creation and issuance, or an increase in the authorized or issued amount, of other series of preferred stock of the Corporation ranking equally with or junior to the Class B Preferred either or both with respect to the payment of dividends (whether such dividends are cumulative or non-cumulative) and/or the distribution of assets upon the liquidation, dissolution or winding up of the Corporation, and
(iv) a Fundamental Change
will not be deemed to materially and adversely affect the special rights, preferences, privileges or voting powers of the Class B Preferred.
(b) Without the consent of the holders of the Class B Preferred, so long as such action does not adversely affect the special rights, preferences, privileges and voting powers, and limitations and restrictions thereof, taken as a whole, of the Class B Preferred, the Corporation may amend, alter, supplement or repeal any terms of the Class B Preferred:
(i) to cure any ambiguity, or to cure, correct or supplement any provision contained in this Certificate of Designations that may be ambiguous, defective or inconsistent; or
(ii) to make any provision with respect to matters or questions relating to the Class B Preferred that is not inconsistent with the provisions of this Certificate of Designations.
(c) On each matter on which holders of Class B Preferred are entitled to vote, each share of Class B Preferred will be entitled to one vote, and when shares of any other class or series of the
Corporation’s preferred stock have the right to vote with the Class B Preferred as a single class on any matter, the Class B Preferred and the shares of each such other class or series will have one vote for each Original Liquidation Preference amount per share (which in the case of the Class B Preferred shall be determined by reference to the Accrued Value).
(d) In addition to the voting rights specified in Sections 13(a), (b) and (c), Holders of Class B Preferred shall have the right to vote, together with holders of the outstanding shares of Common Stock as a single class, on any and all matters requiring the vote of common stockholders under applicable law and on any other matter put before holders of the Common Stock for a vote. Any such vote shall be on an “as converted” basis such that Holders of the Class B Preferred shall, with respect to each share of Class B Preferred, be entitled to the vote that a holder of a number of shares of Common Stock equal to the Conversion Rate then in effect at the time of such vote would be.
Section 14. Fractional Shares.
(a) No fractional shares of Common Stock will be issued as a result of any conversion of shares of Class B Preferred.
(b) In lieu of any fractional share of Common Stock otherwise issuable upon conversion of the Class B Preferred, the Holder shall be entitled to receive one full share of Common Stock.
(c) If more than one share of the Class B Preferred is surrendered for conversion at one time (or within 30 days of a conversion) by or for the same Holder, the number of full shares of Common Stock issuable upon conversion thereof shall be computed on the basis of the aggregate number of shares of the Class B Preferred so surrendered.
Section 15. Transfer Agent, Registrar, Paying Agent and Conversion Agent. The duly appointed Transfer Agent, Registrar, paying agent and Conversion Agent for the Class B Preferred shall be a Person appointed by the Corporation, which may include the Corporation. American Stock Transfer will initially act as the Transfer Agent, Registrar, paying agent and Conversion Agent for the Class B Preferred. The Corporation may, in its sole discretion, appoint any other Person as Transfer Agent, Registrar, paying agent and Conversion Agent for the Class B Preferred.
Section 16. Additional Provisions Relating to the Class B Preferred.
(a) Until the earlier to occur of (i) no shares of Class B Preferred remain outstanding and (ii) a Qualifying Public Offering has been completed, (A) no dividend shall be declared and paid or set aside for payment and no distribution shall be declared and made or set aside for payment on any Junior Securities (other than a dividend payable solely in shares of Junior Securities) and (B) no purchase, redemption, repurchase or other acquisition for value of Junior Securities shall be made or be permitted to be made.
(b) Each Holder of Class B Preferred hereby agrees, with respect to the shares of Common Stock issuable upon conversion of the Class B Preferred and any other shares of Common Stock that it may hold at the time of a Qualifying Public Offering, not to transfer such shares of Common Stock during such periods as reasonably requested by the representatives of the underwriters in the Qualifying Public Offering (but in no event for longer than 30 days prior to or 90 days following the effective date of the registration statement filed in connection with the Qualifying Public Offering of Common Stock).
(c) From the date of this Certificate of Designations until the date upon which the Corporation completes a Qualifying Public Offering, no Holder may make any disposition of all or any
portion of the Class B Preferred held by such Holder unless and until such Holder shall have notified the Corporation of the proposed disposition and shall have furnished the Corporation with information reasonably requested by the Corporation to allow the Corporation to (i) determine that such transfer would not result in potential restriction by the Committee on Foreign Investment in the United States or other regulatory restriction that could negatively impact the ability of the Corporation to conduct its business, (ii) determine whether such transfer would be to a direct competitor of the Corporation and (iii) verify, including by requesting the furnishing of an opinion of counsel reasonably satisfactory to the Corporation (other than for dispositions in compliance with Rule 144), that such transfer would be made pursuant to an exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”), and any applicable state or other securities laws. Notwithstanding the provisions of this Section 16(c), no such, prior notice shall be necessary for a transfer by such Holder to a partner (or retired partner) or member (or retired member) of such Holder in accordance with partnership or limited liability company interests, or transfers by gift, will or intestate succession to any spouse or lineal descendants or ancestors, if all transferees agree in writing to be subject to the terms hereof to the same extent as if they were Holders hereunder.
(d) The Corporation shall use its commercially reasonable efforts to file, within 90 days after the completion of a Qualifying Public Offering, a registration statement covering the sale or distribution from time to time by the Holders, on a delayed or continuous basis pursuant to Rule 415 of the Securities Act of all of the shares of Common Stock into which any outstanding shares of Class B Preferred convert upon a Qualifying Public Offering on Form S-3 (except if the Corporation is not then eligible to register for resale the shares of Common Stock on Form S-3, then such registration shall be on another appropriate form and shall provide for the registration of such shares of Common Stock for resale by such Holders in accordance with any reasonable method of distribution elected by the Holders). The Holder or Holders of such shares of Common Stock included in any registration shall furnish to the Corporation such information regarding such Holder or Holders and their Affiliates, the shares of Common Stock held by them and the distribution proposed by such Holder or Holders and their Affiliates as the Corporation may reasonably request in writing and as shall be required in connection with any registration, qualification or compliance with applicable law or regulation, and during such time as such Holder or Holders and their respective Affiliates may be engaged in a distribution of such securities, such Holder or Holders will, and they will cause their Affiliates to, comply with all laws applicable to such distribution. The obligations of the Corporation under this Section 16(d) are conditioned on the timely provisions of the foregoing information by such Holder or Holders and, without limitation of the foregoing, will be conditioned on compliance by such. Holder or Holders with the foregoing. All reasonable and documented fees and expenses incident to the registration, qualification, listing and filing fees, printing expenses, escrow fees, fees and disbursements of counsel for the Corporation, fees and disbursements of all independent certified public accountants, blue sky fees and expenses, expenses of the Corporation incurred in connection with any road show and the expense of any special audits incident to or required by any such registration shall be borne by the Corporation. All fees and expenses of any counsel to the Holders, all underwriting discounts, selling commissions and stock transfer taxes relating to securities registered on behalf of the Holders shall be borne by the Holders of the registered securities included in such registration.
Section 17. Tax Withholding. The Corporation may withhold tax from any payment or distribution (or deemed distribution for federal income tax purposes) made hereunder as required by law. In the case of distributions that are deemed to occur for federal income tax purposes where no cash or property is being distributed or paid to the Holder, the Corporation may, at its election, either withhold the tax from any other cash or property otherwise payable to the applicable Holder (including from any future distributions or from any Common Stock receivable by such Holder upon the conversion of the Class B
Preferred), or require the Holder to indemnify the Corporation for any such withholding tax, in which case the Holder shall pay the Corporation the amount of such tax within five Business Days of being requested to do so. Any amount of tax (or property) withheld by the Corporation under the terms of this Section 17 shall be promptly paid to the applicable tax authorities and shall be treated as having being paid to the applicable Holder in accordance with the terms of this Certificate of Designations.
Section 18. Miscellaneous. All notices referred to herein shall be in writing, and, unless otherwise specified herein, all notices hereunder shall be deemed to have been given upon the earlier of receipt thereof or three Business Days after the mailing thereof if sent by registered or certified mail (unless first-class mail shall be specifically permitted for such notice under the terms of this Certificate of Designations) with postage prepaid, addressed: (i) if to the Corporation, to the principal executive office of the Corporation or to the Transfer Agent at its principal office in the United States of America, or other agent of the Corporation designated as permitted by this Certificate of Designations, or (ii) if to any Holder or holder of shares of Common Stock, as the case may be, to such Holder at the address of such Holder as listed in the stock record books of the Corporation (which may include the records of any transfer agent for the Class B Preferred or the Common Stock, as the case may be), or (iii) to such other address as the Corporation or any such Holder, as the case may be, shall have designated by notice similarly given.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, VOYAGER SPACE HOLDINGS, INC. has caused this Amended and Restated Certificate of Designations to be signed by a duly authorized officer this 7th day of February, 2022.
| | | | | | | | | | | | | | |
| VOYAGER SPACE HOLDINGS, INC. |
| | | | |
| | | | |
| By: | /s/ Dylan Taylor |
| | Name: Dylan Taylor |
| | Title: Chief Executive Officer |
CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
OF
VOYAGER SPACE HOLDINGS, INC.
Voyager Space Holdings, Inc. (the “Corporation”), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify that:
FIRST: The name of the Corporation is Voyager Space Holdings, Inc.
SECOND: The Corporation’s Certificate of Incorporation was filed with the Secretary of State of the State of Delaware on August 15, 2019.
THIRD: That this Certificate of Amendment has been duly adopted in accordance with the provisions of Section 242 and Section 228 of the General Corporation Law of the State of Delaware by the directors and stockholders of the corporation.
FOURTH: That the first sentence of Section 4(a) of the Certificate of Incorporation shall be deleted in its entirety and inserted in lieu thereof shall be the following:
The total number of shares of all classes of stock that the Corporation shall have authority to issue shall be Two Hundred and Fifty Million (250,000,000) shares of common stock, par value of $0.0001 per share (the “Common Stock”), and Twenty-Two Million (22,000,000) shares of preferred stock, par value of $0.0001 per share (the “Preferred Stock”).
FIFTH: Except as herein amended, the Certificate of Incorporation of the Corporation shall remain in full force and effect.
[Signature page follows]
IN WITNESS WHEREOF, VOYAGER SPACE HOLDINGS, INC. has caused this Certificate of Amendment to the Certificate of Incorporation to be signed by a duly authorized officer this 30th day of June, 2023.
| | | | | | | | | | | | | | | | | |
| VOYAGER SPACE HOLDINGS, INC. |
| | | | | |
| | | | | |
| By: | /s/ Dylan Taylor | |
| | Name: Dylan Taylor | |
| | Title: Chief Executive Officer | |
ASS C PREFERRED CERTIFICATE OF DESIGNATIONS
VOYAGER SPACE HOLDINGS, INC.
CERTIFICATE OF DESIGNATIONS
Pursuant to Section 151 of the General Corporation Law of the State of Delaware
CLASS C CONVERTIBLE PREFERRED STOCK
(par value $0.0001 per share)
Voyager Space Holdings, Inc. (the “Corporation”), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify that:
The Board of Directors of the Corporation, in accordance with the resolutions of the Board of Directors of the Corporation dated November 2, 2023, the Certificate of Incorporation of the Corporation, as amended from time to time (the “Certificate of Incorporation”), the Bylaws of the Corporation (the “Bylaws”) and applicable law, adopted the following resolution on such date creating a series of 4,600,000 shares of preferred stock, par value $0.0001 per share, of the Corporation designated as “Class C Preferred Stock”:
RESOLVED that, pursuant to the Certificate of Incorporation, the Bylaws and applicable law, a series of preferred stock, par value $0.0001 per share, of the Corporation be, and hereby is, created and designated as the “Class C Preferred Stock” and the Board of Directors hereby fixes and determines the number of shares, the designations, voting power, preferences, participations, optional, relative or special rights, and the qualifications, limitations and restrictions thereof, of the shares of such series as set forth below:
Section 1. Designation of Series and Number of Shares. The shares of such series of preferred stock shall be designated “Class C Preferred Stock” (the “Class C Preferred”), and the authorized number of shares that shall constitute such series shall be 4,600,000 shares, which may be decreased (but not below the number of shares of Class C Preferred then issued and outstanding) from time to time by the Board of Directors. Shares of outstanding Class C Preferred that are purchased or otherwise acquired by the Corporation shall be cancelled and shall revert to authorized but unissued shares of preferred stock of the Corporation undesignated as to series.
Section 2. Ranking. The Class C Preferred will rank, with respect to the payment of dividends and distributions upon liquidation, dissolution or winding-up, (1) on a parity with each class or series of capital stock the Corporation may issue in the future the terms of which expressly provide that such class or series will rank on a parity with the Class C Preferred as to payment of dividends and distributions upon liquidation, winding up or dissolution of the Corporation (collectively, the “Parity Securities”), (2) senior to the Class B Preferred Stock, Class A-1 Preferred Stock and Common Stock and each other class or series of capital stock the Corporation may issue in the future the terms of which do not expressly provide that it ranks on a parity with or senior to the Class C Preferred as to payment of dividends and distributions upon liquidation, winding-up or dissolution of the Corporation (the “Junior Securities”), and (3) junior to the shares of such series of preferred stock of the Corporation designated “Class A Preferred” and each class or series of capital stock the Corporation may issue in the future the terms of which expressly provide that such class or series will rank senior to the Class C Preferred as to payment of dividends and distributions upon liquidation, winding up or dissolution of the Corporation (“Senior Securities”).
Section 3. Definitions. As used herein with respect to the Class C Preferred:
“Accrued Value” means, with respect to each share of Class C Preferred, the sum of (i) the Original Liquidation Preference plus (ii) an additional amount equal to the dollar value of any dividends declared on such share of Class C Preferred which have not been paid.
“Affiliate” has the meaning specified in Rule 15b-2 under the Exchange Act.
“Board of Directors” means the board of directors of the Corporation or any committee thereof duly authorized to act on behalf of such board of directors.
“Business Day” means any day that is not Saturday or Sunday and that, in New York City, is not a day on which banking institutions generally are authorized or obligated by law or executive order to be closed.
“Bylaws” means the Bylaws of the Corporation, as may be amended from time to time.
“Certificate of Designations” means this Certificate of Designations relating to the Class C Preferred, as it may be amended from time to time.
“Certification of Incorporation” means the Certificate of Incorporation of the Corporation, as it may be amended from time to time, and shall include this Certificate of Designations.
“Class C Original Issue Price” means $43.82 per share.
“Common Stock” means the Common Stock, par value $0.0001 per share, of the Corporation.
“Conversion Agent” means the Transfer Agent acting in its capacity as conversion agent for the Class C Preferred, and its successors and assigns or any successor Conversion Agent appointed by the Corporation.
“Conversion Date” has the meaning set forth in Section 9(e)(ii).
“Conversion Price” means, for the Class C Preferred, Class C Original Issue Price per share, subject to adjustment in accordance with the provisions of Section 11 of this Certificate of Designations.
“Conversion Rate” means, for each share of Class C Preferred, a rate equal to the quotient of (i) the Accrued Value of such share of Class C Preferred divided by (ii) the Conversion Price.
“Corporation” means Voyager Space Holdings, Inc., a Delaware corporation.
“Depositary” means DTC or its nominee or any successor depositary appointed by the Corporation.
“Dividend Payment Date” has the meaning set forth in Section 4(b).
“Dividend Period” has the meaning set forth in Section 4(b).
“DTC” means The Depository Trust Company and its successors or assigns.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Ex-Date,” when used with respect to any issuance or distribution, means the first date on which the Common Stock or other securities trade without the right to receive such issuance or distribution.
“Fundamental Change” means the consummation of any consolidation or merger of the Corporation or similar transaction or any sale, lease or other transfer in one transaction or a series of transactions of all or substantially all the assets of the Corporation and its subsidiaries, taken as a whole (whether by means of a sale of the common equity of the Corporation or otherwise), to any person other than one of the Corporation’s wholly-owned subsidiaries, in each case pursuant to which the Corporation’s common stock will be converted into, or receive a distribution of the proceeds in, cash, securities or other property, other than pursuant to a transaction in which the persons that “beneficially owned” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, voting shares of the Corporation immediately prior to such transaction beneficially own, directly or indirectly, voting shares representing a majority of the total voting power of all outstanding classes of voting shares of the continuing or surviving entity immediately after the transaction; provided that a “fundamental change” will not include any transaction constituting a “Qualifying Public Offering” (as defined below).
“GAAP” means accounting principles generally accepted in the United States of America.
“Holder” means the Person in whose name the shares of the Class C Preferred are registered, which may be treated by the Corporation as the absolute owner of the shares of Class C Preferred for the purpose of making payment and settling any conversions and for all other purposes.
“Independent Investment Bank” means a nationally recognized independent U.S. investment bank.
“Issue Date” means the date on which shares of the Class C Preferred are first issued.
“Junior Securities” has the meaning set forth in Section 2.
“Liquidation Event” has the meaning set forth in Section 5(a).
“Mandatory Conversion Date” means the date on which each outstanding share of Class C Preferred automatically converts into shares of Common Stock in accordance with the provisions of Section 10(a) or 10(b).
“Original Liquidation Preference” means, as to the Class C Preferred, the Class C Original Issue Price per share, subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the applicable Class C Preferred.
“Parity Securities” has the meaning set forth in Section 2.
“Person” means a legal person, including any individual, corporation, estate, partnership, joint venture, association, joint-stock company, limited liability company or trust.
“Per Share FMV” of the Common Stock or any other security on any date means:
(i) the volume weighted average price per share of the Common Stock or per unit of such other security (in each case, determined by the Corporation using customary methods) on the Principal Stock Exchange for the 10 consecutive Trading Days immediately prior to such date; or
(ii) if the Common Stock or such other security is not listed for trading on a U.S. national or regional securities exchange on the relevant date, the fair market value per share of the Common Stock or such other security, as determined reasonably and in good faith by the Board of Directors, who may take into account various factors in its determination, including (1) the last quoted bid price for the Common Stock or such other security in the over-the-counter market as reported by OTC Link LLC or a similar organization over a period of Trading Days deemed reasonable and advisable by the Board of Directors, (2) if the Common Stock or such other security is not so quoted, the bid and ask prices for the Common Stock or such other security on the relevant date from Independent Investment Banks over a period of Trading Days deemed reasonable and advisable by the Board of Directors, (3) the opinion or appraisal of an Independent Investment Bank or a U.S. nationally recognized valuation firm, (4) the circumstances of any proposed transaction, including the availability of willing third party buyers or the financial condition or liquidity requirements of the Corporation, (5) the lack of a market for the Common Stock and the limited liquidity with respect thereto, and (6) any other factors deemed relevant by the Board of Directors in its reasonable judgment.
The Per Share FMV of the Common Stock or such other security shall be determined without reference to extended or after-hours trading.
“Principal Stock Exchange” means, with respect to a security, the primary U.S. national or regional stock exchange on which such security is listed for trading.
“Public Offering Price” means the price per share at which Common Stock is offered and sold to the public pursuant to a Qualifying Public Offering.
“Qualifying Public Offering” means a (i) firm-commitment underwritten public offering of Common Stock listed on a national securities exchange, whether primary or secondary, (ii) a direct listing of Common Stock listed on a national securities exchange, or (iii) an acquisition of the Corporation through a de-SPAC transaction or otherwise by an entity with its shares listed on a national securities exchange, in each case registered with the Securities and Exchange Commission, the gross proceeds of which exceed $50.0 million, which amount may be lowered by the Corporation upon receiving approval of a majority of the then-outstanding shares of the Class C Preferred.
“Record Date” has the meaning set forth in Section 4(b).
“Reference Property” has the meaning set forth in Section 12(a).
“Registrar” means the Transfer Agent acting in its capacity as registrar for the Class C Preferred, and its successors and assigns or any successor registrar duly appointed by the Corporation.
“Reorganization Event” has the meaning set forth in Section 12(a).
“Securities Act” has the meaning set forth in Section 16(c).
“Senior Securities” has the meaning set forth in Section 2.
“Trading Day” means any day during which all of the following conditions are satisfied: (i) trading in the Common Stock generally occurs on the Principal Stock Exchange and (ii) a closing sale price for the Common Stock is provided on the Principal Stock Exchange or, if the shares of Common Stock are not listed on a U.S. national or regional securities exchange, on the principal other market on which the shares of Common Stock are then traded; provided that if the Common Stock is not publicly listed or traded on any exchange or market, “Trading Day” means Business Day.
“Transfer Agent” means the Person acting as Transfer Agent and paying agent for the Class C Preferred in accordance with the provisions of Section 15, and its successors and assigns, including any successor transfer agent appointed by the Corporation.
Section 4. Dividends. The Corporation shall not declare, pay or set aside any dividends on shares of any other class or series of capital stock of the Corporation (other than dividends on shares of Common Stock payable in shares of Common Stock) unless (in addition to the obtaining of any consents required elsewhere in the Certificate of Incorporation or the Certificate of Designations of the Corporation) the holders of the Class C Preferred then outstanding shall first receive, or simultaneously receive, a dividend on each outstanding share of Class C Preferred in an amount at least equal to (i) in the case of a dividend on Common Stock, the product of (A) the dividend declared, paid or set aside on such Common Stock and (B) the number of shares of Common Stock issuable upon conversion of a share of Class C Preferred; (ii) in the case of a dividend on a class or series of capital stock that is convertible into Common Stock, the product of (A) the dividend declared, paid or set aside per share of such class or series of capital stock and (B) the number of shares of Common Stock issuable upon conversion of a share of Class C Preferred, divided by the number of shares of Common Stock issuable upon conversion of a share of such class or series of capital stock; or (iii) in the case of a dividend on any class or series that is not convertible into Common Stock, the product of (A) the amount of the dividend payable on each share of such class or series of capital stock divided by the original issuance price of such class or series of capital stock (subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to such class or series) and (B) the Class C Original Issue Price; provided that, if the Corporation declares, pays or sets aside, on the same date, a dividend on shares of more than one class or series of capital stock of the Corporation, the dividend payable to the holders of Class C Preferred pursuant to this Section 4 shall be calculated based upon the dividend on the class or series of capital stock that would result in the highest preferred stock dividend for the Class C Preferred.
Section 5. Liquidation.
(a) In the event the Corporation voluntarily or involuntarily liquidates, dissolves or winds up (a “Liquidation Event”), after payment in full has been made to the holders of shares of Senior Securities of the full amounts to which they shall be entitled as provided in the Certificate of Incorporation by reason of their ownership thereof, the Holders at the time shall be entitled to receive a liquidating distribution in the amount of the Accrued Value per share of Class C Preferred at the time of such Liquidation Event, out of assets legally available for distribution to the Corporation’s stockholders, on a pari passu basis with distributions to any holders of Parity Securities and before any distribution of assets is made to the holders of the Common Stock or any other Junior Securities. After payment of the full amount of such liquidating distributions, the Holders will not be entitled to any further participation in any distribution of assets by, and shall have no right or claim to any remaining assets of, the Corporation.
The Corporation shall give the Holders written notice of any Liquidation Event not later than 15 days prior to the expected date of such Liquidation Event (or, if such Liquidation Event is involuntary and such prior written notice is not practicable, as early as practicable prior to the occurrence of such Liquidation Event), which notice shall set forth in reasonable detail the nature and expected timing of the Liquidation Event and the expected amount of assets of the Corporation available for distribution to holders of Common Stock and Preferred Stock.
(b) In the event the assets of the Corporation available for distribution to stockholders upon any liquidation, dissolution or winding-up of the affairs of the Corporation, whether voluntary or involuntary, after the payment of any preferential amounts required to be paid to the holders of Senior Securitiesshall be insufficient to pay in full the amounts payable with respect to all outstanding shares of the Class C Preferred and the corresponding amounts payable on any Parity Securities, Holders and the holders of such Parity Securities shall share ratably in any distribution of assets of the Corporation in proportion to the full respective liquidating distributions to which they would otherwise be respectively entitled.
(c) The Corporation’s consolidation or merger with or into any other entity, the consolidation or merger of any other entity with or into the Corporation, or the sale of all or substantially all the Corporation’s property or business will not constitute its liquidation, dissolution or winding up.
Section 6. Maturity. The Class B Preferred shall be perpetual unless converted or redeemed in accordance with this Certificate of Designations.
Section 7. [RESERVED].
Section 8. Right to Convert. Each Holder shall have the right, at such Holder’s option, at any time and from time to time, to convert all or any portion of such Holder’s shares of Class C Preferred into shares of Common Stock at the then applicable Conversion Rate per share of Class C Preferred.
Section 9. Conversion Procedures; Reservation of Shares of Common Stock.
(a) Effective immediately prior to the close of business on the Mandatory Conversion Date or any applicable Conversion Date, dividends shall no longer accrue on any shares of Class C Preferred converted on such Conversion Date and such shares of Class C Preferred shall cease to be outstanding, subject to the right of Holders to receive the shares of Common Stock due upon conversion.
(b) Except as provided in Section 11 hereto, no allowance or adjustment shall be made in respect of dividends payable to holders of the Common Stock of record as of any date prior to the close of business on the Mandatory Conversion Date or any applicable Conversion Date. Prior to the close of business on the Mandatory Conversion Date or any applicable Conversion Date, shares of Common Stock issuable upon conversion of any shares of Class C Preferred shall not be deemed outstanding for any purpose, and Holders shall have no rights with respect to the Common Stock issuable upon conversion (including voting rights and rights to receive any dividends or other distributions on the Common Stock issuable upon conversion) by virtue of holding shares of Class C Preferred.
(c) Shares of Class C Preferred duly converted in accordance with this Certificate of Designations will resume the status of authorized and unissued serial preferred stock, undesignated as to series and available for future issuance. The Corporation may from time to time take such appropriate action as may be necessary to reduce the authorized number of shares of Class C Preferred, but not below the number of shares of Class C Preferred then outstanding.
(d) The Person or Persons entitled to receive the Common Stock issuable upon conversion of Class C Preferred shall be treated for all purposes as the record holder(s) of such shares of Common Stock as of the close of business on the Mandatory Conversion Date or any applicable Conversion Date. In the event that a Holder shall not by written notice designate the name in which shares of Common Stock to be issued or paid upon conversion of shares of Class C Preferred should be registered or paid or the manner in which such shares should be delivered, the Corporation shall be entitled to register and deliver such shares in the name of the Holder and in the manner shown on the records of the Corporation.
(e) The conversion of shares of Class C Preferred into shares of Common Stock will occur on the Mandatory Conversion Date or any applicable Conversion Date as follows:
(i) On the Mandatory Conversion Date, shares of Common Stock shall be issued to a Holder or its designee upon presentation and surrender of the certificate evidencing the Class C Preferred to the Corporation if shares of the Class C Preferred are held in certificated form, and, if required, the furnishing of appropriate endorsements and transfer documents and the payment of all transfer and similar taxes. If a Holder’s interest is a beneficial interest in a global certificate representing Class C Preferred, a book-entry transfer through the Depositary will be made by or at the direction of the Corporation upon compliance with the Depositary’s procedures for converting a beneficial interest in a global security.
(ii) On the date of any conversion at the option of a Holder, if a Holder’s interest is in certificated form, in order to convert Class C Preferred, a Holder must:
(A) complete and manually sign an irrevocable notice of conversion and deliver such notice to the Corporation;
(B) surrender the shares of Class C Preferred to the Corporation;
(C) if required by the Corporation, furnish appropriate endorsements and transfer documents; and
(D) if required by the Corporation, pay all transfer or similar taxes.
If a Holder’s interest is a beneficial interest in a global certificate representing Class C Preferred, in order to convert, such Holder must comply with paragraphs (C) and (D) of this clause (ii) and comply with the Depositary’s procedures for converting a beneficial interest in a global security. The date on which a Holder complies with the procedures in this clause (ii) is the “Conversion Date.” The Corporation shall deliver the shares of Common Stock due upon conversion at the option of the Holder to such converting Holder by the second Business Day following the Conversion Date.
(f) The Corporation shall at all times reserve and keep available out of its authorized but unissued Common Stock solely for the purpose of issuance upon the conversion of the Class C Preferred as herein provided, such number of shares of Common Stock as shall then be issuable upon the conversion of all outstanding shares or fractions of shares of Class C Preferred. All shares of Common Stock which shall be so issued shall be duly and validly issued and fully paid and non-assessable.
Section 10. Mandatory Conversion.
(a) The Corporation shall have the right, in its sole discretion, to cause all outstanding shares of Class C Preferred to convert, without any action by any Holder, into shares of Common Stock on the closing date of the Qualifying Public Offering at a price per share of Class C Preferred that is equal to the then current Conversion Price.
(b) Immediately prior to the effective date of a Fundamental Change, each outstanding share of Class C Preferred shall automatically, without any action by the Corporation or any Holder, convert into shares of Common Stock at a conversion rate per share of Class C Preferred equal to the then current Accrued Value of such share divided by the Conversion Price as of the effective date of the Fundamental Change.
The Corporation shall give the Holders of the Class C Preferred prompt written notice of the Corporation’s execution of any binding definitive agreement expected by the Corporation to result in a Fundamental Change, which notice shall describe in reasonable detail the nature of the Fundamental Change (including, without limitation, the nature and amount of any consideration to be paid to holders of Common Stock), the expected date of completion of the Fundamental Change. Such written notice shall be provided to Holders of Class C Preferred not less than 30 calendar days prior to the anticipated effective date of the Fundamental Change.
Section 11. Anti-Dilution Adjustments.
(a) The Conversion Rate shall be subject to the following adjustment (and the Conversion Price shall be adjusted simultaneously with any adjustment to the Conversion Rate):
If the Corporation issues Common Stock as a dividend or distribution on the Common Stock, or if the Corporation effects a share split or share combination, then the Conversion Rate in effect immediately prior to the Ex-Date for such dividend or distribution or the open of business on the effective date of such share split or share combination, as the case may be, will be multiplied by the following fraction:
Where,
OS0 = the number of shares of Common Stock outstanding immediately prior to the Ex-Date for such dividend or distribution or the open of business on the effective date of such share split or share combination, as the case may be.
OS1 = the number of shares of Common Stock that will be outstanding immediately after giving effect to such dividend or distribution or such share split or share combination, as the case may be.
Any adjustment made pursuant to this Section 11(a) shall be effective as of immediately after the open of business on such Ex-Date (in the case of a dividend or distribution) or immediately after the open of business on such effective date (in the case of a share split or share combination). If any dividend or distribution or share split or share combination described in this clause (a) is authorized and declared but not so paid or made or share split or share combination is announced but the outstanding shares of
Common Stock are not split or combined, as the case may be, the Conversion Price shall be readjusted, effective as of the date the Board of Directors announces its decision not to make such dividend, distribution, share split or share combination to such Conversion Rate that would be in effect if such dividend, distribution, share split or share combination had not been declared.
(b) Notwithstanding this Section 11, if a Conversion Rate adjustment becomes effective on any Ex-Date, and a Holder that has converted its Class C Preferred on or after such Ex-Date and on or prior to the related record date would be treated as the record holder of Common Stock as of the related Conversion Date based on an adjusted Conversion Rate for such Ex-Date, then, notwithstanding the Conversion Rate adjustment provisions in this Section 11, the Conversion Rate adjustment relating to such Ex-Date shall not be made for such converting Holder. Instead, such Holder shall be treated as if such Holder were the record owner of the Common Stock on an unadjusted basis and participate, following conversion, as a holder of Common Stock of the Corporation, in the related dividend, distribution or other event giving rise to such adjustment.
(c) The Corporation may make such decreases in the Conversion Price, in addition to any other increases required by this Section 11, if the Board of Directors deems it to be in the best interests of the Corporation or otherwise advisable to avoid or diminish any income tax to holders of the Common Stock resulting from any dividend or distribution of shares of Common Stock (or issuance of rights or warrants to acquire shares of Common Stock) or from any event treated as such for income tax purposes or for any other reason.
(d) All adjustments to the Conversion Rate shall be calculated to the nearest 1/10,000th of a share of Common Stock. No adjustment in the Conversion Rate shall be required unless such adjustment would require an increase or decrease of at least one percent thereof; provided, however, that any adjustments which by reason of this subparagraph are not required to be made shall be carried forward and taken into account in any subsequent adjustment; provided further that on the Mandatory Conversion Date or any Conversion Date relating to a conversion at the option of the Holder, adjustments to the Conversion Rate will be made with respect to any such adjustment carried forward and which has not been taken into account before such date.
(e) No adjustment to the Conversion Price shall be made if Holders may participate in the transaction that would otherwise give rise to an adjustment, as a result of holding the Class C Preferred, without having to convert the Class C Preferred, as if they held the full number of shares of Common Stock into which a share of the Class C Preferred may then be converted.
(f) The applicable Conversion Price shall not be adjusted:
(i) upon the issuance of any shares of the Common Stock pursuant to any present or future plan providing for the reinvestment of dividends or interest payable on the Corporation’s securities and the investment of additional optional amounts in shares of Common Stock under any plan;
(ii) upon the issuance of any shares of the Common Stock or rights or warrants to purchase those shares pursuant to any present or future employee, director or consultant benefit plan or program of or assumed by the Corporation or any of its subsidiaries;
(iii) upon the issuance of any shares of the Common Stock pursuant to any option, warrant, right or exercisable, exchangeable or convertible security outstanding as of the Issue Date;
(iv) for a change in the par value of the Common Stock; or
(v) for accrued and unpaid dividends on the Class C Preferred.
(g) Whenever the Conversion Price is to be adjusted in accordance with Section 11(a) or Section 11(c), the Corporation shall as soon as practicable following the determination of the revised Conversion Price provide, or cause to be provided, a written notice to the holders of Class C Preferred setting forth in reasonable detail the method by which the adjustment to the Conversion Price was determined and setting forth the revised Conversion Price.
Section 12. Reorganization Events.
(a) In the event of:
(i) any reclassification of the Common Stock into securities including securities other than the Common Stock; or
(ii) any statutory exchange of the Corporation’s securities (other than in connection with a merger or any Fundamental Change);
(each of the foregoing events, a “Reorganization Event”) pursuant to which the Common Stock is exchanged for securities, cash or other property (“Reference Property” and the kind and amount of Reference Property received by a holder of one share of Common Stock, a “unit of Reference Property” ), the Class C Preferred outstanding immediately prior to such Reorganization Event will thereafter, and without the consent of Holders, become convertible into Reference Property, and each share of Class C Preferred will be convertible into a number of units of Reference Property equal to the Conversion Rate then applicable at the time of any such conversion. If holders of Common Stock are permitted to elect to receive more than one form of Reference Property in connection with a Reorganization Event, the Class C Preferred shall become convertible into the Reference Property elected by a plurality of the holders of Common Stock.
(b) The above provisions of this Section 12 shall similarly apply to successive Reorganization Events and the provisions of Section 11 shall apply to any shares of capital stock of the Corporation received by the holders of the Common Stock in any such Reorganization Event.
(c) The Corporation shall, not later than three (3) Business Days following the date on which a definitive agreement is executed by the Corporation that would give rise to a Reorganization Event, provide written notice to the Holders of such anticipated Reorganization Event. Not later than three (3) Business Days following the date such Reorganization Event occurs, the Corporation shall provide written notice to the Holders of the occurrence of such Reorganization Event and of the kind and amount of the cash, securities or other property or assets that constitutes the Reference Property and a unit of Reference Property. Failure to deliver such notice shall not affect the operation of this Section 12. To the extent any amendments are necessary to this Certificate of Designations to effectuate the intent of this Section 12, the Corporation shall, as promptly as practicable, make such amendments.
Section 13. Voting Rights.
(a) So long as any shares of Class C Preferred are outstanding, in addition to any other vote or consent of stockholders required by law or by the Certificate of Incorporation, the vote or consent of the holders of a majority of the outstanding shares of Class C Preferred then outstanding, voting separately as a class, given in person or by proxy, either in writing without a meeting or by vote at any
meeting called for the purpose, shall be necessary for (i) the issuance of Senior Securities, (ii) effecting or validating any amendment, alteration or repeal of any provision of the Certificate of Incorporation or this Certificate of Designations, whether by merger, consolidation or otherwise, so as to materially and adversely affect the special rights, preferences, privileges, conversion right or voting powers of the Class C Preferred, taken as a whole, and (iii) the payment of any dividends on any series or class or classes of Parity Securities or Junior Securities for any period; provided, however, that for all purposes of this Section 13(a), but subject to the provisions of Section 16,
(i) any increase in the amount of the Corporation’s authorized but unissued shares of preferred stock, including any shares of preferred stock which would rank equal with or senior to the Class C Preferred with respect to either or both of the payment of dividends or the distribution of assets upon liquidation or dissolution or winding up of the Corporation,
(ii) any increase in the amount of the Corporation’s authorized or issued Class C Preferred,
(iii) the creation and issuance, or an increase in the authorized or issued amount, of other series of preferred stock of the Corporation ranking equally with or junior to the Class C Preferred either or both with respect to the payment of dividends (whether such dividends are cumulative or non-cumulative) and/or the distribution of assets upon the liquidation, dissolution or winding up of the Corporation, and
(iv) a Fundamental Change
will not be deemed to materially and adversely affect the special rights, preferences, privileges or voting powers of the Class C Preferred.
(b) Without the consent of the holders of the Class C Preferred, so long as such action does not adversely affect the special rights, preferences, privileges and voting powers, and limitations and restrictions thereof, taken as a whole, of the Class C Preferred, the Corporation may amend, alter, supplement or repeal any terms of the Class C Preferred:
(i) to cure any ambiguity, or to cure, correct or supplement any provision contained in this Certificate of Designations that may be ambiguous, defective or inconsistent; or
(ii) to make any provision with respect to matters or questions relating to the Class C Preferred that is not inconsistent with the provisions of this Certificate of Designations.
(c) On each matter on which holders of Class C Preferred are entitled to vote, each share of Class C Preferred will be entitled to one vote, and when shares of any other class or series of the Corporation’s preferred stock have the right to vote with the Class C Preferred as a single class on any matter, any such vote shall be on an “as converted” basis such that each holder of outstanding shares of preferred stock of the Corporation shall be entitled to cast the number of votes equal to the number of whole shares of Common Stock into which the shares of preferred stock of the Corporation held by such holder are convertible as of the record date for determining stockholders entitled to vote on such matter.
(d) In addition to the voting rights specified in Sections 13(a), (b) and (c), Holders of Class C Preferred shall have the right to vote, together with holders of the outstanding shares of Common Stock as a single class, on any and all matters requiring the vote of common stockholders under applicable law and on any other matter put before holders of the Common Stock for a vote. Any such vote shall be on an “as converted” basis such that Holders of the Class C Preferred shall, with respect to each
share of Class C Preferred, shall be entitled to cast the number of votes equal to the number of whole shares of Common Stock into which the shares of Class C Preferred held by such holder are convertible as of the record date for determining stockholders entitled to vote on such matter.
Section 14. Fractional Shares.
(a) No fractional shares of Common Stock will be issued as a result of any conversion of shares of Class C Preferred.
(b) In lieu of any fractional share of Common Stock otherwise issuable upon conversion of the Class C Preferred, the Holder shall be entitled to receive one full share of Common Stock.
(c) If more than one share of the Class C Preferred is surrendered for conversion at one time (or within 30 days of a conversion) by or for the same Holder, the number of full shares of Common Stock issuable upon conversion thereof shall be computed on the basis of the aggregate number of shares of the Class C Preferred so surrendered.
Section 15. Transfer Agent, Registrar, Paying Agent and Conversion Agent. The duly appointed Transfer Agent, Registrar, paying agent and Conversion Agent for the Class C Preferred shall be a Person appointed by the Corporation, which may include the Corporation. The Corporation may, in its sole discretion, appoint any other Person as Transfer Agent, Registrar, paying agent and Conversion Agent for the Class C Preferred.
Section 16. Additional Provisions Relating to the Class C Preferred.
(a) Until the earlier to occur of (i) no shares of Class C Preferred remain outstanding and (ii) a Qualifying Public Offering has been completed, (A) no dividend shall be declared and paid or set aside for payment and no distribution shall be declared and made or set aside for payment on any Common Stock (other than a dividend payable solely in shares of Common Stock).
Section 17. Miscellaneous. All notices referred to herein shall be in writing, and, unless otherwise specified herein, all notices hereunder shall be deemed to have been given upon the earlier of receipt thereof or (a) when sent, if sent by electronic mail during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next Business Day, or (b) three Business Days after the mailing thereof if sent by registered or certified mail (unless first-class mail shall be specifically permitted for such notice under the terms of this Certificate of Designations) with postage prepaid, addressed: (i) if to the Corporation, to the principal executive office of the Corporation or to the Transfer Agent at its principal office in the United States of America, or other agent of the Corporation designated as permitted by this Certificate of Designations, or (ii) if to any Holder or holder of shares of Common Stock, as the case may be, to such Holder at the address of such Holder as listed in the stock record books of the Corporation (which may include the records of any transfer agent for the Class C Preferred or the Common Stock, as the case may be), or (iii) to such other address as the Corporation or any such Holder, as the case may be, shall have designated by notice similarly given.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, VOYAGER SPACE HOLDINGS, INC. has caused this Certificate of Designations to be signed by a duly authorized officer this 8th day of February, 2024.
| | | | | | | | | | | | | | | | | |
| VOYAGER SPACE HOLDINGS, INC. |
| | | | | |
| | | | | |
| By: | /s/ Dylan Taylor | |
| | Name: Dylan Taylor | |
| | Title: Chief Executive Officer | |
CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
OF
VOYAGER SPACE HOLDINGS, INC.
Voyager Space Holdings, Inc. (the “Corporation”), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify that:
FIRST: That this Certificate of Amendment has been duly adopted in accordance with the provisions of Section 242 and Section 228 of the General Corporation Law of the State of Delaware by the directors and stockholders of the corporation.
SECOND: That the Certificate of Incorporation of the Corporation be amended by changing the FIRST Article thereof so that, as amended said Article shall read as follows:
“FIRST: The name of the Corporation is Voyager Technologies, Inc. (the “Corporation”).”
THIRD: Except as herein amended, the Certificate of Incorporation of the Corporation shall remain in full force and effect.
[Signature page follows]
IN WITNESS WHEREOF, VOYAGER SPACE HOLDINGS, INC. has caused this Certificate of Amendment to the Certificate of Incorporation to be signed by a duly authorized officer this 8th day of January, 2025.
| | | | | | | | | | | | | | | | | | | | |
| VOYAGER SPACE HOLDINGS, INC. |
| | | | | | |
| | | | | | |
| | By: | | /s/ Dylan Taylor | |
| | | | Name: Dylan Taylor |
| | | Title: Chief Executive Officer |
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF
VOYAGER TECHNOLOGIES, INC.
Voyager Technologies, Inc. (the “Corporation”), a corporation organized and existing under the General Corporation Law of the State of Delaware (the “DGCL”), does hereby certify as follows:
1.The name of the Corporation is Voyager Technologies, Inc. The Corporation was incorporated under the name Voyager Space Holdings, Inc. by the filing of its original Certificate of Incorporation with the Secretary of State of the State of Delaware on August 15, 2019.
2.This Amended and Restated Certificate of Incorporation (the “Restated Certificate”), which amends, restates and further integrates the certificate of incorporation of the Corporation as heretofore in effect, has been approved by the Board of Directors of the Corporation (the “Board of Directors”) in accordance with Sections 242 and 245 of the DGCL, and has been adopted by the written consent of the stockholders of the Corporation in accordance with Section 228 of the DGCL.
3.The text of the certificate of incorporation of the Corporation, as heretofore amended, is hereby amended and restated by this Restated Certificate to read in its entirety as set forth in EXHIBIT A attached hereto.
IN WITNESS WHEREOF, Voyager Technologies, Inc. has caused this Restated Certificate to be signed by a duly authorized officer of the Corporation, on [ ò ], 2025.
Voyager Technologies, Inc., a Delaware corporation
| | | | | | | | | | | | | | | | | |
| By: | |
| Name: | Dylan Taylor |
| Title: | Chief Executive Officer |
[Signature Page to Voyager Technologies, Inc.’s Certificate of Incorporation]|
EXHIBIT A
ARTICLE I
The name of the corporation is Voyager Technologies, Inc. (the “Corporation”).
ARTICLE II
The address of the Corporation’s registered office in the State of Delaware is 3411 Silverside Road Tatnall Building #104, Wilmington, Delaware 19810, New Castle County, and the name of its registered agent at such address is Corporate Creations Network Inc.
ARTICLE III
The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware (the “DGCL”) as it now exists or may hereafter be amended and supplemented.
ARTICLE IV
CAPITAL STOCK
The total number of shares of capital stock which the Corporation is authorized to issue is 500,000,000 shares comprised of two classes as follows: (i) 450,000,000 shares of common stock, having a par value of $0.0001 per share (the “Common Stock”), of which (a) 400,000,000 shares shall be a series designated as Class A Common Stock (the “Class A Common Stock”) and (b) 50,000,000 shares shall be a series designated as Class B Common Stock (the “Class B Common Stock”), and (ii) 50,000,000 shares of preferred stock, $0.0001 par value per share (the “Preferred Stock”). For the avoidance of doubt, the Class A Common Stock and the Class B Common Stock shall be two separate series of stock and shall not be deemed to be separate classes of capital stock.
Immediately upon the filing and effectiveness of this Restated Certificate with the Secretary of State of the State of Delaware (the “Effective Time”), each share of the Corporation’s common stock, par value $0.0001 per share, that is issued and outstanding or held as treasury stock immediately prior to the Effective Time (the “Old Common Stock”) shall, automatically and without any further action by the Corporation or any stockholder, be reclassified as, and shall become, one (1) validly issued, fully paid and non-assessable share of Class A Common Stock (the “Reclassification”). Each certificate that immediately prior to the Effective Time represented shares of Old Common Stock (an “Old Certificate”) shall, from and after the Effective Time, be deemed to represent the number of shares of Class A Common Stock as to which such shares have been reclassified pursuant to the Reclassification; provided, however, that any holder of an Old Certificate may surrender the Old Certificate to the Corporation and such holder’s shares shall thereafter be uncertificated. The Reclassification shall also apply to any outstanding securities or rights convertible into, or exchangeable or exercisable for, Old Common Stock of the Corporation and all references to the Old Common Stock in agreements, arrangements, documents and plans relating thereto or any option or right to
purchase or acquire shares of Old Common Stock shall be deemed to be references to the Class A Common Stock or options or rights to purchase or acquire shares of Class A Common Stock, as the case may be.
The number of authorized shares of Common Stock or Preferred Stock may from time to time be increased or decreased (but not below the number of shares thereof then outstanding) without a separate class vote of the holders of any of the Common Stock or Preferred Stock, irrespective of the provisions of Section 242(b)(2) of the DGCL, unless a vote of any such holder is required pursuant to this Restated Certificate (including any Certificate of Designation relating to any series of Preferred Stock).
The designations and the powers, preferences and rights, and the qualifications, limitations or restrictions thereof in respect of each class and series of capital stock of the Corporation are as follows:
A. COMMON STOCK.
Subject to and qualified by all the rights, powers and preferences of the Preferred Stock and except as provided by law or in this Restated Certificate (including any Certificate of Designation relating to any series of Preferred Stock):
1. Voting Rights.
(a) General Right to Vote Together. Except as otherwise expressly provided herein or required by applicable law, the holders of Class A Common Stock and Class B Common Stock shall vote together on all matters submitted to a vote of the stockholders.
(b) Votes Per Share. Except as otherwise expressly provided herein or required by applicable law, on any matter that is submitted to a vote of the stockholders, each holder of Class A Common Stock shall be entitled to one (1) vote for each such share held by such holder as of the record date for determining stockholders entitled to vote on such matter, and each holder of Class B Common Stock shall be entitled to fifteen (15) votes for each such share held by such holder as of the record date for determining stockholders entitled to vote on such matter. Notwithstanding the foregoing, except as otherwise required by law, holders of shares of Common Stock, as such, shall have no voting power with respect to, and shall not be entitled to vote on, any amendment to this Restated Certificate (including any Certificate of Designation relating to any series of Preferred Stock) that relates solely to the terms of the Preferred Stock or one or more outstanding series thereof if the holders of such Preferred Stock or series thereof are entitled, either separately or together with the holders of one or more other such series, to vote thereon under this Restated Certificate (including any Certificate of Designation relating to any series of Preferred Stock) or under the DGCL.
(c) Cumulative Voting. Unless required by law, there shall be no cumulative voting.
2. Identical Rights. Except as otherwise expressly provided herein or required by applicable law, shares of Class A Common Stock and Class B Common Stock shall have the same rights and privileges and rank equally, share ratably and be identical in all respects as to all matters, including, without limitation:
(a) Dividends. Subject to applicable law and the rights, if any, of the holders of any outstanding series of Preferred Stock or any class or series of stock having a preference over or the right to participate with the Common Stock with respect to the payment of any Distribution, Distributions may be declared and paid ratably on the Common Stock out of the assets of the Corporation which are legally available for this purpose at such times and in such amounts as the Board of Directors of the Corporation (the “Board”) in its discretion shall determine. Shares of Class A Common Stock and Class B Common Stock shall be treated equally, identically and ratably, on a per share basis, with respect to any Distribution paid or distributed by the Corporation, unless different treatment of the shares of each such series is approved by the affirmative vote of the holders of a majority of the outstanding shares of Class A Common Stock and by the affirmative vote of the holders of a majority of the outstanding shares of Class B Common Stock, each voting separately as a series; provided, however, that in the event a Distribution is paid in the form of Class A Common Stock or Class B Common Stock (or Rights to acquire, or securities convertible into or exchangeable for, such stock, as the case may be), then holders of Class A Common Stock shall receive Class A Common Stock (or Rights to acquire, or securities convertible into or exchangeable for, such stock, as the case may be) and holders of Class B Common Stock shall receive Class B Common Stock (or Rights to acquire, or securities convertible into or exchangeable for, such stock, as the case may be) and such Distribution shall be deemed equal, identical and ratable so long as such Distribution is paid or distributed ratably on a per share basis.
(b) Subdivision or Combination. If the Corporation in any manner subdivides, combines or reclassifies the outstanding shares of Class A Common Stock or Class B Common Stock, then the outstanding shares of the other such series will be concurrently subdivided, combined or reclassified in the same proportion and manner to maintain the same proportionate equity ownership between the holders of the outstanding Class A Common Stock and Class B Common Stock on the record date or effective date for such subdivision, combination or reclassification, unless different treatment of the shares of each such series is approved by the affirmative vote of the holders of a majority of the outstanding shares of Class A Common Stock and by the affirmative vote of the holders of a majority of the outstanding shares of Class B Common Stock, each voting separately as a series.
(c) Equal Treatment in any Merger Transaction. The consideration received per share by the holders of each series of Common Stock in any merger, consolidation, reorganization or other business combination shall be identical; provided, however, that if (i) such consideration consists, in whole or in part, of shares of capital stock of, or other equity interests in, the Corporation or any other corporation, partnership, limited liability company or other entity, and (ii) the powers, designations, preferences and relative, optional or other special rights and qualifications, limitations and restrictions of shares of capital stock or other equity interests received in respect of the shares of Class A Common Stock and Class B Common Stock
differ solely to the extent that the powers, designations, preferences and relative, optional or other special rights and qualifications, limitations and restrictions of the Class A Common Stock and the Class B Common Stock differ as described in this Article IV, then the powers, designations, preferences and relative, optional or other special rights and qualifications, limitations and restrictions of such shares of capital stock or other equity interests may differ to the extent that the powers, designations, preferences and relative, optional or other special rights and qualifications, limitations and restrictions of the Class A Common Stock and the Class B Common Stock differ as provided herein (including, without limitation, with respect to the voting rights and conversion provisions hereof); and provided further, that, if the holders of any series of Common Stock are granted the right to elect to receive one of two or more alternative forms of consideration, the foregoing provisions shall be deemed satisfied if holders of the other series of Common Stock are granted corresponding election rights.
3. Conversion of Class B Common Stock.
(a) Voluntary Conversion. Each one (1) share of Class B Common Stock shall be convertible into one (1) fully paid and nonassessable share of Class A Common Stock at the option of the holder thereof at any time upon written notice to the transfer agent of the Corporation. Such written notice shall state therein the number of shares of Class B Common Stock being converted and the name or names of the holder or holders thereof in which the shares of Class A Common Stock are to be registered.
(b) Automatic Conversion. Each share of Class B Common Stock shall automatically, without any further action by the holder thereof, convert into one fully paid and nonassessable share of Class A Common Stock upon a Transfer of such share; provided, however, that no such automatic conversion shall occur in the case of a Transfer by a Class B Stockholder to any of the persons or entities listed in clauses (i) through (v) below (each, a “Permitted Transferee”) and from any such Permitted Transferee back to such Class B Stockholder and/or any other Permitted Transferee established by or for such Class B Stockholder:
(i) an Immediate Family Member of the Founder who shares the Founder’s household;
(ii) a trust (including a grantor retained annuity trust), or a trustee of a trust, for the benefit of the Founder or any Immediate Family Member of the Founder so long as the Founder (or the spouse of the Founder), directly or indirectly through one or more Permitted Transferees, has sole dispositive power and Voting Control with respect to the shares of Class B Common Stock held by such trust; provided such Transfer does not involve any payment of cash, securities, property or other consideration and, provided, further, that in the event the Founder (or the spouse of the Founder) no longer has direct or indirect sole dispositive power and Voting Control with respect to the shares of Class B Common Stock held by such trust, each share of Class B Common Stock then held by such trust shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock;
(iii) an Individual Retirement Account, as defined in Section 408(a) of the Internal Revenue Code (or successor provision), or a pension, profit sharing, stock bonus or other type of plan or trust of which such Class B Stockholder is a participant or beneficiary and which satisfies the an Individual Retirement Account, as defined in Section 408(a) of the Internal Revenue Code (or successor provision) maintained by the Founder or the spouse of the Founder, or a pension, profit sharing, stock bonus or other type of plan or trust of which the Founder or the spouse of the Founder is a participant and beneficiary and which satisfies the requirements for qualification under Section 401 of the Internal Revenue Code (or successor provision); provided that in each case the Founder or the spouse of the Founder, directly or indirectly through one or more Permitted Transferees, has sole dispositive power and Voting Control with respect to the shares of Class B Common Stock held in such account, plan or trust, and provided, further, that in the event the Founder or the spouse of the Founder no longer has sole dispositive power and Voting Control with respect to the shares of Class B Common Stock held by such account, plan or trust, each share of Class B Common Stock then held by such account, plan or trust shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock;
(iv) a corporation, partnership or limited liability company in which the Founder or the spouse of the Founder directly, or indirectly through one or more Permitted Transferees, own shares, partnership interests or membership interests, as applicable, with sufficient Voting Control in the corporation, partnership or limited liability company, as applicable, or otherwise have legally enforceable rights, such that the Founder or the spouse of the Founder retains sole dispositive power and Voting Control with respect to the shares of Class B Common Stock held by such corporation, partnership or limited liability company; provided such Transfer does not involve any payment of cash, securities, property or other consideration and, provided, further, that in the event the Founder or spouse of the Founder no longer owns sufficient shares, partnership interests or membership interests, as applicable, or no longer has sufficient legally enforceable rights to ensure such Class B Stockholder retains sole dispositive power and Voting Control with respect to the shares of Class B Common Stock held by such corporation, partnership or limited liability company, as applicable, each share of Class B Common Stock then held by such corporation, partnership or limited liability company, as applicable, shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock; or
(v) from the Founder or the Founder’s Permitted Transferees to the Founder’s estate or to any Immediate Family Member of the Founder as a result of the Founder’s death.
(c) Final Conversion of Class B Common Stock. On the Final Conversion Date, each one (1) outstanding share of Class B Common Stock shall automatically, without any further action, convert into one (1) fully paid and nonassessable share of Class A Common Stock. Following such conversion, the reissuance of any shares of Class B Common Stock shall be prohibited, and the Corporation shall take all necessary action to retire each share of Class B Common Stock in accordance with Section 243 of the DGCL, including filing a certificate of retirement with the Secretary of State of the State of Delaware required thereby,
and upon the effectiveness of such certificate of retirement, it shall have the effect of reducing the number of authorized shares of Class B Common Stock and, if all shares of Class B Common Stock were previously issued, eliminating all references to Class B Common Stock in this Restated Certificate.
(d) Procedures. The Corporation may, from time to time, establish such policies and procedures relating to the conversion of Class B Common Stock to Class A Common Stock in accordance with this Article IV, Section A(3) and the general administration of this dual series stock structure, including the issuance of stock certificates (or the establishment of book-entry positions) with respect thereto, as it may deem necessary or advisable, and may request that holders of shares of Class B Common Stock furnish certifications, affidavits or other proof to the Corporation as it deems necessary to verify the ownership of Class B Common Stock and to confirm that a conversion to Class A Common Stock has not occurred in accordance with this Article IV, Section A(3)(b)(ii). A determination by the Board that a Transfer results in a conversion to Class A Common Stock shall be conclusive and binding.
(e) Immediate Effect of Conversion. In the event of a conversion of shares of Class B Common Stock to shares of Class A Common Stock pursuant to this Article IV, Section A(3), such conversion(s) shall be deemed to have been effective immediately prior to the close of business on the date that the Corporation’s transfer agent receives the written notice required under Section A(3)(a) of this Article IV, the time that the Transfer of such shares occurred under Section A(3)(b) of this Article IV, the date specified in Section A(3)(c) of this Article IV, or immediately upon the Final Conversion Date, as applicable. Upon any conversion of Class B Common Stock to Class A Common Stock pursuant to this Article IV, Section A(3), all rights of the holder of such shares of Class B Common Stock shall cease and the person or persons in whose names or names the certificate or certificates (or book-entry position(s) representing the shares of Class A Common Stock) are to be issued shall be treated for all purposes as having become the record holder or holders of such number of shares of Class A Common Stock into which such shares of Class B Common Stock were converted. Notwithstanding anything to the contrary in Section A(3) of this Article IV, if the date on which any share of Class B Common Stock is converted into Class A Common Stock pursuant to the provisions of Section A(3) of this Article IV occurs after the record date for the determination of the holders of Class B Common Stock entitled to receive any dividend or distribution to be paid on the shares of Class B Common Stock, the Class B Stockholder as of such record date will be entitled to receive such dividend or distribution on such payment date; provided, that, notwithstanding any other provision of this Restated Certificate, to the extent that any such dividend or distribution is payable in shares of Class B Common Stock, such shares of Class B Common Stock shall automatically be converted to Class A Common Stock, on a one-to-one basis.
(f) Reservation of Stock. The Corporation shall at all times reserve and keep available out of its authorized but unissued shares of Class A Common Stock, solely for the purpose of effecting the conversion of the shares of Class B Common Stock pursuant to this Article IV, Section A(3), such number of its shares of Class A Common Stock as shall from time
to time be sufficient to effect the conversion of all outstanding shares of Class B Common Stock into shares of Class A Common Stock.
4. No Further Issuances. Except for the issuance of Class B Common Stock issuable upon the settlement, exercise or conversion of Rights outstanding at the IPO Time or Rights contemplated by the Equity Incentive Plan, a dividend payable in accordance with Article IV, Section A(2)(a) or a subdivision or reclassification in accordance with Article IV, Section A(2)(b), the Corporation shall not at any time after the IPO Time issue any additional shares of Class B Common Stock, unless such issuance is approved by the affirmative vote of the holders of a majority of the outstanding shares of Class B Common Stock, voting as a separate series. After the Final Conversion Date, the Corporation shall not issue any additional shares of Class B Common Stock.
B. PREFERRED STOCK
Shares of Preferred Stock may be issued from time to time in one or more series, each of such series to have such terms as stated or expressed herein and in the resolution or resolutions providing for the creation and issuance of such series adopted by the Board as hereinafter provided.
Authority is hereby expressly granted to the Board from time to time to issue the Preferred Stock in one or more series, and in connection with the creation of any such series, by adopting a resolution or resolutions providing for the issuance of the shares thereof and by filing a Certificate of Designation relating thereto in accordance with the DGCL, to determine and fix the number of shares of such series and such voting powers, full or limited, or no voting powers, and such designations, preferences and relative participating, optional or other special rights, and qualifications, limitations or restrictions thereof, including without limitation thereof, dividend rights, conversion rights, redemption rights and liquidation preferences, and to increase or decrease (but not below the number of shares of such series then outstanding) the number of shares of any series as shall be stated and expressed in such resolutions, all to the fullest extent now or hereafter permitted by the DGCL. Without limiting the generality of the foregoing, the resolution or resolutions providing for the creation and issuance of any series of Preferred Stock may provide that such series shall be superior or rank equally or be junior to any other series of Preferred Stock to the extent permitted by law and this Restated Certificate (including any Certificate of Designation relating to such series of Preferred Stock). Except as otherwise required by law, holders of any series of Preferred Stock shall be entitled only to such voting rights, if any, as shall expressly be granted thereto by this Restated Certificate (including any Certificate of Designation relating to such series of Preferred Stock).
ARTICLE V
The following terms, where capitalized in this Restated Certificate, shall have the meanings ascribed to them in this Article V:
“Certificate of Designation” means a certificate of designation relating to a series of Preferred Stock.
“Class B Stockholder” means (i) the registered holder of a share of Class B Common Stock issued at or prior to the IPO Time, (ii) the registered holder of any shares of Class B Common Stock that are originally issued by the Corporation after the IPO Time (including, without limitation upon exercise of options or warrants and settlement of restricted stock units) or (iii) a Permitted Transferee of the foregoing registered holders in clauses (i) and (ii).
“Distribution” means (i) any dividend of cash, property or shares of the Corporation’s capital stock payable to holders of shares of the Corporation’s capital stock; and (ii) any distribution to holders of shares of the Corporation’s capital stock following or in connection with any liquidation, dissolution or winding up of the Corporation, either voluntary or involuntary.
“Equity Incentive Plan” means the Corporation’s 2025 Incentive Award Plan, as may be amended and/or restated from time to time prior to the Final Conversion Date.
“Exchange Act” means the United States Securities Exchange Act of 1934, as amended.
“Final Conversion Date” means 5:00 p.m. in New York City, New York on the earliest to occur following the IPO Time of (i) the date fixed by the Board that is no less than sixty-one (61) days and no more than one hundred and eighty (180) days following the date the Founder is no longer providing services to the Corporation as an executive officer or member of the Board, (ii) the date fixed by the Board that is no less than sixty-one (61) days and no more than one hundred and eighty (180) days following the death or Incapacity of the Founder, (iii) the first trading day following the seven (7) year anniversary of the IPO Time, or (iv) the date on which the number of shares of Class A Common Stock and Class B Common Stock beneficially owned by the Founder and the Founder’s Permitted Transferees (including shares underlying outstanding Rights) represents less than 50% of the shares of Class A Common Stock and Class B Common Stock beneficially owned by the Founder at the IPO Time.
“Founder” means Dylan Taylor.
“Immediate Family Member” means, with respect to a natural person, the child, stepchild, grandchild, parent, stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, and shall include adoptive relationships.
“Incapacity” means that such holder is incapable of managing such holder’s financial affairs under the criteria set forth in the applicable probate code and such incapacity has lasted or can be expected to last for a continuous period of not less than twelve (12) months or is suffering from a condition that can be expected to result in death, in each case, as determined by a licensed medical practitioner. In the event of a dispute regarding whether a Class B Stockholder has suffered an Incapacity, no Incapacity of such holder will be deemed to have occurred unless and until an affirmative ruling regarding such Incapacity has been made by a court of competent jurisdiction.
“IPO” means the Corporation’s initial underwritten public offering of the Class A Common Stock.
“IPO Time” means the closing of the IPO.
“Rights” means any option, warrant, restricted stock unit, conversion right or contractual right of any kind to acquire shares of the Corporation’s authorized but unissued capital stock.
“Securities Act” means the United States Securities Act of 1933, as amended.
“Securities Exchange” means, at any time, the registered national securities exchange on which the Corporation’s equity securities are then principally listed or traded, which shall be the New York Stock Exchange or Nasdaq Global Market (or similar national quotation system of the Nasdaq Stock Market) (“Nasdaq”) or any successor exchange of either the New York Stock Exchange or Nasdaq.
“Transfer” of a share of Class B Common Stock shall mean, directly or indirectly, any sale, assignment, transfer, conveyance, hypothecation or other transfer or disposition of such share or any legal or beneficial interest in such share, whether or not for value and whether voluntary or involuntary or by operation of law. A “Transfer” shall also include, without limitation, (i) a transfer of a share of Class B Common Stock to a broker or other nominee (regardless of whether or not there is a corresponding change in beneficial ownership) or (ii) the transfer of, or entering into a binding agreement with respect to, Voting Control over a share of Class B Common Stock. Notwithstanding the foregoing, that the following shall not be considered a “Transfer”: (a) granting a revocable proxy to officers or directors of the Corporation at the request of the Board in connection with actions to be taken at an annual or special meeting of stockholders of the Corporation or by written consent in lieu of a meeting of stockholders of the Corporation; (b) pledging shares of Class B Common Stock by a Class B Stockholder that creates a mere security interest in such shares pursuant to a bona fide loan or indebtedness transaction so long as the Class B Stockholder continues to exercise Voting Control over such pledged shares; provided, however, that a foreclosure on such shares of Class B Common Stock or other similar action by the pledgee shall constitute a “Transfer”; (c) the fact that, as of the IPO Time or at any time after the IPO Time, the spouse of any Class B Stockholder possesses or obtains an interest in such holder’s shares of Class B Common Stock arising solely by reason of the application of the community property laws of any jurisdiction, so long as no other event or circumstance shall exist or have occurred that constitutes a “Transfer” of such shares of Class B Common Stock (and provided that any transfer of shares by any holder of shares of Class B Common Stock to such holder’s spouse, including a transfer in connection with a divorce proceeding, domestic relations order or similar legal requirement, shall constitute a “Transfer” of such shares of Class B Common Stock unless otherwise exempt from the definition of Transfer); (d) entering into a trading plan pursuant to Rule 10b5-1 under the Exchange Act with a broker or other nominee; provided, however, that a sale of such shares of Class B Common Stock pursuant to such plan shall constitute a “Transfer” at the time of such sale; (e) granting a proxy by the Founder or the Founder’s Permitted Transferees to a person designated by the Board to exercise Voting Control of shares of Class B Common Stock owned directly or indirectly, beneficially and of record, by such Founder or such Founder’s Permitted Transferees, or over which such Founder has Voting Control pursuant to a proxy or voting agreements then in place, effective either (x) on the death of such Founder or (y) during any Incapacity of such Founder, including the exercise of such proxy by the person designated by the Board; or (f) entering into, or reaching an agreement, arrangement or understanding regarding, a support, voting, tender or similar agreement or arrangement (with or without a proxy) in connection with a merger, conversion, transfer, asset transfer, asset acquisition or any other transaction approved by the Board.
“Voting Control” with respect to a share of Class B Common Stock means the exclusive power (whether directly or indirectly) to vote or direct the voting of such share of Class B Common Stock by proxy, voting agreement, or otherwise; provided, however, that the following shall not be considered a loss or other diminishment of “Voting Control”: (a) granting a revocable proxy to officers or directors of the Corporation at the request of the Board in connection with actions to be taken at an annual or special meeting of stockholders of the Corporation or by written consent in lieu of a meeting of stockholders of the Corporation; (b) pledging shares of Class B Common Stock by a holder that creates a mere security interest in such shares pursuant to a bona fide loan or indebtedness transaction so long as the holder continues to exercise voting control over such pledged shares; provided, however, that a
foreclosure on such shares of Class B Common Stock or other similar action by the pledgee shall constitute a loss of “Voting Control”; (c) the fact that, as of the IPO Time or at any time after the IPO Time, the spouse of any holder possesses or obtains an interest in such holder’s shares of Class B Common Stock arising solely by reason of the application of the community property laws of any jurisdiction, so long as no other event or circumstance shall exist or have occurred that constitutes a loss of “Voting Control” of such shares of Class B Common Stock (and provided that any transfer of voting control over shares held by any holder of shares of Class B Common Stock to such holder’s spouse, including a transfer of voting control in connection with a divorce proceeding, domestic relations order or similar legal requirement, shall constitute a loss of “Voting Control” of such shares of Class B Common Stock unless otherwise provided herein); (d) entering into a trading plan pursuant to Rule 10b5-1 under the Exchange Act with a broker or other nominee; provided, however, that a sale of such shares of Class B Common Stock pursuant to such plan shall constitute a loss of “Voting Control” at the time of such sale; (e) granting a proxy by a Founder or a Founder’s Permitted Transferees to a person designated by the Board to exercise Voting Control of shares of Class B Common Stock owned directly or indirectly, beneficially and of record, by such Founder or such Founder’s Permitted Transferees, or over which such Founder has Voting Control pursuant to a proxy or voting agreements then in place, effective either (x) on the death of such Founder or (y) during any Incapacity of such Founder, including the exercise of such proxy by the person designated by the Board; or (f) entering into, or reaching an agreement, arrangement or understanding regarding, a support, voting, tender or similar agreement or arrangement (with or without a proxy) in connection with a merger, conversion, transfer, asset transfer, asset acquisition or other approved by the Board.
ARTICLE VI
For the management of the business and for the conduct of the affairs of the Corporation it is further provided that:
A. Subject to the special rights of the holders of one or more outstanding series of Preferred Stock to elect directors, the directors of the Corporation shall be classified with respect to the time for which they severally hold office into three classes, designated as Class I, Class II and Class III. The initial Class I directors shall serve for a term expiring at the first annual meeting of stockholders IPO Time; the initial Class II directors shall serve for a term expiring at the second annual meeting of stockholders following the IPO Time; and the initial Class III directors shall serve for a term expiring at the third annual meeting of stockholders following the IPO Time. At each annual meeting of stockholders of the Corporation beginning with the first annual meeting of stockholders following the IPO Time, subject to any special rights of the holders of one or more outstanding series of Preferred Stock to elect directors, the successors of the class of directors whose term expires at that meeting shall be elected to hold office for a term expiring at the annual meeting of stockholders held in the third year following the year of their election. Each director shall hold office until his or her successor is duly elected and qualified or until his or her earlier death, resignation, disqualification or removal. No decrease in the number of directors shall shorten the term of any incumbent director. The Board is authorized to designate members of the Board already in office as Class I, Class II and Class III.
B. Except as otherwise expressly provided by the DGCL or this Restated Certificate, the business and affairs of the Corporation shall be managed by or under the direction of the Board. The number of directors which shall constitute the whole Board shall be fixed exclusively by one or more resolutions adopted from time to time by the Board of Directors.
C. Subject to the special rights of the holders of one or more outstanding series of Preferred Stock to elect directors, the Board or any individual director may be removed from office at any time, but only for cause and only by the affirmative vote of the holders of at least two-thirds of the voting power of all of the then outstanding shares of voting stock of the Corporation entitled to vote thereon.
D. Subject to the special rights of the holders of one or more outstanding series of Preferred Stock to elect directors, except as otherwise provided by law, any vacancies on the Board resulting from death, resignation, disqualification, retirement, removal or other causes and any newly created directorships resulting from any increase in the number of directors shall be filled exclusively by the affirmative vote of a majority of the directors then in office, even though less than a quorum, or by a sole remaining director (other than any directors elected by the separate vote of one or more outstanding series of Preferred Stock), and shall not be filled by the stockholders. Any director appointed in accordance with the preceding sentence shall hold office until the expiration of the term of the class to which such director shall have been appointed or until his or her earlier death, resignation, retirement, disqualification or removal.
E. Whenever the holders of any one or more series of Preferred Stock issued by the Corporation shall have the right, voting separately as a series or separately as a class with one or more such other series, to elect directors at an annual or special meeting of stockholders, the election, term of office, removal and other features of such directorships shall be governed by the terms of this Restated Certificate (including any Certificate of Designation relating to any such series of Preferred Stock). Notwithstanding anything to the contrary in this Article VI, the number of directors that may be elected by the holders of any such series of Preferred Stock shall be in addition to the number fixed pursuant to paragraph B of this Article VI, and the total number of directors constituting the whole Board shall be automatically adjusted accordingly. Except as otherwise provided in the Certificate of Designation(s) in respect of one or more series of Preferred Stock, whenever the holders of any series of Preferred Stock having such right to elect additional directors are divested of such right pursuant to the provisions of such Certificate of Designation(s), the terms of office of all such additional directors elected by the holders of such series of Preferred Stock, or elected to fill any vacancies resulting from the death, resignation, disqualification or removal of such additional directors, shall forthwith terminate (in which case each such director thereupon shall cease to be qualified as, and shall cease to be, a director) and the total authorized number of directors of the Corporation shall automatically be reduced accordingly.
F. In furtherance and not in limitation of the powers conferred by DCGL, the Board is expressly authorized to adopt, amend or repeal Bylaws of the Corporation. In addition to any vote of the holders of any class or series of stock of the Corporation required by applicable law or by this Restated Certificate (including any Certificate of Designation relating to any such series of Preferred Stock) or the Bylaws of the Corporation, the adoption, amendment or repeal of the Bylaws of the Corporation by the stockholders of the Corporation shall require the affirmative vote of the holders of at least two-thirds of the voting power of all of the then outstanding shares of voting stock of the Corporation entitled to vote thereon.
G. The directors of the Corporation need not be elected by written ballot unless the Bylaws so provide.
ARTICLE VII
A. Prior to the Final Conversion Date, any action required or permitted to be taken by the stockholders of the Corporation may be authorized or taken by the consent of the holders of outstanding shares of voting stock having not less than the minimum voting power that would be necessary to authorize or take such action at an annual or special meeting of the stockholders. Following the Final Conversion Date, any action required or permitted to be taken by the stockholders of the Corporation must be effected at an annual or special meeting of stockholders of the Corporation, and shall not be taken by written consent in lieu of a meeting. Notwithstanding the foregoing, any action required or permitted to be taken by the holders of any series of Preferred Stock, voting separately as a series or separately as a class with one or more other such series, may be taken without a meeting, without prior notice and without a vote, to the extent expressly so provided by the applicable Certificate of Designation relating to such series of Preferred Stock, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding shares of the relevant series of Preferred Stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to the Corporation in accordance with the applicable provisions of the DGCL.
B. Subject to the special rights of the holders of one or more series of Preferred Stock, special meetings of stockholders of the Corporation may be called, for any purpose or purposes, at any time only by or at the direction of the Board or the Chairperson of the Board, and shall not be called by any other person or persons.
C. Advance notice of stockholder nominations for the election of directors and of other business proposed to be brought by stockholders before any meeting of stockholders of the Corporation shall be given in the manner provided in the Bylaws of the Corporation.
ARTICLE VIII
Directors. To the fullest extent permitted by the DGCL, a director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of his or her fiduciary duty as a director, except for liability (a) for any breach of the director’s duty of loyalty to the Corporation or its stockholders, (b) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (c) under Section 174 of the DGCL or (d) for any transaction from which the director derived an improper personal benefit. If the DGCL is amended after the effective date of this Restated Certificate to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the DGCL, as so amended.
Officers. To the fullest extent permitted by the DGCL, an Officer (as defined below) of the Corporation shall not be personally liable to the Corporation or its stockholders for
monetary damages for breach of his or her fiduciary duty as an officer of the Corporation, except for liability (a) for any breach of the Officer’s duty of loyalty to the Corporation or its stockholders, (b) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (c) for any transaction from which the Officer derived an improper personal benefit, or (d) arising from any claim brought by or in the right of the Corporation. If the DGCL is amended after the effective date of this Restated Certificate to authorize corporate action further eliminating or limiting the personal liability of Officers, then the liability of an Officer of the Corporation shall be eliminated or limited to the fullest extent permitted by the DGCL, as so amended. For purposes of this Article VIII, “Officer” shall mean an individual who has been duly appointed as an officer of the Corporation and who, at the time of an act or omission as to which liability is asserted, is deemed to have consented to service by the delivery of process to the registered agent of the Corporation as contemplated by 10 Del. C. § 3114(b).
Amendment or Modification. Any amendment, repeal or modification of this Article VIII or any amendment to the DGCL, shall not adversely affect any right or protection existing at the time of such amendment, repeal or modification with respect to any acts or omissions occurring before such amendment, repeal or modification of a person serving as a director or Officer, as applicable, at the time of such amendment, repeal or modification.
ARTICLE IX
The Corporation shall have the power to provide rights to indemnification and advancement of expenses to its current and former officers, directors, employees and agents and to any person who is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise.
ARTICLE X
Unless the Corporation consents in writing to the selection of an alternative forum, (a) the Court of Chancery (the “Chancery Court”) of the State of Delaware (or, in the event that the Chancery Court does not have jurisdiction, the federal district court for the District of Delaware or other state courts of the State of Delaware) shall, to the fullest extent permitted by law, be the sole and exclusive forum for (i) any derivative action, suit or proceeding brought on behalf of the Corporation, (ii) any current or former action, suit or proceeding asserting a claim of breach of a fiduciary duty owed by any director, officer, other employee or stockholder of the Corporation to the Corporation or to the Corporation’s stockholders, (iii) any action, suit or proceeding arising pursuant to any provision of the DGCL or the bylaws of the Corporation or this Restated Certificate (as either may be amended from time to time) or (iv) any action, suit or proceeding asserting a claim against the Corporation governed by the internal affairs doctrine; and (b) the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause or causes of action arising under the Securities Act of 1933, as amended, including all causes of action asserted against any defendant to such complaint.
Any person or entity purchasing or otherwise acquiring any interest in any security of the Corporation shall be deemed to have notice of and consented to this Article X. This Article X is intended to benefit and may be enforced by the Corporation, its officers and directors, the underwriters to any offering giving rise to such complaint, and any other professional or entity whose profession gives authority to a statement made by that person or entity and who has prepared or certified any part of the documents underlying the offering. Notwithstanding the foregoing, the provisions of this Article X shall not apply to suits brought to enforce any liability or duty created by the Securities Exchange Act of 1934, as amended, or any other claim for which the federal courts of the United States have exclusive jurisdiction.
If any provision or provisions of this Article X shall be held to be invalid, illegal or unenforceable as applied to any circumstance for any reason whatsoever, (a) the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions of this Article X (including, without limitation, each portion of any paragraph of this Article X containing any such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and (b) the application of such provision to other persons or entities and circumstances shall not in any way be affected or impaired thereby.
ARTICLE XI
The Corporation reserves the right to amend or repeal this Restated Certificate in the manner now or hereafter prescribed by statute and this Restated Certificate, and all rights conferred upon stockholders herein are granted subject to this reservation.
Notwithstanding anything contained in this Restated Certificate to the contrary, in addition to any vote required by applicable law, the following provisions in this Restated Certificate may be amended, altered, repealed or rescinded, in whole or in part, or any provision inconsistent therewith or herewith may be adopted, only by the affirmative vote of the holders of at least 66 2/3% of the total voting power of all the then outstanding shares of stock of the Corporation entitled to vote thereon, voting together as a single class: Part B of Article IV, Article VI, Article VII, Article VIII, Article IX, Article X, and this Article XI; provided, however, for so long as any shares of Class B Common Stock remain outstanding, the Corporation shall not, without the prior affirmative vote of the holders of at least a majority of the total voting power of all the then outstanding shares of Class B Common Stock, voting as a separate series, in addition to any other vote required by law or this Restated Certificate, directly or indirectly, amend, alter, change, adopt, or repeal any provision inconsistent with Part A of Article IV, Article VI or this proviso of this paragraph of Article X.
If any provision or provisions of this Restated Certificate shall be held to be invalid, illegal or unenforceable as applied to any circumstance for any reason whatsoever: (i) the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions of this Restated Certificate (including, without limitation, each portion of any paragraph of this Restated Certificate containing any such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) shall not, to the fullest extent permitted by applicable law, in any way be affected or impaired thereby and (ii)
to the fullest extent permitted by applicable law, the provisions of this Restated Certificate (including, without limitation, each such portion of any paragraph of this Restated Certificate containing any such provision held to be invalid, illegal or unenforceable) shall be construed so as to permit the Corporation to protect its directors, officers, employees and agents from personal liability in respect of their good faith service to or for the benefit of the Corporation to the fullest extent permitted by law.
Amended and Restated Bylaws of
Voyager Technologies, Inc.
(a Delaware corporation)
as of [ ò ], 2025
Table of Contents
| | | | | | | | | | | |
| | | Page |
| | | |
| | | |
Article I - Corporate Offices | 1 | |
| | | |
| 1.1 | Registered Office | 1 | |
| 1.2 | Other Offices | 1 | |
| | | |
Article II - Meetings of Stockholders | 1 | |
| | | |
| 2.1 | Place of Meetings | 1 | |
| 2.2 | Annual Meeting | 1 | |
| 2.3 | Special Meeting | 1 | |
| 2.4 | Notice of Business to be Brought before a Meeting. | 2 | |
| 2.5 | Notice of Nominations for Election to the Board of Directors. | 7 | |
| 2.6 | Additional Requirements for Valid Nomination of Candidates to Serve as Director and, if Elected, to be Seated as Directors. | 10 | |
| 2.7 | Notice of Stockholders’ Meetings | 12 | |
| 2.8 | Quorum | 12 | |
| 2.9 | Adjourned Meeting; Notice | 12 | |
| 2.10 | Conduct of Business | 12 | |
| 2.11 | Voting | 13 | |
| 2.12 | Record Date for Stockholder Meetings and Other Purposes | 13 | |
| 2.13 | Proxies | 14 | |
| 2.14 | List of Stockholders Entitled to Vote | 15 | |
| 2.15 | Inspectors of Election | 15 | |
| 2.16 | Delivery to the Corporation. | 16 | |
| | | |
Article III - Directors | 16 | |
| | | |
| 3.1 | Powers | 16 | |
| 3.2 | Number of Directors | 16 | |
| 3.3 | Election, Qualification and Term of Office of Directors | 16 | |
| 3.4 | Resignation and Vacancies | 16 | |
| 3.5 | Place of Meetings; Meetings by Telephone | 17 | |
| 3.6 | Regular Meetings | 17 | |
| 3.7 | Special Meetings; Notice | 17 | |
| 3.8 | Quorum | 18 | |
| 3.9 | Board Action without a Meeting | 18 | |
| 3.10 | Fees and Compensation of Directors | 18 | |
| | | |
Article IV - Committees | 18 | |
| | | |
| 4.1 | Committees of Directors | 18 | |
| 4.2 | Committee Minutes | 18 | |
| 4.3 | Meetings and Actions of Committees | 19 | |
| 4.4 | Subcommittees. | 19 | |
| | | |
Article V - Officers | 19 | |
TABLE OF CONTENTS
(continued)
| | | | | | | | | | | |
| | | Page |
| | | |
| | | |
| 5.1 | Officers | 19 | |
| 5.2 | Appointment of Officers | 20 | |
| 5.3 | Subordinate Officers | 20 | |
| 5.4 | Removal and Resignation of Officers | 20 | |
| 5.5 | Vacancies in Offices | 20 | |
| 5.6 | Representation of Shares of Other Corporations | 20 | |
| 5.7 | Authority and Duties of Officers | 20 | |
| 5.8 | Compensation. | 21 | |
| | | |
Article VI - Records | 21 | |
| | | |
Article VII - General Matters | 21 | |
| | | |
| 7.1 | Execution of Corporate Contracts and Instruments | 21 | |
| 7.2 | Stock Certificates | 21 | |
| 7.3 | Special Designation of Certificates. | 22 | |
| 7.4 | Lost Certificates | 22 | |
| 7.5 | Shares Without Certificates | 22 | |
| 7.6 | Construction; Definitions | 22 | |
| 7.7 | Dividends | 23 | |
| 7.8 | Fiscal Year | 23 | |
| 7.9 | Seal | 23 | |
| 7.10 | Transfer of Stock | 23 | |
| 7.11 | Stock Transfer Agreements | 23 | |
| 7.12 | Registered Stockholders | 23 | |
| 7.13 | Waiver of Notice | 24 | |
| | | |
Article VIII - Notice | 24 | |
| | | |
| 8.1 | Delivery of Notice; Notice by Electronic Transmission | 24 | |
| | | |
Article IX - Indemnification | 25 | |
| | | |
| 9.1 | Indemnification of Directors and Officers | 25 | |
| 9.2 | Indemnification of Others | 25 | |
| 9.3 | Prepayment of Expenses | 25 | |
| 9.4 | Determination; Claim | 26 | |
| 9.5 | Non-Exclusivity of Rights | 26 | |
| 9.6 | Insurance | 26 | |
| 9.7 | Other Indemnification | 26 | |
| 9.8 | Continuation of Indemnification | 26 | |
| 9.9 | Amendment or Repeal; Interpretation | 26 | |
| | | |
Article X - Amendments | 27 | |
| | | |
Article XI - Definitions | 27 | |
Amended and Restated Bylaws of
Voyager Technologies, Inc.
Article I - Corporate Offices
1.1 Registered Office.
The address of the registered office of Voyager Technologies, Inc. (the “Corporation”) in the State of Delaware, and the name of its registered agent at such address, shall be as set forth in the Corporation’s certificate of incorporation, as the same may be amended and/or restated from time to time (the “Certificate of Incorporation”).
1.2 Other Offices.
The Corporation may have additional offices at any place or places, within or outside the State of Delaware, as the Corporation’s board of directors (the “Board”) may from time to time establish or as the business of the Corporation may require.
Article II - Meetings of Stockholders
2.1 Place of Meetings.
Meetings of stockholders shall be held at any place within or outside the State of Delaware, designated by the Board. The Board may, in its sole discretion, determine that a meeting of stockholders shall not be held at any place, but may instead be held solely by means of remote communication as authorized by Section 211(a)(2) of the General Corporation Law of the State of Delaware (the “DGCL”). In the absence of any such designation or determination, stockholders’ meetings shall be held at the Corporation’s principal executive office.
2.2 Annual Meeting.
The Board shall designate the date and time of the annual meeting of stockholders. At the annual meeting of stockholders, directors shall be elected and other proper business properly brought before the meeting in accordance with Section 2.4 of these Bylaws may be transacted. The Board may postpone, reschedule or cancel any previously scheduled annual meeting of stockholders.
2.3 Special Meeting.
Special meetings of stockholders may be called only by such persons and only in such manner as set forth in the Certificate of Incorporation.
No business may be transacted at any special meeting of stockholders other than the business specified in the notice of such meeting. The Board may postpone, reschedule or cancel any previously scheduled special meeting of stockholders.
2.4 Notice of Business to be Brought before a Meeting.
(a) At an annual meeting of the stockholders, only such business (other than the nomination of persons for election to the Board) shall be conducted as shall have been properly brought before the meeting pursuant to and in accordance with this Section 2.4. To be properly brought before an annual meeting, business must be (i) specified in a notice of meeting given by or at the direction of the Board, including by any committee or persons authorized to do so by the Board or these Bylaws, (ii) if not specified in a notice of meeting, otherwise brought before the meeting by the Board or (iii) otherwise properly brought before the meeting by a stockholder present in person who (A) (1) was a record owner of shares of the Corporation both at the time of giving the notice to the Corporation provided for in this Section 2.4 and at the time of the meeting, (2) is entitled to vote at the meeting, and (3) has complied with this Section 2.4 in all applicable respects or (B) properly made such proposal in accordance with Rule 14a-8 under the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder (as so amended and inclusive of such rules and regulations, the “Exchange Act”). The foregoing clause (iii) shall be the exclusive means for a stockholder to propose business (other than nominations of persons for election to the Board) to be brought before an annual meeting of the stockholders. The only matters that may be brought before a special meeting are the matters specified in the notice of meeting given by or at the direction of the person calling the meeting pursuant to Section 2.7, and stockholders shall not be permitted to propose business to be brought before a special meeting of the stockholders. For purposes of this Section 2.4, (i) “present in person” shall mean that the stockholder proposing that the business be brought before the annual meeting of the stockholders, or a qualified representative of such proposing stockholder, appear at such annual meeting. and (ii) a “qualified representative” of such proposing stockholder shall be a duly authorized officer, manager or partner of such stockholder or any other person authorized by a writing executed by such stockholder or an electronic transmission delivered by such stockholder to act for such stockholder as proxy at the annual meeting of stockholders and such person must produce such writing or electronic transmission, or a reliable reproduction of the writing or electronic transmission, at or before such annual meeting of stockholders. Stockholders seeking to nominate persons for election to the Board must comply with Section 2.5 and Section 2.5(a) and this Section 2.4 shall not be applicable to nominations except as expressly provided in Section 2.5 and Section 2.5(a).
(b) Without qualification, for business to be properly brought before an annual meeting of stockholders by a stockholder, such proposed business must constitute a proper matter for stockholder action and the stockholder must (i) provide Timely Notice (as defined below) thereof in writing and in proper form to the Secretary of the Corporation and (ii) provide any updates or supplements to such notice at the times and in the forms required by this Section 2.4. To be timely, a stockholder’s notice must be delivered to, or mailed and received at, the principal executive offices of the Corporation not less than ninety (90) days nor more than one hundred twenty (120) days prior to the one-year anniversary of the preceding year’s annual meeting which, in the case of the first annual meeting of stockholders following the closing of the Corporation’s initial underwritten public offering of Class A Common Stock, the date of the preceding year’s annual meeting shall be deemed to be May 15; provided, however, that if the date of the annual meeting is more than thirty (30) days before or more than sixty (60) days after such anniversary date, notice by the stockholder to be timely must be so delivered, or mailed and received at, the principal executive offices of the Corporation, not more than the one hundred twentieth (120th) day prior to such annual meeting and not later than (i) the ninetieth (90th) day prior to such annual meeting or, (ii) if later, the tenth (10th) day following the day on which public disclosure of the date of such annual meeting was first made by the Corporation (such notice within such time periods, “Timely Notice”). In no event shall any adjournment or postponement of an annual meeting or the announcement thereof
commence a new time period (or extend any time period) for the giving of Timely Notice as described above.
(c) To be in proper form for purposes of this Section 2.4, a stockholder’s notice to the Secretary shall set forth:
(i) As to each Proposing Person (as defined below), (A) the name and address of such Proposing Person (including, if applicable, the name and address that appear on the Corporation’s books and records), (B) the class or series and number of shares of capital stock of the Corporation that are, directly or indirectly, owned of record or beneficially owned (within the meaning of Rule 13d-3 under the Exchange Act) by such Proposing Person, except that such Proposing Person shall in all events be deemed to beneficially own any shares of any class or series of capital stock of the Corporation as to which such Proposing Person has a right to acquire beneficial ownership at any time in the future, (C) the date or dates such shares were acquired, (D) the investment intent of such acquisition of such shares and (E) any pledge by such Proposing Person with respect to any of such shares (the disclosures to be made pursuant to the foregoing clauses (A) through (E) are referred to as “Stockholder Information”);
(ii) As to each Proposing Person,
(a) the material terms and conditions of any “derivative security” (as such term is defined in Rule 16a-1(c) under the Exchange Act) that constitutes a “call equivalent position” (as such term is defined in Rule 16a-1(b) under the Exchange Act) or a “put equivalent position” (as such term is defined in Rule 16a-1(h) under the Exchange Act) or other derivative or synthetic arrangement in respect of any class or series of shares of capital stock of the Corporation (“Synthetic Equity Position”) that is, directly or indirectly, held or maintained by, held for the benefit of, or involving such Proposing Person, including, without limitation,
(1) any option, warrant, convertible security, stock appreciation right, future or similar right with an exercise or conversion privilege or a settlement payment or mechanism at a price related to any class or series of shares of capital stock of the Corporation or with a value derived in whole or in part from the value of any shares of any class or series of shares of capital stock of the Corporation,
(2) any derivative or synthetic arrangement having the characteristics of a long position or a short position in any class or series of shares of capital stock of the Corporation, including, without limitation, a stock loan transaction, a stock borrowing transaction, or a share repurchase transaction or
(3) any contract, derivative, swap or other transaction or series of transactions designed to
(x) produce economic benefits and risks that correspond substantially to the ownership of any class or series of shares of capital stock of the Corporation,
(y) mitigate any loss relating to, reduce the economic risk (of ownership or otherwise) of, or manage the risk of share price decrease in, any class or series of shares of capital stock of the Corporation, or
(z) increase or decrease the voting power in respect of any class or series of shares of capital stock of the Corporation held or maintained by, held for the benefit of, or involving such Proposing Person,
including, without limitation, due to the fact that the value of such contract, derivative, swap or other transaction or series of transactions is determined by reference to the price, value or volatility of any class or series of shares of capital stock of the Corporation, whether or not such instrument, contract or right shall be subject to settlement in the underlying class or series of shares of capital stock of the Corporation, through the delivery of cash or other property, or otherwise, and without regard to whether the holder thereof may have entered into transactions that hedge or mitigate the economic effect of such instrument, contract or right, or any other direct or indirect opportunity to profit or share in any profit derived from any increase or decrease in the price or value of any shares of any class or series of shares of capital stock of the Corporation;
provided that, for the purposes of the definition of “Synthetic Equity Position,” the term “derivative security” shall also include any security or instrument that would not otherwise constitute a “derivative security” as a result of any feature that would make any conversion, exercise or similar right or privilege of such security or instrument becoming determinable only at some future date or upon the happening of a future occurrence, in which case the determination of the amount of securities into which such security or instrument would be convertible or exercisable shall be made assuming that such security or instrument is immediately convertible or exercisable at the time of such determination; and, provided, further, that any Proposing Person satisfying the requirements of Rule 13d-1(b)(1) under the Exchange Act (other than a Proposing Person that so satisfies Rule 13d-1(b)(1) under the Exchange Act solely by reason of Rule 13d-1(b)(1)(ii)(E)) shall not be deemed to hold or maintain the notional amount of any securities that underly any Synthetic Equity Position that is, directly or indirectly, held or maintained by, held for the benefit of, or involving such Proposing Person as a hedge with respect to a bona fide derivatives trade or position of such Proposing Person arising in the ordinary course of such Proposing Person’s business as a derivatives dealer,
(b) a description of any agreement, arrangement or understanding with respect to any rights to dividends on the shares of any class or series of shares of capital stock of the Corporation owned beneficially by such Proposing Person that are separated or separable from the underlying shares of capital stock of the Corporation,
(c) any material pending or threatened legal proceeding in which such Proposing Person is a party or material participant involving the Corporation or any of its officers or directors, or any affiliate of the Corporation,
(d) any other material relationship between such Proposing Person, on the one hand, and the Corporation or any affiliate of the Corporation, on the other hand,
(e) any direct or indirect material interest in any material contract or agreement of such Proposing Person with the Corporation or any affiliate of the Corporation (including, in any such case, any employment agreement, collective bargaining agreement or consulting agreement),
(f) any proportionate interest in shares of capital stock of the Corporation or a Synthetic Equity Position held, directly or indirectly, by a general or limited partnership, limited liability company or similar entity in which any such Proposing Person (1) is a general partner or, directly or indirectly, beneficially owns an interest in a general partner of such general or limited partnership or (2) is the manager, managing member or, directly or indirectly, beneficially owns an interest in the manager or managing member of such limited liability company or similar entity;
(g) a representation that such Proposing Person intends or is part of a group that intends to deliver a proxy statement and/or form of proxy to holders of at least the percentage of the Corporation’s outstanding capital stock required to approve or adopt the proposal or otherwise solicit proxies or votes from stockholders in support of such proposal and
(h) any other information relating to such Proposing Person that would be required to be disclosed in a proxy statement or other filing required to be made in connection with solicitations of proxies or consents by such Proposing Person in support of the business proposed to be brought before the annual meeting pursuant to Section 14(a) of the Exchange Act
(the disclosures to be made pursuant to the foregoing clauses (a) through (h) are referred to as “Disclosable Interests”); provided, however, that Disclosable Interests shall not include any such disclosures with respect to the ordinary course business activities of any broker, dealer, commercial bank, trust company or other nominee who is a Proposing Person solely as a result of being the stockholder directed to prepare and submit the notice required by these Bylaws on behalf of a beneficial owner; and
(iii) As to each item of business that the stockholder proposes to bring before the annual meeting of stockholders, (A) a brief description of the business desired to be brought before the annual meeting, the reasons for conducting such business at the annual meeting and any material interest in such business of each Proposing Person, (B) the text of the proposal or business (including the text of any resolutions proposed for consideration and in the event that such business includes a proposal to amend the Bylaws, the language of the proposed amendment), (C) a reasonably detailed description of all agreements, arrangements and understandings (x) between or among any of the Proposing Persons or (y) between or among any Proposing Person and any other person or entity (including their names), in each case, in connection with the proposal of such business by such stockholder, and (D) any other information relating to such item of business that would be required to be disclosed in a proxy statement or other filing required to be made in connection with solicitations of proxies in support of the business proposed to be brought before the annual meeting pursuant to Section 14(a) of the
Exchange Act; provided, however, that the disclosures required by this paragraph (iii) shall not include any disclosures with respect to any broker, dealer, commercial bank, trust company or other nominee who is a Proposing Person solely as a result of being the stockholder directed to prepare and submit the notice required by these Bylaws on behalf of a beneficial owner.
For purposes of this Section 2.4, the term “Proposing Person” shall mean (i) the stockholder providing the notice of business proposed to be brought before an annual meeting of stockholders, (ii) the beneficial owner or beneficial owners, if different, on whose behalf the notice of the business proposed to be brought before the annual meeting is made, and (iii) any participant (as defined in paragraphs (a)(ii)-(vi) of Instruction 3 to Item 4 of Schedule 14A) with such stockholder in such solicitation.
(d) The Board may request that any Proposing Person furnish such additional information as may be reasonably required by the Board. Such Proposing Person shall provide such additional information within ten (10) days after it has been requested by the Board.
(e) A Proposing Person shall update and supplement its notice to the Corporation of its intent to propose business at an annual meeting of stockholders, if necessary, so that the information provided or required to be provided in such notice pursuant to this Section 2.4 shall be true and correct as of the record date for stockholders entitled to vote at the meeting and as of the date that is ten (10) business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Corporation not later than five (5) business days after the record date for stockholders entitled to vote at the meeting in the case of the update and supplement required to be made as of such record date, and not later than eight (8) business days prior to the date for the meeting or, any adjournment or postponement thereof in the case of the update and supplement required to be made as of ten (10) business days prior to the meeting or any adjournment or postponement thereof, provided that, in the case of an adjournment or postponement, if it is not possible to deliver such update and supplement by such date due to an adjournment or postponement of the annual meeting that is less than eight (8) business days, such update or supplement shall be delivered on the first practicable date prior to the date to which such annual meeting has been adjourned or postponed. For the avoidance of doubt, the obligation to update and supplement as set forth in this paragraph or any other Section of these Bylaws shall not limit the Corporation’s rights with respect to any deficiencies in any notice provided by a stockholder, extend any applicable deadlines hereunder or enable or be deemed to permit a stockholder who has previously submitted notice hereunder to amend or update any proposal or to submit any new proposal, including by changing or adding matters, business or resolutions proposed to be brought before an annual meeting of the stockholders.
(f) Notwithstanding anything in these Bylaws to the contrary, no business shall be conducted at an annual meeting of stockholders that is not properly brought before the meeting in accordance with this Section 2.4. The presiding officer of the meeting (or, in advance of any meeting of stockholders, the Board of Directors or an authorized committee thereof) shall, if the facts warrant, determine whether the business was properly brought before the meeting in accordance with this Section 2.4, and if the presiding officer or Board should determine any proposed business was not proposed in compliance with this Section 2.4, the presiding officer or the Board shall so declare to the meeting and any such business not properly brought before the meeting shall not be transacted.
(g) This Section 2.4 is expressly intended to apply to any business proposed to be brought before an annual meeting of stockholders other than any proposal made in accordance with Rule 14a-8 under the Exchange Act and included in the Corporation’s proxy statement. In addition to the
requirements of this Section 2.4 with respect to any business proposed to be brought before an annual meeting, each Proposing Person shall comply with all applicable requirements of the Exchange Act with respect to any such business. Nothing in this Section 2.4 shall be deemed to affect the rights of stockholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act.
(h) For purposes of these Bylaws, “public disclosure” shall mean disclosure in a press release reported by a national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act.
2.5 Notice of Nominations for Election to the Board of Directors.
(a) Nominations of any person for election to the Board at an annual meeting of stockholders or at a special meeting of stockholders (but only if the election of directors is a matter specified in the notice of meeting given by or at the direction of the person calling such special meeting) may be made at such meeting only (i) by or at the direction of the Board, including by any committee or persons authorized to do so by the Board or these Bylaws, or (ii) by a stockholder present in person who (A) was a record owner of shares of capital stock the Corporation both at the time of giving the notice provided for in this Section 2.5 and at the time of the meeting, (B) is entitled to vote at the meeting, and (C) has complied with this Section 2.5 and Section (e) as to such notice and nomination. For purposes of this Section 2.5, (i) “present in person” shall mean that the stockholder nominating any person for election to the Board at the meeting of the Corporation, or a qualified representative of such stockholder, appear at such meeting and (ii) a “qualified representative” of such proposing stockholder shall be a duly authorized officer, manager or partner of such stockholder or any other person authorized by a writing executed by such stockholder or an electronic transmission delivered by such stockholder to act for such stockholder as proxy at the meeting of stockholders and such person must produce such writing or electronic transmission, or a reliable reproduction of the writing or electronic transmission, at the meeting of stockholders. The foregoing clause (ii) shall be the exclusive means for a stockholder to make any nomination of a person or persons for election to the Board at an annual or special meeting of stockholders.
(b) (i) Without qualification, in the case of an annual meeting of stockholders, for a stockholder to make any nomination of a person or persons for election to the Board at an annual meeting, the stockholder must (1) provide Timely Notice (as defined in Section 2.4) thereof in writing and in proper form to the Secretary of the Corporation, (2) provide the information, agreements and questionnaires with respect to such stockholder and its candidate for nomination as required to be set forth by this Section 2.5 and Section (e) and (3) provide any updates or supplements to such notice at the times and in the forms required by this Section 2.5 and Section (e).
(ii) Without qualification, if the election of directors is a matter specified in the notice of meeting given by or at the direction of the person calling a special meeting, then for a stockholder to make any nomination of a person or persons for election to the Board at a special meeting, the stockholder must (1) provide timely notice thereof in writing and in proper form to the Secretary of the Corporation at the principal executive offices of the Corporation, (2) provide the information with respect to each Nominating Person and each candidate for nomination as required by this Section 2.5 and Section (e) and (3) provide any updates or supplements to such notice at the times and in the forms required by this Section 2.5. To be timely, a stockholder’s notice for nominations to be made at a special meeting must be delivered to, or mailed and received at, the principal
executive offices of the Corporation not earlier than the one hundred twentieth (120th) day prior to such special meeting and not later than the ninetieth (90th) day prior to such special meeting or, if later, the tenth (10th) day following the day on which public disclosure (as defined in Section 2.4) of the date of such special meeting was first made (such notice within such time periods, “Special Meeting Timely Notice”).
(iii) In no event shall any adjournment or postponement of an annual or special meeting of stockholders or the announcement thereof commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above.
(iv) In no event may a Nominating Person provide Timely Notice or Special Meeting Timely Notice, as applicable, with respect to a greater number of director candidates than are subject to election by stockholders at the applicable annual or special meeting of stockholders. If the Corporation shall, subsequent to such notice, increase the number of directors subject to election at the meeting, such notice as to any additional nominees shall be due on the later of (i) the conclusion of the time period for Timely Notice or Special Meeting Timely Notice, as applicable or (ii) the tenth day following the date of public disclosure (as defined in Section 2.4) of such increase.
(c) To be in proper form for purposes of this Section 2.5, a stockholder’s notice to the Secretary shall set forth:
(i) As to each Nominating Person, the Stockholder Information (as defined in Section 2.4(c)(i), except that for purposes of this Section 2.5 the term “Nominating Person” shall be substituted for the term “Proposing Person” in all places it appears in Section 2.4(c)(i));
(ii) As to each Nominating Person, any Disclosable Interests (as defined in Section 2.4(c)(ii), except that for purposes of this Section 2.5 the term “Nominating Person” shall be substituted for the term “Proposing Person” in all places it appears in Section 2.4(c)(ii) and the disclosure with respect to the business to be brought before the meeting in Section 2.4(c)(ii) shall be made with respect to the election of directors at the meeting); and provided that, in lieu of including the information set forth in Section 2.4(c)(ii)(g), the Nominating Person’s notice for purposes of this Section 2.5 shall include a representation as to whether the Nominating Person intends or is part of a group which intends to deliver a proxy statement and solicit the holders of shares representing at least 67% of the voting power of shares entitled to vote on the election of directors in support of director nominees other than the Corporation’s nominees in accordance with Rule 14a-19 promulgated under the Exchange Act; and
(iii) As to each candidate whom a Nominating Person proposes to nominate for election as a director, (A) all information relating to such candidate for nomination that is required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors in a contested election pursuant to Section 14(a) under the Exchange Act (including such candidate’s written consent to being named in a proxy statement and accompanying proxy card relating to the Corporation’s next meeting of stockholders at which directors are to be elected and to serving as a director for a full term if elected), (B) a description of any direct or indirect
material interest in any material contract or agreement between or among any Nominating Person, on the one hand, and each candidate for nomination or his or her respective associates (as defined in Rule 14a-1(a) promulgated under the Exchange Act) or any other participants (as defined in paragraphs (a)(ii)-(vi) of Instruction 3 to Item 4 of Schedule 14A) in such solicitation, on the other hand, including, without limitation, all information that would be required to be disclosed pursuant to Item 404 under Regulation S-K if such Nominating Person were the “registrant” for purposes of such rule and the candidate for nomination were a director or executive officer of such registrant (the disclosures to be made pursuant to the foregoing clauses (A) and (B) are referred to as “Nominee Information”), and (C) a completed and signed questionnaire, representation and agreement as provided in Section (e)(a).
For purposes of this Section 2.5, the term “Nominating Person” shall mean (i) the stockholder providing the notice of the nomination proposed to be made at the meeting, (ii) the beneficial owner or beneficial owners, if different, on whose behalf the notice of the nomination proposed to be made at the meeting is made, and (iii) any participant (as defined in paragraphs (a)(ii)-(vi) of Instruction 3 to Item 4 of Schedule 14A) with such stockholder in such solicitation.
(d) The Board may request that any Nominating Person furnish such additional information as may be reasonably required by the Board. Such Nominating Person shall provide such additional information within ten (10) days after it has been requested by the Board.
(e) A stockholder providing notice of any nomination proposed to be made at an annual or special meeting of stockholders shall further update and supplement such notice or the materials delivered pursuant to this Section 2.5, as applicable, if necessary, so that the information provided or required to be provided in such notice pursuant to this Section 2.5 shall be true and correct as of the record date for stockholders entitled to vote at the meeting and as of the date that is ten (10) business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Corporation not later than five (5) business days after the record date for stockholders entitled to vote at the meeting in the case of the update and supplement required to be made as of such record date, and not later than eight (8) business days prior to the date for the meeting or any adjournment or postponement thereof in the case of the update and supplement required to be made as of ten (10) business days prior to the meeting or any adjournment or postponement thereof, provided that, in the case of an adjournment or postponement, if it is not possible to deliver such update and supplement by such date due to an adjournment or postponement of the annual meeting that is less than eight (8) business days, such update or supplement shall be delivered on the first practicable date prior to the date to which such annual meeting has been adjourned or postponed. For the avoidance of doubt, the obligation to update and supplement as set forth in this paragraph or any other Section of these Bylaws shall not limit the Corporation’s rights with respect to any deficiencies in any notice provided by a stockholder, extend any applicable deadlines hereunder or enable or be deemed to permit a stockholder who has previously submitted notice hereunder to amend or update any nomination, including by changing or adding nominees, or to submit any new nomination, or submit any new proposal, matters, business or resolutions proposed to be brought before an annual or special meeting of the stockholders.
(f) In addition to the requirements of this Section 2.5 with respect to any nomination proposed to be made at a meeting of stockholders, each Nominating Person shall comply with all applicable requirements of the Exchange Act with respect to any such nominations. Notwithstanding the foregoing provisions of this Section 2.5, unless otherwise required by law, (i) no Nominating Person shall
solicit proxies in support of director nominees other than the Corporation’s nominees unless such Nominating Person has, or is part of a group that has, complied with Rule 14a-19 promulgated under the Exchange Act in connection with the solicitation of such proxies, including the provision to the Corporation of notices required thereunder in accordance with the time frames required in this Section 2.5 or by Rule 14a-19 promulgated under the Exchange Act, as applicable, and (ii) if (1) any Nominating Person provides notice in accordance with Rule 14a-19(b) promulgated under the Exchange Act and (2) (x) such notice in accordance with Rule 14a-19(b) is not provided within the time period for Timely Notice or Special Meeting Timely Notice, as applicable, (y) such Nominating Person subsequently fails to comply with the requirements of Rule 14a-19(a)(2) or Rule 14a-19(a)(3) promulgated under the Exchange Act or (z) such Nominating Person fails to timely provide reasonable evidence sufficient to satisfy the Corporation that such Nominating Person has met the requirements of Rule 14a-19(a)(3) promulgated under the Exchange Act in accordance with the following sentence, then the nomination of such Nominating Person’s proposed nominees shall be disregarded, notwithstanding that each such nominee is included as a nominee in the Corporation’s proxy statement, notice of meeting or other proxy materials for any meeting of stockholders (or any supplement thereto) and notwithstanding that proxies or votes in respect of the election of such proposed nominees may have been received by the Corporation (which proxies and votes shall be disregarded). If any Nominating Person provides notice in accordance with Rule 14a-19(b) promulgated under the Exchange Act, such Nominating Person shall deliver to the Corporation, no later than seven (7) business days prior to the applicable meeting, reasonable evidence that it has met the requirements of Rule 14a-19(a)(3) promulgated under the Exchange Act.
2.6 Additional Requirements for Valid Nomination of Candidates to Serve as Director and, if Elected, to be Seated as Directors.
(a) To be eligible to be a candidate for election as a director of the Corporation at an annual or special meeting, a candidate must be nominated in the manner prescribed in Section 2.5 and the candidate for nomination, whether nominated by the Board or by a stockholder of record, must have previously delivered, to the Secretary at the principal executive offices of the Corporation, (i) a completed written questionnaire (in the form provided by the Corporation within ten (10) days upon written request of any stockholder of record therefor) with respect to the background, qualifications, stock ownership and independence of such proposed nominee and (ii) a written representation and agreement (in the form provided by the Corporation within ten (10) days upon written request of any stockholder of record therefor) that such candidate for nomination (A) is not and, if elected as a director during his or her term of office, will not become a party to (1) any agreement, arrangement or understanding with, and has not given and will not give any commitment or assurance to, any person or entity as to how such proposed nominee, if elected as a director of the Corporation, will act or vote on any issue or question (a “Voting Commitment”) or (2) any Voting Commitment that could limit or interfere with such proposed nominee’s ability to comply, if elected as a director of the Corporation, with such proposed nominee’s fiduciary duties under applicable law, (B) is not, and will not become a party to, any agreement, arrangement or understanding with any person or entity other than the Corporation with respect to any direct or indirect compensation or reimbursement for service as a director that has not been disclosed therein or to the Corporation, (C) if elected as a director of the Corporation, will comply with all applicable corporate governance, conflict of interest, confidentiality, stock ownership and trading and other policies and guidelines of the Corporation applicable to directors and in effect during such person’s term in office as a director (and, if requested by any candidate for nomination, the Secretary of the Corporation shall provide to such candidate for nomination all such policies and guidelines then in effect), and (D) if elected as a director of the Corporation, intends to serve the entire term until the next meeting at which such candidate would face re-election.
(b) The Board may also require any proposed candidate for nomination as a director to furnish such other information related to such candidate’s eligibility or qualification to serve as a director as may reasonably be requested by the Board in writing prior to the meeting of stockholders at which such candidate’s nomination is to be acted upon. Without limiting the generality of the foregoing, the Board may request such other information in order for the Board to determine the eligibility of such candidate for nomination to be an independent director of the Corporation or to comply with the director qualification standards and additional selection criteria in accordance with the Corporation’s Corporate Governance Guidelines. Such other information shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Corporation not later than five (5) business days after the request by the Board has been delivered to, or mailed and received by, the Nominating Person.
(c) A candidate for nomination as a director shall further update and supplement the materials delivered pursuant to this Section 2.5(e), if necessary, so that the information provided or required to be provided pursuant to this Section 2.5(e) shall be true and correct as of the record date for stockholders entitled to vote at the meeting and as of the date that is ten (10) business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Corporation not later than five (5) business days after the record date for stockholders entitled to vote at the meeting in the case of the update and supplement required to be made as of such record date, and not later than eight (8) business days prior to the date for the meeting or any adjournment or postponement thereof in the case of the update and supplement required to be made as of ten (10) business days prior to the meeting or any adjournment or postponement thereof, provided that, in the case of an adjournment or postponement, if it is not possible to deliver such update and supplement by such date due to an adjournment or postponement of the annual meeting that is less than eight (8) business days, such update or supplement shall be delivered on the first practicable date prior to the date to which such annual meeting has been adjourned or postponed. For the avoidance of doubt, the obligation to update and supplement as set forth in this paragraph or any other Section of these Bylaws shall not limit the Corporation’s rights with respect to any deficiencies in any notice provided by a stockholder, extend any applicable deadlines hereunder or enable or be deemed to permit a stockholder who has previously submitted notice hereunder to amend or update any nomination or to submit any new proposal, including by changing or adding nominees, matters, business or resolutions proposed to be brought before a meeting of the stockholders.
(d) No candidate nominated pursuant to Section 2.5(a)(ii) shall be eligible for nomination as a director of the Corporation unless such candidate for nomination and the Nominating Person seeking to place such candidate’s name in nomination has complied with Section 2.5 and this Section 2.5(e), as applicable. The presiding officer at the meeting shall (or, in advance of any meeting of stockholders, the Board or an authorized committee thereof), if the facts warrant, determine whether a nomination was properly made in accordance with Section 2.5 and this Section 2.5(e), and if the presiding officer or the Board should determine that any nomination was not made in compliance with Section 2.5 and this Section 2.6, the presiding officer or the Board shall so declare such determination to the meeting, the defective nomination shall be disregarded and any ballots cast for the candidate in question (but in the case of any form of ballot listing other qualified nominees, only the ballots cast for the nominee in question) shall be void and of no force or effect.
(e) Notwithstanding anything in these Bylaws to the contrary, no candidate for nomination shall be eligible to be seated as a director of the Corporation unless nominated in accordance with Section 2.5 and this Section 2.5(e) and elected as a director.
2.7 Notice of Stockholders’ Meetings.
Unless otherwise provided by law, the Certificate of Incorporation or these Bylaws, the notice of any meeting of stockholders shall be sent or otherwise given in accordance with Section 8.1 of these Bylaws not less than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder entitled to vote at such meeting. The notice shall specify the place, if any, date and time of the meeting, the means of remote communication, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting, and, in the case of a special meeting of stockholders, the purpose or purposes for which such meeting is called.
2.8 Quorum.
Unless otherwise provided by law, the Certificate of Incorporation or these Bylaws, the holders of a majority in voting power of the stock issued and outstanding and entitled to vote at the meeting, present in person, or by remote communication, if applicable, or represented by proxy, shall constitute a quorum for the transaction of business at all meetings of stockholders. A quorum, once established at a meeting, shall not be broken by the withdrawal of enough votes to leave less than a quorum. If, however, a quorum is not present or represented at any meeting of stockholders, then either (i) the presiding officer of the meeting or (ii) a majority in voting power of the stockholders, present in person, or by remote communication, if applicable, or represented by proxy, and entitled to vote thereon shall have power to adjourn the meeting from time to time in the manner provided in Section 2.9 of these Bylaws until a quorum is present or represented. At any adjourned meeting at which a quorum is present or represented, any business may be transacted that might have been transacted at the meeting as originally noticed.
2.9 Adjourned Meeting; Notice.
When a meeting of stockholders is adjourned to another time or place, unless these Bylaws otherwise require, notice need not be given of the adjourned meeting if the time, place, if any, thereof, and the means of remote communications, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such adjourned meeting are announced at the meeting at which the adjournment is taken or are provided in any other manner permitted by the DGCL. At any adjourned meeting of stockholders, the Corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than thirty (30) days, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. If after the adjournment a new record date for determination of stockholders entitled to vote is fixed for the adjourned meeting, the Board shall fix as the record date for determining stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of stockholders entitled to vote at the adjourned meeting, and shall give notice of the adjourned meeting to each stockholder of record entitled to vote at such meeting as of the record date so fixed for notice of such adjourned meeting.
2.10 Conduct of Business.
Meetings of stockholders shall be presided over by the Chair of the Board, if any, or in his or her absence or at his or her direction by the Chief Executive Officer or in the absence or at the direction of the foregoing persons by a presiding officer, who shall be a director or officer of the Corporation, designated by the Board. The Secretary shall act as Secretary of the meeting, but in his or her absence the chairperson of the meeting may appoint any person to act as Secretary of the meeting. The date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at a meeting of stockholders shall be announced at the meeting by the presiding officer. The Board may adopt
by resolution such rules and regulations for the conduct of the meeting of stockholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as adopted by the Board, the presiding officer of any meeting of stockholders shall have the right and authority to convene and (for any or no reason) to recess and/or adjourn the meeting, to prescribe such rules, regulations and procedures (which need not be in writing) and to do all such acts as, in the judgment of such presiding officer, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, whether adopted by the Board or prescribed by the presiding officer of the meeting, may include, without limitation, the following: (i) the establishment of an agenda or order of business for the meeting; (ii) rules and procedures for maintaining order at the meeting and the safety of those present (including, without limitation, rules and procedures for removal of disruptive persons from the meeting); (iii) limitations on attendance at or participation in the meeting to stockholders entitled to vote at the meeting, their duly authorized and constituted proxies or such other persons as the presiding officer of the meeting shall determine; (iv) restrictions on entry to the meeting after the time fixed for the commencement thereof; and (v) limitations on the time allotted to questions or comments by participants. The presiding officer at any meeting of stockholders, in addition to making any other determinations that may be appropriate to the conduct of the meeting (including, without limitation, determinations with respect to the administration and/or interpretation of any of the rules, regulations or procedures of the meeting, whether adopted by the Board or prescribed by the person presiding over the meeting), (or, in advance of the meeting of stockholders, the Board or an authorized committee thereof) shall, if the facts warrant, determine whether the business or nomination was properly brought before the meeting and if such presiding person or the Board should determine that such business or nomination was not properly brought, such presiding person or the Board shall so declare to the meeting and any such business or nomination not properly brought before the meeting shall not be transacted or considered. Unless and to the extent determined by the Board or the person presiding officer of meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure.
2.11 Voting.
Except as may be otherwise provided in the Certificate of Incorporation or the DGCL, each stockholder shall be entitled to one (1) vote for each share of capital stock of the Corporation held by such stockholder.
Except as otherwise provided by the Certificate of Incorporation, at all duly called or convened meetings of stockholders at which a quorum is present, for the election of directors, a plurality of the votes cast shall be sufficient to elect a director. Except as otherwise provided by the Certificate of Incorporation, these Bylaws, the rules or regulations of any stock exchange applicable to the Corporation, or applicable law or pursuant to any regulation applicable to the Corporation or its securities, in which case such different or minimum vote shall be applicable to the matter, each other matter presented to the stockholders at a duly called or convened meeting at which a quorum is present shall be decided by the majority of the votes cast (excluding abstentions and broker non-votes) on such matter.
2.12 Record Date for Stockholder Meetings and Other Purposes.
In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, the Board may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board, and which record date shall, unless otherwise required by law, not be more than sixty (60) days nor less than ten (10) days before the date of such meeting. If the Board so fixes a date, such date shall also be the record date for determining the stockholders entitled to vote at such meeting unless the Board determines,
at the time it fixes such record date, that a later date on or before the date of the meeting shall be the date for making such determination. If no record date is fixed by the Board, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be the close of business on the next day preceding the day on which notice is first given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board may fix a new record date for determination of stockholders entitled to vote at the adjourned meeting; and in such case shall also fix as the record date for stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of stockholders entitled to vote in accordance herewith at the adjourned meeting.
In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment or any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of capital stock, or for the purposes of any other lawful action, the Board may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than sixty (60) days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board adopts the resolution relating thereto.
If stockholders are permitted to act by consent under the Certificate of Incorporation, in order that the Corporation may determine the stockholders entitled to express consent to corporate action without a meeting, the Board may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board, and which record date shall not be more than ten (10) days after the date upon which the resolution fixing the record date is adopted by the Board. If no record date for determining stockholders entitled to express consent to corporate action without a meeting is fixed by the Board, (i) when no prior action of the Board is required by law, the record date for such purpose shall be the first date on which a signed consent setting forth the action taken or proposed to be taken is delivered to the Corporation in accordance with applicable law, and (ii) if prior action by the Board is required by law, the record date for such purpose shall be at the close of business on the day on which the Board adopts the resolution taking such prior action.
2.13 Proxies.
Each stockholder entitled to vote at a meeting of stockholders may authorize another person or persons to act for such stockholder by proxy authorized by an instrument in writing or by a transmission permitted by law, including Rule 14a-19 promulgated under the Exchange Act, filed in accordance with the procedure established for the meeting, but no such proxy shall be voted or acted upon after three (3) years from its date, unless the proxy provides for a longer period. The revocability of a proxy that states on its face that it is irrevocable shall be governed by the provisions of Section 212 of the DGCL. A proxy may be in the form of an electronic transmission which sets forth or is submitted with information from which it can be determined that the transmission was authorized by the stockholder.
Any stockholder directly or indirectly soliciting proxies from other stockholders must use a proxy card color other than white, which shall be reserved for the exclusive use by the Board.
2.14 List of Stockholders Entitled to Vote.
The Corporation shall prepare, no later than the tenth day before each meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting (provided, however, that if the record date for determining the stockholders entitled to vote is less than ten (10) days before the date of the meeting, the list shall reflect the stockholders entitled to vote as of the tenth day before the meeting date), arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. The Corporation shall not be required to include electronic mail addresses or other electronic contact information on such list. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting for a period of ten (10) days ending on the day before the meeting date: (i) on a reasonably accessible electronic network, provided that the information required to gain access to such list is provided with the notice of the meeting, or (ii) during ordinary business hours, at the Corporation’s principal executive office. In the event that the Corporation determines to make the list available on an electronic network, the Corporation may take reasonable steps to ensure that such information is available only to stockholders of the Corporation. Such list shall presumptively determine the identity of the stockholders entitled to vote at the meeting and the number of shares held by each of them. Except as otherwise provided by law, the stock ledger shall be the only evidence as to who are the stockholders entitled to examine the list of stockholders required by this Section 2.14 or to vote in person or by proxy at any meeting of stockholders.
2.15 Inspectors of Election.
Before any meeting of stockholders, the Corporation shall appoint an inspector or inspectors of election to act at the meeting or its adjournment and make a written report thereof. The Corporation may designate one or more persons as alternate inspectors to replace any inspector who fails to act. If any person appointed as inspector or any alternate fails to appear or fails or refuses to act, then the person presiding over the meeting shall appoint a person to fill that vacancy.
Such inspectors shall:
(a) determine the number of shares outstanding and the voting power of each, the number of shares represented at the meeting and the validity of any proxies and ballots;
(b) count all votes or ballots;
(c) count and tabulate all votes;
(d) determine and retain for a reasonable period a record of the disposition of any challenges made to any determination by the inspector(s); and
(e) certify its or their determination of the number of shares represented at the meeting and its or their count of all votes and ballots.
Each inspector, before entering upon the discharge of the duties of inspector, shall take and sign an oath faithfully to execute the duties of inspection with strict impartiality and according to the best of such inspector’s ability. Any report or certificate made by the inspectors of election is prima facie evidence of the facts stated therein. The inspectors of election may appoint such persons to assist them in performing their duties as they determine.
2.16 Delivery to the Corporation.
Other than as permitted by Section 2.13, whenever this Article II requires one or more persons (including a record or beneficial owner of stock) to deliver a document or information to the Corporation or any officer, employee or agent thereof (including any notice, request, questionnaire, revocation, representation or other document or agreement), such document or information shall be in writing exclusively (and not in an electronic transmission) and shall be delivered exclusively by hand (including, without limitation, overnight courier service) or by certified or registered mail, return receipt requested, and the Corporation shall not be required to accept delivery of any document not in such written form or so delivered. For the avoidance of doubt, the Corporation expressly opts out of Section 116 of the DGCL with respect to the delivery of information and documents to the Corporation required by this Article II (other than as permitted by Section 2.13).
Article III - Directors
3.1 Powers.
Except as otherwise provided by the Certificate of Incorporation or the DGCL, the business and affairs of the Corporation shall be managed by or under the direction of the Board.
3.2 Number of Directors.
Subject to the Certificate of Incorporation, the total number of directors constituting the Board shall be determined from time to time exclusively by resolution of the Board. No reduction of the authorized number of directors shall have the effect of removing any director before that director’s term of office expires.
3.3 Election, Qualification and Term of Office of Directors.
Except as provided in Section 3.4 of these Bylaws, and subject to the Certificate of Incorporation, each director, including a director elected to fill a vacancy or newly created directorship, shall hold office until the expiration of the term of the class, if any, for which elected and until such director’s successor is elected and qualified or until such director’s earlier death, resignation, disqualification or removal. Directors need not be stockholders. The Certificate of Incorporation or these Bylaws may prescribe qualifications for directors.
3.4 Resignation and Vacancies.
Any director may resign at any time upon notice given in writing or by electronic transmission to the Corporation. The resignation shall take effect at the time specified therein or upon the happening of an event specified therein, and if no time or event is specified, at the time of its receipt. When one or more directors so resigns and the resignation is effective at a future date or upon the happening of an event to occur on a future date, a majority of the directors then in office, including those who have so resigned, shall have power to fill such vacancy or vacancies, the vote thereon to take effect when such resignation or resignations shall become effective, and each director so chosen shall hold office as provided in Section 3.3.
Unless otherwise provided in the Certificate of Incorporation or these Bylaws, vacancies resulting from the death, resignation, disqualification or removal of any director, and newly created directorships
resulting from any increase in the authorized number of directors shall be filled only by a majority of the directors then in office, although less than a quorum, or by a sole remaining director.
3.5 Place of Meetings; Meetings by Telephone.
The Board may hold meetings, both regular and special, either within or outside the State of Delaware.
Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, members of the Board, or any committee designated by the Board, may participate in a meeting of the Board, or any committee, by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting pursuant to this Bylaw shall constitute presence in person at the meeting.
3.6 Regular Meetings.
Regular meetings of the Board may be held within or outside the State of Delaware and at such time and at such place as which has been designated by the Board and publicized among all directors, either orally or in writing, by telephone, including a voice-messaging system or other system designed to record and communicate messages, facsimile, or by electronic mail or other means of electronic transmission. No further notice shall be required for regular meetings of the Board.
3.7 Special Meetings; Notice.
Special meetings of the Board for any purpose or purposes may be called at any time by the chairperson of the Board, the Chief Executive Officer, the President, the Secretary or a majority of the total number of directors constituting the Board.
Notice of the time and place of special meetings shall be:
(a) delivered personally by hand, by courier or by telephone;
(b) sent by United States first-class mail, postage prepaid;
(c) sent by facsimile or electronic mail; or
(d) sent by other means of electronic transmission,
directed to each director at that director’s address, telephone number, facsimile number or electronic mail address, or other address for electronic transmission, as the case may be, as shown on the Corporation’s records.
If the notice is (i) delivered personally by hand, by courier or by telephone, (ii) sent by facsimile or electronic mail, or (iii) sent by other means of electronic transmission, it shall be delivered or sent at least twenty-four (24) hours before the time of the holding of the meeting. If the notice is sent by U.S. mail, it shall be deposited in the U.S. mail at least four (4) days before the time of the holding of the meeting. The notice need not specify the place of the meeting (if the meeting is to be held at the Corporation’s principal executive office) nor the purpose of the meeting.
3.8 Quorum.
At all meetings of the Board, unless otherwise provided by the Certificate of Incorporation, a majority of the total number of directors shall constitute a quorum for the transaction of business. The vote of a majority of the directors present at any meeting at which a quorum is present shall be the act of the Board, except as may be otherwise specifically provided by statute, the Certificate of Incorporation or these Bylaws.
3.9 Board Action without a Meeting.
Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the Board, or of any committee thereof, may be taken without a meeting if all members of the Board or committee, as the case may be, consent thereto in writing or by electronic transmission. After an action is taken, the consent or consents relating thereto shall be filed with the minutes of the proceedings of the Board, or the committee thereof, in the same paper or electronic form as the minutes are maintained. Such action by written consent or consent by electronic transmission shall have the same force and effect as a unanimous vote of the Board.
3.10 Fees and Compensation of Directors.
Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, the Board shall have the authority to fix the compensation, including fees and reimbursement of expenses, of directors for services to the Corporation in any capacity.
Article IV - Committees
4.1 Committees of Directors.
The Board may designate one (1) or more committees, each committee to consist, of one (1) or more of the directors of the Corporation. The Board may designate one (1) or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member of the Board to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board or in these Bylaws, shall have and may exercise all the powers and authority of the Board in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers that may require it; but no such committee shall have the power or authority to (i) approve or adopt, or recommend to the stockholders, any action or matter (other than the election or removal of directors) expressly required by the DGCL to be submitted to stockholders for approval, or (ii) adopt, amend or repeal any bylaw of the Corporation.
4.2 Committee Minutes.
Each committee shall keep regular minutes of its meetings and report the same to the Board when required.
4.3 Meetings and Actions of Committees.
Meetings and actions of committees shall be governed by, and held and taken in accordance with, the provisions of:
(i) Section 3.5 (place of meetings; meetings by telephone);
(ii) Section 3.6 (regular meetings);
(iii) Section 3.7 (special meetings; notice);
(iv) Section 3.9 (board action without a meeting); and
(v) Section 7.13 (waiver of notice),
with such changes in the context of those bylaws as are necessary to substitute the committee and its members for the Board and its members. However:
(i) the time of regular meetings of committees may be determined either by resolution of the Board or by resolution of the committee;
(ii) special meetings of committees may also be called by resolution of the Board or the chairperson of the applicable committee; and
(iii) the Board may adopt rules for the governance of any committee to override the provisions that would otherwise apply to the committee pursuant to this Section 4.3, provided that such rules do not violate the provisions of the Certificate of Incorporation or applicable law.
4.4 Subcommittees.
Unless otherwise provided in the Certificate of Incorporation, these Bylaws or the resolutions of the Board designating the committee, a committee may create one (1) or more subcommittees, each subcommittee to consist of one (1) or more members of the committee, and delegate to a subcommittee any or all of the powers and authority of the committee.
Article V - Officers
5.1 Officers.
The officers of the Corporation shall include a Chief Executive Officer, a President and a Secretary. The Corporation may also have, at the discretion of the Board, a Chairperson of the Board, a Vice Chairperson of the Board, a Chief Financial Officer, a Treasurer, one (1) or more Vice Presidents, one (1) or more Assistant Vice Presidents, one (1) or more Assistant Treasurers, one (1) or more Assistant Secretaries, and any such other officers as may be appointed in accordance with the provisions of these Bylaws. Any number of offices may be held by the same person. No officer need be a stockholder or director of the Corporation.
5.2 Appointment of Officers.
The Board shall appoint the officers of the Corporation, except such officers as may be appointed in accordance with the provisions of Section 5.3 of these Bylaws.
5.3 Subordinate Officers.
The Board may appoint, or empower the Chief Executive Officer or, in the absence of a Chief Executive Officer, the President, to appoint, such other officers and agents as the business of the Corporation may require. Each of such officers and agents shall hold office for such period, have such authority, and perform such duties as are provided in these Bylaws or as the Board may from time to time determine.
5.4 Removal and Resignation of Officers.
Subject to the rights, if any, of an officer under any contract of employment, any officer may be removed, either with or without cause, by the Board, provided that, if the Board has empowered the Chief Executive Officer or, in the absence of a Chief Executive Officer, the President, to appoint any officer of the Corporation in accordance with the provisions of Section 5.3 of these Bylaws, then such officer may also be removed, with or without cause, by the Chief Executive Officer or the President, as applicable.
Any officer may resign at any time by giving notice in writing or by electronic transmission to the Corporation. Any resignation shall take effect at the date of the receipt of that notice or at any later time specified in that notice. Unless otherwise specified in the notice of resignation, the acceptance of the resignation shall not be necessary to make it effective. Any resignation is without prejudice to the rights, if any, of the Corporation under any contract to which the officer is a party.
5.5 Vacancies in Offices.
Any vacancy occurring in any office of the Corporation shall be filled by the Board or as provided in Section 5.2 and Section 5.3.
5.6 Representation of Shares of Other Corporations.
The Chairperson of the Board, the Chief Executive Officer, or the President of this Corporation, or any other person authorized by the Board, the Chief Executive Officer or the President, is authorized to vote, represent and exercise on behalf of this Corporation all rights incident to any and all shares or voting securities of any other corporation or other person standing in the name of this Corporation. The authority granted herein may be exercised either by such person directly or by any other person authorized to do so by proxy or power of attorney duly executed by such person having the authority.
5.7 Authority and Duties of Officers.
All officers of the Corporation shall respectively have such authority and perform such duties in the management of the business of the Corporation as may be provided herein or designated from time to time by the Board or, if the Board has empowered the Chief Executive Officer or, in the absence of a Chief Executive Officer, the President, to appoint any officer of the Corporation in accordance with the provisions of Section 5.3 of these Bylaws, by the Chief Executive Officer or President, as applicable, with respect to such officers appointed by the Chief Executive Officer or the President, as applicable, and, to
the extent not so provided, as generally pertain to their respective offices, subject to the control of the Board.
5.8 Compensation.
The compensation of the officers of the Corporation for their services as such shall be fixed from time to time by or at the direction of the Board. An officer of the Corporation shall not be prevented from receiving compensation by reason of the fact that he or she is also a director of the Corporation.
Article VI - Records
A stock ledger consisting of one or more records in which the names of all of the Corporation’s stockholders of record, the address and number of shares registered in the name of each such stockholder, and all issuances and transfers of stock of the Corporation are recorded in accordance with Section 224 of the DGCL shall be administered by or on behalf of the Corporation. Any records administered by or on behalf of the Corporation in the regular course of its business, including its stock ledger, books of account, and minute books, may be kept on, or by means of, or be in the form of, any information storage device, or method, or one or more electronic networks or databases (including one or more distributed electronic networks or databases), provided that the records so kept can be converted into clearly legible paper form within a reasonable time and, with respect to the stock ledger, that the records so kept (i) can be used to prepare the list of stockholders specified in Sections 219 and 220 of the DGCL, (ii) record the information specified in Sections 156, 159, 217(a) and 218 of the DGCL, and (iii) record transfers of stock as governed by Article 8 of the Uniform Commercial Code as adopted in the State of Delaware.
Article VII - General Matters
7.1 Execution of Corporate Contracts and Instruments.
The Board, except as otherwise provided in these Bylaws, may authorize any officer or officers, or agent or agents of the Corporation, to enter into any contract or execute any instrument in the name of and on behalf of the Corporation; such authority may be general or confined to specific instances.
7.2 Stock Certificates.
The shares of the Corporation shall be represented by certificates, provided that the Board by resolution may provide that some or all of the shares of any class or series of stock of the Corporation shall be uncertificated. Certificates for the shares of stock, if any, shall be in such form as is consistent with the Certificate of Incorporation and applicable law. Every holder of stock represented by a certificate shall be entitled to have a certificate signed by, or in the name of the Corporation by, any two officers authorized to sign stock certificates representing the number of shares registered in certificate form. Without limiting any other officer who may hereafter be authorized to sign stock certificates on behalf of the Corporation, the Chairperson or Vice Chairperson of the Board, Chief Executive Officer, the President, Vice President, the Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary of the Corporation are specifically authorized to sign stock certificates. Any or all of the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate has ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he or she were such officer, transfer agent or registrar at the date of issue.
The Corporation may issue the whole or any part of its shares as partly paid and subject to call for the remainder of the consideration to be paid therefor. Upon the face or back of each stock certificate issued to represent any such partly paid shares, or upon the books and records of the Corporation in the case of uncertificated partly paid shares, the total amount of the consideration to be paid therefor and the amount paid thereon shall be stated. Upon the declaration of any dividend on fully paid shares, the Corporation shall declare a dividend upon partly paid shares of the same class, but only upon the basis of the percentage of the consideration actually paid thereon.
7.3 Special Designation of Certificates.
If the Corporation is authorized to issue more than one class of stock or more than one series of any class, then the powers, the designations, the preferences and the relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights shall be set forth in full or summarized on the face or on the back of the certificate that the Corporation shall issue to represent such class or series of stock (or, in the case of uncertificated shares, set forth in a notice provided pursuant to Section 151 of the DGCL); provided, however, that except as otherwise provided in Section 202 of the DGCL, in lieu of the foregoing requirements, there may be set forth on the face or back of the certificate that the Corporation shall issue to represent such class or series of stock (or, in the case of any uncertificated shares, included in the aforementioned notice) a statement that the Corporation will furnish without charge to each stockholder who so requests the powers, the designations, the preferences and the relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights.
7.4 Lost Certificates.
Except as provided in this Section 7.4, no new certificates for shares or uncertificated shares shall be issued to replace a previously issued certificate unless the latter is surrendered to the Corporation and cancelled at the same time. The Corporation may issue a new certificate of stock or uncertificated shares in the place of any certificate theretofore issued by it, alleged to have been lost, stolen or destroyed, and the Corporation may require the owner of the lost, stolen or destroyed certificate, or such owner’s legal representative, to give the Corporation a bond sufficient to indemnify it against any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate or uncertificated shares.
7.5 Shares Without Certificates
The Corporation may adopt a system of issuance, recordation and transfer of its shares of stock by electronic or other means not involving the issuance of certificates, provided the use of such system by the Corporation is permitted in accordance with applicable law.
7.6 Construction; Definitions.
Unless the context requires otherwise, the general provisions, rules of construction and definitions in the DGCL shall govern the construction of these Bylaws. Without limiting the generality of this provision, the singular number includes the plural and the plural number includes the singular.
7.7 Dividends.
The Board, subject to any restrictions contained in either (i) the DGCL or (ii) the Certificate of Incorporation, may declare and pay dividends upon the shares of its capital stock. Dividends may be paid in cash, in property or in shares of the Corporation’s capital stock.
The Board may set apart out of any of the funds of the Corporation available for dividends a reserve or reserves for any proper purpose and may abolish any such reserve. Such purposes shall include but not be limited to equalizing dividends, repairing or maintaining any property of the Corporation, and meeting contingencies.
7.8 Fiscal Year.
The fiscal year of the Corporation shall be fixed by resolution of the Board and may be changed by the Board.
7.9 Seal.
The Corporation may adopt a corporate seal, which shall be adopted and which may be altered by the Board. The Corporation may use the corporate seal by causing it or a facsimile thereof to be impressed or affixed or in any other manner reproduced.
7.10 Transfer of Stock.
Shares of the Corporation shall be transferable in the manner prescribed by law and in these Bylaws. Shares of stock of the Corporation shall be transferred on the books of the Corporation only by the holder of record thereof or by such holder’s attorney duly authorized in writing, upon surrender to the Corporation of the certificate or certificates representing such shares endorsed by the appropriate person or persons (or by delivery of duly executed instructions with respect to uncertificated shares), with such evidence of the authenticity of such endorsement or execution, transfer, authorization and other matters as the Corporation may reasonably require, and accompanied by all necessary stock transfer stamps. No transfer of stock shall be valid as against the Corporation for any purpose until it shall have been entered in the stock records of the Corporation by an entry showing the names of the persons from and to whom it was transferred.
7.11 Stock Transfer Agreements.
The Corporation shall have power to enter into and perform any agreement with any number of stockholders of any one or more classes or series of stock of the Corporation to restrict the transfer of shares of stock of the Corporation of any one or more classes owned by such stockholders in any manner not prohibited by the DGCL.
7.12 Registered Stockholders.
Except as otherwise provided by applicable law, the Corporation:
(a) shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends and to vote as such owner; and
(b) shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of another person, whether or not it shall have express or other notice thereof.
7.13 Waiver of Notice.
Whenever notice is required to be given under any provision of the DGCL, the Certificate of Incorporation or these Bylaws, a written waiver, signed by the person entitled to notice, or a waiver by electronic transmission by the person entitled to notice, whether before or after the time of the event for which notice is to be given, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any annual or special meeting of the stockholders need be specified in any written waiver of notice or any waiver by electronic transmission unless so required by the Certificate of Incorporation or these Bylaws.
Article VIII - Notice
8.1 Delivery of Notice; Notice by Electronic Transmission.
Without limiting the manner by which notice otherwise may be given effectively to stockholders, any notice to stockholders given by the Corporation under any provisions of the DGCL, the Certificate of Incorporation, or these Bylaws may be given in writing directed to the stockholder’s mailing address (or by electronic transmission directed to the stockholder’s electronic mail address, as applicable) as it appears on the records of the Corporation and shall be given (1) if mailed, when the notice is deposited in the U.S. mail, postage prepaid, (2) if delivered by courier service, the earlier of when the notice is received or left at such stockholder’s address or (3) if given by electronic mail, when directed to such stockholder’s electronic mail address unless the stockholder has notified the Corporation in writing or by electronic transmission of an objection to receiving notice by electronic mail. A notice by electronic mail must include a prominent legend that the communication is an important notice regarding the Corporation.
Without limiting the manner by which notice otherwise may be given effectively to stockholders, any notice to stockholders given by the Corporation under any provision of the DGCL, the Certificate of Incorporation or these Bylaws shall be effective if given by a form of electronic transmission consented to by the stockholder to whom the notice is given. Any such consent shall be revocable by the stockholder by written notice or electronic transmission to the Corporation. Notwithstanding the provisions of this paragraph, the Corporation may give a notice by electronic mail in accordance with the first paragraph of this section without obtaining the consent required by this paragraph.
Any notice given pursuant to the preceding paragraph shall be deemed given:
(i) if by facsimile telecommunication, when directed to a number at which the stockholder has consented to receive notice;
(ii) if by a posting on an electronic network together with separate notice to the stockholder of such specific posting, upon the later of (A) such posting and (B) the giving of such separate notice; and
(iii) if by any other form of electronic transmission, when directed to the stockholder.
Notwithstanding the foregoing, a notice may not be given by an electronic transmission from and after the time that (1) the Corporation is unable to deliver by such electronic transmission two (2) consecutive notices given by the Corporation and (2) such inability becomes known to the Secretary or an Assistant Secretary of the Corporation or to the transfer agent, or other person responsible for the giving of notice, provided, however, the inadvertent failure to discover such inability shall not invalidate any meeting or other action.
An affidavit of the Secretary or an Assistant Secretary or of the transfer agent or other agent of the Corporation that the notice has been given shall, in the absence of fraud, be prima facie evidence of the facts stated therein.
Article IX - Indemnification
9.1 Indemnification of Directors and Officers.
The Corporation shall indemnify and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended, any director or officer of the Corporation (a “covered person”) who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (a “Proceeding”) by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was a director or officer of the Corporation or, while serving as a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust, enterprise or non-profit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including attorneys’ fees, judgments, fines ERISA excise taxes or penalties and amounts paid in settlement) reasonably incurred by such person in connection with any such Proceeding. Notwithstanding the preceding sentence, except as otherwise provided in Section 9.4, the Corporation shall be required to indemnify a person in connection with a Proceeding initiated by such person only if the Proceeding was authorized in the specific case by the Board.
9.2 Indemnification of Others.
The Corporation shall have the power to indemnify and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended, any employee or agent of the Corporation who was or is made or is threatened to be made a party or is otherwise involved in any Proceeding by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was an employee or agent of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust, enterprise or non-profit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses reasonably incurred by such person in connection with any such Proceeding.
9.3 Prepayment of Expenses.
The Corporation shall, to the fullest extent not prohibited by applicable law, pay the expenses (including attorneys’ fees) incurred by any covered person, and may pay the expenses incurred by any employee or agent of the Corporation, in defending any Proceeding in advance of its final disposition;
provided, however, that such payment of expenses in advance of the final disposition of the Proceeding shall be made only upon receipt of an undertaking by the person to repay all amounts advanced if it should be ultimately determined that the person is not entitled to be indemnified under this Article IX or otherwise.
9.4 Determination; Claim.
If a claim for indemnification (following the final disposition of such Proceeding) under this Article IX is not paid in full within sixty (60) days, or a claim for advancement of expenses under this Article IX is not paid in full within thirty (30) days, after a written claim therefor has been received by the Corporation the claimant may thereafter (but not before) file suit to recover the unpaid amount of such claim and, if successful in whole or in part, shall be entitled to be paid the expense of prosecuting such claim to the fullest extent permitted by law. In any such action the Corporation shall have the burden of proving that the claimant was not entitled to the requested indemnification or payment of expenses under applicable law.
9.5 Non-Exclusivity of Rights.
The rights conferred on any person by this Article IX shall not be exclusive of any other rights which such person may have or hereafter acquire under any statute, provision of the Certificate of Incorporation, these Bylaws, agreement, vote of stockholders or disinterested directors or otherwise.
9.6 Insurance.
The Corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust enterprise or non-profit entity against any liability asserted against him or her and incurred by him or her in any such capacity, or arising out of his or her status as such, whether or not the Corporation would have the power to indemnify him or her against such liability under the provisions of the DGCL.
9.7 Other Indemnification.
The Corporation’s obligation, if any, to indemnify or advance expenses to any person who was or is serving at its request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, enterprise or non-profit entity shall be reduced by any amount such person may collect as indemnification or advancement of expenses from such other corporation, partnership, joint venture, trust, enterprise or non-profit enterprise.
9.8 Continuation of Indemnification.
The rights to indemnification and to prepayment of expenses provided by, or granted pursuant to, this Article IX shall continue notwithstanding that the person has ceased to be a director or officer of the Corporation and shall inure to the benefit of the estate, heirs, executors, administrators, legatees and distributees of such person.
9.9 Amendment or Repeal; Interpretation.
The provisions of this Article IX shall constitute a contract between the Corporation, on the one hand, and, on the other hand, each individual who serves or has served as a director or officer of the
Corporation (whether before or after the adoption of these Bylaws), in consideration of such person’s performance of such services, and pursuant to this Article IX the Corporation intends to be legally bound to each such current or former director or officer of the Corporation. With respect to current and former directors and officers of the Corporation, the rights conferred under this Article IX are present contractual rights and such rights are fully vested, and shall be deemed to have vested fully, immediately upon adoption of theses Bylaws. With respect to any directors or officers of the Corporation who commence service following adoption of these Bylaws, the rights conferred under this provision shall be present contractual rights and such rights shall fully vest, and be deemed to have vested fully, immediately upon such director or officer commencing service as a director or officer of the Corporation. Any repeal or modification of the foregoing provisions of this Article IX shall not adversely affect any right or protection (i) hereunder of any person in respect of any act or omission occurring prior to the time of such repeal or modification or (ii) under any agreement providing for indemnification or advancement of expenses to an officer or director of the Corporation in effect prior to the time of such repeal or modification.
Any reference to an officer of the Corporation in this Article IX shall be deemed to refer exclusively to the Chief Executive Officer, President, and Secretary, or other officer of the Corporation appointed by (x) the Board pursuant to Article V of these Bylaws or (y) an officer to whom the Board has delegated the power to appoint officers pursuant to Article V of these Bylaws, and any reference to an officer of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise shall be deemed to refer exclusively to an officer appointed by the board of directors (or equivalent governing body) of such other entity pursuant to the certificate of incorporation and bylaws (or equivalent organizational documents) of such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise. The fact that any person who is or was an employee of the Corporation or an employee of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise has been given or has used the title of “Vice President” or any other title that could be construed to suggest or imply that such person is or may be an officer of the Corporation or of such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise shall not result in such person being constituted as, or being deemed to be, an officer of the Corporation or of such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise for purposes of this Article IX.
Article X - Amendments
The Board is expressly empowered to adopt, amend or repeal these Bylaws. The stockholders also shall have power to adopt, amend or repeal these Bylaws; provided, however, that such action by stockholders shall require, in addition to any other vote required by the Certificate of Incorporation or applicable law, the affirmative vote of the holders of at least two-thirds of the voting power of all the then-outstanding shares of voting stock of the Corporation entitled to vote thereon, voting together as a single class.
Article XI - Definitions
As used in these Bylaws, unless the context otherwise requires, the following terms shall have the following meanings:
An “electronic transmission” means any form of communication, not directly involving the physical transmission of paper, including the use of, or participation in, one or more electronic networks
or databases (including one or more distributed electronic networks or databases), that creates a record that may be retained, retrieved and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a recipient through an automated process.
An “electronic mail” means an electronic transmission directed to a unique electronic mail address (which electronic mail shall be deemed to include any files attached thereto and any information hyperlinked to a website if such electronic mail includes the contact information of an officer or agent of the Corporation who is available to assist with accessing such files and information).
An “electronic mail address” means a destination, commonly expressed as a string of characters, consisting of a unique user name or mailbox (commonly referred to as the “local part” of the address) and a reference to an internet domain (commonly referred to as the “domain part” of the address), whether or not displayed, to which electronic mail can be sent or delivered.
The term “person” means any individual, general partnership, limited partnership, limited liability company, corporation, trust, business trust, joint stock company, joint venture, unincorporated association, cooperative or association or any other legal entity or organization of whatever nature, and shall include any successor (by merger or otherwise) of such entity.
| | | | | | | | | | | |
| Number *0* | | | Shares *0* |
| | | |
| | | |
| SEE REVERSE FOR IMPORTANT NOTICE |
| ON TRANSFER RESTRICTIONS |
| AND OTHER INFORMATION |
| | | |
| | | | | | | | | | | | | | | | | | | | |
| THIS CERTIFICATE IS TRANSFERABLE | | | CUSIP | |
| | IN THE CITIES OF | | | | |
| | | | | | |
Voyager Technologies, Inc.
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
THIS CERTIFIES THAT **Specimen** is the owner of **Zero (0)** fully paid and nonassessable shares of Class A Common Stock, $0.0001 par value per share, of
Voyager Technologies, Inc.
(the “Company”) transferable on the books of the Company by the holder hereof in person or by its duly authorized attorney, upon surrender of this Certificate properly endorsed. This Certificate and the shares represented hereby are issued and shall be held subject to all of the provisions of the Certificate of Incorporation, as amended, and the Bylaws, as amended, of the Company (copies of which are on file with the Company and with the Transfer Agent), to all of which each holder, by acceptance hereof, assents. This Certificate is not valid unless countersigned and registered by the Transfer Agent and Registrar.
IN WITNESS WHEREOF, the Company has caused this Certificate to be executed on its behalf by its duly authorized officers.
| | | | | | | | | | | | | | | | | | | | |
| DATED: | | | | | |
| | | | | | |
| Countersigned and Registered: | | | | |
| Transfer Agent | | | | (SEAL) |
| and Registrar | | Dylan Taylor | | |
| | | | Chief Executive Officer | | |
| By: | | | | | |
| Authorized Signature | | Matthew Kuta | | |
| | | | President | | |
IMPORTANT NOTICE
THE COMPANY WILL FURNISH WITHOUT CHARGE TO EACH SHAREHOLDER WHO SO REQUESTS, A SUMMARY OF THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OF THE COMPANY AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND RIGHTS, AND THE VARIATIONS IN RIGHTS, PREFERENCES AND LIMITATIONS DETERMINED FOR EACH SERIES, WHICH ARE FIXED BY THE CERTIFICATE OF INCORPORATION OF THE COMPANY, AS AMENDED, AND THE RESOLUTIONS OF THE BOARD OF DIRECTORS OF THE COMPANY, AND THE AUTHORITY OF THE BOARD OF DIRECTORS TO DETERMINE VARIATIONS FOR FUTURE SERIES. SUCH ERQUEST MAY BE MADE TO THE OFFICE OF THE SECRETARY OF THE COMPANY OR TO THE TRANSFER AGENT. THE BOARD OF DIRECTORS MAY REQUIRE THE OWNER OF A LOST OR DESTROYED STOCK CERTIFICATE, OR HIS LEGAL REPRESENTATIVES, TO GIVE THE COMPANY A BOND TO INDEMNIFY IT AND ITS TRANSFER AGENTS AND REGISTRATS AGAINST ANY CLAIM THAT MAY BE MADE AGAINST THEM ON ACCOUNT OF THE ALLEGED LOSS OR DESTRUCTION OF ANY SUCH CERTIFICATE.
The following abbreviations, when used in the inscription on the face of this Certificate, shall be construed as though they were written out in full according to applicable laws or regulations:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| TEN COM | | as tenants in common | UNIF GIFT MIN ACT | | Custodian | | |
| TEN ENT | | as tenants by the entireties | | (Custodian) | | (Minor) | |
| JT TEN | | as joint tenants with right of | Under the Uniform Gifts to Minors Act of | | | |
| | | survivorship and not as tenants in common | | | | (State) | |
| | | | | | | | | | | | | | |
| FOR VALUE RECEIVED, | | HEREBY SELLS, ASSIGNS AND TRANSFERS UNTO | |
| | | | |
| (NAME & ADDRESS, INCLUDING ZIP CODE & SS# OR OTHER IDENTIFYING # OF ASSIGNEE) | |
| | (__________) shares of the Class A Common Stock represented by this Certificate and does hereby irrevocably constitute and appoint |
| | | attorney to transfer the said shares on the books of the within-named Company, with full power of substitution in the premises. |
| | | | | | | | | | | | | | |
| Dated: | | | | |
| | | | |
| | | | |
| Signature: | | | |
| | | | |
| | | | |
| Signature: | | | |
| | NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH
THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY OTHER CHANGE. |
| | | | |
| | | | | | | | | | | | | | |
| SIGNATURE(S) GUARANTEED: | | |
| | | | |
| | | | |
| | | | |
THE SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15. |
| | | | | | | | | | | |
| 1271 Avenue of the Americas New York, New York 10020-1401 Tel: +1.212.906.1200 Fax: +1.212.751.4864 www.lw.com | Exhibit 5.1 |
| | | |
| FIRM / AFFILIATE OFFICES | |
| Austin | Milan | |
| Beijing | Munich | |
| Boston | New York | |
| Brussels | Orange County | |
| Century City | Paris | |
| Chicago | Riyadh | |
| Dubai | San Diego | |
| Düsseldorf | San Francisco | |
| Frankfurt | Seoul | |
| Hamburg | Silicon Valley | |
| Hong Kong | Singapore | |
| Houston | Tel Aviv | |
| London | Tokyo | |
| Los Angeles | Washington, D.C. | |
| Madrid | | |
June 2, 2025
Voyager Technologies, Inc.
1225 17th Street, Suite 1100
Denver, Colorado 80202
Re: Registration Statement No. 333-287354
12,650,000 shares of Class A common stock, $0.0001 par value per share
To the addressee set forth above:
We have acted as special counsel to Voyager Technologies, Inc., a Delaware corporation (the “Company”), in connection with the proposed issuance of up to 12,650,000 shares (including shares subject to the underwriters’ option to purchase additional shares) of Class A common stock, $0.0001 par value per share (the “Shares”). The Shares are included in a registration statement on Form S–1 under the Securities Act of 1933, as amended (the “Act”), initially filed with the Securities and Exchange Commission (the “Commission”) on May 16, 2025 (Registration No. 333–287354) (as amended, the “Registration Statement”). The term “Shares” shall include any additional shares of Class A common stock registered by the Company pursuant to Rule 462(b) under the Act in connection with the offering contemplated by the Registration Statement. This opinion is being furnished in connection with the requirements of Item 601(b)(5) of Regulation S-K under the Act, and no opinion is expressed herein as to any matter pertaining to the contents of the Registration Statement or related Prospectus, other than as expressly stated herein with respect to the issue of the Shares.
As such counsel, we have examined such matters of fact and questions of law as we have considered appropriate for purposes of this letter. With your consent, we have relied upon certificates and other assurances of officers of the Company and others as to factual matters without having independently verified such factual matters. We are opining herein as to the General Corporation Law of the State of Delaware (the “DGCL”), and we express no opinion with respect to any other laws.
Subject to the foregoing and the other matters set forth herein, it is our opinion that, as of the date hereof, when the Shares shall have been duly registered on the books of the transfer agent and registrar therefor in the name or on behalf of the purchasers and have been issued by the Company against payment therefor (not less than par value) in the circumstances contemplated by the form of underwriting agreement most recently filed as an exhibit to the Registration Statement, the issue and sale of the Shares will have been duly authorized by all
necessary corporate action of the Company and the Shares will be validly issued, fully paid and nonassessable. In rendering the foregoing opinion, we have assumed that the Company will comply with all applicable notice requirements regarding uncertificated shares provided in the DGCL.
This opinion is for your benefit in connection with the Registration Statement and may be relied upon by you and by persons entitled to rely upon it pursuant to the applicable provisions of the Act. We consent to your filing this opinion as an exhibit to the Registration Statement and to the reference to our firm in the Prospectus under the heading “Legal Matters.” We further consent to the incorporation by reference of this letter and consent into any registration statement filed pursuant to Rule 462(b) with respect to the Shares. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission thereunder.
Sincerely,
/s/ Latham & Watkins LLP
LOAN AND SECURITY AGREEMENT
THIS LOAN AND SECURITY AGREEMENT is made and dated as of June 28, 2024 and is entered into by and among Voyager Space Holdings, Inc., a Delaware corporation (“Company”), and each other Person that has delivered a Joinder Agreement pursuant to Section 7.13 from time to time party hereto (together with Company, individually or collectively, as the context may require, “Borrower”), each Original Guarantor and each Additional Guarantor from time to time party hereto the several banks and other financial institutions or entities from time to time party hereto as lenders (each, a “Lender”, and collectively “Lenders”) and HERCULES CAPITAL, INC., a Maryland corporation, in its capacity as administrative agent and collateral agent for itself and Lenders (in such capacity, including any successors or assigns, “Agent”).
RECITALS
A. The Loan Parties have requested Lenders make available to Borrower a term loan in an aggregate principal amount of Fifty-Eight Million Dollars ($58,000,000) (the “Term Loan”); and
B. Lenders are willing to make the Term Loan on the terms and conditions set forth in this Agreement.
AGREEMENT
NOW, THEREFORE, Loan Parties, Agent and Lenders agree as follows:
SECTION 1. DEFINITIONS AND RULES OF CONSTRUCTION
1.1 Unless otherwise defined herein, the following capitalized terms shall have the following meanings:
“Account Control Agreement(s)” means any agreement entered into by and among Agent, the applicable Loan Party and a third-party bank or other institution (including a Securities Intermediary) in which the applicable Loan Party maintains a Deposit Account or an account holding Investment Property and which perfects Agent’s first priority security interest in the subject account or accounts.
“ACH Authorization” means the ACH Debit Authorization Agreement in substantially the form of Exhibit H, which account numbers shall be redacted for security purposes if and when filed publicly by Borrower.
“Acquisition” means any transaction or series of related transactions for the purpose of or resulting, directly or indirectly, in (a) the acquisition of all or substantially all of the assets of a Person, or of any business, line of business or division or other unit of operation of a Person, (b) the acquisition of fifty percent (50%) or more of the Equity Interests of any Person, whether or not involving a merger, consolidation or similar transaction with such other Person, or otherwise causing any Person to become a Subsidiary of any Loan Party, or (c) the acquisition of, or the right to use, develop or sell (in each case,
including through licensing (other than “off-the-shelf” licenses)), any product, product line or intellectual property of or from any other Person.
“Additional Guarantor” means each Person that has delivered a Joinder Agreement pursuant to Section 7.13 and elected to become a ‘Guarantor’ thereunder.
“Advance(s)” means a Term Loan Advance.
“Advance Date” means the funding date of any Advance.
“Advance Request” means a request for an Advance submitted by Borrower to Agent in substantially the form of Exhibit A, which account numbers shall be redacted for security purposes if and when filed publicly by Borrower.
“Affiliate” means (a) any Person that directly or indirectly controls, is controlled by, or is under common control with the Person in question, (b) in the case of any Loan Party, (i) any Person directly or indirectly owning, controlling or holding with power to vote ten percent (10%) or more of the outstanding voting securities of such Loan Party, or (ii), any Person ten percent (10%) or more of whose outstanding voting securities are directly or indirectly owned, controlled or held by such Loan Party with power to vote such securities, (c) in the case of any other Person other than a Loan Party, (i) any Person directly or indirectly owning, controlling or holding with power to vote a majority or more of the outstanding voting securities of such Person, or (ii) any Person a majority or more of whose outstanding voting securities are directly or indirectly owned, controlled or held by such Person with power to vote such securities, or (d) any Person related by blood or marriage to any Person described in subsection (a), or, as applicable, (b) or (c) of this definition. As used in the definition of “Affiliate,” the term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract or otherwise.
“Agreement” means this Loan and Security Agreement, as amended, restated, amended and restated, supplemented or otherwise modified from time to time.
“Amortization Date” means July 1, 2026; provided however, if (a) the First Interest Only Extension Conditions are satisfied, then July 1, 2027, and (b) the Second Interest Only Extension Conditions are satisfied, then July 1, 2028.
“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to any Loan Party or any of their respective Affiliates from time to time concerning or relating to bribery or corruption, including without limitation the United States Foreign Corrupt Practices Act of 1977, as amended, the UK Bribery Act 2010 and other similar legislation in any other jurisdictions.
“Anti-Terrorism Laws” means any laws, rules, regulations or orders relating to terrorism or money laundering, including without limitation Executive Order No. 13224 (effective September 24, 2001), the USA PATRIOT Act, the laws comprising or implementing the Bank Secrecy Act, and the laws administered by OFAC.
“Available Amount” means, at any time, without duplication, an amount equal to the sum of aggregate proceeds received by the Borrower from its (a) issuance of shares of Series C Preferred Stock in excess of Twenty-Seven Million Five Hundred Thousand Dollars ($27,500,000) and (b) issuance of additional Equity Interests after the Closing Date.
“Bankruptcy Code” means the federal bankruptcy law of the United States as from time to time in effect, currently as Title 11 of the United States Code. Section references to current sections of the Bankruptcy Code shall refer to comparable sections of any revised version thereof if section numbering is changed.
“Blocked Person” means any Person: (a) listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224, (b) a Person owned or controlled by, or acting for or on behalf of, any Person that is listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224, (c) a Person with which any Lender is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law, (d) a Person that commits, threatens or conspires to commit or supports “terrorism” as defined in Executive Order No. 13224, or (e) a Person that is named a “specially designated national” or “blocked person” on the most current list published by OFAC or other similar list.
“Board of Directors” means, with respect to any Person that is a corporation (including a public benefit corporation), its board of directors, with respect to any Person that is a limited liability company, its board of managers, board of members or similar governing body, and with respect to any other Person that is another form of a legal entity, such Person’s governing body in accordance with its Organizational Documents.
“Borrower’s Books” means Borrower’s or any Loan Party’s books and records including ledgers, federal, state, local and foreign tax returns, records regarding any Loan Party’s assets or liabilities, the Collateral, business operations or financial condition, and all computer programs or storage or any equipment containing such information.
“Borrower Products” means all products, software, service offerings, technical data or technology currently being designed, manufactured or sold or that are under clinical investigation or development by any Loan Party or any of its Subsidiaries or which any Loan Party or any of their respective Subsidiaries intends to sell, license, or distribute in the future including any products or service offerings under development, collectively, together with all products, software, service offerings, technical data or technology that have been sold, licensed or distributed by Loan Party since its formation or incorporation.
“Borrowing Base Limit” means an amount equal to:
(a) prior to Borrower’s achievement of the Equity Milestone, (i) with respect to the fiscal quarters ending December 31, 2024, March 31, 2025, and June 30, 2025, 1.45 multiplied by T6MA Gross Profit, (ii) with respect to the fiscal quarters ending on September 30, 2025 and December 31, 2025, 1.25 multiplied by T6MA Gross Profit and (iii) with respect to
fiscal quarter ending March 31, 2026 and each fiscal quarter thereafter, 1.00 multiplied by T6MA Gross Profit; and
(b) after Borrower’s achievement of the Equity Milestone, (i) with respect to the fiscal quarters ending December 31, 2024, March 31, 2025, and June 30, 2025, 1.50 multiplied by T6MA Gross Profit, (ii) with respect to the fiscal quarters ending on September 30, 2025 and December 31, 2025, 1.25 multiplied by T6MA Gross Profit and (iii) with respect to fiscal quarter ending March 31, 2026 and each fiscal quarter thereafter, 1.00 multiplied by T6MA Gross Profit.
“Borrowing Base Limit Period” shall mean any day on or after December 31, 2024 when Borrower maintains Qualified Cash in an amount less than Thirty Million Dollars ($30,000,000).
“Business Day” means any day other than Saturday, Sunday and any other day on which banking institutions in the State of New York are closed for business.
“Cash” means all cash, cash equivalents and liquid funds.
“Change in Control” means (a) at any time, any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of Securities Exchange Act of 1934, as amended), shall become, or obtain rights (whether by means of warrants, options or otherwise) to become, the “beneficial owner” (as defined in Rules 13(d)-3 and 13(d)-5 under Securities Exchange Act of 1934, as amended), directly or indirectly, of forty-nine percent (49.0%) or more of the ordinary voting power for the election of directors, partners, managers and members, as applicable, of Company (determined on a fully diluted basis); (b) during any period of twelve (12) consecutive months, a majority of the members of the Board of Directors of Company cease to be composed of individuals (i) who were members of that Board of Directors on the first (1st) day of such period, (ii) whose election or nomination to that Board of Directors was approved by individuals referred to in clause (i) above constituting at the time of such election or nomination at least a majority of that Board of Directors or (iii) whose election or nomination to that Board of Directors was approved by individuals referred to in clauses (i) and (ii) above constituting at the time of such election or nomination at least a majority of that Board of Directors; or (c) at any time, Company shall cease to own and control, of record and beneficially, directly or indirectly, the lesser of (i) one hundred percent (100.0%) and (ii) its current (as of the Closing Date) ownership percentage of each class of outstanding stock, partnership, membership, or other ownership interest or other equity securities of each Subsidiary of Company free and clear of all Liens (other than Permitted Liens).
“Charter” means, with respect to any Person, such Person’s incorporation, formation or equivalent documents, as in effect from time to time.
“Closing Date” means the date of this Agreement.
“Code” means the U.S. Internal Revenue Code of 1986, as amended.
“Collateral Claim” means any and all present and future “claims” (used in its broadest sense, as contemplated by and defined in Section 101(5) of the Bankruptcy Code, but without regard to whether such claim would be disallowed under the Bankruptcy Code) of a Lender now or hereafter
arising or existing under or relating to this Agreement and related Loan Documents, whether joint, several, or joint and several, whether fixed or indeterminate, due or not yet due, contingent or non-contingent, matured or unmatured, liquidated or unliquidated, or disputed or undisputed, whether under a guaranty or a letter of credit, and whether arising under contract, in tort, by law, or otherwise, any interest or fees thereon (including interest or fees that accrue after the filing of a petition by or against a Loan Party under the Bankruptcy Code, irrespective of whether allowable under the Bankruptcy Code), any costs of Enforcement Actions, including reasonable attorneys’ fees and costs, and any prepayment or termination premiums.
“Compliance Certificate” means a certificate in the form attached hereto as Exhibit E.
“Contingent Obligation” means, as applied to any Person, any direct or indirect liability, contingent or otherwise, of that Person with respect to (i) any Indebtedness, lease (excluding operating leases of real property), dividend, letter of credit or other obligation of another Person, including any such obligation directly or indirectly guaranteed, endorsed, co-made or discounted or sold with recourse by that Person, or in respect of which that Person is otherwise directly or indirectly liable; (ii) any obligations with respect to undrawn letters of credit, corporate credit cards or merchant services issued for the account of that Person; and (iii) all obligations arising under any interest rate, currency or commodity swap agreement, interest rate cap agreement, interest rate collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices; provided, however, that the term “Contingent Obligation” shall not include endorsements for collection or deposit in the ordinary course of business. The amount of any Contingent Obligation shall be deemed, without duplication of the primary obligation, to be an amount equal to the stated or determined amount of the primary obligation in respect of which such Contingent Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by such Person in good faith; provided, however, that such amount shall not in any event exceed the maximum amount of the obligations under the guarantee or other support arrangement.
“Copyright License” means any written agreement granting any right to use any Copyright or Copyright registration, now owned or hereafter acquired by a Loan Party or in which a Loan Party now holds or hereafter acquires any interest.
“Copyrights” means all copyrights, whether registered or unregistered, held pursuant to the laws of the United States of America, any State thereof, or of any other country.
“Default” means any event, circumstance or condition that has occurred or exists, that would, with the passage of time or the requirement that notice be given or both, become an Event of Default.
“Deposit Accounts” means any “deposit accounts”, as such term is defined in the UCC, and includes any checking account, savings account, or certificate of deposit.
“Division” means, in reference to any Person which is an entity, the division of such Person into two (2) or more separate Persons, with the dividing Person either continuing or terminating its
existence as part of such division, including, without limitation, as contemplated under Section 18-217 of the Delaware Limited Liability Company Act for limited liability companies formed under Delaware law, Section 17-220 of the Delaware Revised Uniform Limited Partnership Act for limited partnerships formed under Delaware law, or any analogous action taken pursuant to any other applicable law with respect to any corporation (including a public benefit corporation), limited liability company, partnership or other entity.
“Domestic Subsidiary” means any Subsidiary organized under the laws of the United States of America, any State thereof, the District of Columbia, or any other jurisdiction within the United States of America.
“DreamUp” means Borrower’s Subsidiary, DreamUp, PBC, a Delaware public benefit corporation.
“Due Diligence Fee” means Fifty Thousand Dollars ($50,000), which fee has been paid to Agent and received by Agent prior to the Closing Date, and shall be deemed fully earned on such date regardless of the early termination of this Agreement.
“EBITDA” means, with respect to any Person for any period, an amount equal to (a) Gross Profit for such period, minus (b) operating expenses (as determined in accordance with GAAP), plus (c) without duplication and to the extent deducted in the calculation of (i) total depreciation expense for such period, plus (ii) total amortization expense for such period), calculated in good faith, commercially reasonable manner, consistent with the model provided to the Agent prior to the Closing Date as of the last day of the month for which the most recent monthly financial statements were delivered in accordance with Section 7.1(a) (including, with respect to such financial statements, any supporting documentation requested by Agent).
“Electrical Engineering JV” means Electrical Engineering and Space Solutions LLC, a Delaware limited liability company.
“Enforcement Action” means, with respect to any Lender and with respect to any Collateral Claim of such Lender or any item of Collateral in which such Lender has or claims a security interest lien or right of offset, any action, whether judicial or nonjudicial, to repossess, collect, accelerate, offset, recoup, give notification to third parties with respect to, sell, dispose of, foreclose upon, give notice of sale, disposition, or foreclosure with respect to, or obtain equitable or injunctive relief with respect to, such Collateral Claim or Collateral. The filing, or the joining in the filing, by any Lender of an involuntary bankruptcy or Insolvency Proceeding against a Loan Party also is an Enforcement Action.
“Equity Interests” means, with respect to any Person, the capital stock, partnership or limited liability company interest, or other equity securities or equity ownership interests of such Person.
“Equity Milestone” means Borrower’s receipt, on or before December 31, 2024, of unrestricted (including, not subject to any redemption, clawback, escrow or similar encumbrance or
restriction) net cash proceeds in excess of Forty Million Dollars ($40,000,000) from issuance of shares of Series C Preferred Stock.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and the regulations promulgated thereunder.
“Excluded Accounts” means any of the following Deposit Accounts which are designated as such in writing to Agent as of the Closing Date or, with respect to any Deposit Account opened after the Closing Date, in the next Compliance Certificate delivered after such Deposit Account is opened: (a) Deposit Accounts exclusively used for payroll, payroll taxes, and other employee wage and benefit payments to or for the benefit of a Loan Party’s employees holding an aggregate amount across all such accounts of not more than amounts needed for the then-next two (2) payroll cycles, (b) any Deposit Account which is a zero-balance disbursement account, (c) any Deposit Account which is solely used for disbursements and payments of withheld income taxes, payroll taxes and/or federal, state or local employee taxes, (d) any Deposit Account which is solely used as a trust account, escrow account, or other fiduciary account, (e) any Deposit Accounts owned by the Starlab JV or the Electrical Engineering JV, (f) Deposit Accounts owned by an Immaterial Foreign Subsidiary, (g) any Deposit Account exclusively used for deposits referenced in clause (vi) of the defined term “Permitted Liens” are made, (h) Deposit Accounts with a balance not greater than Five Hundred Thousand Dollars ($500,000) individually and One Million Dollars ($1,000,000) in the aggregate at any time.
“FDA” means the U.S. Food and Drug Administration or any successor thereto.
“First Interest Only Extension Conditions” means satisfaction of each of the following events: (a) no Default or Event of Default shall have occurred; and (b) Borrower’s achievement of Interest Only Milestone I.
“Foreign Subsidiary” means a Subsidiary other than any Domestic Subsidiary.
“Funding Account” means the deposit account maintained at PNC Bank, N.A., bearing account number 4751242658 in which Borrower has an interest (which, for the avoidance of doubt, shall be the account into which the proceeds of the Loan will be funded into on the Closing Date).
“GAAP” means generally accepted accounting principles in the United States of America, as in effect from time to time.
“Governmental Approval” means any consent, authorization, approval, order, license, franchise, permit, certificate, accreditation, registration, filing or notice, of, issued by, from or to, or other act by or in respect of, any Governmental Authority.
“Governmental Authority” means any federal, state, municipal, national or other government, governmental department, commission, board, bureau, court, agency or instrumentality or political subdivision thereof (including the FDA) or any entity or officer exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to any government or any court, in each
case whether associated with a state or locality of the United States, the United States, or a foreign government.
“Gross Profit” means, with respect to any Person for any period, an amount equal to total revenue (as determined in accordance with GAAP), minus total cost of goods sold (determined on a consolidated basis in accordance with GAAP, but exclusive of (a) any gross profit attributable to the Starlab JV or the Electrical Engineering JV and (b) non-cash costs or charges incurred in connection with that certain Subscription Agreement, dated as of June 17, 2024, by and between the Company and Palantir Technologies Inc., and all transactions related thereto).
“Guarantor” means each Original Guarantor or an Additional Guarantor.
“Guaranty” means the guarantee of the Secured Obligations provided by the Guarantors under Section 12.
“Immaterial Foreign Subsidiary” means any Foreign Subsidiary that is not a Material Foreign Subsidiary.
“Indebtedness” means indebtedness of any kind, including, without duplication (a) all indebtedness for borrowed money, (b) the deferred purchase price of property or services (excluding trade credit entered into in the ordinary course of business due within one hundred twenty (120) days), including reimbursement and other obligations with respect to surety bonds and letters of credit, (c) all obligations evidenced by notes, bonds, debentures or similar instruments, (d) all capital lease obligations, (e) all equity securities of any Person subject to repurchase or redemption other than at the sole option of such Person, (f) “earnouts”, purchase price adjustments, profit sharing arrangements, deferred purchase money amounts and similar payment obligations or continuing obligations of any nature arising out of purchase and sale contracts, in each case, the aggregate amount of which is determined by the Company in accordance with GAAP (g) obligations arising under bonus, deferred compensation, incentive compensation or similar arrangements (other than those arising in the ordinary course of business), (h) non-contingent obligations to reimburse any bank or Person in respect of amounts paid under a letter of credit, banker’s acceptance or similar instrument, and (i) all Contingent Obligations in respect of any of the obligations set forth in clauses (a) through (g) above.
“Initial Facility Charge” means Five hundred Eighty Thousand Dollars ($580,000), which is payable to Lenders in accordance with Section 4.1(g).
“Insolvency Proceeding” means any proceeding by or against any Person under the United States Bankruptcy Code, or any other bankruptcy, liquidation, moratorium, receivership, or insolvency law, including assignments for the benefit of creditors, compositions, extensions generally with its creditors, or proceedings seeking reorganization, administration, arrangement, receivership or other similar relief proceedings in the applicable jurisdiction from time to time in effect and affecting the rights of creditors generally.
“Intellectual Property” means all of a Loan Party’s Copyrights; Trademarks; Patents; Licenses; trade secrets and inventions; mask works; all of a Loan Party’s applications therefor and reissues, extensions, or renewals thereof; and such Loan Party’s goodwill associated with any of the foregoing, together with such Loan Party’s rights to sue for past, present and future infringement of Intellectual Property and the goodwill associated therewith.
“Intellectual Property Security Agreement” means the Intellectual Property Security Agreement dated as of the Closing Date between Loan Parties party thereto and Agent, as the same may from time to time be amended, restated, modified or otherwise supplemented.
“Interest Only Milestone I” means Borrower’s simultaneous achievement of (a) at least Fifty-Five Million Dollars ($55,000,000) of Gross Profit (measured on a trailing twelve (12) month basis), and (b) at least Ten Million Dollars ($10,000,000) of EBITDA (measured on a trailing twelve (12) month basis) as of the last day of the month for which the most recent monthly financial statements were delivered in accordance with Section 7.1(a) and calculated consistently with such financial statements and subject to Agent’s receipt of any supporting documentation reasonably requested by Agent, in each case on or before December 31, 2025.
“Interest Only Milestone II” means Borrower’s simultaneous achievement of (a) at least Seventy-Two Million Dollars ($72,000,000) of Gross Profit (measured on a trailing twelve (12) month basis), and (b) at least Twenty Million Dollars ($20,000,000) of EBITDA (measured on a trailing twelve (12) month basis) as of the last day of the month for which the most recent monthly financial statements were delivered in accordance with Section 7.1(a) and calculated consistently with such financial statements and subject to Agent’s receipt of any supporting documentation reasonably requested by Agent, in each case on or before December 31, 2026.
“Investment” means (a) purchasing, holding or acquiring any stock, partnership interests, limited liability company interests, or other equity securities or ownership interests of or in any Person, (b) making any loan, advance or capital contribution to any Person, or (c) making any Acquisition, or (d) other transfers on behalf of or in connection with any formation or acquisition of equity ownership or similar transfers.
“IRS” means the U.S. Internal Revenue Service. “Joinder Agreements” means for each Subsidiary required to join as a Borrower or as a Guarantor pursuant to Section 7.13, a completed and executed Joinder Agreement in substantially the form attached hereto as Exhibit F.
“License” means any Copyright License, Patent License, Trademark License or other Intellectual Property license of rights or interests.
“Lien” means any mortgage, deed of trust, pledge, hypothecation, assignment for security, security interest, encumbrance, levy, lien or charge of any kind, whether voluntarily incurred or arising by operation of law or otherwise, against any property, any conditional sale or other title retention agreement, and any lease in the nature of a security interest.
“Loan” means the Advances made under this Agreement.
“Loan Documents” means this Agreement, the promissory notes (if any), the ACH Authorization, the Account Control Agreements, any Joinder Agreement, all UCC Financing Statements, any Guaranty, the Pledge Agreement, the Intellectual Property Security Agreement, and any other documents executed by a Loan Party in favor of the Agent of any Lender in connection with the Secured Obligations or the transactions contemplated hereby, as the same may from time to time be amended, modified, supplemented or restated.
“Loan Party” means Borrower or any Guarantor.
“Material Adverse Effect” means a material adverse effect upon: (i) the business, operations, properties, assets or financial condition of the Loan Parties and their respective Subsidiaries taken as a whole; or (ii) the ability of the Loan Parties to perform or pay the Secured Obligations in accordance with the terms of the Loan Documents, or the ability of Agent or Lenders to enforce any of its rights or remedies with respect to the Secured Obligations; or (iii) the Collateral or Agent’s Liens on the Collateral or the priority of such Liens.
“Material Agreement” means any license, agreement or other contractual arrangement involving the receipt or payment of amounts in the aggregate exceeding Five Million Dollars ($5,000,000) per fiscal year.
“Material Foreign Subsidiary” means, as of any date of determination, any Foreign Subsidiary of Borrower which (a) has generated more than five percent (5.0%) of Borrower’s consolidated total net revenues determined in accordance with GAAP for the four calendar quarter period ending on the last day of the most recent period for which financial statements have been delivered pursuant to Section 7.1(b), or (b) at any time holds assets the aggregate value of which exceed five percent (5.0%) of Borrower’s consolidated assets; provided that if all Foreign Subsidiaries that are not Material Foreign Subsidiaries in the aggregate, exceed ten percent (10%) of either the of the Company’s consolidated total net revenues or the Company’s consolidated assets, then the Company shall designate as many such Foreign Subsidiaries as are necessary to be deemed Material Foreign Subsidiaries so that after such designation the Foreign Subsidiaries that are not Material Foreign Subsidiaries in the aggregate are below such ten percent (10%) threshold with respect to both the Company’s consolidated total net revenues and Company’s consolidated assets.
“Maximum Term Loan Amount” means Fifty-Eight Million Dollars and No/100 Dollars ($58,000,000).
“Non-Disclosure Agreement” means that certain Mutual Confidentiality and Non-Disclosure Agreement by and between Borrower and Hercules Capital, Inc. dated as of March 1, 2024.
“OFAC” means the U.S. Department of Treasury Office of Foreign Assets Control.
“OFAC Lists” means, collectively, the Specially Designated Nationals and Blocked Persons List maintained by OFAC pursuant to Executive Order No. 13224, 66 Fed. Reg. 49079 (Sept. 25,
2001) and/or any other list of terrorists or other restricted Persons maintained pursuant to any of the rules and regulations of OFAC or pursuant to any other applicable Executive Orders.
“Organizational Documents” means with respect to any Person, such Person’s Charter, and (a) if such Person is a corporation (including a public benefit corporation), its bylaws, (b) if such Person is a limited liability company, its limited liability company agreement (or similar agreement), (c) if such Person is a partnership, its partnership agreement (or similar agreement), each of the foregoing with all current amendments or modifications thereto, and (d) if such Person is a Joint Venture Company, its shareholders agreements, joint venture agreements or similar binding agreements relating to any Joint Venture Company.
“Original Guarantor” means each of the Borrower’s direct and indirect Subsidiaries listed on Annex A attached hereto.
“Patent License” means any written agreement granting any right with respect to any invention on which a Patent is in existence or a Patent application is pending, in which agreement a Loan Party now holds or hereafter acquires any interest.
“Patents” means all letters patent of, or rights corresponding thereto, in the United States of America or in any other country, all registrations and recordings thereof, and all applications for letters patent of, or rights corresponding thereto, in the United States of America or any other country.
“Perfection Certificate” means each completed certificate entitled “Perfection Certificate”, dated as of the Closing Date, delivered by Company to Agent and Lenders, signed by Company (as amended pursuant to the terms of this Agreement).
“Permitted Acquisition” means any Acquisition which is conducted in accordance with the following requirements:
(i) of a business or Person or product engaged in substantially the same line of business as that of the Borrower or its Subsidiaries;
(ii) if such Acquisition is structured as a stock acquisition, then the Person so acquired shall either (i) become a majority-owned Subsidiary of the Borrower and the Borrower shall comply, or cause such Subsidiary to comply, with Section 7.13 hereof or (ii) such Person shall be merged with and into a Loan Party (with such Loan Party being the surviving entity);
(iii) if such Acquisition is structured as the acquisition or in-licensing of assets, such assets shall be acquired by Borrower or a newly-organized wholly-owned Subsidiary (in which event such Subsidiary shall comply with Section 7.13 hereof), and shall be free and clear of Liens other than Permitted Liens;
(iv) Borrower shall have delivered to Lenders not less than fifteen (15) nor more than forty five (45) days prior to the date of such Acquisition, notice of such Acquisition together with pro forma projected financial information, copies of all material documents relating to such
acquisition, and historical financial statements for such acquired entity, division or line of business, in each case in form and substance satisfactory to Lenders and demonstrating compliance with the covenants set forth in Section 7.21 on a pro forma basis as if the Acquisition occurred on the first day of the most recent measurement period;
(v) both immediately before and after such Acquisition no Event of Default shall have occurred and be continuing;
(vi) the target of such Acquisition is headquartered in the United States;
(vii) Borrower shall have delivered to Lenders not less than fifteen (15) nor more than forty five (45) days prior to the date of such Acquisition, calculations demonstrating Remaining Months Liquidity of at least 12; and
(viii) the sum of the purchase price of such proposed new Acquisition, computed on the basis of total acquisition cash consideration paid or incurred, or to be paid or incurred, by the Borrower with respect thereto, including the amount of Permitted Indebtedness assumed or to which such assets, businesses or business or ownership interest or shares, or any Person so acquired, is subject (excluding deferred or installment payments and “earnouts” or similar contingent payments otherwise permitted under this Agreement), and all other Permitted Acquisitions consummated in the same year shall not exceed the sum of (A) One Million Dollars ($1,000,000) per year, plus (B) the Available Amount, minus (C) any portion of the Available Amount that has already been used for a distribution contemplated under Section 7.7(f), Permitted Acquisitions, Permitted Indebtedness or Permitted Investments; provided, however, that there shall be no limit on consideration paid in the form of Equity Interests of any Loan Party.
“Permitted Indebtedness” means:
(i) Indebtedness of Borrower in favor of any Lender or Agent arising under this Agreement or any other Loan Document;
(ii) Indebtedness existing on the Closing Date which is disclosed in Schedule 1A;
(iii) Indebtedness of up to Five Hundred Thousand Dollars ($500,000) outstanding at any time secured by a Lien described in subsection (vii) of the defined term “Permitted Liens,” provided such Indebtedness does not exceed the cost of the equipment, software or other Intellectual Property financed with such Indebtedness;
(iv) Indebtedness incurred in the ordinary course of business with corporate credit cards in an aggregate outstanding amount not to exceed Seven Hundred and Fifty Thousand Dollars ($750,000) at any time;
(v) Indebtedness that also constitutes a Permitted Investment or is secured by a Permitted Lien;
(vi) Subordinated Indebtedness;
(vii) reimbursement obligations in connection with letters of credit that are at any time outstanding and secured by Cash and issued on behalf of any Loan Party or any of their respective Subsidiaries in an amount not to exceed Five Hundred Thousand Dollars ($500,000);
(viii) other unsecured Indebtedness in an amount not to exceed Five Hundred Thousand Dollars ($500,000) at any time outstanding;
(ix) Indebtedness of any Loan Party owing to any other Loan Party;
(x) Indebtedness of a Loan Party or any other Person consisting of obligations pursuant to put rights and/or call rights in an amount not to exceed the sum of (A) Five Hundred Thousand Dollars ($500,000) per year, plus (B) the Available Amount, minus (C) any portion of the Available Amount that has already been used for a distribution contemplated under Section 7.7(f), Permitted Acquisitions, Permitted Indebtedness or Permitted Investments;
(xi) “earnouts”, purchase price adjustments, profit sharing arrangements, deferred purchase money amounts and similar payment obligations or continuing obligations of any nature arising out of purchase and sale contracts incurred in connection with a Permitted Acquisition or any other Investment permitted hereunder; provided that aggregate amount of all such items permitted by this subsection (xi) shall not exceed (A) the sum of (1) Five Hundred Thousand Dollars ($500,000), plus (2) the Available Amount, minus (3) any portion of the Available Amount that has already been used for a distribution contemplated under Section 7.7(f), Permitted Acquisitions, Permitted Indebtedness or Permitted Investments for the fiscal year ending December 31, 2024, and (B) the sum of (1) One Million Dollars ($1,000,000), plus (2) the Available Amount, minus (3) any portion of the Available Amount that has already been used for a distribution contemplated under Section 7.7(f), Permitted Acquisitions, Permitted Indebtedness or Permitted Investments, plus (4) and the amount of operating cash flow minus capital expenditures, received by the Company from the target of such Permitted Acquisition or Investment and in each case calculated in accordance with GAAP on a trailing twelve (12) month basis as of the last day of the most recently ended calendar month for which financial statements are available, per fiscal year thereafter; provided, however, that there shall be no limit on amounts paid in the form of Equity Interests of any Loan Party for all items permitted by this subsection (xi); Contingent Obligations incurred by any Loan Party in respect of Indebtedness of any of their respective Subsidiaries and incurred by any of their respective Subsidiaries in respect of Indebtedness of any Loan Party or any other Subsidiary in an aggregate amount not to exceed Five Hundred Thousand Dollars ($500,000) at any time outstanding;
(xii) Indebtedness of any Loan Party incurred to finance the acquisition, construction, or improvement of any fixed or capital assets (whether or not constituting purchase money Indebtedness) in the ordinary course of business, including capital lease obligations and Indebtedness assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets (which shall attach only to such assets and shall not be an “all assets” or
“blanket” Lien) prior to the acquisition thereof; provided, that (A) such Indebtedness is incurred prior to or within ninety (90) days after such acquisition or the completion of such construction or improvement and (B) the aggregate principal amount of Indebtedness permitted by this subsection (xii) shall not exceed Five Hundred Thousand Dollars ($500,000) in aggregate at any time outstanding;
(xiii) obligations in respect of performance, bid, appeal and surety bonds and performance and completion guarantees provided by any Loan Party or its Subsidiaries to any Person and similar obligations, in an aggregate amount not to exceed (A) with respect to the bid bond for the United Arab Emirates Gateway Project, Twelve Million Five Hundred Thousand Dollars ($12,500,000) at any time outstanding, and (B), for all other such performance, bid, appeal and surety bonds and performance and completion guarantees, the sum of (1) Five Hundred Thousand Dollars ($500,000) (or such larger amount that Agent shall approve in advance in writing in its sole discretion) plus (2) the Available Amount, minus (3) any portion of the Available Amount that has already been used for a distribution contemplated under Section 7.7(f), Permitted Acquisitions, Permitted Indebtedness or Permitted Investments at any time outstanding; and
(xiv) extensions, refinancings and renewals of any items of Permitted Indebtedness, provided that the principal amount is not increased or the terms modified to impose materially more burdensome terms upon any Loan Party or any of their respective Subsidiaries, as the case may be, and subject to any limitations on the aggregate amount of such Indebtedness.
“Permitted Investment” means:
(i) Investments existing on the Closing Date which are disclosed in Schedule 1B;
(ii) (a) marketable direct obligations issued or unconditionally guaranteed by the United States of America or any agency or any State thereof maturing within one year from the date of acquisition thereof currently having a rating of at least A-2 or P-2 from either Standard & Poor’s Corporation or Moody’s Investors Service, (b) commercial paper maturing no more than one year from the date of creation thereof and currently having a rating of at least A-2 or P-2 from either Standard & Poor’s Corporation or Moody’s Investors Service, (c) certificates of deposit issued by any bank with assets of at least Five Hundred Million Dollars ($500,000,000) maturing no more than one year from the date of investment therein, and (d) money market accounts;
(iii) repurchases of stock of Borrower from former employees, directors, or consultants of Borrower under the terms of applicable repurchase agreements at the original issuance price of such securities in an aggregate amount not to exceed Seven Hundred and Fifty Thousand Dollars ($750,000) in any year, provided that no Event of Default has occurred, is continuing or could exist after giving effect to the repurchases;
(iv) Investments accepted in connection with Permitted Transfers;
(v) Investments (including debt obligations) received in connection with the bankruptcy or reorganization of customers or suppliers and in settlement of delinquent obligations of, and other disputes with, customers or suppliers arising in the ordinary course of any Loan Party’s business;
(vi) Investments consisting of notes receivable of, or prepaid royalties and other credit extensions, to customers and suppliers who are not Affiliates, in the ordinary course of business, provided that this subsection (vi) shall not apply to Investments of any Loan Party in any Subsidiary of a Loan Party;
(vii) Investments consisting of loans not involving the net transfer on a substantially contemporaneous basis of cash proceeds to employees, officers or directors relating to the purchase of capital stock of Company pursuant to employee stock purchase plans or other similar agreements approved by Company’s Board of Directors;
(viii) Investments consisting of: (A) travel advances and employee relocation loans in the ordinary course of business, and (B) loans to employees, officers, managers or directors relating to the purchase of equity securities of Borrower pursuant to employee stock purchase plans or agreements approved by Borrower’s Board of Directors or similar governing body; not to exceed Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate for (A) and (B), collectively, from the Closing Date until the time that no Secured Obligations (other than for inchoate indemnification obligations which, by their terms, survive termination of this Agreement) remain outstanding;
(ix) Investments (A) by a Loan Party in or to another Loan Party (other than an Original Guarantor), and (B) by any Loan Party in any Subsidiaries, provided that each such Subsidiary enters into a Joinder Agreement in accordance with Section 7.13;
(x) Investments in Foreign Subsidiaries not to exceed the sum of (A) One Million Dollars ($1,000,000), plus (B) the Available Amount, minus (C) any portion of the Available Amount that has already been used for a distribution contemplated under Section 7.7(f), Permitted Acquisitions, Permitted Indebtedness or Permitted Investments in aggregate per year;
(xi) joint ventures or strategic alliances other than the Starlab JV in the ordinary course of a Loan Party’s business consisting of the nonexclusive licensing of technology, the development of technology or the providing of technical support, provided that any cash Investments by the Loan Parties do not exceed the sum of (A) Five Hundred Thousand Dollars ($500,000), plus (B) the Available Amount, minus (C) any portion of the Available Amount that has already been used for a distribution contemplated under Section 7.7(f), Permitted Acquisitions, Permitted Indebtedness or Permitted Investments, in the aggregate per year;
(xii) Investments in the Starlab JV in the ordinary course of Borrower’s business consisting of (A) up to Five Hundred Thousand Dollars ($500,000) in in kind services in the aggregate per year, and (B) cash Investments by Borrower that do not exceed the sum of (A) One
Million Dollars ($1,000,000), plus (B) the Available Amount, minus (C) any portion of the Available Amount that has already been used for a distribution contemplated under Section 7.7(f), Permitted Acquisitions, Permitted Indebtedness or Permitted Investments, in the aggregate per year;
(xiii) Investments in Domestic Subsidiaries which are not Loan Parties in an aggregate amount per year not to exceed One Hundred Thousand Dollars ($100,000);
(xiv) any Permitted Acquisitions;
(xv) advances of payroll payments to employees of Loan Parties and their Subsidiaries in the ordinary course of business; provided, however, that the aggregate amount of such advances shall not exceed One Hundred Thousand Dollars ($100,000) in aggregate per year;
(xvi) Investments in the nature of pledges or deposits with respect to leases or utilities provided to third parties in the ordinary course of business and in an aggregate amount per year not to exceed the sum of (A) Five Hundred Thousand Dollars ($500,000), plus (B) the Available Amount, minus (C) any portion of the Available Amount that has already been used for a distribution contemplated under Section 7.7(f), Permitted Acquisitions, Permitted Indebtedness or Permitted Investments,;
(xvii) Investments, including Acquisitions, to the extent that payment for such Investments is made in the form of Equity Interests of the Borrower;
(xviii) Investments by the Loan Parties and their Subsidiaries (A) consisting of deposits, prepayment and other credits to suppliers or landlords and (B) in connection with obtaining, maintaining or renewing client contracts, each made in the ordinary course of business;
(xix) the issuance of directors’ qualifying shares and shares of Equity Interests of Foreign Subsidiaries issued to foreign nationals to the extent required by law;
(xx) guarantees, provided, that the aggregate principal amount of Indebtedness of Subsidiaries that are not Loan Parties that is guaranteed by any Loan Party shall not exceed Five Hundred Thousand Dollars ($500,000) in aggregate outstanding at any time;
(xxi) Investments in Subsidiaries which are not wholly-owned Subsidiaries as of the Closing Date for purposes of acquiring additional Equity Interests in such Subsidiary, provided, however, the aggregate amount of cash Investments made pursuant to this subsection (xxi) shall not exceed the sum of (A) Five Hundred Thousand Dollars ($500,000) per year, plus (B) the Available Amount, minus (C) any portion of the Available Amount that has already been used for a distribution contemplated under Section 7.7(f), Permitted Acquisitions, Permitted Indebtedness or Permitted Investments, in the aggregate;
(xxii) Investments in Subsidiaries which are not wholly-owned Subsidiaries as of the Closing Date for purposes of acquiring additional Equity Interests in such Subsidiary pursuant to
put rights and/or call rights held by the Loan Parties or other holders of Equity Interests in such Subsidiaries, provided, however, the aggregate amount of cash Investments made pursuant to this subsection (xxii) shall not exceed the sum of (A) Five Hundred Thousand Dollars ($500,000) per year, plus (B) the Available Amount, minus (C) any portion of the Available Amount that has already been used for a distribution contemplated under Section 7.7(f), Permitted Acquisitions, Permitted Indebtedness or Permitted Investments, in the aggregate;
(xxiii) Investments in Subsidiaries made solely for the purpose of funding obligations in respect of performance, bid, appeal and surety bonds and performance and completion guarantees pursuant to subsection (xiii) of the definition of “Permitted Indebtedness”, provided, however, the aggregate amount of cash Investments made pursuant to this subsection (xxiii) shall not exceed the sum of (A) Five Hundred Thousand Dollars ($500,000) per year, plus (B) the remaining unused portion of the Available Amount, minus (C) any portion of the Available Amount that has already been used for a distribution contemplated under Section 7.7(f), Permitted Acquisitions, Permitted Indebtedness or Permitted Investments, in the aggregate; and
(xxiv) additional Investments that do not exceed Five Hundred Thousand Dollars ($500,000) in the aggregate.
“Permitted Liens” means:
(i) Liens in favor of Agent or Lenders;
(ii) Liens existing on the Closing Date which are disclosed in Schedule 1C;
(iii) Liens for taxes, fees, assessments or other governmental charges or levies, either not yet due or being contested in good faith by appropriate proceedings diligently conducted; provided, that Borrower maintains adequate reserves therefor on Borrower’s Books in accordance with GAAP;
(iv) Liens securing claims or demands of materialmen, artisans, mechanics, carriers, warehousemen, landlords and other like Persons arising in the ordinary course of any Loan Party’s business and imposed without action of such parties; provided, that the payment thereof is not yet required;
(v) Liens arising from judgments, decrees or attachments in circumstances which do not constitute an Event of Default hereunder;
(vi) the following deposits, to the extent made in connection with the United Arab Emirates Gateway Project or in the ordinary course of business: deposits under worker’s compensation, unemployment insurance, social security and other similar laws, or to secure the performance of bids, tenders or contracts (other than for the repayment of borrowed money) or to secure indemnity, performance or other similar bonds for the performance of bids, tenders or contracts (other than for the repayment of borrowed money) or to secure statutory obligations
(other than Liens arising under ERISA or environmental Liens) or surety, bid or appeal bonds, or to secure indemnity, performance or other similar bonds; provided, however, that Borrower, Agent and the Lenders mutually agree to work in the best interest of the Company to submit the bid bond related to the Emirates Gateway Project which the Company is currently pursuing (the “Gateway Bid Bond”) and agree that any cash deposited by the Company towards the Gateway Bid Bond will be excluded from the definition of Qualified Cash under this Agreement; provided, further, that if this treatment of the Gateway Bid Bond prevents the Company from pursuing the Emirates Gateway Project, the Parties agree to work in good faith to identify alternative solutions, including potential temporary modifications to the Loan Agreement, to enable the posting of a Gateway Bid Bond and the pursuit of the Emirates Gateway Project, which will ultimately be subject to Lender’s Investment Committee approval in its sole discretion;
(i) Liens on equipment or software or other intellectual property constituting purchase money Liens and other Liens in connection with capital leases securing Indebtedness permitted in clause (iii) of “Permitted Indebtedness”;
(ii) Liens incurred in connection with Subordinated Indebtedness;
(iii) leasehold interests in leases or subleases and licenses (other than with respect to Intellectual Property) granted in the ordinary course of business and not interfering in any material respect with the business of the licensor;
(iv) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of custom duties that are promptly paid on or before the date they become due;
(v) Liens on insurance proceeds securing the payment of financed insurance premiums that are promptly paid on or before the date they become due (provided that such Liens extend only to such insurance proceeds and not to any other property or assets);
(vi) statutory and common law rights of set-off and other similar rights as to deposits of cash and securities in favor of banks, other depository institutions and brokerage firms;
(vii) easements, servitudes, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business so long as they do not materially impair the value or marketability of the related property;
(viii) Liens on Cash securing obligations permitted under clause (vii) of the definition of Permitted Indebtedness in an aggregate amount not to exceed Five Hundred Thousand Dollars ($500,000) at any time;
(ix) Licenses that qualify as Permitted Transfers;
(x) Liens in favor of other financial institutions arising in connection with a Deposit Account or Securities Account of a Loan Party or Subsidiary thereof held at such
institutions, provided, that Agent has a perfected security interest in such Deposit Account (other than an Excluded Account), or the securities maintained therein and Agent has received an Account Control Agreement with respect thereto to the extent required pursuant to the applicable Loan Documents;
(xi) Liens securing Indebtedness permitted by clause (xii) of the definition of Permitted Indebtedness;
(xii) Liens incurred in connection with the extension, renewal or refinancing of the Indebtedness secured by Liens of the type described in clauses (i) through (xvii) above; provided, that any extension, renewal or replacement Lien shall be limited to the property encumbered by the existing Lien and the principal amount of the Indebtedness being extended, renewed or refinanced (as may have been reduced by any payment thereon) does not increase.
“Permitted Transfers” means:
(i) sales of Inventory in the ordinary course of business;
(ii) non-exclusive licenses and similar arrangements for the use of Intellectual Property in the ordinary course of business and licenses on an arms’ length basis, including in connection with business development transactions, co-development or co-promotion transactions, collaborations, licensing, partnering or similar transactions with third parties and that are entered into with commercially reasonable terms, that are not exclusive or could not result in a legal transfer of title of the licensed property that may be exclusive in respects other than territory or may be exclusive as to territory but only as to discrete geographical areas outside of the United States of America in the ordinary course of business;
(iii) Transfers (A) among Loan Parties, (B) among Subsidiaries that are not Loan Parties and (C) from Subsidiaries that are not Loan Parties to Loan Parties;
(iv) transfers constituting the making of Permitted Investments, or the granting of Permitted Liens;
(v) (A) dispositions of worn-out, obsolete or surplus property at fair market value in the ordinary course of business, (B) dispositions of property no longer used or useful in the conduct of the business, and (C) abandonment or lapse of Intellectual Property, in each case, that is, in the good faith reasonable judgement of such Loan Party or Subsidiary, no longer economically practicable to maintain or useful;
(vi) the use of cash and cash equivalents (or other assets that were cash equivalents when the relevant Investment was made) in the ordinary course of business to make payments that are not otherwise prohibited by this Agreement;
(vii) the surrender or waiver of contractual rights and settle or waive contractual or litigation claims in the ordinary course of business or consistent with past practice or otherwise if
Borrower determines in good faith after consultation with the Lenders that such action is in the best interests of the Loan Parties;
(viii) other Transfers of assets having a fair market value of not more than Five Hundred Thousand Dollars ($500,000) in the aggregate per year.
“Person” means any individual, sole proprietorship, partnership, joint venture, trust, unincorporated organization, association, corporation (including a public benefit corporation), limited liability company, institution, other entity or government.
“Pledge Agreement” means the Pledge Agreement dated as of the Closing Date between each Loan Party party thereto and Agent, as the same may from time to time be amended, restated, modified or otherwise supplemented.
“Prime Rate” means the greater of (a) the “prime rate” as reported in The Wall Street Journal or any successor publication thereto and (b) eight and one half of one percent (8.50%).
“Qualified Cash” means an amount equal to (a) the amount of each Loan Party’s Cash held in accounts subject to an Account Control Agreement in favor of Agent, minus (b) the Qualified Cash A/P Amount.
“Qualified Cash A/P Amount” means the aggregate amount of the Loan Parties’ accounts payable under GAAP in excess of One Million Dollars ($1,000,000) not paid after the 90th day following the due date for such account payable.
“Receivables” means (i) all of the Loan Parties’ Accounts, Instruments, Documents, Chattel Paper, Supporting Obligations, letters of credit, proceeds of any letter of credit, and Letter of Credit Rights, and (ii) all customer lists, software, and business records related thereto.
“Registration” means any registration, authorization, approval, license, permit, clearance, certificate, and exemption issued or allowed by the FDA or state pharmacy licensing authorities (including, without limitation, new drug applications, abbreviated new drug applications, investigational new drug applications, pricing and reimbursement approvals, labelling approvals or their foreign equivalent, and wholesale distributor permits).
“Remaining Months Liquidity” means, as of any date of determination, the quotient of (a) the consolidated cash of Borrower and the target of a Permitted Acquisition, calculated on a pro forma basis as of the day immediately after the date of such Acquisition, divided by (b) the pro forma sum for Borrower and the target of such Acquisition of (i) operating cash flow minus (ii) capital expenditures, in each case calculated on a consolidated basis in accordance with GAAP on a trailing twelve (12) month basis as of the last day of the most recently ended calendar month for which financial statements have been delivered to Agent pursuant to Section 7.1(a) as if such Acquisition occurred on the first day of the most recent measurement period.
“Required Lenders” means at any time, the holders of more than fifty percent (50%) of the sum of the aggregate unpaid principal amount of the Term Loans then outstanding.
“Restricted License” means any agreement with respect to which a Loan Party is the licensee (a) that prohibits or otherwise restricts such Loan Party from granting a security interest in such Loan Party’s interest in such License or agreement or any other property, or (b) for which a default under or termination of could interfere with Agent’s right to sell any Collateral.
“Sanctioned Country” means, at any time, a country or territory which is the subject or target of any Sanctions.
“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or by the United Nations Security Council, the European Union or any EU member state, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person controlled by any such Person.
“Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union or His Majesty’s Treasury of the United Kingdom.
“SBA Funding Date” means each date on which a Lender which is an SBIC funds any portion of the Term Loan.
“Second Interest Only Extension Conditions” means satisfaction of each of the following events: (a) no Default or Event of Default shall have occurred; (b) Borrower’s achievement of Interest Only Milestone I; and (c) Borrower’s achievement of Interest Only Milestone II.
“Secured Obligations” means Borrower’s obligations under this Agreement and any Loan Document, including any obligation to pay any amount now owing or later arising. “Starlab JV” means Borrower’s Subsidiary, Starlab Space LLC, a Delaware limited liability company.
“Subordinated Indebtedness” means Indebtedness subordinated to the Secured Obligations in amounts and on terms and conditions reasonably satisfactory to Agent in its sole discretion and subject to a subordination agreement in form and substance reasonably satisfactory to Agent in its sole discretion.
“Subsidiary” means an entity, whether a corporation (including a public benefit corporation), partnership, limited liability company, joint venture or otherwise, in which a Loan Party owns or controls, either directly or indirectly, fifty percent (50%) or more of the outstanding voting securities, including each entity listed on Schedule 1.
“T6MA Gross Profit” means, as of any date of determination, the product of (a) Borrower’s gross profit (determined on a consolidated basis in accordance with GAAP, but exclusive of any gross profit attributable to the Starlab JV or the Electrical Engineering JV) for the two (2) most recently ended fiscal quarters, calculated as of the last day of the fiscal quarter for which the most recent quarterly financial statements were delivered in accordance with Section 7.1(b) and calculated consistently with such financial statements and subject to Agent’s receipt of any supporting documentation reasonably requested by Agent,, multiplied by (b) two (2).
“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
“Term Commitment” means as to any Lender, the obligation of such Lender, if any, to make a Term Loan Advance to Borrower in a principal amount not to exceed the amount set forth under the heading “Term Commitment” opposite such Lender’s name on Schedule 1.1.
“Term Loan” means any Term Loan Advance made under this Agreement.
“Term Loan Advance” means any funds advanced under Section 2.2(a).
“Term Loan Cash Interest Rate” means for any day a per annum rate of interest equal to (a) the Prime Rate plus (b) 1.25%.
“Term Loan Deferred Additional Interest Rate” means 2.50%.
“Term Loan Maturity Date” means July 1, 2028; provided that if such day is not a Business Day, the Term Loan Maturity Date shall be the immediately subsequent Business Day.
“Total Debt Outstanding” means, as of any date of determination, with respect to Borrower, determined on a consolidated basis, the aggregate amount of all Indebtedness of the type described in clauses (a), (c), and (h) of the definition thereof, and in each case, secured by Liens on any assets of Borrower.
“Trademark License” means any written agreement granting any right to use any Trademark or Trademark registration, now owned or hereafter acquired by a Loan Party or in which a Loan Party now holds or hereafter acquires any interest.
“Trademarks” means all trademarks (registered, common law or otherwise) and any applications in connection therewith, including registrations, recordings and applications in the United States Patent and Trademark Office or in any similar office or agency of the United States of America, any State thereof or any other country or any political subdivision thereof.
“U.S. Person” means any Person that is a “United States person” as defined in Section 7701(a)(30) of the Code.
“UCC” means the Uniform Commercial Code as the same is, from time to time, in effect in the State of New York; provided, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection or priority of, or remedies with respect to, Agent’s Lien on any Collateral is governed by the Uniform Commercial Code as the same is, from time to time, in effect in a jurisdiction other than the State of New York, then the term “UCC” shall mean the Uniform Commercial Code as in effect, from time to time, in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority or remedies and for purposes of definitions related to such provisions.
1.2 The following terms are defined in the Sections or subsections referenced opposite such terms:
| | | | | | | | | | | |
| Defined Term | Section | |
| 1940 Act | 5.6(b) | |
| Agent | Preamble | |
| Assignee | 11.14 | |
| Borrower | Preamble | |
| Borrowing Base Cure Period | 2.5(b) | |
| Borrowing Base Repayment | 2.5(b) | |
| Claims | 11.11(a) | |
| Collateral | 3.1 | |
| Company | Preamble | |
| Confidential Information | 11.13 | |
| End of Term Charge | 2.6(b) | |
| Event of Default | 9 | |
| Financial Statements | 7.1 | |
| Indemnified Person | 6.3 | |
| Lenders | Preamble | |
| Liabilities | 6.3 | |
| Maximum Rate | 2.3 | |
| Observer | 7.24(a) | |
| Participant Register | 11.8 | |
| Payment Date | 2.2(e) | |
| Prepayment Charge | 2.5(a) | |
| Publicity Materials | 11.19 | |
| Register | 11.7 | |
| SBA | 7.16 | |
| SBIC | 7.16 | |
| SBIC Act | 7.16 | |
| Transfer | 7.8 | |
1.3 Unless otherwise specified, all references in this Agreement or any Annex or Schedule hereto to a “Section,” “subsection,” “Exhibit,” “Annex,” or “Schedule” shall refer to the corresponding Section, subsection, Exhibit, Annex, or Schedule in or to this Agreement. Unless otherwise specifically provided herein, any accounting term used in this Agreement or the other Loan Documents shall have the meaning customarily given such term in accordance with GAAP as in effect on the date hereof, and all financial computations hereunder shall be computed in accordance with GAAP as in effect on the date hereof, consistently applied. Unless otherwise defined herein or in the other Loan Documents, terms that are used herein or in the other Loan Documents and defined in the UCC shall have the meanings given to them in the UCC. For all purposes under the Loan Documents, in connection with any Division or plan of Division under Delaware law (or any comparable event under a different jurisdiction’s laws): (a) if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person to the subsequent Person and (b) if any new Person comes into existence, such new Person shall be deemed to have been organized on the first date of its existence by the holders of its Equity Interests at such time.
1.4 If at any time any change in GAAP would affect the computation of any financial requirement set forth in any Loan Document, and either Borrower or the Required Lenders shall so request, Agent, Lenders and Borrower shall negotiate in good faith to amend such requirement to preserve the original intent thereof in light of such change in GAAP; provided that, until so amended, such requirement shall continue to be computed in accordance with GAAP prior to such change.
1.5 Any reference in any Loan Document to a merger, transfer, consolidation, amalgamation, consolidation, assignment, sale, disposition or transfer, or similar term, shall be deemed to apply to a Division of or by a limited liability company, or an allocation of assets to a series of a limited liability company (or the unwinding of such a Division or allocation), as if it were a merger, transfer, consolidation, amalgamation, consolidation, assignment, sale or transfer, or similar term, as applicable, to, of or with a separate Person. Any Division of a limited liability company shall constitute a separate Person under the Loan Documents (and each Division of any limited liability company that is a Subsidiary, joint venture or any other like term shall also constitute such a Person or entity) on the first date of its existence. In connection with any Division, if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then such asset shall be deemed to have been transferred from the original Person to the subsequent Person.
SECTION 2.THE LOAN
2.1 [Reserved]
2.2 Term Loan Advances.
(a) Advances. Subject to the terms and conditions of this Agreement, on the Closing Date, Lenders will severally (and not jointly) make, and Borrower agrees to draw, a Term Loan Advance in an aggregate principal amount equal to Fifty-Eight Million Dollars ($58,000,000).
(b) Maximum Term Loan Amount. The aggregate outstanding Term Loan Advances shall not exceed the Maximum Term Loan Amount plus, for the avoidance of doubt, any amount equal to the payment-in-kind interest added to principal pursuant to Section 2.1(d)(ii). Each Term Loan Advance of each Lender shall not exceed its respective Term Commitment plus, for the avoidance of doubt, any amount equal to the Term Loan Deferred Additional Interest Rate added to principal pursuant to Section 2.2(d)(ii). After repayment, no Term Loan Advance (or any portion thereof) may be reborrowed.
(c) Advance Request. To obtain a Term Loan Advance, Borrower shall complete, sign and deliver an Advance Request (at least one (1) Business Day before the Closing Date and at least five (5) Business Days before each Advance Date other than the Closing Date) to Agent. Lenders shall fund the Term Loan Advance in the manner requested by the Advance Request provided that each of the conditions precedent set forth in Section 4 and applicable to such Term Loan Advance is satisfied as of the requested Advance Date. The proceeds of any Term Loan Advance shall be deposited and at all times prior to satisfaction of the condition set forth in Section 7.25(a) maintained within, the Funding Account an account that is subject to an Account Control Agreement.
(d) Interest. Interest shall accrue as set forth below and as provided in the Amortization Schedule which shall be provided by Agent to the Borrower within fourteen (14) Business Days after the Closing Date.
(i) Term Loan Cash Interest Rate. In addition to interest accrued pursuant to the Term Loan Deferred Additional Interest Rate, the principal balance (including, for the avoidance of doubt, any payment-in-kind interest added to principal pursuant to Section 2.2(d)(ii)) of each Term Loan Advance shall bear interest thereon from such Advance Date at the Term Loan Cash Interest Rate based on a year consisting of three hundred sixty (360) days, with interest computed daily based on the actual number of days elapsed. The Term Loan Cash Interest Rate will float and change on the day the Prime Rate changes from time to time.
(ii) Term Loan Deferred Additional Interest Rate. In addition to interest accrued pursuant to the Term Loan Cash Interest Rate, the principal balance of each Term Loan Advance shall bear interest thereon from such Advance Date at the Term Loan Deferred Additional Interest Rate based on a year consisting of three hundred sixty (360) days, with interest computed daily based on the actual number of days elapsed, which amount shall be added to the outstanding principal balance so as to increase the outstanding principal balance of such Term Loan Advance on each Payment Date for such Advance, which principal amount shall accrue interest payable as provided in Section 2.2(d)(i) and which accrued and unpaid amount shall be payable when the principal amount of the Advance is payable in accordance with Section 2.2(e).
(e) Payment. Borrower will pay accrued but unpaid interest on each Term Loan Advance on the first Business Day of each month (each such date, a “Payment Date”), beginning
the month after the Advance Date. Borrower shall repay the aggregate principal balance of the Term Loan Advances that is outstanding on the day immediately subsequent the Amortization Date, in equal monthly installments of principal and interest (mortgage style) beginning on the Amortization Date and continuing on the first Business Day of each month thereafter until the Secured Obligations (other than inchoate indemnity obligations which, by their terms, survive termination of this Agreement) are repaid. The entire principal balance of the Term Loan Advances and all accrued but unpaid interest hereunder, shall be due and payable on the Term Loan Maturity Date. Borrower shall make all payments under this Agreement without setoff, recoupment or deduction and regardless of any counterclaim or defense. If a payment hereunder becomes due and payable on a day that is not a Business Day, the due date thereof shall be the immediately subsequent Business Day. Agent or Lenders will initiate debit entries to Borrower’s account as authorized on the ACH Authorization (i) on each Payment Date of all periodic obligations payable to Lenders under each Term Loan Advance and (ii) reasonable out-of-pocket legal fees and costs actually incurred by Agent or Lenders in connection with Section 11.12; provided that, with respect to clause (i) above, in the event that Lenders or Agent informs Borrower that Lenders will not initiate a debit entry to Borrower’s account for a certain amount of the periodic obligations due on a specific Payment Date, Borrower shall pay to Lenders, such amount of periodic obligations in full in immediately available funds on such Payment Date; provided, further, that, with respect to clause (i) above, if Lenders or Agent informs Borrower that Lenders will not initiate a debit entry as described above later than the date that is three (3) Business Days prior to such Payment Date, Borrower shall pay to Lenders such amount of periodic obligations in full in immediately available funds on the date that is three (3) Business Days after the date on which Lenders or Agent notifies Borrower of such; provided, further, that, with respect to clause (ii) above, in the event that Lenders or Agent informs Borrower that Lenders will not initiate a debit entry to Borrower’s account for specified out-of-pocket legal fees and costs incurred by Agent or Lenders, Borrower shall pay to Lenders such amount in full in immediately available funds within three (3) Business Days.
2.3 Maximum Interest. Notwithstanding any provision in this Agreement or any other Loan Document, it is the parties’ intent not to contract for, charge or receive interest at a rate that is greater than the maximum rate permissible by law that a court of competent jurisdiction shall deem applicable hereto (which under the laws of the State of New York shall be deemed to be the laws relating to permissible rates of interest on commercial loans) (the “Maximum Rate”). If a court of competent jurisdiction shall finally determine that Borrower has actually paid to Lenders an amount of interest in excess of the amount that would have been payable if all of the Secured Obligations had at all times borne interest at the Maximum Rate, then such excess interest actually paid by Borrower shall be applied as follows: first, to the payment of the Secured Obligations consisting of the outstanding principal; second, after all principal is repaid, to the payment of Lenders’ accrued interest, costs, expenses, professional fees and any other Secured Obligations; and third, after all Secured Obligations are repaid, the excess (if any) shall be refunded to Borrower.
2.4 Default Interest. In the event any payment is not paid on the scheduled payment date, an amount equal to four percent (4%) of such past due amount shall be payable on demand. In addition, upon the occurrence and during the continuation of an Event of Default hereunder, all outstanding Secured Obligations, including principal, interest, compounded interest, and professional fees, shall bear interest at a rate per annum equal to the rate set forth in Section 2.2(d) plus four percent (4%) per annum. In the event any interest is not paid when due hereunder, delinquent interest shall be added to principal and shall bear interest on interest, compounded at the rate set forth in Section 2.2(d) or 2.4, as applicable.
2.5 Prepayment.
(a) Voluntary Prepayment. At its option, Borrower may prepay all or a portion of the outstanding Advances by paying the entire principal balance (or such portion thereof) all accrued and unpaid interest thereon, all unpaid Lender’s fees and expenses due hereunder accrued to the date of the repayment (including, without limitation, the portion of the End of Term Charge applicable to the aggregate original principal amount of the Term Loan Advances being prepaid in accordance with Section 2.6(a)), together with a prepayment charge equal to the following percentage of the outstanding principal amount of such Advance amount being so prepaid: with respect to each Advance (which Advance amount shall include, for the avoidance of doubt, any principal that has been added to the principal balance of such Advance pursuant to Section 2.2(d)(ii)) (a) if the principal amount of such Advance amounts are prepaid on or prior to the date which is twelve (12) months following the Closing Date, three percent (3.00%); (b) if the principal amount of such Advance amounts are prepaid after the date which is twelve (12) months following the Closing Date but on or prior to the date which is twenty-four (24) months following the Closing Date, two percent (2.00)%; and (c) thereafter through the day before the Term Loan Maturity Date, one percent (1.00)% (each, a “Prepayment Charge”). Borrower agrees that the Prepayment Charge is a reasonable calculation of Lenders’ lost profits in view of the difficulties and impracticality of determining actual damages resulting from an early repayment of the Advances. Borrower shall prepay the outstanding amount of all principal and accrued interest through the prepayment date and the Prepayment Charge upon the occurrence of a Change in Control or any other prepayment hereunder. Notwithstanding the foregoing, Agent and Lenders agree to waive the Prepayment Charge if Agent and Lenders (in their sole and absolute discretion) agree in writing to refinance the Advances prior to the Term Loan Maturity Date. Any amounts paid under this Section shall be applied by Agent to the then unpaid amount of any outstanding Secured Obligations (including principal and interest) in such order and priority as Agent may choose in its sole discretion. For the avoidance of doubt, if a payment hereunder becomes due and payable on a day that is not a Business Day, the due date thereof shall be the immediately subsequent Business Day.
(b) Mandatory Prepayment. At any time during the Borrowing Base Limit Period, if the Total Debt Outstanding exceeds the Borrowing Base Limit as of the last day of any fiscal quarter, Borrower shall promptly (but in any event, no later than three (3) Business Days after the same shall become due and payable), repay any portion of the Term Loan Advance until the Total
Debt Outstanding is less than the Borrowing Base Limit, together with all accrued and unpaid interest thereon (a “Borrowing Base Repayment”). The Borrowing Base Repayment shall be due and payable on the date which is thirty (30) days after the earlier of the date on which the Compliance Certificate for such fiscal quarter has been delivered or was required to have been delivered (the “Borrowing Base Cure Period”). Notwithstanding the generality of the foregoing, a Borrowing Base Repayment shall not be due and payable if Borrower delivers an updated Compliance Certificate to Agent during the Borrowing Base Cure Period demonstrating that the Total Debt Outstanding no longer exceeds the Borrowing Base Limit. The Prepayment Charge shall not be due and payable with respect to a Borrowing Base Repayment made pursuant to this Section 2.5(b); provided that if any prepayment is made pursuant to Section 2.5(a) or Section 10.1 concurrently with a Borrowing Base Repayment, then the Prepayment Charge shall apply to the Advances repaid to such Borrowing Base Repayment.
2.6 End of Term Charge.
(a) On any date that Borrower partially prepays the outstanding Secured Obligations pursuant to Section 2.5, Borrower shall pay Lenders a charge equal to (i) five and one half of one percent (5.50)% multiplied by (ii) the principal amount of such Term Loan Advances being prepaid.
(b) On the earliest to occur of (i) the Term Loan Maturity Date, (ii) the date that Borrower prepays the outstanding Secured Obligations (other than any inchoate indemnity obligations and any other obligations which, by their terms, are to survive the termination of this Agreement) in full, (iii) the date that the outstanding Secured Obligations become due and payable, or (iv) as required pursuant to Section 2.5, Borrower shall pay Lenders a charge equal to (A) five and one half of one percent (5.50)% multiplied by the Term Commitment minus (B) the aggregate amount of payments made pursuant to Section 2.6(a) (the “End of Term Charge”).
(c) Notwithstanding the required payment date of such End of Term Charge, it shall be deemed earned by Lenders as of each date that an applicable Term Loan Advance is made. For the avoidance of doubt, if a payment hereunder becomes due and payable on a day that is not a Business Day, the due date thereof shall be the immediately subsequent Business Day.
2.7 Pro Rata Treatment. Each payment (including prepayment) on account of any fee and any reduction of the Term Loan Advances shall be made pro rata according to the Term Commitments of the relevant Lender.
2.8 Taxes; Increased Costs. Each Loan Party, Agent and Lenders each hereby agree to the terms and conditions set forth on Addendum 1 attached hereto.
2.9 Treatment of Prepayment Charge and End of Term Charge. Each Loan Party agrees that any Prepayment Charge and any End of Term Charge payable shall be presumed to be the liquidated damages sustained by each Lender as the result of the early termination, and each Loan Party agrees that it is reasonable under the circumstances currently existing and existing as of
the Closing Date. The Prepayment Charge and the End of Term Charge shall also be payable in the event the Secured Obligations (and/or this Agreement) are satisfied or released by foreclosure (whether by power of judicial proceeding), deed in lieu of foreclosure, or by any other means. Each Loan Party expressly waives (to the fullest extent it may lawfully do so) the provisions of any present or future statute or law that prohibits or may prohibit the collection of the foregoing Prepayment Charge and End of Term Charge in connection with any such acceleration. Each Loan Party agrees (to the fullest extent that each may lawfully do so): (a) each of the Prepayment Charge and the End of Term Charge is reasonable and is the product of an arm’s length transaction between sophisticated business people, ably represented by counsel; (b) each of the Prepayment Charge and the End of Term Charge shall be payable notwithstanding the then prevailing market rates at the time payment is made; (c) there has been a course of conduct between Lenders and Borrower giving specific consideration in this transaction for such agreement to pay the Prepayment Charge and the End of Term Charge as a charge (and not interest) in the event of prepayment or acceleration; and (d) Borrower shall be estopped from claiming differently than as agreed to in this Section. Each Loan Party expressly acknowledges that its agreement to pay each of the Prepayment Charge and the End of Term Charge to Lenders as herein described was on the Closing Date and continues to be a material inducement to Lenders to provide the Term Loan Advances.
SECTION 3.SECURITY INTEREST
3.1 Grant of Security Interest. As security for the prompt and complete payment when due (whether on the payment dates or otherwise) of all the Secured Obligations, each Loan Party grants to Agent a security interest in all of such Loan Party’s right, title, and interest in, to and under all of such Loan Party’s personal property and other assets including without limitation the following (except as set forth herein) whether now owned or hereafter acquired (collectively, the “Collateral”): (a) Receivables; (b) equipment; (c) Fixtures; (d) General Intangibles; (e) Inventory; (f) Investment Property; (g) Deposit Accounts; (h) Cash; (i) Goods; and all other tangible and intangible personal property of such Loan Party whether now or hereafter owned or existing, leased, consigned by or to, or acquired by, such Loan Party and wherever located, and any of such Loan Party’s property in the possession or under the control of Agent; and, to the extent not otherwise included, all Proceeds of each of the foregoing and all accessions to, substitutions and replacements for, and rents, profits and products of each of the foregoing.
3.2 Excluded Collateral.
(a) Notwithstanding the broad grant of the security interest set forth in Section 3.1, above, the Collateral shall not include (i) any “intent to use” trademarks at all times prior to the first use thereof, whether by the actual use thereof in commerce, the recording of a statement of use with the United States Patent and Trademark Office or otherwise, provided, that upon submission and acceptance by the United States Patent and Trademark Office of an amendment to allege use of an intent-to-use trademark application pursuant to 15 U.S.C. Section 1060(a) (or any successor provision) such intent-to-use application shall constitute Collateral, (ii) nonassignable
licenses or contracts, which by their terms, or by statute or law, require the consent of the licensor thereof or another party or a Governmental Authority (but only to the extent such prohibition on transfer is enforceable under applicable law, including, without limitation, Sections 9406, 9407 and 9408 of the UCC) and (iii) any Excluded Account.
(b) Notwithstanding anything to the contrary in any Loan Document, no Loan Parties shall be required to take any action to assign its payment rights in accounts owing from an account debtor that is a Governmental Authority or any department, agency or instrumentality thereof, or any other action under the Federal Assignment of Claims Act of 1940, as amended (the “Assignment of Claims Act”); provided that upon the reasonable written request of Agent, the Loan Parties will use commercially reasonable efforts to take any such action under the Assignment of Claims Act with respect to any contract with a Governmental Authority the value of which exceeds Five Million Dollars ($5,000,000) as determined by the Borrower in good faith, except to the extent (i) any such assignment would not be permitted under applicable law (including, without limitation, 31 U.S. Code § 3727 and 41 U.S. Code § 6305), or (ii) Agent or any Lender is ineligible to be an assignee of such payment rights under applicable law.
SECTION 4.CONDITIONS PRECEDENT TO LOAN
The obligations of Lenders to make the Loan hereunder are subject to the satisfaction by Borrower of the following conditions:
4.1 Initial Advance. On or prior to the Closing Date, the Loan Parties shall have delivered to Agent the following:
(a) duly executed copies of the Loan Documents, and all other documents and instruments reasonably required by Agent to effectuate the transactions contemplated hereby or to create and perfect the Liens of Agent with respect to all Collateral, in all cases in form and substance reasonably acceptable to Agent;
(b) duly executed Account Control Agreement(s) with respect to the Funding Account;
(c) a legal opinion of counsel for the Loan Parties in form and substance reasonably acceptable to Agent;
(d) copy of resolutions of each Loan Party’s Board of Directors, certified by an officer of such Loan Party, evidencing (i) approval of the Loan and other transactions evidenced by the Loan Documents, (ii) authorizing a specified person or persons to execute the Loan Documents to which it is a party on its behalf, (iii) authorizing a specified person or persons, on its behalf, to sign and/or dispatch all documents and notices (including, if relevant, any Advance Request or other relevant notice) to be signed and/or dispatched by it under or in connection with the Loan Documents to which it is a party, and (iv) acknowledging that the Board of Directors are
acting for a proper purpose and that the Loan Documents are in the best interests of that Loan Party and for its commercial benefit;
(e) certified copies of the Charter of each Loan Party, certified by the Secretary of State of the applicable jurisdiction of organization and the other Organizational Documents, as amended through the Closing Date, of such Loan Party;
(f) a certificate of good standing for each Loan Party from its jurisdiction of organization and similar certificates from all other jurisdictions in which it does business and where the failure to be qualified could have a Material Adverse Effect;
(g) certified copies, dated as of a recent date, of searches for financing statements filed in the central filing office of the Secretary of State of each Loan Party’s jurisdiction of formation, accompanied by written evidence (including any UCC termination statements) that the Liens on any Collateral indicated in any such financing statements either constitute Permitted Liens or have been or, in connection with the initial Term Loan Advance, will be terminated or released;
(h) payment of the Due Diligence Fee, Initial Facility Charge and reimbursement of Agent’s and Lenders’ current expenses reimbursable pursuant to this Agreement, which amounts may be deducted from the initial Advance;
(i) a duly executed copy of the Perfection Certificate and each exhibit and addendum thereto;
(j) a duly executed copy of a payoff letter from JGB Capital, LP and each exhibit and addendum thereto, in form and substance satisfactory to Agent and the Lenders;
(k) [Reserved];
(l) [Reserved];
(m) all reports, declarations and forms required by the SBA, including but not limited to SBA 652, SBA 1031 and SBA 480; and
(n) such other documents as Agent may reasonably request.
4.2 All Advances. On each Advance Date:
(a) Agent shall have received (i) an Advance Request for the relevant Advance as required by Section 2.2(c), duly executed by Borrower’s Chief Executive Officer, Chief Financial Officer or Treasurer, and (ii) any other documents Agent may reasonably request;
(b) The representations and warranties set forth in this Agreement shall be true and correct in all material respects on and as of the applicable Advance Date with the same effect as
though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date;
(c) Each Loan Party shall be in compliance with all the terms and provisions set forth herein and in each other Loan Document on its part to be observed or performed; and
(d) Each Advance Request shall be deemed to constitute a representation and warranty by each Loan Party on the relevant Advance Date as to the matters specified in Section 4.2(b), Section 4.2(c) and Section 4.3 and as to the matters set forth in the Advance Request.
4.3 No Default. As of the Closing Date and at the time of and immediately after each Advance Date, (i) no fact or condition exists that could (or could, with the passage of time, the giving of notice, or both) constitute an Event of Default, and (ii) no event that has had or could reasonably be expected to have a Material Adverse Effect has occurred and is continuing.
SECTION 5.REPRESENTATIONS AND WARRANTIES OF BORROWER
Each Loan Party represents and warrants that:
5.1 Corporate Status; Execution and Delivery; Binding Effect. Each Loan Party is a corporation, limited liability company, or partnership (as the case may be) duly organized, legally existing and in good standing under the laws of its jurisdiction of incorporation or formation (as applicable), and is duly qualified as a foreign corporation, limited liability company or partnership, as the case may be, in all jurisdictions in which the nature of its business or location of its properties require such qualifications and where the failure to be qualified could reasonably be expected to have a Material Adverse Effect. Each Loan Party’s present name, former names (if any), locations, place of formation, tax identification number, organizational identification number and other information are correctly set forth in Exhibit B, as may be updated by such Loan Party in a written notice (including any Compliance Certificate) provided to Agent after the Closing Date in accordance with this Agreement. This Agreement has been, and each other Loan Document, when delivered hereunder, will have been, duly executed and delivered by such Loan Party. This Agreement constitutes, and each other Loan Document when so delivered will constitute, a legal, valid and binding obligation of each Loan Party, enforceable against such Loan Party in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium or other laws affecting creditors’ rights generally and by general principles of equity.
5.2 Collateral. Each Loan Party owns or otherwise has the rights to use the Collateral, free of all Liens, except for Permitted Liens. Each Loan Party has the power and authority to grant to Agent a Lien in the Collateral as security for the Secured Obligations.
5.3 Consents. Each Loan Party’s execution, delivery and performance of this Agreement and all other Loan Documents to which it is a party, (i) have been duly authorized by all necessary action of such Loan Party in accordance with its Organizational Documents and applicable law, (ii) will not result in the creation or imposition of any Lien upon the Collateral, other than Permitted Liens, (iii) do not violate any provisions of such Loan Party’s Organizational Documents or any, law, regulation, order, injunction, judgment, decree or writ to which such Loan Party is subject and (iv) except as described on Schedule 5.3, do not violate any contract or agreement or require the consent or approval of any other Person or Governmental Authority which has not already been obtained. The individual or individuals executing the Loan Documents are duly authorized to do so.
5.4 Material Adverse Effect. No event that has had or could reasonably be expected to have a Material Adverse Effect has occurred and is continuing. No Loan Party is aware of any event or circumstance that is likely to occur that is reasonably expected to result in a Material Adverse Effect.
5.5 Actions Before Governmental Authorities. There are no actions, suits, claims, disputes or proceedings at law or in equity or by or before any Governmental Authority now pending or, to the knowledge of any Loan Party, threatened against or affecting such Loan Party or its property, that is reasonably expected to result in a Material Adverse Effect.
5.6 Laws.
(a) No Loan Party nor any of their respective Subsidiaries is in violation of any law, rule or regulation, or in default with respect to any judgment, writ, injunction or decree of any Governmental Authority to which such Loan Party or their respective Subsidiaries are subject, where such violation or default would reasonably be expected to result in a Material Adverse Effect. No Loan Party is in default in any manner under any provision of any agreement or instrument evidencing Indebtedness, or any other agreement to which it is a party or by which it is bound where such violation or default could reasonably be expected to result in a Material Adverse Effect.
(b) No Loan Party nor any of their respective Subsidiaries is an “investment company,” a company that would be an “investment company” except for the exclusion from the definition of “investment company” in Section 3(c) of the Investment Company Act of 1940, as amended (the “1940 Act”), or a company “controlled” by an “investment company” under the 1940 Act. No Loan Party nor any of their respective Subsidiaries is engaged as one of its important activities in extending credit for margin stock (under Regulations X, T and U of the Federal Reserve Board of Governors). Each Loan Party and their respective Subsidiaries has complied in all material respects with the Federal Fair Labor Standards Act. No Loan Party nor any of their respective Subsidiaries is a “holding company” or an “affiliate” of a “holding company” or a “subsidiary company” of a “holding company” as each term is defined and used in the Public Utility Holding Company Act of 2005. Except as disclosed on Schedule 5.6(b), No Loan Party nor any of their respective Subsidiaries’ properties or assets have been used by such
Loan Party or such Subsidiary or, to each Loan Party’s knowledge, by previous Persons, in disposing, producing, storing, treating, or transporting any hazardous substance other than in material compliance with applicable laws. Each Loan Party and each of its Subsidiaries has obtained all consents, approvals and authorizations of, made all declarations or filings with, and given all notices to, all Governmental Authorities that are necessary to continue their respective businesses as currently conducted.
(c) No Loan Party, any of its Subsidiaries, nor to the knowledge of any Loan Party, any Loan Party’s or its Subsidiaries’ Affiliates or any of their respective agents acting or benefiting in any capacity in connection with the transactions contemplated by this Agreement is (i) in violation of any Anti-Terrorism Law, (ii) engaging in or conspiring to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law, or (iii) is a Blocked Person. No Loan Party nor any of their respective Subsidiaries, or (to the knowledge of any Loan Party) any of their Affiliates or agents acting or benefiting in any capacity in connection with the transactions contemplated by this Agreement, (x) conducts any business or engages in making or receiving any contribution of funds, goods or services to or for the benefit of any Blocked Person, or (y) deals in, or otherwise engages in any transaction relating to, any property or interest in property blocked pursuant to Executive Order No. 13224, any similar executive order or other Anti-Terrorism Law. None of the funds to be provided under this Agreement will be used, directly or indirectly, (a) for any activities in violation of any applicable anti-money laundering, economic sanctions and anti-bribery laws and regulations or (b) for any payment to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.
5.7 Information Correct and Current. No information, report, Advance Request, financial statement, exhibit or schedule furnished, by or on behalf of any Loan Party to Agent in connection with any Loan Document or included therein or delivered pursuant thereto contained, or, when taken as a whole, contains or will contain any material misstatement of fact or, when taken together with all other such information or documents, omitted, omits or will omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were, are or will be made, not materially misleading at the time such statement was made or deemed made. Additionally, any and all financial or business projections provided by any Loan Party to Agent, whether prior to or after the Closing Date, shall be (i) provided in good faith and based on the most current data and information available to such Loan Party, and (ii) the most current of such projections provided to such Loan Party’s Board of Directors.
5.8 Tax Matters. Except as set forth on Schedule 5.8, (a) each Loan Party and their respective Subsidiaries have filed all federal and state income Tax returns and other material Tax returns that they are required to file, (b) each Loan Party and their respective Subsidiaries have duly paid all federal and state income Taxes and other material Taxes or installments thereof that
they are required to pay, except Taxes being contested in good faith by appropriate proceedings and for which such Loan Party and its Subsidiaries maintain adequate reserves in accordance with GAAP, and (c) to the best of each Loan Party’s knowledge, no proposed or pending Tax assessments, deficiencies, audits or other proceedings with respect to such Loan Party or any Subsidiaries have had, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
5.9 Intellectual Property Claims. Each Loan Party is the sole owner of, or otherwise has the right to use, the Intellectual Property material to such Loan Party’s business. Except as described on Schedule 5.9, (i) each of the material Copyrights, Trademarks and Patents is valid and enforceable, (ii) no material part of the Intellectual Property has been judged invalid or unenforceable, in whole or in part, and (iii) no claim has been made to any Loan Party that the ownership of or use of any material part of the Intellectual Property violates the rights of any third party. Exhibit C is a true, correct and complete list of each of such loan Party’s Patents, registered Trademarks, registered Copyrights, and material agreements under which such Loan Party licenses Intellectual Property from third parties (other than shrink-wrap software licenses or other than “off- the-shelf” licenses or open-source software), together with application or registration numbers, as applicable, owned by such Loan Party or any Subsidiary. No Loan Party is in material breach of, and no Loan Party has failed to perform any material obligations under, any of the foregoing contracts, licenses or agreements and, to such Loan Party’s knowledge, no third party to any such contract, license or agreement is in material breach thereof or has failed to perform any material obligations thereunder.
5.10 Intellectual Property.
(a) Except as described on Schedule 5.10, each Loan Party has all material rights with respect to intellectual property necessary or material in the operation or conduct of such Loan Party’s business as currently conducted and proposed to be conducted by such Loan Party. Without limiting the generality of the foregoing, except for restrictions that are unenforceable under Division 9 of the UCC or otherwise permitted under this Agreement with respect to Licenses, each Loan Party has the right, to the extent required to operate such Loan Party’s business, to freely transfer, license or assign Intellectual Property necessary or material in the operation or conduct of such Loan Party’s business as currently conducted and proposed to be conducted by such Loan Party, without condition, restriction or payment of any kind (other than license payments in the ordinary course of business) to any third party, and such Loan Party owns or has the right to use, pursuant to valid licenses, all software development tools, library functions, compilers and all other third-party software and other items that are material in the operation or conduct of such Loan Party’s business and used in the design, development, promotion, sale, license, manufacture, import, export, use or distribution of Borrower Products except customary covenants in inbound license agreements and equipment leases where such Loan Party is the licensee or lessee. Except as disclosed on Schedule 5.10, no Loan Party is a party to, nor is it bound by, any Restricted License.
(b) No material software or other materials used by any Loan Party or any of their respective Subsidiaries (or used in any Borrower Products) are subject to an open-source or similar license (including but not limited to the General Public License, Lesser General Public License, Mozilla Public License, or Affero License) in a manner that would cause such software or other materials to have to be (i) distributed to third parties at no charge or a minimal charge (royalty-free basis); (ii) licensed to third parties to modify, make derivative works based on, decompile, disassemble, or reverse engineer; or (iii) used in a manner that requires disclosure or distribution in source code form.
(c) There are no material unpaid fees or royalties under any Material Agreements that have become overdue. Each Material Agreement is in full force and effect and is legal, valid, binding, and enforceable in accordance with its respective terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability. Except as set forth on Schedule 5.10(c), to the knowledge of any Loan Party, neither such Loan Party nor any of its Subsidiaries, as applicable, is in breach of or default in any manner that could reasonably be expected to materially affect the Borrower Products under any Material Agreement to which it is a party, and no circumstances or grounds exist that would give rise to a claim of breach or right of rescission, termination or nonrenewal of any of the Material Agreements, including the execution, delivery and performance of this Agreement and the other Loan Documents.
5.11 Borrower Products. Except as set forth on Schedule 5.11, no Intellectual Property owned by any Loan Party or Borrower Product has been or is subject to any actual or, to the knowledge of such Loan Party, threatened litigation, proceeding (including any proceeding in the United States Patent and Trademark Office or any corresponding foreign office or agency) or outstanding decree, order, judgment, settlement agreement or stipulation that restricts in any manner such Loan Party’s use, transfer or licensing thereof or that may affect the validity, use or enforceability thereof. There is no decree, order, judgment, agreement, stipulation, arbitral award or other provision entered into in connection with any litigation or proceeding that obligates any Loan Party to grant licenses or ownership interest in any future Intellectual Property related to the operation or conduct of the business of such Loan Party or Borrower Products. No Loan Party has received any written notice or claim, or, to the knowledge of such Loan Party, oral notice or claim, challenging or questioning such Loan Party’s ownership in any Intellectual Property (or written notice of any claim challenging or questioning the ownership in any licensed Intellectual Property of the owner thereof) or suggesting that any third party has any claim of legal or beneficial ownership with respect thereto nor, to such Loan Party’s knowledge, is there a reasonable basis for any such claim. No Loan Party’s use of its Intellectual Property nor the production and sale of Borrower Products infringes the Intellectual Property or other rights of others.
5.12 Financial Accounts. Exhibit D, as may be updated by Borrower in a written notice provided to Agent after the Closing Date, is a true, correct and complete list of (a) all banks and other financial institutions at which each Loan Party or any Subsidiary maintains Deposit Accounts and (b) all institutions at which each Loan Party or any Subsidiary maintains an account holding
Investment Property, and such exhibit correctly identifies the name, address and telephone number of each bank or other institution, the name in which the account is held, a description of the purpose of the account, and the complete account number therefor.
5.13 Employee Loans. Except for loans constituting Permitted Investments or as described on Schedule 5.13, no Loan Party has any outstanding loans to any employee, officer or director of such Loan Party nor has any Loan Party guaranteed the payment of any loan made to an employee, officer or director of such Loan Party by a third party.
5.14 Capitalization and Subsidiaries. The capitalization of each Loan Party as of the Closing Date is set forth on Schedule 5.14 annexed hereto. No Loan Party owns any stock, partnership interest or other securities of any Person, except for Permitted Investments. Attached as Schedule 5.14, as may be updated by Borrower in a written notice provided after the Closing Date, is a true, correct and complete list of each Subsidiary.
5.15 Solvency. The fair salable value of the Loan Parties’ consolidated assets (including goodwill minus disposition costs) exceeds the fair value of the Loan Parties’ liabilities; no Loan Party is left with unreasonably small capital after the transactions in this Agreement; and the Loan Parties and their Subsidiaries, on a consolidated basis, are able to pay their debts (including trade debts) as they mature. The amount of any contingent liability at any time shall be computed as the amount that would reasonably be expected to become an actual and matured liability.
SECTION 6.INSURANCE; INDEMNIFICATION
6.1 Coverage. The Loan Parties shall cause to be carried and maintained commercial general liability insurance covering Borrower and its Subsidiaries, on an occurrence form, against risks and in such amounts customarily insured against in Borrower’s line of business. Such risks shall include the risks of bodily injury, including death, property damage, personal injury, advertising injury, and contractual liability per the terms of the indemnification agreement found in Section 6.3. The Loan Parties must maintain a minimum of Two Million Dollars ($2,000,000) of commercial general liability insurance for each occurrence. The Loan Parties maintain and shall continue to maintain a minimum of Two Million Dollars ($2,000,000) of directors’ and officers’ insurance for each occurrence and Five Million Dollars ($5,000,000) in the aggregate. So long as there are any Secured Obligations outstanding (other than inchoate indemnity obligations which, by their terms, survive termination of this Agreement), Borrower shall also cause to be carried and maintained insurance upon the business and assets of such Loan Party and its Subsidiaries, insuring against all risks of physical loss or damage howsoever caused, in an amount not less than the full replacement cost of the Collateral, provided that such insurance may be subject to standard exceptions and deductibles. If any Loan Party fails to obtain the insurance called for by this Section 6.1 or fails to pay any premium thereon or fails to pay any other amount which such Loan Party is obligated to pay under this Agreement or any other Loan Document or which may be required to preserve the Collateral, Agent may obtain such insurance or make such payment, and all amounts so paid by Agent are immediately due and payable, bearing interest at the then highest
rate applicable to the Secured Obligations, and secured by the Collateral. Agent will make reasonable efforts to provide Borrower with notice of Agent obtaining such insurance at the time it is obtained or within a reasonable time thereafter. No payments by Agent are deemed an agreement to make similar payments in the future or Agent’s waiver of any Event of Default.
6.2 Certificates. Borrower shall deliver to Agent certificates of insurance that evidence each Loan Party’s compliance with its insurance obligations in Section 6.1 and the obligations contained in this Section 6.2. Each Loan Party’s insurance certificate shall reflect Agent (shown as “Hercules Capital, Inc., as Agent, and its successors and/or assigns”) is an additional insured for commercial general liability a lenders loss payable for all risk property damage insurance, subject to the insurer’s approval, and a lenders loss payable for property insurance and additional insured for liability insurance for any future insurance that such Loan Party may acquire from such insurer. Subject to Section 7.25(b), attached to the certificates of insurance will be additional insured endorsements for liability and lender’s loss payable endorsements for all risk property damage insurance. All certificates of insurance will provide for a minimum of thirty (30) days’ advance written notice to Agent of cancellation (other than cancellation for non-payment of premiums, for which ten (10) days’ advance written notice shall be sufficient) or any other change adverse to Agent’s interests. Any failure of Agent to scrutinize such insurance certificates for compliance is not a waiver of any of Agent’s rights, all of which are reserved. Each Loan Party shall provide Agent with copies of each insurance policy, and upon entering or amending any insurance policy required hereunder, such Loan Party shall provide Agent with copies of such policies and shall promptly deliver to Agent updated insurance certificates with respect to such policies.
6.3 Indemnity. Each Loan Party agrees to indemnify and hold Agent, Lenders and their officers, directors, employees, agents, in-house attorneys, representatives and shareholders (each, an “Indemnified Person”) harmless from and against any and all third-party claims, costs, expenses, damages and liabilities (including such claims, costs, expenses, damages and liabilities based on liability in tort, including strict liability in tort), including reasonable attorneys’ fees and disbursements and other costs of investigation or defense (including those incurred upon any appeal) (collectively, “Liabilities”), that may be instituted or asserted against or incurred by such Indemnified Person as the result of credit having been extended, suspended or terminated under this Agreement and the other Loan Documents or the administration of such credit, or in connection with or arising out of the transactions contemplated hereunder and thereunder, or any actions or failures to act in connection therewith, or arising out of the disposition or utilization of the Collateral, excluding in all cases Liabilities to the extent such Liabilities arise solely out of gross negligence or willful misconduct of any Indemnified Person or changes in income tax rates. This Section 6.3 shall not apply with respect to Taxes other than any Taxes that represent losses, claims, damages, etc. arising from any non-Tax claim. In no event shall any Indemnified Person be liable on any theory 33 of liability for any special, indirect, consequential or punitive damages (including any loss of profits, business or anticipated savings). This Section 6.3 shall survive the repayment of indebtedness under, and otherwise shall survive the expiration or other termination of, this Agreement, in each case, subject to the applicable statute of limitations.
SECTION 7.COVENANTS OF LOAN PARTIES
Borrower agrees as follows:
7.1 Financial Reports. Borrower shall furnish to Agent the financial statements and reports listed hereinafter (the “Financial Statements”):
(a) as soon as practicable (and in any event within thirty (30) days) after the end of each month, unaudited interim and year-to-date financial statements as of the end of such month (prepared on a consolidated and consolidating basis, if applicable), solely including balance sheet and related statements of income accompanied by a report detailing any material contingencies (including the commencement of any material litigation by or against any Loan Party) or any other occurrence that could reasonably be expected to have a Material Adverse Effect, all certified by a duly authorized officer of Borrower to the effect that they have been prepared in accordance with GAAP, except (i) for the absence of footnotes, (ii) that they are subject to normal year-end adjustments, and (iii) they do not contain certain non-cash items that are customarily included in quarterly and annual financial statements;
(b) as soon as practicable (and in any event within forty-five (45) days after the end of each calendar quarter), unaudited interim and year-to-date financial statements as of the end of such calendar quarter (prepared on a consolidated basis), including balance sheet and related statements of income and cash flows accompanied by a report detailing any material contingencies (including the commencement of any material litigation by or against any Loan Party) or any other occurrence that could reasonably be expected to have a Material Adverse Effect, certified by a duly authorized officer of Borrower to the effect that they have been prepared in accordance with GAAP, except (i) for the absence of footnotes, and (ii) that they are subject to normal year-end adjustments, as well as the most recent capitalization table for Borrower, including the weighted average exercise price of employee stock options;
(c) as soon as practicable (and in any event within one hundred fifty (150) days or, if Borrower or any other Loan Party becomes subject to SEC reporting rules, ninety (90) days) after the end of each fiscal year, audited financial statements as of the end of such year (prepared on a consolidated and consolidating basis, if applicable), including balance sheet and related statements of income and cash flows, and setting forth in comparative form the corresponding figures for the preceding fiscal year, certified without qualification by a firm of independent certified public accountants selected by Borrower and reasonably acceptable to Agent, accompanied by any management report from such accountants;
(d) as soon as practicable (and in any event within thirty (30) days) after the end of each month, a Compliance Certificate;
(e) as soon as practicable (and in any event within thirty (30) days) after the end of each calendar quarter (or as reasonably requested by Agent), a report showing agings of accounts receivable and accounts payable;
(f) promptly after the sending or filing thereof, as the case may be, copies of any proxy statements, financial statements, information or reports that Company has made available to holders of its common stock and copies of any regular, periodic and special reports or registration statements that Company files with the Securities and Exchange Commission or any Governmental Authority that may be substituted therefor, or any national securities exchange;
(g) copies of any material Governmental Approvals obtained by any Loan Party or any of their respective Subsidiaries;
(h) at the same time and in the same manner as it gives to its directors, copies of all notices, minutes, consents and other materials that Borrower provides to its directors in connection with meetings of the Board of Directors, and within thirty (30) days after each such meeting, minutes of such meeting, provided that in all cases Borrower may exclude confidential compensation information;
(i) financial and business projections promptly following its presentation to the Company’s Board of Directors, as well as budgets, operating plans and other financial information reasonably requested by Agent;
(j) a copy of Borrower’s annual 409A valuation report as soon as practicable (and in any event, within ten (10) days after such report becomes available to Borrower);
(k) upon request by the Agent, insurance renewal statements, annually or otherwise promptly upon renewal of insurance policies required to be maintained in accordance with Section 6.1;
(l) prompt notice of any legal process that is reasonably likely to result in damages, expenses or liabilities in excess of Five Hundred Thousand Dollars ($500,000); and
(m) prompt (but in any event no more than two (2) Business Days’) notice if Borrower or any Subsidiary has knowledge that Borrower, or any Subsidiary or Affiliate of Borrower, is listed on the OFAC Lists or (a) is convicted on, (b) pleads nolo contendere to, (c) is indicted on, or (d) is arraigned and held over on charges involving money laundering or predicate crimes to money laundering.
No Loan Party shall make any change in its (a) accounting policies or reporting practices, or (b) fiscal years or fiscal quarters. The fiscal year of each Loan Party shall end on December 31.
The executed Compliance Certificate, and all Financial Statements required to be delivered hereunder shall be sent per instructions (i) specified on Addendum 2 or (ii) otherwise provided by Agent to Borrower via a written notice from time to time.
7.2 Management Rights. The Loan Parties shall permit any representative that Agent or Lenders authorizes, including its attorneys and accountants, to inspect the Collateral and examine and make copies and abstracts of the books of account and records of the Loan Parties at
reasonable times and upon reasonable notice during normal business hours; provided, however, that so long as no Event of Default has occurred and is continuing, such examinations shall be limited to no more often than twice per fiscal year. In addition, in connection with such inspections, any such representative shall have the right to meet with management and officers of the Loan Parties to discuss such books of account and records. In addition, Agent or Lenders shall be entitled at reasonable times and intervals to consult with and advise the management and officers of the Loan 35 Parties concerning significant business issues affecting the Loan Parties. Such consultations shall not unreasonably interfere with the Loan Parties’ business operations. The parties intend that the rights granted Agent and Lenders shall constitute “management rights” within the meaning of 29 C.F.R. Section 2510.3-101(d)(3)(ii), but that any advice, recommendations or participation by Agent or Lenders with respect to any business issues shall not be deemed to give Agent or Lenders, nor be deemed an exercise by Agent or Lenders of, control over the Loan Parties’ management or policies.
7.3 Further Assurances. Each Loan Party shall, and shall cause each other Loan Party to, from time to time execute, deliver and file, alone or with Agent, any financing statements, security agreements, collateral assignments, notices, control agreements, promissory notes or other documents to perfect, give the highest priority to Agent’s Lien on the Collateral or otherwise evidence Agent’s rights herein. Each Loan Party shall from time to time procure any instruments or documents as may be reasonably requested by Agent, and take all further action that may be necessary, or that Agent may reasonably request, to perfect and protect the Liens granted hereby or pursuant to applicable Loan Documents. In addition, and for such purposes only, each Loan Party hereby authorizes Agent to execute and deliver on behalf of such Loan Party and to file such financing statements (including an indication that the financing statement covers “all assets or all personal property” of such Loan Party in accordance with Section 9504 of the UCC), collateral assignments, notices, control agreements, security agreements and other documents without the signature of such Loan Party either in Agent’s name or in the name of Agent as agent and attorney-in-fact for such Loan Party. Each Loan Party shall protect and defend such Loan Party’s title to the Collateral and Agent’s Lien thereon against all Persons claiming any interest adverse to such Loan Party or Agent other than Permitted Liens.
7.4 Indebtedness. No Loan Party shall create, incur, assume, guarantee or be or remain liable with respect to any Indebtedness, or permit any Subsidiary so to do, other than Permitted Indebtedness, or prepay any Indebtedness or take any actions which impose on such Loan Party an obligation to prepay any Indebtedness, except for (a) the conversion of Indebtedness into equity securities and the payment of cash in lieu of fractional shares in connection with such conversion, (b) purchase money Indebtedness pursuant to its then applicable payment schedule, (c) prepayment by any Subsidiary of (i) inter-company Indebtedness owed by such Subsidiary to any Loan Party, or (ii) if such Subsidiary is not a Loan Party, intercompany Indebtedness owed by such Subsidiary to another Subsidiary that is not a Loan Party, (d) payments made on Subordinated Indebtedness to the extent permitted under the relevant Subordination Agreement or (e) as otherwise permitted hereunder or approved in writing by Agent.
7.5 Collateral. Each Loan Party shall at all times (a) keep the Collateral and all other property and assets used in such Loan Party’s business or in which such Loan Party now or hereafter holds any interest free and clear from any Liens whatsoever (except for Permitted Liens), and (b) shall give Agent prompt written notice of any legal process affecting the Collateral, such other property and assets, or any Liens thereon, provided however, that the Collateral and such other property or assets may be subject to Permitted Liens except that there shall be no Liens whatsoever on Intellectual Property. No Loan Party shall agree with any Person other than Agent or Lenders to encumber its property other than in connection with Permitted Liens. No Loan Party shall enter into or suffer to exist or become effective any agreement that prohibits or limits the ability of any Loan Party to create, incur, assume or suffer to exist any Lien upon any of its property (including Intellectual Property), whether now owned or hereafter acquired, to secure its obligations under the Loan Documents to which it is a party other than (i) this Agreement and the other Loan Documents, (ii) any agreements governing any purchase money Liens or capital lease obligations otherwise permitted hereby (in which case, any prohibition or limitation shall only be effective against the assets financed thereby) and (iii) customary restrictions on the assignment of leases, licenses and other agreements. Each Loan Party shall cause its Subsidiaries to protect and defend such Subsidiary’s title to its assets from and against all Persons claiming any interest adverse to such Subsidiary, and such Loan Party shall cause its Subsidiaries at all times to keep such Subsidiary’s property and assets free and clear from any legal process or Liens whatsoever (except for Permitted Liens, provided however, that there shall be no Liens whatsoever on Intellectual Property), and shall give Agent prompt written notice of any legal process affecting such Subsidiary’s assets.
7.6 Investments. No Loan Party shall directly or indirectly acquire or own, or make any Investment in or to any Person, or permit any of its Subsidiaries to do so, other than Permitted Investments.
7.7 Distributions. Except as otherwise described on Schedule 7.7, no Loan Party shall, nor shall it allow any Subsidiary to, (a) repurchase or redeem any class of stock or other Equity Interest other than pursuant to employee, director or consultant repurchase plans or other similar agreements, provided, however, in each case the repurchase or redemption price does not exceed the original consideration paid for such stock or Equity Interest, or (b) declare or pay any cash dividend or make any other cash distribution on any class of stock or other Equity Interest, except that a Subsidiary may pay dividends or make other distributions to such Loan Party or any Subsidiary of such Loan Party, or (c) except for Permitted Investments, lend money to any employees, officers or directors or guarantee the payment of any such loans granted by a third party in excess of Five Hundred Thousand Dollars ($500,000) in the aggregate, or (d) convert of any of its convertible securities into other securities pursuant to the terms of such convertible securities or otherwise in exchange thereof, (e) waive, release or forgive any Indebtedness owed by any employees, officers or directors in excess of Five Hundred Thousand Dollars ($500,000) in the aggregate or (f) distributions pursuant to any put right and/or call right obligations not to exceed the sum of (A) Five Hundred Thousand Dollars ($500,000), plus (B) the remaining unused portion of the Available Amount, minus (C) any portion of the Available Amount that has already been
used for a distribution contemplated under this Section 7.7(f), Permitted Acquisitions, Permitted Indebtedness or Permitted Investments.
7.8 Transfers. Except for Permitted Transfers, no Loan Party shall, nor shall it permit any Subsidiary to, voluntarily or involuntarily transfer, sell, lease, license, lend or in any other manner convey (“Transfer”) any equitable, beneficial or legal interest in any material portion of its assets (including, without limitation, pursuant to a Division).
7.9 Mergers, Consolidations and Acquisitions. No Loan Party shall, nor shall it permit any Subsidiary to, merge, dissolve, liquidate, consolidate with or into another Person, or dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to or in favor of any Person (other than mergers or consolidations of (a) a Subsidiary which is not a Loan Party into another Subsidiary or into such Loan Party or (b) a Loan Party into another Loan Party); provided, however, that any Permitted Acquisition and/or Permitted Investment shall be permitted.
7.10 Taxes. Each Loan Party shall, and shall cause each of its Subsidiaries to, pay when due all material Taxes of any nature whatsoever now or hereafter imposed or assessed against such Loan Party or such Subsidiary or the Collateral or upon such Loan Party’s (or such Subsidiary’s) ownership, possession, use, operation or disposition thereof or upon such Loan Party’s (or such Subsidiary’s) rents, receipts or earnings arising therefrom. Borrower shall, and shall cause each of its Subsidiaries to, accurately file on or before the due date therefor (taking into account proper extensions) all federal and state income Tax returns and other material Tax returns required to be filed. Notwithstanding the foregoing, Each Loan Party and its Subsidiaries may contest, in good faith and by appropriate proceedings diligently conducted, Taxes for which such Loan Party and its Subsidiaries maintain adequate reserves in accordance with GAAP.
7.11 Corporate Changes.
(a) Neither any Loan Party nor any of its Subsidiaries shall change its corporate name, legal form or jurisdiction of formation without ten (10) days’ prior written notice to Agent.
(b) Neither any Loan Party nor any of its Subsidiaries shall suffer a Change in Control.
(c) Neither any Loan Party nor any of its Subsidiaries shall relocate its chief executive office or its principal place of business unless: (i) it has provided prior written notice to Agent; and (ii) such relocation shall be within the continental United States of America.
(d) If any Loan Party intends to add any new offices or business locations, including warehouses, containing any portion of such Loan Party’s assets or property valued, individually or in the aggregate, in excess of Five Hundred Thousand Dollars ($500,000), then such Loan Party shall use commercially reasonable efforts to cause the landlord of any such new offices or business locations, including warehouses, to execute and deliver a landlord consent in form and
substance satisfactory to Agent within forty-five (45) days of such location exceeding such threshold.
(e) If any Loan Party intends to deliver any portion of such Loan Party’s assets or property valued, individually or in the aggregate, in excess of Five Hundred Thousand Dollars ($500,000) to a bailee, and Agent and such bailee are not already parties to a bailee agreement governing both the Collateral and the location to which such Loan Party intends to deliver the Collateral, then such Loan Party will use commercially reasonable efforts to cause such bailee to execute and deliver a bailee agreement in form and substance satisfactory to Agent within forty- five (45) days of such location exceeding such threshold.
(f) No Loan Party will, nor will it permit any Subsidiary to, engage to any material extent in any business other than those businesses conducted by such Loan Party and its Subsidiaries on the date hereof or any business reasonably related or incidental thereto or representing a reasonable expansion thereof.
(g) Without the prior written consent of Agent, no Loan Party will make, or agree to make, any modification, amendment or waiver of any of the terms or provisions of such Loan Party’s Organizational Documents that is materially adverse to Agent or any of the Lenders.
7.12 Deposit Accounts. No Loan Party shall maintain any Deposit Accounts, or accounts holding Investment Property, except with respect to which Agent has an Account Control Agreement, provided that no Account Control Agreement shall be required for any Excluded Account.
7.13 Joinder of Subsidiaries. Borrower shall notify Agent of each Subsidiary formed or acquired subsequent to the Closing Date (including any new Subsidiary formed by Division) and, (a) each Domestic Subsidiary, and (b) if any Foreign Subsidiary becomes a Material Foreign Subsidiary, then within fifteen (15) days of such formation or acquisition (or such longer period of time as agreed to by Agent in writing in its sole discretion), shall cause any such Domestic Subsidiary or Material Foreign Subsidiary to execute and deliver to Agent a Joinder Agreement and such other documents and instruments as shall be requested by Agent to effectuate the transactions contemplated by such Joinder Agreement (in each case in form and substance acceptable to Agent), or, if requested by Agent, a Guaranty and appropriate collateral security documents to secure the obligations pursuant to such Guaranty (in each case in form and substance acceptable to Agent); it being agreed that if such new Subsidiary is formed by a Division, the foregoing requirements shall be satisfied substantially concurrently with the formation of such Subsidiary.
7.14 [Reserved].
7.15 Notification of Event of Default. Each Loan Party shall notify Agent promptly (but in no event later than two (2) Business Days) of the occurrence of any Event of Default.
7.16 SBA. One or more affiliates of Agent have received a license from the U.S. Small Business Administration (“SBA”) to extend loans as a small business investment company (“SBIC”) pursuant to the Small Business Investment Act of 1958, as amended, and the associated regulations (collectively, the “SBIC Act”). Portions of the Loan to Borrower may be made by a Lender that is a SBIC. Addendum 3 to this Agreement outlines various responsibilities of Agent, each Lender and Borrower associated with a loan made by a SBIC, and such Addendum 3 is hereby incorporated in this Agreement.
7.17 Use of Proceeds. Borrower agrees that the proceeds of the Loans shall be used solely to refinance existing indebtedness, to pay related fees and expenses in connection with this Agreement and for working capital and general corporate purposes. The proceeds of the Loans will not be used in violation of Anti-Corruption Laws or applicable Sanctions.
7.18 [Reserved].
7.19 Material Agreement. Each Loan Party shall give prompt written notice to Agent of entering into a Material Agreement or amending a Material Agreement in a manner that is reasonably likely to have a material negative impact on Agent or Lenders or terminating a Material Agreement.
7.20 Compliance with Laws.
(a) Each Loan Party (i) shall maintain, and shall cause its Subsidiaries to maintain, compliance in all material respects with all applicable laws, rules or regulations (including any law, rule or regulation with respect to the making or brokering of loans or financial accommodations), and (ii) shall, or cause its Subsidiaries to, obtain and maintain all required governmental authorizations, approvals, licenses, franchises, permits or registrations reasonably necessary in connection with the conduct of such Loan Party’s business. No Loan Party shall become an “investment company,” a company that would be an “investment company” except for the exclusion from the definition of “investment company” in Section 3(c) of the 1940 Act, or a company controlled by an “investment company” under the 1940 Act, or undertake as one of its important activities extending credit to purchase or carry margin stock (as defined in Regulation X, T and U of the Federal Reserve Board of Governors).
(b) No Loan Party nor any of its Subsidiaries shall, nor shall such Loan Party or any of its Subsidiaries, knowingly permit any Affiliate to, directly or indirectly, knowingly enter into any documents, instruments, agreements or contracts with any Person listed on the OFAC Lists. No Loan Party nor any of its Subsidiaries shall, nor shall such Loan Party or any of its Subsidiaries, knowingly permit any Affiliate to, directly or indirectly, (i) conduct any business or engage in any transaction or dealing with any Blocked Person, including, without limitation, the making or receiving of any contribution of funds, goods or services to or for the benefit of any Blocked Person, (ii) deal in, or otherwise engage in any transaction relating to, any property or interests in property blocked pursuant to Executive Order No. 13224 or any similar executive order or other Anti-Terrorism Law, or (iii) engage in or conspire to engage in any transaction that
evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in Executive Order No. 13224 or other Anti-Terrorism Law.
(c) Each Loan Party has implemented and shall maintain in effect policies and procedures designed to ensure compliance by such Loan Party, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions, and such Loan Party, its Subsidiaries and their respective officers and employees and to the knowledge of such Loan Party its directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects.
(d) No Loan Party, nor any of its Subsidiaries or any of their respective directors, officers or employees, or to the knowledge of such Loan Party, any agent for such Loan Party or its Subsidiaries that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person. No Loan, use of proceeds or other transaction contemplated by this Agreement will violate Anti-Corruption Laws or applicable Sanctions.
7.21 Financial Covenant. Beginning on the Closing Date and at all times thereafter, the Loan Parties shall maintain Qualified Cash in an amount greater than or equal to (i) at all times prior to Borrower’s achievement of the Equity Milestone, Fifteen Million Dollars ($15,000,000) and (ii) at all times after Borrower’s achievement of the Equity Milestone, Twelve Million Five Hundred Thousand Dollars ($12,500,000).
7.22 Intellectual Property. Each Loan Party shall (i) protect, defend and maintain the validity and enforceability of its Intellectual Property; (ii) promptly advise Agent in writing of infringements of its Intellectual Property which has any material value; and (iii) not allow any Intellectual Property material to such Loan Party’s business to be abandoned, forfeited or dedicated to the public without Agent’s written consent. If any Loan Party (a) obtains any Patent, registered Trademark, registered Copyright, registered mask work, or any pending application for any of the foregoing, whether as owner, licensee or otherwise, or (b) applies for any Patent or the registration of any Trademark, then such Loan Party shall promptly (but in no event no later than with delivery of the next Compliance Certificate required to be delivered hereunder) provide written notice thereof to Agent and shall execute such intellectual property security agreements and other documents and take such other actions as Agent may request in its good faith business judgment to perfect and maintain a first priority perfected security interest in favor of Agent in such property. If any Loan Party decides to register any Copyrights or mask works in the United States Copyright Office, such Loan Party shall: (x) provide Agent with at least fifteen (15) days prior written notice of such Loan Party’s intent to register such Copyrights or mask works together with a copy of the application it intends to file with the United States Copyright Office (excluding exhibits thereto); (y) execute an intellectual property security agreement and such other documents and take such other actions as Agent may request in its good faith business judgment to perfect and maintain a first priority perfected security interest in favor of Agent in the Copyrights or mask works intended to be registered with the United States Copyright Office; and (z) record such intellectual property security agreement with the United States Copyright
Office contemporaneously with filing the Copyright or mask work application(s) with the United States Copyright Office. Each Loan Party shall promptly provide to Agent copies of all applications that it files for Patents or for the registration of Trademarks, Copyrights or mask works, together with evidence of the recording of the intellectual property security agreement required for Agent to perfect and maintain a first priority perfected security interest in such property. Each Loan Party shall provide written notice to Agent within thirty (30) days of entering or becoming bound by any Restricted License (other than off-the-shelf software that is commercially available to the public). Each Loan Party shall take such steps as Agent requests to obtain the consent of, or waiver by, any person whose consent or waiver is necessary for (1) any Restricted License to be deemed “Collateral” and for Agent to have a security interest in it that might otherwise be restricted or prohibited by law or by the terms of any such Restricted License, whether now existing or entered into in the future, and (2) Agent to have the ability in the event of a liquidation of any Collateral to dispose of such Collateral in accordance with Agent’s rights and remedies under this Agreement and the other Loan Documents.
7.23 Transactions with Affiliates. Except as otherwise described on Schedule 7.23, No Loan Party shall, nor shall it permit any Subsidiary to, directly or indirectly, enter into or permit to exist any transaction of any kind with any Affiliate of such Loan Party or such Subsidiary on terms that are less favorable to such Loan Party or such Subsidiary, as the case may be, than those that might be obtained in an arm’s length transaction from a Person who is not an Affiliate of such Loan Party or such Subsidiary.
7.24 Board Observation Rights.
(a) Agent shall have the right to have a single representative attend all meetings of the board of directors of any Loan Party and any Subsidiary, as an observer without the right to vote (the “Observer”). Each Loan Party reserves the right to withhold any information and to exclude the Observer from any meeting of the board of directors or portion thereof if such Loan Party reasonably determines that (a) the access to such information or attendance at such meeting would adversely affect the attorney-client privilege between such Loan Party and its counsel, (b) the access to such information or attendance at such meeting would result in disclosure of trade secrets or a conflict of interest to Observer, (c) or the Observer is a competitor of such Loan Party or an Affiliate of a competitor of such Loan Party. Initially, the Observer shall be Gregory Peterson. Observer shall be provided written notice (which may be via email) of all regular meetings of such entities’ board of directors at the same time as provided to any other director, and at least two (2) full business days’ prior written notice (which may be via email) of all special meetings of such entities’ board of directors thereof unless due to the emergency nature of the matters to be addressed at the meeting 48 hours’ written notice is not reasonably practical. Each Loan Party or Subsidiary, as applicable, shall concurrently provide Observer with copies of all notices, minutes, consents and other materials it provides to any member of such board of directors or any committee, provided that any materials protected from discovery by the attorney-client privilege or the attorney work product privilege, any materials necessary or advisable in the good faith determination of such board of directors to avoid a conflict of interest between such
Loan Party, on the one hand, and Agent and Lenders, on the other hand, and any trade secrets may be excluded. All Confidential Information provided to Observer pursuant to this Section 7.24 shall be subject to the confidentiality obligations under Section 11.13. Each Loan Party will reimburse Observer for all reasonable out-of-pocket expenses incurred by Observer in connection with attendance at any such meetings.
(b) In addition to any other rights or remedies to which the Agent may be entitled, Each Loan Party agrees to and will indemnify and hold harmless Agent, Lenders, Observer, their Affiliates and all of their respective successors, assigns, officers, directors, employees, attorneys, and agents from and against any and all losses, claims, obligations, liabilities, deficiencies, diminutions in value, penalties, causes of action, damages, costs, and expenses (including, without limitation, costs of investigation and defense, reasonable attorneys’ fees and expenses) that they, or any of them, may suffer, incur, or be responsible for, arising or resulting from the exercise of rights pursuant to Section 7.24(a) and/or service or status as an “Observer”.
7.25 Post-Closing Obligations. The Loan Parties shall:
(a) deliver, or caused to be delivered, to Agent, within thirty (30) days after the Closing Date (or such later date as Agent may agree in its sole but reasonable discretion), duly executed Account Control Agreements with respect to each Deposit Account and Securities Account (other than the Funding Account and any Excluded Accounts) maintained by any Loan Party;
(b) deliver, or caused to be delivered, to Agent, within thirty (30) days after the Closing Date (or such later date as Agent may agree in its sole but reasonable discretion), insurance endorsements as required pursuant to Section 6.2;
(c) use commercially reasonable efforts to deliver, or cause to be delivered, to Agent, within thirty (30) days after the Closing Date (or such later date as Agent may agree in its sole but reasonable discretion), landlord consents for its (i) chief executive office or its principal place of business and (ii) offices or business locations, including warehouses, containing in excess of Five Hundred Thousand Dollars ($500,000) of any Loan Party’s assets or property;
(d) use commercially reasonable efforts to deliver, or cause to be delivered, to Agent, within thirty (30) days after the Closing Date (or such later date as Agent may agree in its sole but reasonable discretion), duly executed bailee agreements for any bailee location holding a portion of any Loan Party’s assets or property valued, individually or in the aggregate, in excess of Five Hundred Thousand Dollars ($500,000);
(e) within ten (10) days after the Closing Date (or such later date as Agent may agree in its sole but reasonable discretion), all certificates of insurance and copies of each insurance policy and endorsements required hereunder; and
(f) within fifteen (15) Business Days after the Closing Date (or such later date as Agent may agree in its sole but reasonable discretion), (i) the certificates representing the Equity Interests required to be pledged pursuant to the Pledge Agreement, together with an undated stock power or similar instrument of transfer for each such certificate endorsed in blank by a duly authorized officer of the pledgor thereof, and (ii) each material debt instrument (if any) endorsed (without recourse) in blank (or accompanied by an transfer form endorsed in blank) by the pledgor thereof required to be pledged to Agent under the Pledge Agreement.
SECTION 8.[RESERVED]
SECTION 9.EVENTS OF DEFAULT
The occurrence of any one or more of the following events shall be an “Event of Default”:
9.1 Payments. A Loan Party fails to pay any amount due under this Agreement or any of the other Loan Documents on the due date; provided, however, that an Event of Default shall not occur on account of a failure to pay due solely to an administrative or operational error of Agent or Lenders or Borrower’s bank if Borrower had the funds to make the payment when due and makes the payment within three (3) Business Days following Borrower’s knowledge of such failure to pay; or
9.2 Covenants. A Loan Party breaches or defaults in the performance of any covenant or Secured Obligation under this Agreement, or any of the other Loan Documents or any other agreement among any Loan Party, Agent and Lenders, and (a) with respect to a Default under any covenant under this Agreement (other than under Sections 6, 7.4, 7.5, 7.6, 7.7, 7.8, 7.9, 7.15, 7.16, 7.17, 7.19, 7.21, 7.22, 7.24 and 7.25), any other Loan Document, or any other agreement among any Loan Party, Agent and Lenders, such default continues for more than ten (10) days after the earlier of the date on which (i) Agent or Lenders has given notice of such default to Borrower and (ii) any Loan Party has actual knowledge of such default or (b) with respect to a Default under any of Sections 6, 7.4, 7.5, 7.6, 7.7, 7.8, 7.9, 7.15, 7.16, 7.17, 7.19, 7.21, 7.22, 7.24 and 7.25, the occurrence of such Default; or
9.3 Material Adverse Effect. A circumstance has occurred that could reasonably be expected to have a Material Adverse Effect; or
9.4 Representations. Any representation or warranty made by any Loan Party in any Loan Document shall have been false or misleading in any material respect when made or when deemed made; or
9.5 Insolvency. (a) A Loan Party or any of its Subsidiaries fails to be solvent as described under Section 5.15 hereof; (b) a Loan Party or any of its Subsidiaries begins an Insolvency Proceeding; or (c) an Insolvency Proceeding is begun against a Loan Party or any of its Subsidiaries and is not dismissed or stayed within thirty (30) days (but no Advances shall be made
while any of the conditions described in clause (a) exist or until any Insolvency Proceeding is dismissed); or
9.6 Judgments; Penalties. One or more fines, penalties or final judgments, orders or decrees for the payment of money in an amount, individually or in the aggregate, of at least Five Hundred Thousand Dollars ($500,000) (not covered by independent third-party insurance as to which liability has been accepted by such insurance carrier) shall be rendered against any Loan Party or any of its Subsidiaries by any Governmental Authority, and the same are not, within ten (10) days after the entry, assessment or issuance thereof, discharged, or after execution thereof, or stayed pending appeal, or such judgments are not discharged prior to the expiration of any such stay (provided that no Advances shall be made prior to the discharge, or stay of such fine, penalty, judgment, order or decree); or
9.7 Attachment; Levy; Restraint on Business.
(a) (i) The service of process seeking to attach, by trustee or similar process, any funds of any Loan Party or any of its Subsidiaries, or (ii) a notice of lien or levy is filed against any of any Loan Party’s or any of its Subsidiaries’ assets by any Governmental Authority, and the same under subclauses (i) and (ii) hereof are not, within ten (10) days after the occurrence thereof, discharged or stayed (whether through the posting of a bond or otherwise); provided, however, no Advances shall be made during any ten (10) day cure period; or
(b) (i) any material portion of any Loan Party’s or any of its Subsidiaries’ assets is attached, seized, levied on, or comes into possession of a trustee or receiver, or (ii) any court order enjoins, restrains, or prevents any Loan Party from conducting all or any material part of its business
9.8 Other Obligations. The occurrence of any default under (i) any agreement or obligation of a Loan Party involving any Indebtedness in excess of Five Hundred Thousand Dollars ($500,000), or (ii) any Material Agreement if (A) a Material Adverse Effect could reasonably be expected to result from such default, or (B) such default either (x) is due to a Loan Party’s material breach of any provision of such Material Agreement that cannot be cured, which results in a right by such third party or parties to terminate such Material Agreement, and such third party or parties terminate such Material Agreement or (y) is due to a Loan Party’s failure to make a payment of a monetary obligation due under such Material Agreement in an amount in excess of Five Hundred Thousand Dollars ($500,000).
9.9 Governmental Approvals. (a) Any Governmental Approval shall have been revoked, rescinded, suspended, modified in an adverse manner, or not renewed in the ordinary course for a full term and such revocation, rescission, suspension, modification or non renewal has resulted in or could reasonably be expected to result in a Material Adverse Effect; or (b) (i) DOJ or other Governmental Authority initiates a regulatory action or any other enforcement action against any Loan Party or any of its Subsidiaries or any supplier of any Loan Party or any of its
Subsidiaries that causes such Loan Party or any of its Subsidiaries to recall, withdraw, remove or discontinue manufacturing, distributing, and/or marketing any of its products, even if such action is based on previously disclosed conduct; (ii) any Governmental Authority issues a warning letter to any Loan Party or any of its Subsidiaries with respect to any of its activities or products which could reasonably be expected to result in a Material Adverse Effect; (iii) any loan Party or any of its Subsidiaries enters into a settlement agreement with the DOJ or other Governmental Authority that results in aggregate liability as to any single or related series of transactions, incidents or conditions, of Five Hundred Thousand Dollars ($500,000) or more, or that could reasonably be expected to result in a Material Adverse Effect, even if such settlement agreement is based on previously disclosed conduct; or (iv) any Governmental Authority revokes any authorization or permission granted under any Registration, or such Loan Party or any of its Subsidiaries withdraws any Registration, that could reasonably be expected to result in a Material Adverse Effect.
SECTION 10.REMEDIES
10.1 General. Upon the occurrence of any one or more Events of Default, Agent may, and at the direction of the Required Lenders shall, accelerate and demand payment of all or any part of the outstanding Secured Obligations together with a Prepayment Charge and declare them to be immediately due and payable (provided, that upon the occurrence of an Event of Default of the type described in Section 9.5, all of the Secured Obligations (including, without limitation, the Prepayment Charge and the End of Term Charge) shall automatically be accelerated and made due and payable, in each case without any further notice or act). Each Loan Party hereby irrevocably appoints Agent as its lawful attorney-in-fact to: (a) exercisable following the occurrence of an Event of Default, (i) sign such Loan Party’s name on any invoice or bill of lading for any account or drafts against account debtors; (ii) demand, collect, sue, and give releases to any account debtor for monies due, settle and adjust disputes and claims about the accounts directly with account debtors, and compromise, prosecute, or defend any action, claim, case, or proceeding about any Collateral (including filing a claim or voting a claim in any bankruptcy case in Agent’s or such Loan Party’s name, as Agent may elect); (iii) make, settle, and adjust all claims under such Loan Party’s insurance policies; (iv) pay, contest or settle any Lien, charge, encumbrance, security interest, or other claim in or to the Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge the same; (v) transfer the Collateral into the name of Agent or a third party as the UCC permits; and (vi) receive, open and dispose of mail addressed to such Loan Party; and (b) regardless of whether an Event of Default has occurred, (i) endorse such Loan Party’s name on any checks, payment instruments, or other forms of payment or security; and (ii) notify all account debtors to pay Agent directly. Each Loan Party hereby appoints Agent as its lawful attorney-in-fact to sign such Loan Party’s name on any documents necessary to perfect or continue the perfection of Agent’s security interest in the Collateral regardless of whether an Event of Default has occurred until all Secured Obligations have been satisfied in full and the Loan Documents have been terminated. Agent’s foregoing appointment as each Loan Party’s attorney in fact, and all of Agent’s rights and powers, coupled with an interest, are irrevocable until all Secured Obligations (other than inchoate indemnity obligations which, by their terms, survive termination of this Agreement) have been fully repaid and performed and the Loan Documents
have been terminated. Agent may, and at the direction of the Required Lenders shall, exercise all rights and remedies with respect to the Collateral under the Loan Documents or otherwise available to it under the UCC and other applicable law, including the right to release, hold, sell, lease, liquidate, collect, realize upon, or otherwise dispose of all or any part of the Collateral and the right to occupy, utilize, process and commingle the Collateral. All Agent’s rights and remedies shall be cumulative and not exclusive.
10.2 Collection; Foreclosure. Upon the occurrence and during the continuance of any Event of Default, Agent may, and at the direction of the Required Lenders shall, at any time or from time to time, apply, collect, liquidate, sell in one or more sales, lease or otherwise dispose of, any or all of the Collateral, in its then condition or following any commercially reasonable preparation or processing, in such order as Agent may elect. Any such sale may be made either at public or private sale at its place of business or elsewhere. Each Loan Party agrees that any such public or private sale may occur upon ten (10) calendar days’ prior written notice to Borrower. Agent may require any Loan Party to assemble the Collateral and make it available to Agent at a place designated by Agent that is reasonably convenient to Agent and such Loan Party. The proceeds of any sale, disposition or other realization upon all or any part of the Collateral shall be applied by Agent in the following order of priorities:
First, to Agent, in an amount equal to the sum of all fees owing to Agent hereunder and under any other Loan Document;
Second, to Agent and Lenders in an amount sufficient to pay in full Agent’s and Lenders’ reasonable costs and professionals’ and advisors’ fees and expenses as described in Section 11.12;
Third, to Lenders, ratably, in an amount equal to the sum of all accrued interest owing to Lenders on the Term Loan Advances hereunder;
Fourth, to Lenders, ratably, in an amount equal to the sum of the outstanding principal and premium, if any owing to Lenders from the Loan Parties on the Term Loan Advances hereunder;
Fifth, to Lenders and Agent, ratably (in proportion to all remaining Secured Obligations owing to each), in an amount equal to the sum of all other outstanding and unpaid Secured Obligations (including principal, interest, and the default rate interest set forth in Section 2.4, if required under this Agreement), in such order and priority as Agent may choose in its sole discretion; and
Finally, after the full and final payment in Cash of all of the Secured Obligations (other than inchoate obligations which, by their terms, survive termination of this Agreement), to any creditor holding a junior Lien on the Collateral, or to the Loan Parties or their representatives or as a court of competent jurisdiction may direct.
Agent shall be deemed to have acted reasonably in the custody, preservation and disposition of any of the Collateral if it complies with the obligations of a secured party under the UCC.
10.3 No Waiver. Agent shall be under no obligation to marshal any of the Collateral for the benefit of any Loan Party or any other Person, and each Loan Party expressly waives all rights, if any, to require Agent to marshal any Collateral.
10.4 Waivers. Each Loan Party waives demand, notice of default or dishonor, notice of payment and nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees held by Agent on which such Loan Party is liable.
10.5 Cumulative Remedies. The rights, powers and remedies of Agent hereunder shall be in addition to all rights, powers and remedies given by statute or rule of law and are cumulative. The exercise of any one or more of the rights, powers and remedies provided herein shall not be construed as a waiver of or election of remedies with respect to any other rights, powers and remedies of Agent.
SECTION 11.MISCELLANEOUS
11.1 Severability. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under such law, such provision shall be ineffective only to the extent and duration of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.
11.2 Notice. Except as otherwise provided herein, any notice, demand, request, consent, approval, declaration, service of process or other communication (including the delivery of Financial Statements) that is required, contemplated, or permitted under the Loan Documents or with respect to the subject matter hereof shall be in writing, and shall be deemed to have been validly served, given, delivered, and received upon the earlier of: (i) the day of transmission by electronic mail or hand delivery or delivery by an overnight express service or overnight mail delivery service; or (ii) the third calendar day after deposit in the United States of America mails, with proper first class postage prepaid, in each case addressed to the party to be notified as follows:
(a) If to Agent:
HERCULES CAPITAL, INC.
Legal Department
Attention: Chief Legal Officer and Gregory Peterson, James Feldman, and Tess Alonge
1 North B Street, Suite 2000
San Mateo, CA 94401
email: legal@htgc.com, gpeterson@htgc.com, jfeldman@htgc.com, Talonge@htgc.com
Telephone: 650-289-3060
(b) If to Lenders:
HERCULES CAPITAL, INC. and
HERCULES CAPITAL IV L.P.
Legal Department
Attention: Chief Legal Officer and Gregory Peterson, James Feldman, and Tess Alonge
1 North B Street, Suite 2000
San Mateo, CA 94401
email: legal@htgc.com, gpeterson@htgc.com, jfeldman@htgc.com, Talonge@htgc.com
Telephone: 650-289-3060
(c) If to Borrower:
VOYAGER SPACE HOLDINGS, INC.
Attention: Phil De Sousa and Meg Vernal
1225 17th St, Suite 1100
Denver, CO 80202
email: phil.desousa@voyagerspace.com, meg.vernal@voyagerspace.com Telephone: 917-740-0353
with a copy to:
Morgan, Lewis & Bockius LLP
2222 Market Street
Philadelphia, Pennsylvania 19103
Attention: Andrew T. Budreika
email: andrew.budreika@morganlewis.com
or to such other address as each party may designate for itself by like notice.
11.3 Entire Agreement; Amendments.
(a) This Agreement and the other Loan Documents constitute the entire agreement and understanding of the parties hereto in respect of the subject matter hereof and thereof, and supersede and replace in their entirety any prior proposals, term sheets, non-disclosure or confidentiality agreements, letters, negotiations or other documents or agreements, whether written or oral, with respect to the subject matter hereof or thereof (including Agent’s revised proposal letter dated May 13, 2024 and the Non-Disclosure Agreement).
(b) Neither this Agreement, any other Loan Document, nor any terms hereof or thereof may be amended, supplemented or modified except in accordance with the provisions of this Section 11.3(b). The Required Lenders and Loan Parties party to the relevant Loan Document may, or, with the written consent of the Required Lenders, Agent and Loan Parties party to the
relevant Loan Document may, from time to time, (i) enter into written amendments, supplements or modifications hereto and to the other Loan Documents for the purpose of adding any provisions to this Agreement or the other Loan Documents or changing in any manner the rights of Lenders or of Loan Parties hereunder or thereunder or (ii) waive, on such terms and conditions as the Required Lenders or Agent, as the case may be, may specify in such instrument, any of the requirements of this Agreement or the other Loan Documents or any Default or Event of Default and its consequences; provided, however, that no such waiver and no such amendment, supplement or modification shall (A) forgive the principal amount or extend the final scheduled date of maturity 47 of any Loan, extend the scheduled date of any amortization payment in respect of any Term Loan Advance, reduce the stated rate of any interest (or fee payable hereunder) or extend the scheduled date of any payment thereof, in each case without the written consent of each Lender directly affected thereby; (B) eliminate or reduce the voting rights of any Lender under this Section 11.3(b) without the written consent of such Lender; (C) reduce any percentage specified in the definition of Required Lenders, consent to the assignment or transfer by Loan Parties of any of its rights and obligations under this Agreement and the other Loan Documents, release all or substantially all of the Collateral or release a Loan Party from its obligations under the Loan Documents, in each case without the written consent of all Lenders; or (D) amend, modify or waive any provision of Section 11.18 or Addendum 4 without the written consent of Agent. Any such waiver and any such amendment, supplement or modification shall apply equally to each Lender and shall be binding upon the applicable Loan Parties, Lenders, Agent and all future holders of the Loans.
11.4 No Strict Construction. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Agreement.
11.5 No Waiver. The powers conferred upon Agent and Lenders by this Agreement are solely to protect their rights hereunder and under the other Loan Documents and their interest in the Collateral and shall not impose any duty upon Agent or Lenders to exercise any such powers. No omission or delay by Agent or Lenders at any time to enforce any right or remedy reserved to them, or to require performance of any of the terms, covenants or provisions hereof by any Loan Party at any time designated, shall be a waiver of any such right or remedy to which Agent or Lenders is entitled, nor shall it in any way affect the right of Agent or Lenders to enforce such provisions thereafter.
11.6 Survival. All agreements, representations and warranties contained in this Agreement and the other Loan Documents or in any document delivered pursuant hereto or thereto shall be for the benefit of Agent and Lenders and shall survive the execution and delivery of this Agreement. Sections 6.3, 11.9, 11.11, 11.14, 11.15, 11.17 and 11.18 shall survive the termination of this Agreement.
11.7 Successors and Assigns. The provisions of this Agreement and the other Loan Documents shall inure to the benefit of and be binding on each of the Loan Parties and their assigns (if any). No Loan Party shall assign its obligations under this Agreement or any of the other Loan Documents without Agent’s express prior written consent, and any such attempted assignment shall be void and of no effect. Agent and Lenders may assign, transfer, or endorse its rights hereunder and under the other Loan Documents without prior notice to Borrower, and all of such rights shall inure to the benefit of Agent’s and Lenders’ successors and assigns; provided that as long as no Event of Default has occurred and is continuing, neither Agent nor any Lender may assign, transfer or endorse its rights hereunder or under the Loan Documents to any party that is a direct competitor of Borrower (as reasonably determined by Agent), it being acknowledged that in all cases, any transfer to an Affiliate of any Lender or Agent shall be allowed. Notwithstanding the foregoing, (x) in connection with any assignment by a Lender as a result of a forced divestiture at the request of any regulatory agency, the restrictions set forth herein shall not apply and Agent and Lenders may assign, transfer or endorse its rights hereunder and under the other Loan Documents to any Person or party and (y) in connection with a Lender’s own financing or securitization transactions, the restrictions set forth herein shall not apply and Agent and Lenders may assign, transfer or endorse its rights hereunder and under the other Loan Documents to any Person or party providing such financing or formed to undertake such securitization transaction and any transferee of such Person or party upon the occurrence of a default, event of default or similar occurrence with respect to such financing or securitization transaction; provided that no such sale, transfer, pledge or assignment under this clause (y) shall release such Lender from any of its obligations hereunder or substitute any such Person or party for such Lender as a party hereto until Agent shall have received and accepted an effective assignment agreement from such Person or party in form satisfactory to Agent executed, delivered and fully completed by the applicable parties thereto, and shall have received such other information regarding such assignee as Agent reasonably shall require. Agent, acting solely for this purpose as a non-fiduciary agent of the Loan Parties, shall maintain at one of its offices in the United States a register for the recordation of the names and addresses of Lender(s), and the Term Commitments of, and principal amounts (and stated interest) of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive absent manifest error, and the Loan Parteis, Agent and Lender(s) shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice.
11.8 Participations. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Loan Parties, maintain a register on which it enters the name and address of each participant and the principal amounts (and stated interest) of each participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any participant or any information relating to a participant’s interest in any commitments, loans, its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such
commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, Agent (in its capacity as Agent) shall have no responsibility for maintaining a Participant Register. Each Loan Party agrees that each participant shall be entitled to the benefits of the provisions in Addendum 1 attached hereto (subject to the requirements and limitations therein, including the requirements under Section 7 of Addendum 1 attached hereto (it being understood that the documentation required under Section 7 of Addendum 1 attached hereto shall be delivered to the participating Lender)) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to Section 11.7; provided that such participant shall not be entitled to receive any greater payment under Addendum 1 attached hereto, with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a change in law that occurs after the participant acquired the applicable participation.
11.9 Governing Law. This Agreement and the other Loan Documents have been negotiated and delivered to Agent and Lenders in the State of New York, and shall have been accepted by Agent and Lenders in the State of New York. Payment to Agent and Lenders by Borrower of the Secured Obligations is due in the State of New York. This Agreement and the other Loan shall be governed by, and construed and enforced in accordance with, the laws of the State of New York, excluding conflict of laws principles that would cause the application of laws of any other jurisdiction.
11.10 Consent to Jurisdiction and Venue. All judicial proceedings (to the extent that the reference requirement of Section 11.11 is not applicable) arising in or under or related to this Agreement or any of the other Loan Documents may be brought in any state or federal court located in the State of New York. By execution and delivery of this Agreement, each party hereto generally and unconditionally: (a) consents to nonexclusive personal jurisdiction in the City of New York, borough of Manhattan, or of the United States of America for the Southern District of New York; (b) waives any objection as to jurisdiction or venue in City of New York, borough of Manhattan, or of the United States of America for the Southern District of New York; (c) agrees not to assert any defense based on lack of jurisdiction or venue in the aforesaid courts; and (d) irrevocably agrees to be bound by any judgment rendered thereby in connection with this Agreement or the other Loan Documents. Service of process on any party hereto in any action arising out of or relating to this Agreement shall be effective if given in accordance with the requirements for notice set forth in Section 11.2, and shall be deemed effective and received as set forth in Section 11.2. Nothing herein shall affect the right to serve process in any other manner permitted by law or shall limit the right of either party to bring proceedings in the courts of any other jurisdiction.
11.11 Mutual Waiver of Jury Trial
. Because disputes arising in connection with complex financial transactions are most quickly and economically resolved by an experienced and expert Person and the parties wish applicable state and federal laws to apply (rather than arbitration rules), the parties desire that their disputes be resolved by a judge applying such applicable laws. EACH OF THE LOAN PARTIES, AGENT AND LENDERS SPECIFICALLY WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY OF ANY CAUSE OF ACTION, CLAIM, CROSS-CLAIM, COUNTERCLAIM, THIRD PARTY CLAIM OR ANY OTHER CLAIM (COLLECTIVELY, “CLAIMS”) ASSERTED BY ANY LOAN PARTY AGAINST AGENT, LENDERS OR THEIR RESPECTIVE ASSIGNEE OR BY AGENT, LENDERS OR THEIR RESPECTIVE ASSIGNEE AGAINST ANY LOAN PARTY. This waiver extends to all such Claims, including Claims that involve Persons other than Agent, any Loan Party or any Lenders; Claims that arise out of or are in any way connected to the relationship among Loan Parties, Agent and Lenders; and any Claims for damages, breach of contract, tort, specific performance, or any equitable or legal relief of any kind, arising out of this Agreement, any other Loan Document.
11.12 Professional Fees. Each Loan Party promises to pay Agent’s and Lenders’ fees and expenses necessary to finalize the Loan Documents, including but not limited to reasonable attorneys’ fees, UCC searches, filing costs, and other miscellaneous expenses. In addition, each Loan Party promises to pay any and all reasonable attorneys’ and other professionals’ fees (including allocated costs of in-house counsel) and expenses incurred by Agent and Lenders after the Closing Date in connection with or related to: (a) the Loan; (b) the administration, collection, or enforcement of the Loan; (c) the amendment or modification of the Loan Documents; (d) any waiver, consent, release, or termination under the Loan Documents; (e) the protection, preservation, audit, field exam, sale, lease, liquidation, or disposition of Collateral or the exercise of remedies with respect to the Collateral; (f) any legal, litigation, administrative, arbitration, or out of court proceeding in connection with or related to any Loan Party or the Collateral, and any appeal or review thereof; and (g) any bankruptcy, restructuring, reorganization, assignment for the benefit of creditors, workout, foreclosure, or other action related to any Loan Party, the Collateral, the Loan Documents, including representing Agent or Lenders in any adversary proceeding or contested matter commenced or continued by or on behalf of any Loan Party’s estate, and any appeal or review thereof.
11.13 Confidentiality. Agent and Lenders acknowledge that certain items of Collateral and information provided to Agent and Lenders by the Loan Parties are confidential and proprietary information of the Loan Parties, if and to the extent such information either (x) is marked as confidential by the Loan Parties at the time of disclosure, or (y) should reasonably be understood to be confidential (the “Confidential Information”). Accordingly, Agent and Lenders agree that any Confidential Information it may obtain in the course of acquiring, administering, or perfecting Agent’s security interest in the Collateral shall not be disclosed to any other Person or entity in any manner whatsoever, in whole or in part, without the prior written consent of Borrower, except that Agent and Lenders may disclose any such information: (a) to its Affiliates and its partners, investors, lenders, directors, officers, employees, agents, advisors, counsel, accountants, representative and other professional advisors if Agent or Lenders in their sole
discretion determines that any such party should have access to such information in connection with such party’s responsibilities in connection with the Loan or this Agreement and, provided that such recipient of such Confidential Information either (i) agrees to be bound by the confidentiality provisions of this Section or (ii) is otherwise subject to confidentiality restrictions that reasonably protect against the disclosure of Confidential Information; (b) if such information is generally available to the public or to the extent such information becomes publicly available other than as a result of a breach of this Section or becomes available to Agent or any Lender, or any of their respective Affiliates on a non- confidential basis from a source other than a Loan Party; (c) if required or appropriate in any report, statement or testimony submitted to any Governmental Authority having or claiming to have jurisdiction over Agent or Lenders and any rating agency; (d) if required or appropriate in response to any summons or subpoena or in connection with any litigation, to the extent permitted or deemed advisable by Agent’s or Lenders’ counsel; (e) to comply with any legal requirement or law applicable to Agent or Lenders or demanded by any Governmental Authority; (f) to the extent reasonably necessary in connection with the exercise of, or preparing to exercise, or the enforcement of, or preparing to enforce, any right or remedy under any Loan Document (including Agent’s sale, lease, or other disposition of Collateral after the occurrence of a Default), or any action or proceeding relating to any Loan Document; (g) to any participant or assignee of Agent or Lenders or any prospective participant or assignee, provided, that such participant or assignee or prospective participant or assignee is subject to confidentiality restrictions that reasonably protect against the disclosure of Confidential Information; (h) to any investor or potential investor (and each of their respective Affiliates or clients) in Agent or Lenders (or each of their respective Affiliates); provided that such investor, potential investor, Affiliate or client is subject to confidentiality obligations with respect to the Confidential Information; (i) otherwise to the extent consisting of general portfolio information that does not identify any Loan Party; or (j) otherwise with the prior consent of Borrower; provided, that any disclosure made in violation of this Agreement shall not affect the obligations of Borrower or any of its Affiliates or any guarantor under this Agreement or the other Loan Documents. Agent’s and Lenders’ obligations under this Section 11.13 shall supersede all of their respective obligations under the Non-Disclosure Agreement.
11.14 Assignment of Rights. Each Loan Party acknowledges and understands that Agent or Lenders may, subject to Section 11.7, sell and assign all or part of its interest hereunder and under the Loan Documents to any Person or entity (an “Assignee”). After such assignment the term “Agent” or “Lender” as used in the Loan Documents shall mean and include such Assignee, and such Assignee shall be vested with all rights, powers and remedies of Agent and Lenders hereunder with respect to the interest so assigned; but with respect to any such interest not so transferred, Agent and Lenders shall retain all rights, powers and remedies hereby given. No such assignment by Agent or Lenders shall relieve any Loan Party of any of its obligations hereunder. Lenders agree that in the event of any transfer by it of the promissory note(s) (if any), it will endorse thereon a notation as to the portion of the principal of the promissory note(s), which shall have been paid at the time of such transfer and as to the date to which interest shall have been last paid thereon.
11.15 Revival of Secured Obligations. This Agreement and the Loan Documents shall remain in full force and effect and continue to be effective if any petition is filed by or against any Loan Party for liquidation or reorganization, if such Loan Party becomes insolvent or makes an assignment for the benefit of creditors, if a receiver or trustee is appointed for all or any significant part of such Loan Party’s assets, or if any payment or transfer of Collateral is recovered from Agent or Lenders. The Loan Documents and the Secured Obligations and Collateral security shall continue to be effective, or shall be revived or reinstated, as the case may be, if at any time payment and performance of the Secured Obligations or any transfer of Collateral to Agent, or any part thereof is rescinded, avoided or avoidable, reduced in amount, or must otherwise be restored or returned by, or is recovered from, Agent, Lenders or by any obligee of the Secured Obligations, whether as a “voidable preference,” “fraudulent conveyance,” or otherwise, all as though such payment, performance, or transfer of Collateral had not been made. In the event that any payment, or any part thereof, is rescinded, reduced, avoided, avoidable, restored, returned, or recovered, the Loan Documents and the Secured Obligations shall be deemed, without any further action or documentation, to have been revived and reinstated except to the extent of the full, final, and indefeasible payment to Agent or Lenders in Cash.
11.16 Counterparts. This Agreement and any amendments, waivers, consents or supplements hereto may be executed in any number of counterparts, and by different parties hereto in separate counterparts, each of which when so delivered shall be deemed an original, but all of which counterparts shall constitute but one and the same instrument.
11.17 No Third-Party Beneficiaries. No provisions of the Loan Documents are intended, nor will be interpreted, to provide or create any third-party beneficiary rights or any other rights of any kind in any Person other than Agent, Lenders and Loan Parties unless specifically provided otherwise herein, and, except as otherwise so provided, all provisions of the Loan Documents will be personal and solely among Agent, Lenders and the Loan Parties party thereto.
11.18 Agency. Agent and each Lender hereby agree to the terms and conditions set forth on Addendum 4 attached hereto. Each Loan Party acknowledges and agrees to the terms and conditions set forth on Addendum 4 attached hereto.
11.19 Publicity. Notwithstanding anything else herein to the contrary, each Loan Party hereby agrees that the Agent and Lender may, at Agent’s or such Lender's sole expense, and without any prior approval by or compensation to such Loan Party, make a public announcement of the transactions contemplated by this Agreement, and may publicize or use (a) the other party’s name (including a brief description of the relationship among the parties hereto), logo or hyperlink to such other parties’ web site, separately or together, in written and oral presentations, advertising, promotional and marketing materials, client lists, public relations materials or on its web site (together, the “Publicity Materials”); (b) the names of officers of such other parties in the Publicity Materials; and (c) such other parties’ name, trademarks, servicemarks in any news or press release concerning such party, in each case to the extent such information is not deemed confidential in accordance with Section 11.13.
11.20 Multiple Borrowers. Each Borrower hereby agrees to the terms and conditions set forth on Addendum 5 attached hereto.
11.21 [Reserved].
11.22 Managerial Assistance. Each Loan Party acknowledges that Hercules Capital, Inc. has elected to be regulated as a business development company under the 1940 Act, and as such is required to make available significant managerial assistance to its portfolio companies. Significant managerial assistance may include, but is not limited to, guidance and counsel concerning the portfolio company’s management, operations, business objectives and policies, arrangement of financing, management of relationships with financing sources, recruitment of management personnel and evaluation of acquisition and divestiture opportunities. Each Loan Party hereby acknowledges and agrees that it may request such assistance at any time from Hercules Capital, Inc. by contacting legal@htgc.com.
11.23 Electronic Execution of Certain Other Documents. The words “execution,” “execute”, “signed,” “signature,” and words of like import in or related to any document to be signed in connection with this Agreement and the transactions contemplated hereby (including without limitation assignments, assumptions, amendments, waivers and consents) shall be deemed to include electronic signatures, the electronic matching of assignment terms and contract formations on electronic platforms approved by Agent, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.
SECTION 12.GUARANTY.
12.1 Guaranty. Each Guarantor hereby absolutely, unconditionally and irrevocably guarantees, as primary obligor and not merely as surety, to Agent on behalf of the Lenders the due and prompt payment (whether at stated maturity, upon acceleration or otherwise and at all times thereafter), performance and discharge of all Secured Obligations. Each Guarantor further agrees that the Secured Obligations may be increased, amended, extended, renewed or otherwise modified in whole or in part without notice to or consent from such Guarantor, and that such actions will not affect the liability of such Guarantor under this Guaranty. All terms of this Guaranty apply to and may be enforced by or on behalf of any domestic or foreign branch or Affiliate of any Lender that extended any portion of the Secured Obligations. Each Guarantor hereby agrees that it is jointly and severally liable for this Guaranty. This guaranty of the Secured Obligations includes in all cases all such Secured Obligations which arise after the filing of a bankruptcy petition with respect to any Loan Party and all such Secured Obligations which would become due but for the operation of (i) the automatic stay under Section 362(a) of the Bankruptcy Code, (ii) Section 502(b) of the Bankruptcy Code, or (iii) Section 506(b) of the Bankruptcy Code, including interest accruing under the Loan Documents after the filing of a bankruptcy petition,
whether or not allowed or allowable as a claim in the Insolvency Proceeding. This Guaranty is a guaranty of prompt and punctual payment of the Secured Obligations, whether at stated maturity, by acceleration or otherwise, and is not merely a guaranty of collection.
12.1 Limitation of Liability. Notwithstanding any other provision of this Guaranty, the amount guaranteed by each Guarantor hereunder shall be limited to the extent, if any, required so that its obligations under this Guaranty will not constitute a fraudulent transfer or conveyance and not be subject to avoidance under any applicable Debtor Relief Law or any state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act, Uniform Voidable Transactions Act or similar statute or common law.
12.2 Term; Reinstatement.
(a) This Guaranty is a continuing guaranty and shall terminate only upon repayment in full of all Secured Obligations (other than inchoate indemnity obligations, inchoate reimbursement obligations and/or other obligations which, by their terms, are to survive the termination of this Agreement). If, notwithstanding the foregoing, any Guarantor shall have any nonwaivable right under applicable law or otherwise to terminate or revoke this Guaranty, such Guarantor agrees that such termination or revocation shall not be effective until such applicable Lender receives written notice of such termination or revocation. Such notice shall not affect any Lender’s right and power to enforce rights arising prior to receipt thereof. If any Lender makes Advances or takes any other action after such Guarantor’s termination or revocation but prior to receipt of the requisite notice, any such Lender’s rights with respect thereto shall be the same as if such termination or revocation had not occurred.
(b) Each Guarantor’s liability hereunder shall be reinstated and revived, and any Lender’s rights shall continue, if at any time all or part of any payment of any Secured Obligation is rescinded or must otherwise be returned by any Lender or any other Person upon the bankruptcy, insolvency or reorganization of Borrower or any other Guarantor or for any other reason, all as though such payment had not been made and this Guaranty shall be reinstated if the Agreement had expired or terminated and all of the Secured Obligations had been satisfied prior to the restoration or return of the payment.
12.3 Guaranty Absolute and Unconditional; Waiver of Defenses. The liability of each Guarantor under this Guaranty is irrevocable, continuing, unconditional and absolute and the obligations of each Guarantor under this Guaranty will not be reduced, limited, impaired, discharged, subject to setoff, counterclaim, recoupment, or termination, or otherwise affected for any reason (other than repayment in full of all Secured Obligations (other than inchoate indemnity obligations, inchoate reimbursement obligations and/or other obligations which, by their terms, are to survive the termination of this Agreement)), and each Guarantor hereby irrevocably waives any defenses to enforcement it may have (now or in the future) based on or arising out of any defense of any Loan Party or the unenforceability of all or any part of the Secured Obligations or any Loan Document or any related agreement or instrument from any cause, or the cessation from any cause of the liability of any Loan Party or any other Person liable for the Secured Obligations, other than
repayment in full of all Secured Obligations (other than inchoate indemnity obligations, inchoate reimbursement obligations and/or other obligations which, by their terms, are to survive the termination of this Agreement). Without limiting the foregoing, the obligations of any Loan Party hereunder are not discharged or impaired or otherwise affected by, without limitation: (a) any claim of waiver, release, extension, renewal, settlement, surrender, alteration, change in terms or compromise of any of the Secured Obligations or any other obligation of any Loan Party under any Loan Document, by operation of law or otherwise; (b) any rescission, waiver, amendment or other modification of any Loan Document or any other agreement, including any increase in the Secured Obligations; (c) any change in the corporate existence, structure or ownership of any Loan Party or any of its Subsidiaries; (d) any Insolvency Proceeding affecting any Person, or their assets or any resulting release or discharge of any obligation of any Person; (e) the existence of any claim, setoff or other rights which any Loan Party may have at any time against any Lender or any other Person, whether in connection herewith or in any unrelated transactions; (f) any sale, disposition, application of proceeds, taking, exchange, substitution, release, impairment, or non-perfection of any collateral, or any taking, release, impairment, amendment, waiver, or other modification of any guaranty, for the Secured Obligations; (g) any default in the performance of the Secured Obligations; (h) any failure of any Lender or such Lender’s Affiliates to disclose to any Loan Party any information relating to the business, condition, operations, performance, properties, or prospects of any other Loan Party now or hereafter known to such Person; (i) the release or reduction of liability of any Loan Party, or other guarantor or surety, with respect to the Secured Obligations; (j) the failure of any Loan Party to assert any claim or demand or to exercise or enforce any right or remedy under the provisions of any Loan Document or otherwise; or (k) any other circumstance (including any statute of limitations) or manner of administering the Loans or any existence of or reliance on any representation by any Lender that might vary the risk of any Loan Party or otherwise operate as a defense available to, or a legal or equitable discharge of, any Loan Party or any other guarantor or surety (other than repayment in full of all Secured Obligations (other than inchoate indemnity obligations, inchoate reimbursement obligations and/or other obligations which, by their terms, are to survive the termination of this Agreement)). Each Loan Party agrees that the payment of all sums payable under the Loan Documents or any part thereof or other act which tolls any statute of limitations applicable to the Loan Documents shall similarly operate to toll the statute of limitations applicable to such Loan Party’s liability under this Guaranty.
12.4 Waivers and Acknowledgments.
(a) Each Guarantor hereby unconditionally and irrevocably waives (i) any right to revoke this Guaranty and acknowledges that this Guaranty is continuing in nature and applies to all presently existing and future Secured Obligations, (ii) promptness, diligence, notice of acceptance, presentment, demand for performance, notice of nonperformance, default, acceleration, protest or dishonor, and any other notice with respect to any of the Secured Obligations and this Guaranty, and any requirement that any Lender protect, secure, perfect, or insure any Lien or any property subject thereto and (iii) any defense based on any right of set-off
or recoupment or counterclaim against or in respect of the obligations of such Guarantor under this Guaranty.
(b) Each Guarantor acknowledges that it has received adequate consideration for entering into this Guaranty and that all waivers and acknowledgments under this Section 12 by such Guarantor are knowingly made and that the Lenders would not enter into the Agreement but for this Guaranty.
(c) Each Guarantor (i) acknowledges and agrees that any Lender will not have any duty to advise of or otherwise disclose any information known to it regarding Borrower’s financial condition or assets or of all other circumstances bearing upon the risk of nonpayment of the Secured Obligations or the nature, scope and extent of the risks that each Guarantor assumes and incurs under this Guaranty and (ii) assumes all responsibility for being and keeping itself informed of such circumstances and risks.
(d) Each Guarantor confirms that it is not a surety under any state law and shall not raise any such law as a defense to its obligations hereunder.
(e) Each Guarantor acknowledges that any Lender may, at its election and without notice to or demand upon such Guarantor, foreclose on any Collateral or other collateral held by it by one or more judicial or non-judicial sales, accept an assignment of any such Collateral or other collateral in lieu of foreclosure, compromise or adjust any part of the Secured Obligations, make any other accommodation with Borrower or any other Loan Party or guarantor, or exercise any other right or remedy available to it against Borrower or any other Loan Party or guarantor, without affecting or impairing in any way the liability of any Guarantor hereunder except on the occurrence of the repayment in full of all Secured Obligations (other than inchoate indemnity obligations, inchoate reimbursement obligations and/or other obligations which, by their terms, are to survive the termination of this Agreement). Each Guarantor hereby waives any defense arising out of such election even though such election operates, pursuant to applicable law, to impair or to extinguish any right of subrogation, reimbursement, exoneration, contribution, or indemnification, or other right or remedy of such Guarantor against Borrower or any other Loan Party or guarantor or any Collateral or any other collateral.
12.5 Agreement to Pay; Subrogation; Etc. Without limiting any other right that any Lender has at law or in equity against any Loan Party, if any Loan Party fails to pay any Secured Obligation when and as due, whether at maturity, by acceleration, after notice of prepayment, or otherwise, each other Loan Party agrees to promptly pay the amount of such unpaid Secured Obligations to Agent in cash. Each Loan Party hereby defers and no Loan Party shall exercise any rights which it may acquire by reason of any payment made under this Guaranty, whether by way of subrogation, reimbursement or otherwise, in each case, until the prior repayment in full of all Secured Obligations (other than inchoate indemnity obligations, inchoate reimbursement obligations and/or other obligations which, by their terms, are to survive the termination of this Agreement). Any amount paid to any Loan Party on account of any payment made under this Guaranty prior to repayment in full of all Secured Obligations (other than inchoate indemnity
obligations, inchoate reimbursement obligations and/or other obligations which, by their terms, are to survive the termination of this Agreement) shall be held in trust for the benefit of Agent and promptly turned over to Agent. So long as any Secured Obligations remain outstanding, each Loan Party will not take any action or commence any proceeding against any Loan Party, whether in connection with an Insolvency Proceeding or otherwise, to recover any amounts in respect of payments made to any Lender under this Guaranty.
12.6 Taxes. For the avoidance of doubt, each Guarantor agrees to observe and perform each of the terms and conditions set forth in Addendum 1 as it relates to such Guarantor in connection with any payments or performance under this Guaranty.
12.7 Additional Guarantors. Each Person that is required to become a Guarantor pursuant to Section 7.13 will become a Guarantor, with the same force and effect as if they were originally named as a Guarantor herein, for all purposes of this Agreement upon the execution and delivery by such Person of a joinder in form and substance acceptable to Agent. Each reference to “Guarantor” or “Loan Party” (or any words of like import referring to a Guarantor) in this Agreement or any other Loan Document shall also mean such additional Guarantor; and each reference in this Agreement or any other Loan Document to this “Guaranty” or “Agreement” (or words of like import referring to this Agreement) shall mean this Agreement as supplemented by such joinder. No consent of any other Loan Party will be required for the execution and delivery of any such joinder. The rights and obligations of each Loan Party will remain in full force and effect notwithstanding the addition of any Guarantor as a party to this Agreement.
12.8 Cumulative Liability. The liability of each Loan Party as a Guarantor under this Section 12 is in addition to and shall be cumulative with all liabilities of such Loan Party to any Lender under this Agreement and the other Loan Documents to which such Loan Party is a party or in respect of any obligations or liabilities of the other Loan Parties, without any limitation as to amount, unless the instrument or agreement evidencing or creating such other liability specifically provides to the contrary.
(SIGNATURES TO FOLLOW)
IN WITNESS WHEREOF, the Loan Parties, Agent and Lenders have duly executed and delivered this Loan and Security Agreement as of the day and year first above written.
| | | | | | | | | | | | | | |
| BORROWER: | | |
| | | | |
| VOYAGER SPACE HOLDINGS, INC. |
| | | | |
| Signature: | /s/ Filipe De Sousa | | |
| Print Name: | Filipe De Sousa | | |
| Title: | Chief Financial Officer | | |
| | | | |
| | | | |
| GUARANTORS: |
| | | | |
| VOYAGER SPACE IP HOLDINGS, LLC |
| | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | /s/ Filipe De Sousa | | |
| Print Name: | Filipe De Sousa | | |
| Title: | Chief Financial Officer | | |
| | | | |
| | | | |
| VOYAGER SPACE FORCE, LLC |
| | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | /s/ Filipe De Sousa | | |
| Print Name: | Filipe De Sousa | | |
| Title: | Chief Financial Officer | | |
| | | | |
| | | | |
| VOYAGER VENTURES, LLC |
| | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | /s/ Filipe De Sousa | | |
| Print Name: | Filipe De Sousa | | |
| Title: | Chief Financial Officer | | |
| | | | |
| | | | |
[Signature page to Loan and Security Agreement]
| | | | | | | | | | | | | | |
| VOYAGER SPACE IPX, LLC |
| | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | /s/ Filipe De Sousa | | |
| Print Name: | Filipe De Sousa | | |
| Title: | Chief Financial Officer | | |
| | | | |
| | | | |
| VOYAGER SPACE SERVICES, LLC | |
| | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | /s/ Filipe De Sousa | | |
| Print Name: | Filipe De Sousa | | |
| Title: | Chief Financial Officer | | |
| | | | |
| | | | |
| ZIN TECHNOLOGIES, INC. |
| | | | |
| Signature: | | | |
| Print Name: | Carlos Grodsinsky | | |
| Title: | President | | |
| | | | |
| | | | |
| ZIN AEROSPACE, INC. |
| | | | |
| Signature: | | | |
| Print Name: | Carlos Grodsinsky | | |
| Title: | President | | |
| | | | |
| | | | |
| PIONEER INVENTION, LLC |
| | | | |
| Signature: | | | |
| Print Name: | Frank Morgan | | |
| Title: | Chief Operating Officer | | |
| | | | |
| | | | |
[Signature page to Loan and Security Agreement]
| | | | | | | | | | | | | | |
| VOYAGER SPACE SCIENCE PARK, LLC |
| | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | /s/ Filipe De Sousa | | |
| Print Name: | Filipe De Sousa | | |
| Title: | Chief Financial Officer | | |
| | | | |
| | | | |
| VOYAGER SPACE IPX, LLC |
| | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | | | |
| Print Name: | Filipe De Sousa | | |
| Title: | Chief Financial Officer | | |
| | | | |
| | | | |
| VOYAGER SPACE SERVICES, LLC | |
| | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | | | |
| Print Name: | Filipe De Sousa | | |
| Title: | Chief Financial Officer | | |
| | | | |
| | | | |
| ZIN TECHNOLOGIES, INC. |
| | | | |
| Signature: | /s/ Carlos Grodsinsky | | |
| Print Name: | Carlos Grodsinsky | | |
| Title: | President | | |
| | | | |
| | | | |
| ZIN AEROSPACE, INC. |
| | | | |
| Signature: | /s/ Carlos Grodsinsky | | |
| Print Name: | Carlos Grodsinsky | | |
| Title: | President | | |
| | | | |
| | | | |
[Signature page to Loan and Security Agreement]
| | | | | | | | | | | | | | |
| PIONEER INVENTION, LLC |
| | | | |
| Signature: | | | |
| Print Name: | Frank Morgan | | |
| Title: | Chief Operating Officer | | |
| | | | |
| | | | |
| VOYAGER SPACE SCIENCE PARK, LLC |
| | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | | | |
| Print Name: | Filipe De Sousa | | |
| Title: | Chief Financial Officer | | |
| | | | |
| | | | |
| VOYAGER SPACE IPX, LLC |
| | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | | | |
| Print Name: | Filipe De Sousa | | |
| Title: | Chief Financial Officer | | |
| | | | |
| | | | |
| VOYAGER SPACE SERVICES, LLC | |
| | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | | | |
| Print Name: | Filipe De Sousa | | |
| Title: | Chief Financial Officer | | |
| | | | |
| | | | |
| ZIN TECHNOLOGIES, INC. |
| | | | |
| Signature: | | | |
| Print Name: | Carlos Grodsinsky | | |
| Title: | President | | |
| | | | |
| | | | |
[Signature page to Loan and Security Agreement]
| | | | | | | | | | | | | | |
| ZIN AEROSPACE, INC. |
| | | | |
| Signature: | | | |
| Print Name: | Carlos Grodsinsky | | |
| Title: | President | | |
| | | | |
| | | | |
| PIONEER INVENTION, LLC |
| | | | |
| Signature: | /s/ Frank Morgan | | |
| Print Name: | Frank Morgan | | |
| Title: | Chief Operating Officer | | |
| | | | |
| | | | |
| VOYAGER SPACE SCIENCE PARK, LLC |
| | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | | | |
| Print Name: | Filipe De Sousa | | |
| Title: | Chief Financial Officer | | |
| | | | |
| | | | |
| ALTIUS SPACE MACHINES, INC. |
| | | | |
| Signature: | /s/ Paul Schauer | | |
| Print Name: | Paul Schauer | | |
| Title: | Chief Operating Officer & | | |
| | Chief Financial Officer | | |
| | | | |
| | | | |
| XO MARKETS HOLDINGS, INC. |
| | | | |
| Signature: | | | |
| Print Name: | Timothy Kopra | | |
| Title: | Chief Executive Officer | | |
| | | | |
| | | | |
| NANORACKS LLC |
| | | | |
| By: XO Markets Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | | | |
| Print Name: | Timothy Kopra | | |
| Title: | Chief Executive Officer | | |
| | | | |
[Signature page to Loan and Security Agreement]
| | | | | | | | | | | | | | |
| | | | |
| XO AIRLOCK, LLC |
| | | | |
| By: XO Markets Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | | | |
| Print Name: | Timothy Kopra | | |
| Title: | Chief Executive Officer | | |
| | | | |
| | | | |
| DREAMUP, PBC |
| | | | |
| Signature: | | | |
| Print Name: | Christopher Cummins | | |
| Title: | President & Vice President | |
| | | | |
| | | | |
| THE LAUNCH COMPANY, LLC |
| | | | |
| Signature: | | | |
| Print Name: | Michael O’Brien | | |
| Title: | President | | |
| | | | |
| ALTIUS SPACE MACHINES, INC. |
| | | | |
| Signature: | | | |
| Print Name: | Paul Schauer | | |
| Title: | Chief Operating Officer & | | |
| | Chief Financial Officer | | |
| | | | |
| | | | |
| XO MARKETS HOLDINGS, INC. |
| | | | |
| Signature: | /s/ Timothy Kopra | | |
| Print Name: | Timothy Kopra | | |
| Title: | Chief Executive Officer | | |
| | | | |
| | | | |
| NANORACKS LLC |
| | | | |
| By: XO Markets Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | /s/ Timothy Kopra | | |
| Print Name: | Timothy Kopra | | |
| Title: | Chief Executive Officer | | |
[Signature page to Loan and Security Agreement]
| | | | | | | | | | | | | | |
| | | | |
| | | | |
| XO AIRLOCK, LLC |
| | | | |
| By: XO Markets Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | /s/ Timothy Kopra | | |
| Print Name: | Timothy Kopra | | |
| Title: | Chief Executive Officer | | |
| | | | |
| | | | |
| DREAMUP, PBC |
| | | | |
| Signature: | | | |
| Print Name: | Christopher Cummins | | |
| Title: | President & Vice President | |
| | | | |
| | | | |
| THE LAUNCH COMPANY, LLC |
| | | | |
| Signature: | | | |
| Print Name: | Michael O’Brien | | |
| Title: | President | | |
| | | | |
| ALTIUS SPACE MACHINES, INC. |
| | | | |
| Signature: | | | |
| Print Name: | Paul Schauer | | |
| Title: | Chief Operating Officer & | | |
| | Chief Financial Officer | | |
| | | | |
| | | | |
| XO MARKETS HOLDINGS, INC. |
| | | | |
| Signature: | | | |
| Print Name: | Timothy Kopra | | |
| Title: | Chief Executive Officer | | |
| | | | |
| | | | |
[Signature page to Loan and Security Agreement]
| | | | | | | | | | | | | | |
| NANORACKS LLC |
| | | | |
| By: XO Markets Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | | | |
| Print Name: | Timothy Kopra | | |
| Title: | Chief Executive Officer | | |
| | | | |
| | | | |
| XO AIRLOCK, LLC |
| | | | |
| By: XO Markets Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | | | |
| Print Name: | Timothy Kopra | | |
| Title: | Chief Executive Officer | | |
| | | | |
| | | | |
| DREAMUP, PBC |
| | | | |
| Signature: | /s/ Christopher Cummins | | |
| Print Name: | Christopher Cummins | | |
| Title: | President & Vice President | |
| | | | |
| | | | |
| THE LAUNCH COMPANY, LLC |
| | | | |
| Signature: | | | |
| Print Name: | Michael O’Brien | | |
| Title: | President | | |
| | | | |
| ALTIUS SPACE MACHINES, INC. |
| | | | |
| Signature: | | | |
| Print Name: | Paul Schauer | | |
| Title: | Chief Operating Officer & | | |
| | Chief Financial Officer | | |
| | | | |
[Signature page to Loan and Security Agreement]
| | | | | | | | | | | | | | |
| | | | |
| XO MARKETS HOLDINGS, INC. |
| | | | |
| Signature: | | | |
| Print Name: | Timothy Kopra | | |
| Title: | Chief Executive Officer | | |
| | | | |
| | | | |
| NANORACKS LLC |
| | | | |
| By: XO Markets Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | | | |
| Print Name: | Timothy Kopra | | |
| Title: | Chief Executive Officer | | |
| | | | |
| | | | |
| XO AIRLOCK, LLC |
| | | | |
| By: XO Markets Holdings, Inc., as sole member and member-manager |
| | | | |
| Signature: | | | |
| Print Name: | Timothy Kopra | | |
| Title: | Chief Executive Officer | | |
| | | | |
| | | | |
| DREAMUP, PBC |
| | | | |
| Signature: | | | |
| Print Name: | Christopher Cummins | | |
| Title: | President & Vice President | |
| | | | |
| | | | |
| THE LAUNCH COMPANY, LLC |
| | | | |
| Signature: | /s/ Michael O’Brien | | |
| Print Name: | Michael O’Brien | | |
| Title: | President | | |
| | | | |
[Signature page to Loan and Security Agreement]
| | | | | | | | | | | | | | | | | |
| VALLEY TECH SYSTEMS, INC. | |
| | | | | |
| Signature: | /s/ Michael O’Brien | | | |
| Print Name: | Michael O’Brien | | | |
| Title: | President & Chief Financial | | |
| | Officer | | | |
| | | | | |
| | | | | |
| SPACE MICRO INC. | |
| | | | | |
| Signature: | | | | |
| Print Name: | Arsen Melconian | | | |
| Title: | Chief Executive Officer & | | | |
| | President | | | |
| | | | | |
| | | | | |
| VOYAGER SPACE EXPLORATION, LLC |
| | | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | | |
| Signature: | | | | |
| Print Name: | Filipe De Sousa | | | |
| Title: | Chief Financial Officer | | | |
[Signature page to Loan and Security Agreement]
| | | | | | | | | | | | | | | | | |
| VALLEY TECH SYSTEMS, INC. | |
| | | | | |
| Signature: | | | | |
| Print Name: | Michael O’Brien | | | |
| Title: | President & Chief Financial | | |
| | Officer | | | |
| | | | | |
| | | | | |
| SPACE MICRO INC. | |
| | | | | |
| Signature: | /s/ Arsen Melconian | | | |
| Print Name: | Arsen Melconian | | | |
| Title: | Chief Executive Officer & | | | |
| | President | | | |
| | | | | |
| | | | | |
| VOYAGER SPACE EXPLORATION, LLC |
| | | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | | |
| Signature: | | | | |
| Print Name: | Filipe De Sousa | | | |
| Title: | Chief Financial Officer | | | |
[Signature page to Loan and Security Agreement]
| | | | | | | | | | | | | | | | | |
| VALLEY TECH SYSTEMS, INC. | |
| | | | | |
| Signature: | | | | |
| Print Name: | Michael O’Brien | | | |
| Title: | President & Chief Financial | | |
| | Officer | | | |
| | | | | |
| | | | | |
| SPACE MICRO INC. | |
| | | | | |
| Signature: | | | | |
| Print Name: | Arsen Melconian | | | |
| Title: | Chief Executive Officer & | | | |
| | President | | | |
| | | | | |
| | | | | |
| VOYAGER SPACE EXPLORATION, LLC |
| | | | | |
| By: Voyager Space Holdings, Inc., as sole member and member-manager |
| | | | | |
| Signature: | /s/ Filipe De Sousa | | | |
| Print Name: | Filipe De Sousa | | | |
| Title: | Chief Financial Officer | | | |
[Signature page to Loan and Security Agreement]
| | | | | | | | | | | | | | |
| AGENT: |
| | | | |
| HERCULES CAPITAL, INC. |
| | | | |
| Signature: | /s/ Jennifer Choe | | |
| Print Name: Jennifer Choe |
| Title: Deputy General Counsel, Portfolio Transactions |
| | | | |
| LENDERS: |
| | | | |
| HERCULES CAPITAL, INC. |
| | | | |
| Signature: | /s/ Jennifer Choe | | |
| Print Name: Jennifer Choe | | |
| Title: Deputy General Counsel, Portfolio Transactions | | |
| | | | |
| HERCULES CAPITAL IV, L.P. |
| | | | |
| By: Hercules Technology SBIC Management, LLC, its General Partner |
| | | | |
| By: Hercules Capital, Inc., its Manager |
| | | | |
| Signature: | /s/ Jennifer Choe | | |
| Print Name: Jennifer Choe |
| Title: Deputy General Counsel, Portfolio Transactions |
| | | | |
| HERCULES PRIVATE CREDIT FUND 1 L.P. |
| | | | |
| By: Hercules Adviser LLC, its Investment Adviser |
| | | | |
| Signature: | /s/ Jennifer Choe | | |
| Print Name: Jennifer Choe |
| Title: Authorized Signatory |
| | | | |
[Signature page to Loan and Security Agreement]
| | | | | | | | | | | | | | |
| HERCULES PRIVATE GLOBAL |
| VENTURE GROWTH FUND I L.P. |
| | | | |
| By: Hercules Adviser LLC, its Investment Adviser |
| | | | |
| Signature: | /s/ Jennifer Choe | | |
| Print Name: Jennifer Choe |
| Title: Authorized Signatory |
[Signature page to Loan and Security Agreement]
| | | | | |
| Table of Addenda, Exhibits and Schedules |
| |
| Annex A: | Original Guarantors |
| |
| Addendum 1: | Taxes; Increased Costs |
| |
| Addendum 2: | Delivery Instructions |
| |
| Addendum 3: | SBA Provisions |
| |
| Addendum 4: | Agent and Lender Terms |
| |
| Addendum 5: | Multiple Loan Party Terms |
| |
| Exhibit A: | Advance Request Attachment to Advance Request |
| |
| Exhibit B: | Name, Locations, and Other Information |
| |
| Exhibit C: | Patents, Trademarks, Copyrights and Licenses |
| |
| Exhibit D: | Deposit Accounts and Investment Accounts |
| |
| Exhibit E: | Compliance Certificate |
| |
| Exhibit F: | Joinder Agreement |
| |
| Exhibit G: | [Reserved] |
| |
| Exhibit H: | ACH Debit Authorization Agreement |
| |
| Exhibit I: | [Reserved] |
| |
| Exhibit J-1: | Form of U.S. Tax Compliance Certificate (For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes) |
| |
| Exhibit J-2: | Form of U.S. Tax Compliance Certificate (For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes) |
| |
| Exhibit J-3: | Form of U.S. Tax Compliance Certificate (For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes) |
| |
| Exhibit J-4: | Form of U.S. Tax Compliance Certificate (For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes) |
| |
| Schedule 1.1 | Commitments |
| Schedule 1 | Subsidiaries |
| Schedule 1A | Existing Permitted Indebtedness |
| | | | | |
| Schedule 1B | Existing Permitted Investments |
| Schedule 1C | Existing Permitted Liens |
| Schedule 5.3 | Consents, Etc. |
| Schedule 5.6(b) Laws |
| Schedule 5.8 | Tax Matters |
| Schedule 5.9 | Intellectual Property Claims |
| Schedule 5.10 | Intellectual Property |
| Schedule 5.10(c) Intellectual Property |
| Schedule 5.11 | Borrower Products |
| Schedule 5.13 | Employee Loans |
| Schedule 5.14 | Capitalization |
| Schedule 7.7 | Distributions |
| Schedule 7.23 | Affiliate Transactions |
| Exhibit A | Capitalization Table |
[Signature Page to Loan and Security Agreement]
ANNEX A to LOAN AND SECURITY AGREEMENT
Original Guarantors
1.Voyager Space IP Holdings, LLC
2.Voyager Space Force, LLC
3.Voyager Ventures, LLC
4.Voyager Space IPX, LLC
5.Voyager Space Services, LLC
6.Zin Technologies, Inc.
7.Zin Aerospace, Inc.
8.Pioneer Invention, LLC
9.Voyager Space Science Park, LLC
10.Altius Space Machines, Inc.
11.XO Markets Holdings, Inc.
12.Nanoracks LLC
13.XO Airlock, LLC
14.DreamUp, PBC
15.The Launch Company, LLC
16.Valley Tech Systems, Inc.
17.Voyager Space Exploration, LLC
18.Space Micro Inc.
ADDENDUM 1 to LOAN AND SECURITY AGREEMENT
TAXES; INCREASED COSTS
1. Defined Terms. For purposes of this Addendum 1:
a. “Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.
b. “Excluded Taxes” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (i) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (A) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (B) that are Other Connection Taxes, (ii) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Term Commitment pursuant to a law in effect on the date on which (A) such Lender acquires such interest in the Loan or Term Commitment or (B) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 2 or Section 4 of this Addendum 1, amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (iii) Taxes attributable to such Recipient’s failure to comply with Section 7 of this Addendum 1 and (iv) any withholding Taxes imposed under FATCA.
c. “FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code, and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities and implementing such Sections of the Code.
d. “Foreign Lender” means a Lender that is not a U.S. Person.
e. “Indemnified Taxes” means (i) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of Borrower under any Loan Document and (ii) to the extent not otherwise described in clause (i), Other Taxes.
f. “Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become
a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).
g. “Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment.
h. “Recipient” means Agent or any Lender, as applicable.
i. “Withholding Agent” means Borrower and Agent.
2. Payments Free of Taxes. Any and all payments by or on account of any obligation of Borrower under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by applicable law. If any applicable law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by Borrower shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section 2 or Section 4 of this Addendum 1) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.
3. Payment of Other Taxes by Borrower. Borrower shall timely pay to the relevant Governmental Authority in accordance with applicable law, or at the option of Agent timely reimburse it for the payment of, any Other Taxes.
4. Indemnification by Borrower. Borrower shall indemnify each Recipient, within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under Section 2 of this Addendum 1 or this Section 4) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate describing the amount of such payment or liability delivered to Borrower by a Lender (with a copy to Agent), or by Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error. In addition, Borrower agrees to pay, and to hold Agent and any Lender harmless from, any and all liabilities with respect to, or resulting from any delay in paying, any and all excise, sales or other similar Taxes (excluding Taxes imposed on or measured by
[Signature Page to Loan and Security Agreement]
the net income of Agent or such Lender) that may be payable or determined to be payable with respect to any of the Collateral or this Agreement.
5. Indemnification by Lenders. Each Lender shall severally indemnify Agent, within ten (10) days after demand therefor, for (a) any Indemnified Taxes attributable to such Lender (but only to the extent that Borrower has not already indemnified Agent for such Indemnified Taxes and without limiting the obligation of Borrower to do so), (b) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 11.8 of the Agreement relating to the maintenance of a Participant Register and (c) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by Agent shall be conclusive absent manifest error. Each Lender hereby authorizes Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by Agent to Lenders from any other source against any amount due to Agent under this Section 5.
6. Evidence of Payments. As soon as practicable after any payment of Taxes by Borrower to a Governmental Authority pursuant to the provisions of this Addendum 1, Borrower shall deliver to Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to Agent.
7. Status of Lenders.
a. Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to Borrower and Agent, at the time or times reasonably requested by Borrower or Agent, such properly completed and executed documentation reasonably requested by Borrower or Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by Borrower or Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by Borrower or Agent as will enable Borrower or Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Sections 7(b)(i), 7(b)(ii) and 7(b)(iv) of this Addendum 1) shall not be required if in such Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.
[Signature Page to Loan and Security Agreement]
b. Without limiting the generality of the foregoing, in the event that Borrower is a U.S. Person,
i.any Lender that is a U.S. Person shall deliver to Borrower and Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or Agent), executed copies of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;
ii.any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to Borrower and Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or Agent), whichever of the following is applicable:
A.in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed copies of IRS Form W-8BEN or IRS Form W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or IRS Form W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;
B.executed copies of IRS Form W-8ECI;
C.in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit J-1 to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of Borrower within the meaning of Section 871(h)(3)(B) of the Code, or a “controlled foreign corporation” related to Borrower as described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed copies of IRS Form W-8BEN or IRS Form W-8BEN-E; or
D.to the extent a Foreign Lender is not the beneficial owner, executed copies of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, IRS Form W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of Exhibit J-2 or Exhibit J-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance
[Signature Page to Loan and Security Agreement]
Certificate substantially in the form of Exhibit J-4 on behalf of each such direct and indirect partner;
iii.any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to Borrower and Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or Agent), executed copies of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit Borrower or Agent to determine the withholding or deduction required to be made; and
iv.if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to Borrower and Agent at the time or times prescribed by law and at such time or times reasonably requested by Borrower or Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by Borrower or Agent as may be necessary for Borrower and Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount, if any, to deduct and withhold from such payment. Solely for purposes of this subsection (iv), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.
c. Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify Borrower and Agent in writing of its legal inability to do so.
8. Treatment of Certain Refunds. If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to the provisions of this Addendum 1 (including by the payment of additional amounts pursuant to the provisions of this Addendum 1), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under the provisions of this Addendum 1 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this Section 8 (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this Section 8, in no event will
[Signature Page to Loan and Security Agreement]
the indemnified party be required to pay any amount to an indemnifying party pursuant to this Section 8 the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This Section 8 shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.
9. Increased Costs. If any change in applicable law shall subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (ii) through (iv) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto, and the result shall be to increase the cost to such Recipient of making, converting to, continuing or maintaining any Term Loan Advance or of maintaining its obligation to make any such Loan, or to reduce the amount of any sum received or receivable by such Recipient (whether of principal, interest or any other amount), then, upon the request of such Recipient, Borrower will pay to such Recipient such additional amount or amounts as will compensate such Recipient for such additional costs incurred or reduction suffered.
10. Survival. Each party’s obligations under the provisions of this Addendum 1 shall survive the resignation or replacement of Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Term Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.
[Signature Page to Loan and Security Agreement]
ADDENDUM 2 to LOAN AND SECURITY AGREEMENT
Delivery Instructions
The Compliance Certificate shall be uploaded and executed via Lumonic2. All other financial reports required to be furnished to Agent pursuant to Section 7.1 shall be submitted via Lumonic.
The Compliance Certificate and other financial reports required to be furnished to Agent pursuant to Section 7.1 may be sent to hercules@lumonic.com with a copy to legal@htgc.com, should access to Lumonic be temporarily unavailable.
2 All references to Lumonic shall be interpreted as the Portfolio Management Software currently in use by Agent. Lumonic can be reached at the following URL: https://lumonic.com/
ADDENDUM 3 to LOAN AND SECURITY AGREEMENT
SBIC
(a) Borrower’s Business. For purposes of this Addendum 3, Borrower shall be deemed to include its “affiliates” as defined in Title 13 Code of Federal Regulations Section 121.103. Borrower represents and warrants to Agent and Lenders as of each SBA Funding Date and covenants to Agent and Lenders for a period of one year after each SBA Funding Date or for such longer period as set forth below with respect to subsections 2, 3, 4, 5, 6 and 7 below, as follows:
1.Size Status. Borrower’s primary NAICS code is 541715 and has less than 575 employees in the aggregate;
2.No Relender. Borrower’s primary business activity does not involve, directly or indirectly, providing funds to others, purchasing debt obligations, factoring, or long-term leasing of equipment with no provision for maintenance or repair;
3.No Passive Business. Borrower is engaged in a regular and continuous business operation (excluding the mere receipt of payments such as dividends, rents, lease payments, or royalties). Borrower’s employees are carrying on the majority of day to day operations. Borrower will not pass through substantially all of the proceeds of the Loan to another entity;
4.No Real Estate Business. Borrower is not classified under North American Industry Classification System (NAICS) codes 531110 (lessors of residential buildings and dwellings), 531120 (lessors of nonresidential buildings except miniwarehouses), 531190 (lessors of other real estate property), 237210 (land subdivision), or 236117 (new housing for-sale builders). Borrower is not classified under NAICS codes 236118 (residential remodelers), 236210 (industrial building construction), or 236220 (commercial and institutional building construction), if Borrower is primarily engaged in construction or renovation of properties on its own account rather than as a hired contractor. Borrower is not classified under NAICS codes 531210 (offices of real estate agents and brokers), 531311 (residential property managers), 531312 (nonresidential property managers), 531320 (offices of real estate appraisers), or 531390 (other activities related to real estate), unless it derives at least 80 percent of its revenue from non-Affiliate sources. The proceeds of the Loan will not be used to acquire or refinance real property unless Borrower (x) is acquiring an existing property and will use at least 51 percent of the usable square footage for its business purposes; (y) is building or renovating a building and will use at least 67 percent of the usable square
footage for its business purposes; or (z) occupies the subject property and uses at least 67 percent of the usable square footage for its business purposes.
5.No Project Finance. Borrower’s assets are not intended to be reduced or consumed, generally without replacement, as the life of its business progresses, and the nature of Borrower’s business does not require that a stream of cash payments be made to the business’s financing sources, on a basis associated with the continuing sale of assets (e.g., real estate development projects and oil and gas wells). The primary purpose of the Loan is not to fund production of a single item or defined limited number of items, generally over a defined production period, where such production will constitute the majority of the activities of Borrower (e.g., motion pictures and electric generating plants).
6.No Farm Land Purchases. Borrower will not use the proceeds of the Loan to acquire farm land which is or is intended to be used for agricultural or forestry purposes, such as the production of food, fiber, or wood, or is so taxed or zoned.
7.No Foreign Investment. The proceeds of the Loan will not be used substantially for a foreign operation. Borrower will not have, on or within one year after each SBA Funding Date and each other Loan provided by a Lender that is an SBIC more than 49 percent of its employees or tangible assets located outside the United States of America.
(b) Small Business Administration Documentation. Agent and Lenders acknowledge that Borrower completed, executed and delivered to Agent prior to each SBA Funding Date SBA Forms 480, 652 and 1031 (Parts A and B) together with a business plan showing Borrower’s financial projections (including balance sheets and income and cash flows statements) for the period described therein and a written statement (whether included in the purchase agreement or pursuant to a separate statement) from Agent regarding its intended use of proceeds from the sale of securities to Lenders (the “Use of Proceeds Statement”). Borrower represents and warrants to Agent and Lenders that the information regarding Borrower and its affiliates set forth in the SBA Form 480, Form 652 and Form 1031 and the Use of Proceeds Statement delivered as of each SBA Funding Date is accurate and complete.
(c) Inspection. The following covenants contained in this Section (c) are intended to supplement and not to restrict the related provisions of the Loan Documents. Subject to the preceding sentence, Borrower will permit, for so long as Lenders hold any debt or equity securities of Borrower, Agent, Lenders or their representative, at Agent’s or Lenders’ expense, and examiners of the SBA to visit and inspect the properties and assets of Borrower, to examine its books of account and records, and to discuss Borrower’s affairs, finances and accounts with
Borrower’s officers, senior management and accountants, all at such reasonable times as may be requested by Agent or Lenders or the SBA.
(d) Annual Assessment. Upon request of Agent or Lender, promptly after the end of each calendar year (but in any event prior to February 28 of each year) and at such other times as may be reasonably requested by Agent or Lenders, Borrower will deliver to Agent a written assessment of the economic impact of Lenders’ investment in Borrower, specifying the full-time equivalent jobs created or retained in connection with the investment, the impact of the investment on the businesses of Borrower in terms of expanded revenue and taxes, other economic benefits resulting from the investment (such as technology development or commercialization, minority business development, or expansion of exports) and such other information as may be required regarding Borrower in connection with the filing of Lenders’ SBA Form 468. Lenders will assist Borrower with preparing such assessment. In addition to any other rights granted hereunder, Borrower will grant Agent and Lenders and the SBA access to Borrower’s books and records for the purpose of verifying the use of such proceeds. Borrower also will furnish or cause to be furnished to Agent and Lenders such other information regarding the business, affairs and condition of Borrower as Agent or Lenders may from time to time reasonably request, and such information shall be certified by the President, Chief Executive Officer or Chief Financial Officer of Borrower to the extent requested by Agent or Lender for compliance with the SBIC Act.
(e) Use of Proceeds. Borrower will use the proceeds from the Loan only for purposes set forth in Section 7.17. Borrower will deliver to Agent from time to time promptly following Agent’s request, a written report, certified as correct by Borrower’s Chief Financial Officer, verifying the purposes and amounts for which proceeds from the Loan have been disbursed. Borrower will supply to Agent such additional information and documents as Agent reasonably requests with respect to its use of proceeds and will, to the extent required by Section 7.2, permit Agent and Lenders and the SBA to have access to any and all Borrower records and information and personnel as Agent deems necessary to verify how such proceeds have been or are being used, and to assure that the proceeds have been used for the purposes specified in Section 7.17.
(f) Activities and Proceeds. Neither Borrower nor any of its affiliates (if any) will engage in any activities or use directly or indirectly the proceeds from the Loan for any purpose for which a small business investment company is prohibited from providing funds by the SBIC Act, including 13 C.F.R. §107.720. Borrower shall not, nor shall it cause or permit any of its subsidiaries to, without obtaining the prior written approval of Agent, change Borrower’s or any such subsidiary’s business activities from that conducted on the date hereof to a business activity from which a licensee under the SBIC Act is prohibited from providing funds by the SBIC Act. Borrower agrees that any such change in its or any such subsidiary’s business activities without such prior written consent of Agent shall constitute a material breach of the obligations of Borrower under this Addendum 3.
(g) [Reserved].
(h) Compliance and Resolution. Borrower agrees that a failure to comply with Borrower’s obligations under this Addendum, or any other set of facts or circumstances where it has been asserted by any governmental regulatory agency (or Agent or Lenders believes that there is a substantial risk of such assertion) that Agent, Lenders and their affiliates are not entitled to hold, or exercise any significant right with respect to, any securities issued to Lenders by Borrower, will constitute a breach of the obligations of Borrower under the financing agreements among Borrower, Agent and Lenders. In the event of (i) a failure to comply with Borrower’s obligations under this Addendum; or (ii) an assertion by any governmental regulatory agency (or Agent or Lenders believe that there is a substantial risk of such assertion) of a failure to comply with Borrower’s obligations under this Addendum, then (i) Agent, Lenders and Borrower will meet and resolve any such issue in good faith to the satisfaction of Borrower, Agent, Lenders, and any governmental regulatory agency, and (ii) upon request of Lenders or Agent, Borrower will cooperate and assist with any assignment of the financing agreements among HERCULES CAPITAL IV L.P. and Hercules Capital, Inc.
ADDENDUM 4 to LOAN AND SECURITY AGREEMENT
Agent and Lender Terms
(a) Each Lender hereby irrevocably appoints Hercules Capital, Inc. to act on its behalf as Agent hereunder and under the other Loan Documents and irrevocably authorizes Agent to take such actions on its behalf and to exercise such powers as are delegated to Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. Agent shall have only those duties which are specified in this Agreement and it may perform such duties by or through its agents, representatives or employees. In performing its duties on behalf of Lenders, Agent shall exercise the same care which it would exercise in dealing with loans made for its own account, but it shall not be responsible to any Lender for the execution, effectiveness, genuineness, validity, enforceability, collectability or sufficiency of all or any of the Loan Documents, or for any representations, warranties, recitals or statements made therein or made in any written or oral statement or in any financial or other statements, instruments, reports, certificates or any other documents furnished or delivered in connection herewith or therewith by Agent to any Lender or by or on behalf of any Loan Party to Agent or any Lender, or be required to ascertain or inquire as to the performance or observance of any of the terms, conditions, provisions, covenants or agreements contained herein or therein, as to the use of the proceeds of the Term Loan Advances, the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or the satisfaction of any condition set forth in Section 4 or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to Agent. Agent shall not be responsible for insuring the Collateral or for the payment of any Taxes, assessments, charges or any other charges or liens of any nature whatsoever upon the Collateral or otherwise for the maintenance of the Collateral, except in the event Agent enters into possession of a part or all of the Collateral, in which event Agent shall preserve the part in its possession. Unless the officers of Agent acting in their capacity as officer of Agent on Borrower’s account have actual knowledge thereof or have been notified in writing thereof by Lenders, Agent shall not be required to ascertain or inquire as to the existence or possible existence of any Event of Default.
(b) Neither Agent nor any of its officers, directors, employees, attorneys, representatives or agents shall be liable to Lenders for any action taken or omitted hereunder or under any of the other Loan Documents or in connection herewith or therewith unless caused by its or their gross negligence or willful misconduct. No provision of this Agreement or of any other Loan Document shall be deemed to impose any duty or obligation on Agent to perform any act or to exercise any power in any jurisdiction in which it shall be illegal, or shall be deemed to impose any duty or obligation on Agent to perform any act or exercise any right or power if such performance or exercise (a) would subject Agent to a Tax in a jurisdiction where it is not then subject to a Tax or (b) would require Agent to qualify to do business in any jurisdiction where it is not so qualified. Without prejudice to the generality of the foregoing, no Lender shall have any
right of action whatsoever against Agent as a result of Agent acting or (where so instructed) refraining from acting under this Agreement or under any of the other Loan Documents in accordance with the instructions of Lenders. Agent shall be entitled to refrain from exercising any power, discretion or authority vested in it under this Agreement unless and until it has obtained the written instructions of Lenders. The agency hereby created shall in no way impair or affect any of the rights and powers of, or impose any duties or obligations upon Agent in its individual capacity. With respect to its participation in the Loan Agreement hereunder, Agent shall have the same rights and powers hereunder as any other Lender and may exercise the same rights and powers as though it were not performing the duties and functions delegated to it hereunder and the term “Lender” or “Lenders” or any similar term shall unless the context clearly indicates otherwise include Agent in its individual capacity.
(c) Agent may rely, and shall be fully protected in acting, or refraining to act, upon, any resolution, statement, certificate, instrument, opinion, report, notice, request, consent, order, bond or other paper or document that it has no reason to believe to be other than genuine and to have been signed or presented by the proper party or parties or, in the case of cables, telecopies and telexes, to have been sent by the proper party or parties. In the absence of its gross negligence or willful misconduct, Agent may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificates or opinions furnished to Agent and conforming to the requirements of this Agreement or any of the other Loan Documents. Agent may consult with counsel, and any opinion or legal advice of such counsel shall be full and complete authorization and protection in respect of any action taken, not taken or suffered by Agent hereunder or under any Loan Documents in accordance therewith. Agent shall have the right at any time to seek instructions concerning the administration of the Collateral from any court of competent jurisdiction. Agent shall not be under any obligation to exercise any of the rights or powers granted to Agent by this Agreement and the other Loan Documents at the request or direction of Lenders unless Agent shall have been provided by Lenders with adequate security and indemnity against the costs, expenses and liabilities that may be incurred by it in compliance with such request or direction.
(d) Each Lender agrees to indemnify Agent in its capacity as such (to the extent not reimbursed by Borrower and without limiting the obligation of Borrower to do so), according to its respective Term Commitment percentages (based upon the total outstanding Term Commitments) in effect on the date on which indemnification is sought under this Addendum 4, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever that may at any time be imposed on, incurred by or asserted against Agent in any way relating to or arising out of, this Agreement, any of the other Loan Documents or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by Agent under or in connection with any of the foregoing; The agreements in this Section shall survive the payment of the Loans and all other amounts payable hereunder.
(e) To the extent not reimbursed either by Borrower or from the application of Collateral proceeds pursuant to Section 10.2, a Lender (the “Indemnified Lender”) shall be indemnified by the other Lender (an “Indemnifying Lender”), on a several basis in proportion to each Lender’s pro rata portion of the Term Commitment, and each Indemnifying Lender agrees to reimburse the Indemnified Lender for the Indemnifying Lender’s pro rata share of the following items (an “Indemnified Payment”):
(i) all reasonable out-of-pocket costs and expenses of the Indemnified Lender incurred by the Indemnified Lender in connection with the discharge of its activities under this Agreement or the Loan Agreement, including reasonable legal expenses and attorneys’ fees; provided, that the Indemnified Lender shall consult with the other Lender regarding the incurrence of such costs and expenses at reasonable intervals (but not more often than monthly) and any such reasonable costs and expenses shall be “Claims” hereunder notwithstanding any disagreement by the other Lender as to their incurrence; and
(ii) from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever, which may be imposed on, incurred by or asserted against the Indemnified Lender in any way relating to or arising out of this Agreement, or any action taken or omitted by the Indemnified Lender hereunder;
provided, however, that the Indemnified Lender shall not be reimbursed or indemnified for an Indemnified Payment, except to the extent that the Indemnified Lender paid more than its ratable share of such payment. All Indemnified Payments as set forth in this subsection (e) to an Indemnified Lender are intended to be paid ratably by the other Lender.
(f) [Reserved].
(g) [Reserved].
(h) Agent in Its Individual Capacity. The Person serving as Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not Agent and the term “Lender” shall, unless otherwise expressly indicated or unless the context otherwise requires, include each such Person serving as Agent hereunder in its individual capacity.
(i) Exculpatory Provisions. Agent shall have no duties or obligations except those
expressly set forth herein and in the other Loan Documents. Without limiting the generality of the foregoing, Agent shall not:
(i) be subject to any fiduciary, advisory or other implied duties, regardless of whether any Default or any Event of Default has occurred and is continuing;
(ii) have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that Agent is required to exercise as directed in writing by Lenders, provided that Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose Agent to liability or that is contrary to any Loan Document or applicable law; and
(iii) except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and Agent shall not be liable for the failure to disclose, any information relating to Borrower or any of its Affiliates that is communicated to or obtained by any Person serving as Agent or any of its Affiliates in any capacity.
(j) In connection with any exercise of Enforcement Actions hereunder, neither any Agent nor any Lender or any of its partners, or any of their respective directors, officers, employees, attorneys, accountants, or agents shall be liable as such for any action taken or omitted by it or them, except for its or their own gross negligence or willful misconduct with respect to its duties under this Agreement.
(k) Each Lender and Agent may execute any of its powers and perform any duties hereunder either directly or by or through agents or attorneys-in-fact. Each Lender and Agent shall be entitled to advice of counsel concerning all matters pertaining to such powers and duties. No Lender or Agent shall be responsible for the negligence or misconduct of any agents or attorneys- in-fact selected by it, if the selection of such agents or attorneys-in-fact was done without gross negligence or willful misconduct.
(l) Each Lender agrees that it will make its own independent investigation of the financial condition and affairs of the Loan Parties in connection with the making of Term Loan Advances pursuant to the Loan Agreement and has made and shall continue to make its own appraisal of the creditworthiness of the Loan Parties. Neither Agent nor any Lender shall have any duty or responsibility either initially or on a continuing basis to make any such investigation or any such appraisal on behalf of all Lenders or to provide the other Lenders with any credit or other information with respect thereto whether coming into its possession before the date hereof or any time or times thereafter and shall further have no responsibility with respect to the accuracy of or the completeness of the information provided to Lenders by the Loan Parties.
ADDENDUM 5 to LOAN AND SECURITY AGREEMENT
Multiple Loan Party Terms
(a) Loan Party’s Agent. Each Loan Party hereby irrevocably appoints Company as its agent, attorney-in-fact and legal representative for all purposes, including (i) for each Borrower, requesting disbursement of the Term Loan and (ii) for each Loan Party, (A) receiving account statements and other notices and communications to Borrowers (or any of them) from Agent or any Lender, and (B) to make such agreements and to effect the relevant amendments, supplements and variations capable of being given, made or effected by any Loan Party notwithstanding that they may affect such Loan Party, without reference to or the consent of such Loan Party, with such Loan Party to be bound as though such Loan Party itself had executed or made the agreements or effected the amendments, supplements or variations. Agent may rely, and shall be fully protected in relying, on any request for the Term Loan Advances, disbursement instruction, report, information or any other notice or communication made or given by Company, whether in its own name or on behalf of one or more of the other Loan Parties, and Agent shall not have any obligation to make any inquiry or request any confirmation from or on behalf of any other Loan Party as to the binding effect on it of any such request, instruction, report, information, other notice or communication, nor shall the joint and several character of Loan Parties’ obligations hereunder be affected thereby. Every act, omission, agreement, undertaking, settlement, waiver, amendment, supplement, variation, notice or other communication given or made by the Borrower or given to the Borrower under any Loan Document on behalf of another Loan Party or in connection with any Loan Document (whether or not known to any other Loan Party and whether occurring before or after such other Loan Party became an Loan Party under any Loan Document) shall be binding for all purposes on that Loan Party as if that Loan Party had expressly made, given or concurred with it.
(b) Waivers. Each Loan Party hereby waives with respect to the Secured Obligations incurred by any other Loan Party: (i) any right to require Agent to institute suit against, or to exhaust its rights and remedies against, such other Loan Party or any other person, or to proceed against any property of any kind which secures all or any part of the Secured Obligations, or to exercise any right of offset or other right with respect to any reserves, credits or deposit accounts held by or maintained with Agent or any Indebtedness of Agent or any Lender to such other Loan Party, or to exercise any other right or power, or pursue any other remedy Agent or any Lender may have; (ii) any defense arising by reason of any disability or other defense of such other Loan Party or any guarantor or any endorser, co-maker or other person, or by reason of the cessation from any cause whatsoever of any liability of such other Loan Party or any guarantor or any endorser, co-maker or other person, with respect to all or any part of the Secured Obligations, or by reason of any act or omission of Agent or others which directly or indirectly results in the discharge or release of such other Loan Party or any guarantor or any other person or any Secured Obligations or any security therefor, whether by operation of law or otherwise; (iii) any defense arising by reason of any failure of Agent to obtain, perfect, maintain or keep in force any Lien on, any property of any Loan Party or any other person; (iv) any defense based upon or arising out of
any bankruptcy, insolvency, reorganization, arrangement, readjustment of debt, liquidation or dissolution proceeding commenced by or against such other Loan Party or any guarantor or any endorser, co-maker or other person, including without limitation any discharge of, or bar against collecting, any of the Secured Obligations (including without limitation any interest thereon), in or as a result of any such proceeding. Until all of the Secured Obligations have been paid, performed, and discharged in full, nothing shall discharge or satisfy the liability of any Loan Party hereunder except the full performance and payment of all of the Secured Obligations. If any claim is ever made upon Agent for repayment or recovery of any amount or amounts received by Agent in payment of or on account of any of the Secured Obligations, because of any claim that any such payment constituted a preferential transfer or fraudulent conveyance, or for any other reason whatsoever, and Agent repays all or part of said amount by reason of any judgment, decree or order of any court or administrative body having jurisdiction over Agent or any of its property, or by reason of any settlement or compromise of any such claim effected by Agent with any such claimant (including without limitation the any other Loan Party), then and in any such event, each Loan Party agrees that any such judgment, decree, order, settlement and compromise shall be binding upon such Loan Party, notwithstanding any revocation or release of this Agreement or the cancellation of any note or other instrument evidencing any of the Secured Obligations, or any release of any of the Secured Obligations, and each Loan Party shall be and remain liable to Agent and Lenders under this Agreement for the amount so repaid or recovered, to the same extent as if such amount had never originally been received by Agent or any Lender, and the provisions of this sentence shall survive, and continue in effect, notwithstanding any revocation or release of this Agreement. Each Loan Party hereby expressly and unconditionally waives all rights of subrogation, reimbursement and indemnity of every kind against any other Loan Party, and all rights of recourse to any assets or property of any other Loan Party, and all rights to any collateral or security held for the payment and performance of any Secured Obligations, including (but not limited to) any of the foregoing rights which Loan Party may have under any present or future document or agreement with any other Loan Party or other person, and including (but not limited to) any of the foregoing rights which any Loan Party may have under any equitable doctrine of subrogation, implied contract, or unjust enrichment, or any other equitable or legal doctrine.
(c) Consents. Each Loan Party hereby consents and agrees that, without notice to or by any Loan Party and without affecting or impairing in any way the obligations or liability of Loan Party hereunder, Agent may, from time to time before or after revocation of this Agreement, do any one or more of the following in its sole and absolute discretion: (i) accept partial payments of, compromise or settle, renew, extend the time for the payment, discharge, or performance of, refuse to enforce, and release all or any parties to, any or all of the Secured Obligations; (ii) grant any other indulgence to any Loan Party or any other Person in respect of any or all of the Secured Obligations or any other matter; (iii) accept, release, waive, surrender, enforce, exchange, modify, impair, or extend the time for the performance, discharge, or payment of, any and all property of any kind securing any or all of the Secured Obligations or any guaranty of any or all of the Secured Obligations, or on which Agent at any time may have a Lien, or refuse to enforce its rights or make any compromise or settlement or agreement therefor in respect of any or all of
such property; (iv) substitute or add, or take any action or omit to take any action which results in the release of, any one or more other Loan Parties or any endorsers or guarantors of all or any part of the Secured Obligations, including, without limitation one or more parties to this Agreement, regardless of any destruction or impairment of any right of contribution or other right of the Loan Parties; (v) apply any sums received from any other Loan Party, any guarantor, endorser, or co-signer, or from the disposition of any Collateral or security, to any Indebtedness whatsoever owing from such person or secured by such Collateral or security, in such manner and order as Agent determines in its sole discretion, and regardless of whether such Indebtedness is part of the Secured Obligations, is secured, or is due and payable. Each Loan Party consents and agrees that Agent shall be under no obligation to marshal any assets in favor of the Loan Parties, or against or in payment of any or all of the Secured Obligations. Each Loan Party further consents and agrees that Agent shall have no duties or responsibilities whatsoever with respect to any property securing any or all of the Secured Obligations. Without limiting the generality of the foregoing, Agent shall have no obligation to monitor, verify, audit, examine, or obtain or maintain any insurance with respect to, any property securing any or all of the Secured Obligations.
(d) Independent Liability. Each Loan Party hereby agrees that one or more successive or concurrent actions may be brought hereon against such Loan Party, in the same action in which any other Loan Party may be sued or in separate actions, as often as deemed advisable by Agent. Each Loan Party is fully aware of the financial condition of each other Loan Party and is executing and delivering this Agreement based solely upon its own independent investigation of all matters pertinent hereto, and such Loan Party is not relying in any manner upon any representation or statement of Agent or any Lender with respect thereto. Each Loan Party represents and warrants that it is in a position to obtain, and each Loan Party hereby assumes full responsibility for obtaining, any additional information concerning any other Loan Party’s financial condition and any other matter pertinent hereto as such Loan Party may desire, and such Loan Party is not relying upon or expecting Agent to furnish to it any information now or hereafter in Agent’s possession concerning the same or any other matter.
(e) Subordination. All Indebtedness of any Loan Party now or hereafter arising held by another Loan Party is subordinated to the Secured Obligations and each Loan Party holding the Indebtedness shall take all actions reasonably requested by Agent to effect, to enforce and to give notice of such subordination.
EXHIBIT A
ADVANCE REQUEST
| | | | | | | | | | | | | | |
To: | Agent: | Date: | __________, 2024 | |
| | | | |
| Hercules Capital, Inc. (“Agent”) | | | |
| 400 Hamilton Avenue, Suite 310 | | | |
| Palo Alto, CA 94301 | | | |
| email: legal@htgc.com | | | |
| Attn: | | | |
Voyager Space Holdings, a Delaware corporation (“Company”), and each other Person that has delivered a Joinder Agreement pursuant to Section 7.13 from time to time party to the Agreement (together with Company, individually or collectively, as the context may require, “Borrower”) hereby requests Agent to cause Lenders to make an Advance in the amount of Fifty-Eight Million Dollars ($58,000,000) (the “Advance Amount”) on June 28, 2024 (the “Advance Date”) pursuant to the Loan and Security Agreement among Borrower, Agent and Lenders (the “Agreement”). Capitalized words and other terms used but not otherwise defined herein are used with the same meanings as defined in the Agreement.
| | | | | | | | | | | | | | | | | |
Please Wire Funds to Borrower’s account | | | |
| | | | | |
| Bank: | | | | |
| Address: | | | | |
| | | | | |
| ABA Number: | | | | |
| Account Number: | | | | |
| Account Name: | | | | |
| Contact Person: | | | | |
| Phone Number | | | | |
| To Verify Wire Info: | | | | |
| Email address: | | | | |
Borrower represents that the conditions precedent to the Advance set forth in the Agreement are satisfied and shall be satisfied upon the making of such Advance, including but not limited to: (i) that no event that has had or could reasonably be expected to have a Material Adverse Effect has occurred and is continuing; (ii) that the representations and warranties set forth in the Loan Documents are and shall be true and correct in all material respects on and as of the Advance Date with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date; (iii) that Borrower is in compliance with all the terms and provisions set forth in each Loan Document on its part to be observed or performed; and (iv) that as of the Advance Date, no fact or condition exists that constitutes (or could, with the passage of time, the giving of notice, or both constitute) an Event of Default under the Loan Documents. Borrower understands and acknowledges that
Agent has the right to review the financial information supporting this representation and, based upon such review in its sole discretion, Lenders may decline to fund the requested Advance.
Borrower hereby represents that Borrower’s corporate status and locations have not changed since the date of the Agreement or, if the Attachment to this Advance Request is completed, are as set forth in the Attachment to this Advance Request.
Borrower agrees to notify Agent promptly before the funding of the Loan if any of the matters which have been represented above shall not be true and correct on the Advance Date and if Agent has received no such notice before the Advance Date then the statements set forth above shall be deemed to have been made and shall be deemed to be true and correct as of the Advance Date.
[REMAINDER OF PAGE INTENTIONALLY BLANK]
This Advance Request is duly executed as of the date set forth above.
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| COMPANY: Voyager Space Holdings, Inc., on behalf of all Borrowers |
| | | | | | | | |
| SIGNATURE: | | | | | | |
| TITLE: | | | | | | | |
| PRINT NAME: | | | | | |
ATTACHMENT TO ADVANCE REQUEST
Dated: _______________________
Borrower hereby represents and warrants to Agent that Borrower’s current legal name and organizational status is as follows:
| | | | | | | | |
| Legal Name: | Voyager Space Holdings, Inc. |
| | |
| Type of organization: | Corporation |
| | |
| State of organization: | Delaware |
| | |
| Organization file number: | 7563326 |
Borrower hereby represents and warrants to Agent that the street addresses, cities, states and postal codes of its current chief executive office locations are as follows:
VOYAGER SPACE HOLDINGS, INC.
[Attention: Dan Taylor and Matt Kuta
1225 17th St, Suite 1100
Denver, CO 80202]
Borrower hereby represents and warrants to Agent that the Advance Amount does not exceed the Maximum Term Loan Amount as follows:
a. Advance Amount: $58,000,000
b. Maximum Term Loan Amount: $58,000,000
c. Is clause a. less than or equal to clause b.? Yes/Compliant X No/Non-Compliant _______
EXHIBIT B
NAME, LOCATIONS, AND OTHER INFORMATION
1. Borrower represents and warrants to Agent that current legal name and organizational status of the Loan Parties as of the Closing Date is as follows:
| | | | | | | | | | | |
| 1. | Legal Name: | VOYAGER SPACE HOLDINGS, INC. |
| | | |
| | Type of organization: | Corporation |
| | | |
| | State of organization: | Delaware |
| | | |
| | Organization file number: | 7563326 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 84-2754888 |
| | | |
| | Legal Name: | VOYAGER SPACE IP HOLDINGS, LLC |
| | | |
| | Type of organization: | Limited Liability Company |
| | | |
| | State of organization: | Delaware |
| | | |
| | Organization file number: | 3125239 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 85-1806665 |
| | | |
| | Legal Name: | VOYAGER SPACE FORCE, LLC |
| | | |
| | Type of organization: | Limited Liability Company |
| | | |
| | State of organization: | Delaware |
| | | |
| | Organization file number: | 6105708 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 87-1818480 |
| | | |
| | Legal Name: | VOYAGER VENTURES, LLC |
| | | |
| | Type of organization: | Limited Liability Company |
| | | |
| | | | | | | | | | | |
| | State of organization: | Delaware |
| | | |
| | Organization file number: | 3239829 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 85-2108047 |
| | | |
| | Legal Name: | VOYAGER SPACE IPX, LLC |
| | | |
| | Type of organization: | Limited Liability Company |
| | | |
| | State of organization: | Delaware |
| | | |
| | Organization file number: | 3548383 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 87-1620276 |
| | | |
| | Legal Name: | VOYAGER SPACE SERVICES, LLC |
| | | |
| | Type of organization: | Limited Liability Company |
| | | |
| | State of organization: | Delaware |
| | | |
| | Organization file number: | 3125276 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 85-1883190 |
| | | |
| | Legal Name: | ZIN TECHNOLOGIES, INC. |
| | | |
| | Type of organization: | Corporation |
| | | |
| | State of organization: | Delaware |
| | | |
| | Organization file number: | 2179320 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 34-1603383 |
| | | |
| | Legal Name: | ZIN AEROSPACE, INC. |
| | | |
| | Type of organization: | Corporation |
| | | | | | | | | | | |
| | | |
| | State of organization: | Delaware |
| | | |
| | Organization file number: | 3842024 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 85-3374010 |
| | | |
| | Legal Name: | PIONEER INVENTION, LLC |
| | | |
| | Type of organization: | Limited Liability Company |
| | | |
| | State of organization: | Colorado |
| | | |
| | Organization file number: | 19941122834 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 84-1322304 |
| | | |
| | Legal Name: | VOYAGER SPACE SCIENCE PARK, LLC |
| | | |
| | Type of organization: | Limited Liability Company |
| | | |
| | State of organization: | Ohio |
| | | |
| | Organization file number: | 4946414 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 92-0846553 |
| | | |
| | Legal Name: | ALTIUS SPACE MACHINES, INC. |
| | | |
| | Type of organization: | Corporation |
| | | |
| | State of organization: | Colorado |
| | | |
| | Organization file number: | 20101374731 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 27-2977968 |
| | | |
| | Legal Name: | XO MARKETS HOLDINGS, INC. |
| | | |
| | | | | | | | | | | |
| | Type of organization: | Corporation |
| | | |
| | State of organization: | Delaware |
| | | |
| | Organization file number: | 5265510 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 46-1953548 |
| | | |
| | Legal Name: | NANORACKS LLC |
| | | |
| | Type of organization: | Limited Liability Company |
| | | |
| | State of organization: | Nevada |
| | | |
| | Organization file number: | E0440152009-2 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 27-1127667 |
| | | |
| | Legal Name: | XO AIRLOCK, LLC |
| | | |
| | Type of organization: | Limited Liability Company |
| | | |
| | State of organization: | Delaware |
| | | |
| | Organization file number: | 5678214 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 38-3954519 |
| | | |
| | Legal Name: | DREAMUP, PBC |
| | | |
| | Type of organization: | Public Benefit Corporation |
| | | |
| | State of organization: | Delaware |
| | | |
| | Organization file number: | 5893721 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 81-1889853 |
| | | |
| | Legal Name: | THE LAUNCH COMPANY, LLC |
| | | | | | | | | | | |
| | | |
| | Type of organization: | Limited Liability Company |
| | | |
| | State of organization: | Alaska |
| | | |
| | Organization file number: | 10032057 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 47-5063532 |
| | | |
| | Legal Name: | VALLEY TECH SYSTEMS, INC. |
| | | |
| | Type of organization: | Corporation |
| | | |
| | State of organization: | California |
| | | |
| | Organization file number: | 2969644 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 20-8494873 |
| | | |
| | Legal Name: | SPACE MICRO INC. |
| | | |
| | Type of organization: | Corporation |
| | | |
| | State of organization: | Delaware |
| | | |
| | Organization file number: | 3565743 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 55-0819567 |
| | | |
| | Legal Name: | VOYAGER SPACE EXPLORATION, LLC |
| | | |
| | Type of organization: | Limited Liability Company |
| | | |
| | State of organization: | Delaware |
| | | |
| | Organization file number: | 7648798 |
| | | |
| | fiscal year ends on December 31 |
| | | |
| | federal employee tax identification number is: 93-3202065 |
| | | |
2. Borrower represents and warrants to Agent that for five (5) years prior to the Closing Date, no Loan Party has done business under any other name or organization or form except the following:
| | | | | | | | | | | |
| Pioneer Invention, LLC | | Legal Name: Pioneer Invention, Inc.; Pioneer Astronautics Used during dates of: through present Type of Organization: N/A State of organization: N/A Organization file Number: N/A Borrower’s fiscal year ends on N/A Borrower’s federal employer tax identification number is: N/A |
| | | |
| The Launch Company, LLC | | Legal Name: K2 Dronotics, LLC Used during dates of: through present Type of Organization: N/A State of organization: N/A Organization file Number: N/A Borrower’s fiscal year ends on N/A Borrower’s federal employer tax identification number is: N/A |
| | | |
| Valley Tech Systems, Inc. | | Legal Name: VALLEY TECH SYSTEMS, INC. Used during dates of: through present Type of Organization: N/A State of organization: N/A Organization file Number: N/A Borrower’s fiscal year ends on N/A Borrower’s federal employer tax identification number is: N/A |
| | | |
| XO Airlock, LLC | | Legal Name: XOFABLABS, LLC Used during dates of: August 4, 2016 - present Type of Organization: N/A State of organization: N/A Organization file Number: N/A Borrower’s fiscal year ends on N/A Borrower’s federal employer tax identification number is: N/A |
| | | |
3. Borrower represents and warrants to Agent that the chief executive office of each Loan Party is located as set forth below
| | | | | |
Voyager Space Holdings, Inc. Voyager Space Force, LLC Voyager Space Holdings, Inc. Voyager Space IP Holdings, LLC Voyager Space IPX, LLC Voyager Space Science Park, LLC Voyager Space Services, LLC Voyager Ventures, LLC Altius Space Machines, Inc. Pioneer Invention LLC | 1225 17th St., Suite 1100, Denver, CO 80202 |
Space Micro, Inc. | 15378 Avenue of Science, Ste 200, San Diego, CA 92128-3451 |
The Launch Company LLC | 349 E Ship Creek Ave, Anchorage, AK 99501-1604 |
Valley Tech Systems, Inc. | 160 Blue Ravine Road, Ste A, Folsom, CA 95630-4718 |
Zin Technologies, Inc. Zin Aerospace, Inc. | 6745 Engle Rd, Ste 105 Cleveland, OH 44130-7993 |
XO Markets Holdings, Inc. Nanoracks, LLC XO Airlock, LLC DreamUp, PBC | 503 Forge River Rd, Webster, TX 77598-4357 |
EXHIBIT C
PATENTS, TRADEMARKS, COPYRIGHTS AND LICENSES
PATENTS
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | |
| Title | | Patent No. | | Application No. | | Jurisdiction | | Grant Date | | Loan Party |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Nitrous oxide based explosives and methods for making same | | | | | | | | | | |
| | 7585381 | | 10913990 | | US | | 9/8/09 | | Pioneer Invention, LLC |
| | | | | | | | | | | |
| Apparatus for generation and use of lift gas | | 7735777 | | 11422486 | | US | | 6/15/10 | | Pioneer Invention, LLC |
| | | | | | | | | | | |
| Apparatus for generation and use of lift gas | | 7871036 | | 12767615 | | US | | 1/18/11 | | Pioneer Invention, LLC |
| | | | | | | | | | | |
| Nitrous oxide based explosives and methods for making same | | 7947137 | | 11684129 | | US | | 5/24/11 | | Pioneer Invention, LLC |
| | | | | | | | | | | |
| Hybrid parachute | | 8118262 | | 11914930 | | US | | 2/21/12 | | Pioneer Invention, LLC |
| | | | | | | | | | | |
| Dust repellent surface coating | | 8449662 | | 12846636 | | US | | 5/28/13 | | Pioneer Invention, LLC |
| | | | | | | | | | | |
| Portable gas generating device | | 8652402 | | 13745544 | | US | | 2/18/14 | | Pioneer Invention, LLC |
| | | | | | | | | | | |
| Portable gas generating device | | 9101898 | | 11537439 | | US | | 8/11/15 | | Pioneer Invention, LLC |
| | | | | | | | | | | |
| Portable gas generating device | | 9283530 | | 14150128 | | US | | 3/15/16 | | Pioneer Invention, LLC |
| | | | | | | | | | | |
| Nitrous oxide based oxygen supply system | | 7165546 | | 9865995 | | US | | 1/23/07 | | Pioneer Invention, LLC |
| | | | | | | | | | | |
| Dipole Drive for Space Propulstion |
| 11077963 |
| 16298970 |
| US |
| 8/3/21 |
| Pioneer Invention, LLC |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Methods and Apparatus for Recovery of Volatile and Carbonaceous Components from Unconventional Feeds |
| None |
| 15861557 |
| US |
|
|
| Pioneer Invention, LLC |
| | | | | | | | | | | |
| Novel Methods of Metals Processing |
| None |
| 15850375 |
| US |
|
|
| Pioneer Invention, LLC |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | |
| Rare Earth Materials Recovery System |
| None |
| 15844127 |
| US |
|
|
| Pioneer Invention, LLC |
| | | | | | | | | | | |
| Systems, Devices and Methods for Improving Ambient Air Quality During Dental, Medical, or Veterinary Procedures |
| None |
| 16811986 |
| US |
|
|
| Pioneer Invention, LLC |
| | | | | | | | | | | |
| Gas Replacement System |
|
|
| 17750120 |
| US |
|
|
| Pioneer Invention, LLC |
| | | | | | | | | | | |
| Adaptable Solar Concentraror |
|
|
| 62916195 |
| US |
|
|
| Pioneer Invention, LLC |
| | | | | | | | | | | |
| Alkaline Solution Method for Recovering Rare Earth Elements |
| 11905573 |
| 17407569 |
| US |
|
|
| Pioneer Invention, LLC |
| | | | | | | | | | | |
| Dust Tolerant Electro Permanent Magnet Tool Interface |
| None |
| 63140501 |
| US |
|
|
| Altius Space Machines, Inc. |
| | | | | | | | | | | |
| Reusable Fluid Transfer Device (Cryo-Coupler) | | None |
| 17194277 |
| US/PCT |
|
|
| Altius Space Machines, Inc. |
| | | | | | | | | | | |
| Dual Mode Electropermanent Magnet | | 11615904 B2 |
| 17212830 |
| US |
| 3/28/23 |
| Altius Space Machines, Inc. |
| | | | | | | | | | | |
| Electropermanent Magnet Array |
| 10984936 B2 |
| 16876096 |
| US/PCT |
| 4/20/21 |
| Altius Space Machines, Inc. |
| | | | | | | | | | | |
| Robotic Capture Interface (DogTags) |
| 11440685 B2 |
| 16269427 |
| US |
| 9/13/22 |
| Altius Space Machines, Inc. |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Modular Service Interface (MagTags) |
| 11728592 |
| 16513035 |
| US |
| 8/15/23 |
| Altius Space Machines, Inc. |
| | | | | | | | | | | |
| Direct To Facility Capture and Release |
| 8967548 |
| 13706956 |
| US |
| 3/3/15 |
| Altius Space Machines, Inc. |
| | | | | | | | | | | |
| Sticky Boom Non-Cooperative Capture Device |
| 8979034 |
| 13312984 |
| US |
| 3/17/15 |
| Altius Space Machines, Inc. |
| | | | | | | | | | | |
| Spacecraft Systems and Methods (Airlock) |
| 10569911 |
| 15264238 |
| US |
| 2/25/20 |
| Nanoracks, LLC |
| | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Spacecraft Systems and Methods - Spacecraft Enclosure (Airlock) - Embodiments provide a method and apparatus for attaching space exposed payloads to a space station. |
| 10882646 B2 |
| 16741206 |
| US |
| 1/5/21 |
| Nanoracks, LLC |
| | | | | | | | | | | |
| Method and Apparatus for Processing Optical Fiber under microgravity conditions (Optical Fiber Spinning) |
| 9533915 B2 |
| 14511898 |
| US |
| 1/3/17 |
| Nanoracks, LLC |
| | | | | | | | | | | |
| Spacecraft Systems Airlock for International Space Station Access and Interface and Methods of Operation - Heat Sink for Spacecraft Airlock |
| 10850872B2 |
| 15910907 |
| US |
| 12/1/20 |
| Nanoracks, LLC |
| | | | | | | | | | | |
| Space Oven |
| None |
| 62901133 |
| US |
|
|
| Nanoracks, LLC |
| | | | | | | | | | | |
| Method and Apparatus for Fabrication of Large Three-Dimensional Single Colloidal Crystals for Bragg Diffraction of Infrared Light |
|
|
| 63365667 |
| US |
|
|
| Nanoracks, LLC |
| | | | | | | | | | | |
| Attitude Control System |
| 9927217 |
| 14847820 |
| US |
| 3/27/18 |
| Valley Tech Systems, Inc. |
| | | | | | | | | | | |
| Hot Gas Thruster |
|
|
| 15488267 |
| US |
|
|
| Valley Tech Systems, Inc. |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Method for Controlling a Flight Vehicle |
| 10712138 |
| 15935630 |
| US |
| 7/14/20 |
| Valley Tech Systems, Inc. |
| | | | | | | | | | | |
| Attitude Control System |
| 10598128 |
| 14875424 |
| US |
| 3/24/20 |
| Valley Tech Systems, Inc. |
| | | | | | | | | | | |
| Extinguishable Divert System |
| 11143143 |
| 16411108 |
| US |
| 10/12/21 |
| Valley Tech Systems, Inc. |
| | | | | | | | | | | |
| Flight Vehicle Control System |
| 11488165 |
| 16827588 |
| US |
| 9/20/22 |
| Valley Tech Systems, Inc. |
| | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Universal Gripper |
|
|
| 63486024 |
| US/PCT |
|
|
| Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| Spacecraft Systems and Methods |
|
|
| 62/217,883 |
| US |
|
|
| Nanoracks, LLC |
| | | | | | | | | | | |
| Spacecraft Systems and Methods |
|
|
| 62/218,427 |
| US |
|
|
| Nanoracks, LLC |
| | | | | | | | | | | |
| Method and Apparatus for Processing Optical Fiber Under Microgravity Conditions |
|
|
| 61/961,304 |
| US |
|
|
| Nanoracks, LLC |
| | | | | | | | | | | |
| Reactor Microplate |
|
|
| 62/636,543 |
| US |
|
|
| Nanoracks, LLC |
| | | | | | | | | | | |
| Reactor Microplate |
|
|
| 16/289,598 |
| US |
|
|
| Nanoracks, LLC |
| | | | | | | | | | | |
| Method and Apparatus for Fabrication of Large Three-Dimensional Single Colloidal Crystals for Bragg Diffraction of Infrared Light |
|
|
| 63365667 |
| US |
|
|
| Nanoracks, LLC |
| | | | | | | | | | | |
| Space Oven |
|
|
| 62901133 |
| US |
|
|
| Nanoracks, LLC |
| | | | | | | | | | | |
| Spacecraft Systems and Methods |
| 10569911 |
| 15264238 |
| US |
| 2/25/20 |
| Nanoracks, LLC |
| | | | | | | | | | | |
| Spacecraft Systems and Methods |
| 10882646 |
| 16741206 |
| US |
| 1/5/21 |
| Nanoracks, LLC |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Spacecraft Systems Airlock for International Space Station Access and Interface and Methods of Operation |
| 10850872 |
| 15910907 |
| US |
| 12/1/20 |
| Nanoracks, LLC |
| | | | | | | | | | | |
| Spacecraft Systems Airlock for International Space Station Access and Interface and Methods of Operation |
| 11718425 |
| 17062103 |
| US |
| 8/8/23 |
| Nanoracks, LLC |
| | | | | | | | | | | |
| Method and Apparatus for Processing Optical Fiber Under Microgravity Conditions |
| 9533915 |
| 14511898 |
| US |
| 1/3/17 |
| Nanoracks, LLC |
| | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Space Oven |
| 11698194 |
| 17023353 |
| US |
| 7/11/23 |
| Nanoracks, LLC |
| | | | | | | | | | | |
| Spacecraft Systems Airlock for International Space Station Access and Interface and Methods of Operation |
| US- 20230382566- A1 |
| 18165567 |
| US |
|
|
| Nanoracks, LLC |
| | | | | | | | | | | |
| Method and Apparatus for Fabrication of Large Three-Dimensional Single Colloidal Crystals for Bragg Diffraction of Infrared Light | | US- 20230393330- A1 | | 18192833 | | US | | | | Nanoracks, LLC |
| | | | | | | | | | | |
| Space Oven | | US- 20230304669- A1 | | 18324504 | | US | | | | Nanoracks, LLC |
| | | | | | | | | | | |
| Medical- Telehealth Space - Method and System for Monitoring and Managing Patient Care | | 10779731 | | | | US | | 9/22/20 | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| Layered chamber acoustic attenuation | | 10720136 | | | | US | | 7/21/20 | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| Integrated broadband acoustic attenuator | | 10657947 | | | | US | | 5/19/20 | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Method and system for generating machine-readable biometric data – issued May 28, 2019 | | 10303962 | | | | US | | 5/28/19 | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| Optimized additive manufacturing process | | 9643251 | | | | US | | 5/9/17 | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| Tuneable acoustic attenuation | | 9697817 | | | | US | | 7/4/17 | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| Modular biometric monitoring system | | 9542531 | | | | US | | 1/10/17 | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Low frequency acoustic attenuator and process for making same | | 9378721 | | | | US | | 6/28/16 | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| Transfer function control for biometric monitoring system | | 9951190 | | | | US | | 2/10/15 | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| Data acquisition for modular biometric monitoring system | | 8764654 | | | | US | | 7/1/14 | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| Bonded and stitched composite structure | | 8663770 | | | | US | | 3/4/14 | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| Pressure sensor with expanding member | | 7418870 | | | | US | | 9/2/08 | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| Multi-parameter sensing system | | 7042230 | | | | US | | 5/6/06 | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| Object level encryption system including encryption key management system | | 9485229 | | 14551081 | | US | | 11/1/16 | | Space Micro, Inc. |
| | | | | | | | | | | |
| Programmable Microwave Integrated Circuit | | 9236644 | | 12660144 | | US | | 1/2/16 | | Space Micro, Inc. |
| | | | | | | | | | | |
| Radiation Hard and Fault Tolerant Multicore Processor and Method for Ionizing Radiation Environment | | 8886994 | | 12928084 | | US | | 11/11/14 | | Space Micro, Inc. |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Apparatus and Method for Detection, Location, and Identification of Gamma Sources | | 8067724 | | 11808648 | | US | | 11/29/11 | | Space Micro, Inc. |
| | | | | | | | | | | |
| Portable Composite Bonding Inspection System | | 8067727 | | 11788844 | | US | | 11/29/11 | | Space Micro, Inc. |
| | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Optimized Nuclear Radiation Shielding Within Composite Structures for Combined Man-Made And Natural Radiation Environments | | 7718984 | | 11431474 | | US | | 5/18/10 | | Space Micro, Inc. |
| | | | | | | | | | | |
| Radiation shielding of integrated circuits and multi-chip modules in ceramic and metal packages | | 7148084 | | 10821409 | | US | | 12/12/06 | | Space Micro, Inc. |
| | | | | | | | | | | |
| SEU and SEFI Fault Tolerant Computer | | 7260742 | | 10767477 | | US | | 8/21/07 | | Space Micro, Inc. |
| | | | | | | | | | | |
| Fault tolerant computer | | 7318169 | | 10435626 | | US | | 1/8/08 | | Space Micro, Inc. |
| | | | | | | | | | | |
| Encrypted internet and intranet communication device | | 7100048 | | 9490941 | | US | | 8/29/06 | | Space Micro, Inc. |
| | | | | | | | | | | |
| Multifunctional radiation shield for space and aerospace applications | | 11784600 | | | | US | | 10/10/23 | | Space Micro, Inc. |
| | | | | | | | | | | |
| Functional interrupt mitigation for fault tolerant computer | | 42314 | | 10656720 | | US | | 6/26/07 | | Space Micro, Inc. |
| | | | | | | | | | | |
| Functional interrupt mitigation for fault tolerant computer | | | | 4590147 | | US | | 4/26/11 | | Space Micro, Inc. |
| | | | | | | | | | | |
| Coating for environmental protection and indication | | | | 11431010 | | US | | | | Space Micro, Inc. |
| | | | | | | | | | | |
| Secure Microprocessor | | | | | | | | | | Space Micro, Inc. |
| | | | | | | | | | | |
| Field Programmable Microwave Array | | | | | | | | | | Space Micro, Inc. |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Systems and Methods for Secure Network Communication | | | | 10273425 | | | | | | Space Micro, Inc. |
| | | | | | | | | | | |
| Radiation Hardened High Density Memory (Flash) | | | | | | | | | | Space Micro, Inc. |
| | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Fault Tolerant Digital Signal Processing | | | | | | | | | | Space Micro, Inc. |
| | | | | | | | | | | |
| Secure Microprocessor and Method | | | | 12655885 | | | | | | Space Micro, Inc. |
| | | | | | | | | | | |
| Secure Microprocessor and Method | | | | 11366373 | | | | | | Space Micro, Inc. |
| | | | | | | | | | | |
| Secure Communications System and Methods | | | | 11442646 | | | | | | Space Micro, Inc. |
| | | | | | | | | | | |
| Field Programmable Microwave Array | | | | 13751047 | | | | | | Space Micro, Inc. |
| | | | | | | | | | | |
| Dual Mode Electropermanent Magnet Array | | | | 21933457.0 | | European Patent | | | | Altius Space Machines, Inc. |
| | | | | | | | | | | |
| Rare Earth Element Extraction and Recycling | | | | 63/517,826 | | US | | | | Pioneer Invention, LLC |
| | | | | | | | | | | |
| Variable field Magnetic Holding System | | | | 2021-568621 | | Japan | | | | Altius Space Machines, Inc. |
| | | | | | | | | | | |
| Dust Repellent Silica and Titania Coatings | | | | 18/746,438 | | US | | | | Pioneer Invention, LLC |
| | | | | | | | | | | |
COPYRIGHTS
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | |
| Title | | NASA Case No. | | Date of Submission | | Contract Number | | Loan Party |
| | | | | | | | | |
| | | | | | | | | |
| SEPTOOL | | | | | | | | ZIN Technologies, Inc. |
| | | | | | | | | |
| | | | | | | | | |
| Core Flight Executive Version 6.6 | | GSC- 18128-1 | | 8/21/18 | | NNC12BA01B | | ZIN Technologies, Inc. |
| | | | | | | | | |
| A Rapid Analytical Method for the Prediction of Launch Ascent Trajectories | | LEW- 19914-1 | | 11/9/18 | |
| | ZIN Technologies, Inc. |
| | | | | | | | | |
| Dynamic Modeling and Simulation Credibility Analysis Algorithm | | LEW- 19915-1 | | 11/19/18 | |
| | ZIN Technologies, Inc. |
| | | | | | | | | |
| Integrated Cryogenically-cooled Experiment-BOX (ICE-BOX) | | LEW- 19918-1 | | 12/30/18 | |
| | ZIN Technologies, Inc. |
| | | | | | | | | |
| SepTOOL | | LEW- 19231-1 | | 8/9/16 | |
| | ZIN Technologies, Inc. |
| | | | | | | | | |
| IP File Transfer (IpFileXfer) | | LEW- 20057-1 | | 2/16/21 | | NNC14CA02C | | ZIN Technologies, Inc. |
| | | | | | | | | |
| Network Service Manager (NSM) | | LEW- 20054-1 | | 2/16/21 | | NNC14CA02C | | ZIN Technologies, Inc. |
| | | | | | | | | |
| CCSDS SOIS Electronic Data Sheet Implementation for Core Flight System | | LEW- 19710-1 | | 10/2/17 | |
| | ZIN Technologies, Inc. |
| | | | | | | | | |
TRADEMARKS
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Title | | Application number | | USPTO Registration No. | | Jurisdiction | | Registration Date | | Loan Party |
| | | | | | | | | | | |
| vMetrics | | | | 3938370 | | United States | | | | ZIN Technologies, Inc. |
| | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Nanoracks "Stripe" Logo | | 18854603 | | 18854603 | | European Union | | 9/9/23 | | Nanoracks, LLC |
| | | | | | | | | | | |
| NANORACKS | | 18854530 | | 18854530 | | European Union | | 9/9/23 | | Nanoracks, LLC |
| | | | | | | | | | | |
| Nanoracks "Stripe" Logo | | UK00003894098 | | UK00003894098 | | United Kingdom | | 6/23/23 | | Nanoracks, LLC |
| | | | | | | | | | | |
| | | | | | | | | | | |
| NANORACKS | | UK00003894087 | | UK00003894087 | | United Kingdom | | 6/23/23 | | Nanoracks, LLC |
| | | | | | | | | | | |
| STARLAB | | UK00003894111 | | UK00003894111 | | United Kingdom | | 6/23/23 | | Starlab Space LLC [NOT A LOAN PARTY] |
| | | | | | | | | | | |
| Nanoracks "Stripe" Logo | | 97/825,048 | | 7338824 | | United States | | 3/26/24 | | Nanoracks, LLC |
| | | | | | | | | | | |
| NANORACKS | | 97/825,020 | | 7338818 | | United States | | 3/26/24 | | Nanoracks, LLC |
| | | | | | | | | | | |
| STARLAB | | 97/833,133 | | 7339629 | | United States | | 3/26/24 | | Starlab Space LLC [NOT A LOAN PARTY] |
| | | | | | | | | | | |
| Starlab "Flag" Logo | | 98/146,321 | | 7340064 | | United States | | 3/26/24 | | Starlab Space LLC [NOT A LOAN PARTY] |
| | | | | | | | | | | |
| STARLAB SPACE | | 98/146,309 | | | | United States | | | | Starlab Space LLC [NOT A LOAN PARTY] |
| | | | | | | | | | | |
| STARLAB | | 18854566 | | | | European Union | | | | Starlab Space LLC [NOT A LOAN PARTY] |
| | | | | | | | | | | |
| STARLAB | | 202397561 | | | | Japan | | | | Starlab Space LLC [NOT A LOAN PARTY] |
| | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Starlab "Flag" Logo | | 202397563 | | | | Japan | | | | Starlab Space LLC [NOT A LOAN PARTY] |
| | | | | | | | | | | |
| STARLAB SPACE | | 202397562 | | | | Japan | | | | Starlab Space LLC [NOT A LOAN PARTY] |
| | | | | | | | | | | |
| STARLAB | | 2278689 | | | | Canada | | | | Starlab Space LLC [NOT A LOAN PARTY] |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Starlab "Flag" Logo | | 2278692 | | | | Canada | | | | Starlab Space LLC [NOT A LOAN PARTY] |
| | | | | | | | | | | |
| STARLAB SPACE | | 2278961 | | | | Canada | | | | Starlab Space LLC [NOT A LOAN PARTY] |
| | | | | | | | | | | |
| VOYAGER SPACE SERVICES | | 6801078 | | | | United States | | | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| VOYAGER SPACE | | 6804174 | | | | United States | | | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| VOYAGER SPACE | | 6804175 | | | | United States | | | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| VOYAGER SPACE EXPLORATION. REIMAGINED. | | 6804176 | | | | United States | | | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| VOYAGER SPACE EXPLORATION. REIMAGINED. | | 6804177 | | | | United States | | | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| EXPLORATION. REIMAGINED. | | 6809004 | | | | United States | | | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| EXPLORATION. REIMAGINED. | | 6809005 | | | | United States | | | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| IT TAKES A PLANET TO | | 97575512 | | | | United States | | | | Voyager Space |
| | | | | | | | | | | |
| EXPLORE THE UNIVERSE | | | | | | | | | | Holdings, Inc. |
| | | | | | | | | | | |
| HUMANITY UNBOUND | | 97326623 | | | | United States | | | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| HUMANITY UNBOUND | | 97326639 | | | | United States | | | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| HUMANITY. UNBOUND. | | 97326676 | | | | United States | | | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| HUMANITY. UNBOUND. | | 97326679 | | | | United States | | | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| | | | | | | | | | | |
| IT TAKES A PLANET TO EXPLORE THE UNIVERSE | | 97575503 | | | | United States | | | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| IT TAKES A PLANET TO EXPLORE THE UNIVERSE | | 97575514 | | 7409703 | | United States | | 6/4/24 | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| MARKETSPACE | | 97421026 | | | | United States | | | | Voyager Space Holdings, Inc. |
| | | | | | | | | | | |
| PIONEER ASTRONAUTICS | | 6628380 | | | | United States | | | | Pioneer Invention, LLC |
| | | | | | | | | | | |
| ALTIUS SPACE MACHINES | | 90511526 | | | | United States | | | | Altius Space Machines, Inc. |
| | | | | | | | | | | |
| ALTIUS SPACE MACHINES | | 90527388 | | | | United States | | | | Altius Space Machines, Inc. |
| | | | | | | | | | | |
| DREAMUP | | 5789547 | | | | United States | | | | DreamUp, PBC |
| | | | | | | | | | | |
| DREAMKITS | | 5789548 | | | | United States | | | | DreamUp, PBC |
| | | | | | | | | | | |
| DREAMUP SPATIUM PRO OMNI DARE TO DREAM | | 5795895 | | | | United States | | | | DreamUp, PBC |
| | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DREAMUP DREAMKIT | | 5795896 | | | | United States | | | | DreamUp, PBC |
| | | | | | | | | | | |
| DREAMCODER | | 5795897 | | | | United States | | | | DreamUp, PBC |
| | | | | | | | | | | |
| DREAMUP DREAMCODER. | | 5795898 | | | | United States | | | | DreamUp, PBC |
| | | | | | | | | | | |
DATA RIGHTS
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Title - Technical Data or Computer Software to be Furnished with Restrictions | | Contract Number | | Asserted Rights Category | | Expiration | | Loan Party |
| | | | | | | | | |
| USAF Launch Vehicle Missile ACS and Post Boost propulsion system design | | FA9300-16-C- 2002 | | SBIR Data Rights | | 6/9/36 | | Valley Tech Systems, Inc. |
| | | | | | | | | |
| | | | | | | | | |
| USAF Post Boost Propulsion System (PBPS) for future strategic missile applications | | FA9300-14-M- 1008 FA9300-16-C- 2002 | | SBIR Data Rights | | 6/9/36 | | Valley Tech Systems, Inc. |
| | | | | | | | | |
| | | | | | | | | Valley Tech Systems, Inc. |
| US Navy Post Boost Control System (PBCS) thruster design for future strategic missile applications | | N00030-18-C-0231 | | SBIR Data Rights | | 7/5/38 | |
| | | | | | | | | |
| | | | | | | | | Valley Tech Systems, Inc. |
| USAF and/or US Navy Maneuverable Warhead Propulsion system design for future strategic or conventional strike weapons/warheads | | VTS Discretionary project: AER30.1000.3100 O/H_AERO_10 | | Limited Rights | | 6/5/38 | |
| | | | | | | | | |
| | | | | | | | | Valley Tech Systems, Inc. |
| Long duration operating proportional hot gas thruster design and construction using advanced manufactured layered refractory metal materials providing a monolithic thruster chamber/nozzle assembly component | | HQ0147-15-C- 7244, HQ0147-16- C-7706. FA9300- 14-M-1008, FA9300-15-C- 2008, FA9300-16- C-2002 and N00030-18-C- 0231. | | SBIR Data Rights | | 5/9/36 | |
| | | | | | | | | |
| | | | | | | | | Valley Tech Systems, Inc. |
| Methods for sealing hot propellant gas, for long duration (200+ sec), in a rocket motor hot gas valve and hot gas valve thruster. | | W91260-09-C- 0008 HQ0147-13-C- 7205 HQ0147-15-C- 7244 HQ0147-16-C- 7706 | | SBIR Data Rights | | 5/9/36 | |
| | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | Valley Tech Systems, Inc. |
| Methods for controlling heat transfer, over long duration (250 to 300+ sec), in a rocket motor hot gas valve and hot gas valve thruster. | | W91260-09-C- 0008 HQ0147-13-C- 7205 HQ0147-15-C- 7244 HQ0147-16-C- 7706 | | SBIR Data Rights | | 6/17/40 | |
| | | | | | | | | |
| | | | | | | | | Valley Tech Systems, Inc. |
| Materials, material properties used for design of rocket motor hot gas valve and hot gas valve thruster. | | HQ0147-13-C- 7205 HQ0147-15-C- 7244 HQ0147-16-C- 7706 | | SBIR Data Rights | | 6/17/39 | |
| | | | | | | | | |
| | | | | | | | | Valley Tech Systems, Inc. |
| Thermal and structural analyses methodologies and modeling for long duration hot gas valves. Hot gas valve dynamic math modeling, operation and control for advanced DACS application. | | HQ0147-13-C- 7205 HQ0147-15-C- 7244 HQ0147-16-C- 7706 | | SBIR Data Rights | | 6/17/39 | |
| | | | | | | | | |
| | | | | | | | | |
| Low Level ACS and DACS ignition system propulsion architecture and operating system that applies hot gas valve design methods, materials and general technologies. | | W9113M-08-C- 0069 W91260-09- C-0008 HQ0147-13-C- 7205 | | SBIR Data Rights/Patent | | 9/8/35 | | Valley Tech Systems, Inc. |
| | | | | | | | | |
| | | | | | | | | Valley Tech Systems, Inc. |
| Long duration hot gas immersed Solid DACS ignition valve design, operation and testing techniques, 200+ second operation. | | W91260-09-C- 0008 HQ0147-13-C- 7206 | | SBIR Data Rights/Patent | | 9/8/35 | |
| | | | | | | | | |
| | | | | | | | | Valley Tech Systems, Inc. |
| TSRM Hot Gas Valve – TRL 5 | | HQ0147-13-C- 7205 | | SBIR Data Rights/Patent | | 9/8/35 | |
| | | | | | | | | |
| | | | | | | | | Valley Tech Systems, Inc. |
| TSRM Hot Gas Thruster Design and Operation | | HQ0147-15-C- 7244 | | SBIR Data Rights/Patent | | 9/8/35 | |
| | | | | | | | | |
| | | | | | | | | Valley Tech Systems, Inc. |
| TSRM Flight Weight Hot Gas Thruster - TRL 5 | | HQ0147-16-C- 7706 | | SBIR Data Rights/Patent | | 9/8/35 | |
| | | | | | | | | |
TRADE NAMES
N/A
SERVICE MARKS
N/A
DOMAIN NAMES
VSH
• Voyagerspace.com
• Voyagerspace.space
• Voyagerspaceholdings.com
• Voyagerspaceholdings.space
• voyagerspace-def.com
• voyagerspace-exp.com
• voyagerspace-store.com
• voyagerspace-tec.com
• voyagerspace-tech.com
• voyagerspace.us
Voyager IPX, LLC
• Spaceipx.com
• Voyagerspaceipx.com
Voyager Space Services, LLC
• Voyager-marketplace.com
• Voyagerbenefitsmarketplace.com
• Voyagermarketpsace.com
• Voyagerspacemarketplace.space
• Voyagerspaceservices.space
• Voyagertestingmarketplace.com
• Vss.space
Voyager IP Holdings, LLC
• Voyagerpatentexchange.com
Pioneer
• Pioneerastro.com
Altius
• Altius-space.com
• Altius-space.biz
• Altius-space.info
• Altius-space.org
XO/Nanoracks & Subs
• DREAMUP.INFO
• DREAMUP.ORG
• NANORACKS.COM
• NANORACKS.INFO
• nanoracks.it
• NANORACKS.ORG
• NANORACKS.US
• nanoracksllc.com
• ORBITALBOOKINGS.COM
• outpost-space.com
• PAYLOADTRACKER.COM
• SPACE4EVERYONE.COM
• spaceoutposts.com
• spaceoutposts.space
• SPACESTATIONCOMPANY.COM
• spacestationcompany.space
• starlaboasis.com
• starposts.space
• Gwcscience.com
• Starlab-space.com
VTS
• Vts-i.com
• @valleytechsystems.com
ZIN
• Zin-tech.com
EXHIBIT D
DEPOSIT ACCOUNTS AND INVESTMENT ACCOUNTS
The following is a complete list of all stocks, bonds, debentures, notes (under which Company or any subsidiary is a payee), commodity contracts and other securities owned by Company and any subsidiary of the Company:
| | | | | | | | | | | | | | | | | |
| Company (Holder of Security / Instrument) | | Name of Issuer of Security / Instrument | | Description and Value of Security / Instrument |
| Voyager Space Holdings | | Atomos Nuclear and Space Corporation | | Series A-2 Preferred Stock and Warrant; $5,060,000 |
| Voyager Ventures LLC | | Helicity Space Corp | | Series Seed Preferred Stock; $100,000 |
| Voyager Ventures LLC | | Kayhan Space Corp. | | Series Seed-1 Preferred Stock; $30,000 |
The following are all financial institutions at which Company and its subsidiaries maintain deposit accounts:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Bank Name | | Account Number | | Branch Address | | Company/ Subsidiary | | Purpose of Account | | Avg. Balance |
| Del Piemonte | | | | Sede Di Torino, Via Cernaia, 7 10121 Torino | | | | | | |
| | IT19M0304 8010000000 00093533 | | | Space Outpost Europe SRL | | Operating | | $500k |
| J.P. Morgan | | | | 383 Madison Ave, NY, NY 10179 | | | | | | |
| | 823390270 | | | Altius Space Machines | | Operating | | $0 ZBA sweep |
| | | | | | | | | | | |
| J.P. Morgan | | 852895371 | | 383 Madison Ave, NY, NY 10179 | | The Launch Company | | Operating | | $75k |
| J.P. Morgan | | 777835320 | | 383 Madison Ave, NY, NY 10179 | | Voyager Space Holdings | | Operating | | $500k |
| J.P. Morgan | | 787571568 | | 383 Madison Ave, NY, NY 10179 | | Voyager Space IP Holdings | | Operating | | $0 ZBA sweep |
| J.P. Morgan | | 890562603 | | 383 Madison Ave, NY, NY 10179 | | Pioneer Invention, LLC | | Operating | | $0 ZBA sweep |
| J.P. Morgan | | 579693216 | | 383 Madison Ave, NY, NY 10179 | | DreamUP PBC | | Operating | | $0 ZBA sweep |
| J.P. Morgan | | 508317218 | | 383 Madison Ave, NY, NY 10179 | | Nanoracks | | Operating | | $500k |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| J.P. Morgan | | 612310778 | | 383 Madison Ave, NY, NY 10179 | | XO Airlock, LLC | | Operating | | $0 ZBA sweep |
| J.P. Morgan | | 508318315 | | 383 Madison Ave, NY, NY 10179 | | XO Markets | | Disbursements | | $0 ZBA sweep |
| J.P. Morgan | | 508317762 | | 383 Madison Ave, NY, NY 10179 | | Nanoracks | | Disbursements | | $0 ZBA sweep |
| J.P. Morgan | | 918161586 | | 383 Madison Ave, NY, NY 10179 | | Nanoracks | | Operating | | $0 (dormant) |
| Banca | | IT19M030480 100000000009 3533 | | Agenzia | | Nanoracks | | Operating | | $500k |
| PNC Bank | | 4686338521 | | 500 1st Ave Pittsburgh, PA 15219 | | Space Micro, Inc. | | Operating, AR | | $0 Overnight investment sweep |
| PNC Bank | | 4686339188 | | 500 1s1 Ave Pittsburgh, PA 15219 | | Space Micro, Inc. | | Disbursements | | $0 ZBA Sweep |
| PNC Bank | | 4686339161 | | 500 1st Ave Pittsburgh, PA 15219 | | Space Micro, Inc. | | 125 Flex Spending | | $0 ZBA Sweep |
| PNC Bank | | 4715254651 | | 500 1st Ave Pittsburgh, PA 15219 | | Valley Tech Systems, Inc. | | Disbursement | | $0 ZBA sweep |
| PNC Bank | | 4715254707 | | 500 1st Ave Pittsburgh, PA 15219 | | Valley Tech Systems, Inc. | | Operating, AR | | $1M, Overnight investment sweep |
| PNC Bank | | 4715258409 | | 500 1st Ave Pittsburgh, PA 15219 | | Zin Technologies | | Operating | | $750k, Overnight investment sweep |
| PNC Bank | | 4715260357 | | 500 1st Ave Pittsburgh, PA 15219 | | Zin Technologies | | Disbursements | | $0 ZBA sweep |
| PNC Bank | | 4715260429 | | 500 1st Ave Pittsburgh, PA 15219 | | Zin Technologies | | Collections | | $0 ZBA sweep |
| PNC Bank | | 4742044588 | | 500 1st Ave Pittsburgh, PA 15219 | | Starlab Space LLC | | Operating | | $15M |
| PNC Bank | | 4742044641 | | 500 1st Ave Pittsburgh, PA 15219 | | Voyager Space Exploration, LLC | | Operating | | $0 |
| PayPal | | BULBQL5LU YYKE | | PayPal Debit Card Department P.O. Box 45940 Omaha, NE 68145 | | Dreamup PBC | | Operating | | $24,490.41 |
SECURITIES ACCOUNTS
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Bank or Brokerage Name | | Account Number | | Branch Address | | Company/ Subsidiary | | Purpose of Account | | Avg. Balance |
| PNC Bank | | 20290023247077 | | 500 1st Ave Pittsburgh, PA 15219 | | Valley Tech Systems | | Investment | | $5M |
| JP Morgan | | 5022586 | | 383 Madison Ave, NY, NY 10179 | | Voyager Space Holdings, Inc | | Investment | | $12M |
| JP Morgan | | 5034207 | | 383 Madison Ave, NY, NY 10179 | | XO Markets Holdings Inc | | Investment | | $2M |
EXHIBIT E
COMPLIANCE CERTIFICATE
Hercules Capital, Inc. (as “Agent”)
400 Hamilton Avenue, Suite 310
Palo Alto, CA 94301
Reference is made to that certain Loan and Security Agreement dated June 28, 2024 and the Loan Documents (as defined therein) entered into in connection with such Loan and Security Agreement all as may be amended from time to time (hereinafter referred to collectively as the “Loan Agreement”) by and among Hercules Capital, Inc. (“Agent”), the several banks and other financial institutions or entities from time to time party thereto (collectively, “Lender”) and Voyager Space Holdings, Inc., a Delaware corporation (“Company”), each Original Guarantor and each Additional Guarantor from time to time party thereto, and each other Person that has delivered a Joinder Agreement pursuant to Section 7.13 from time to time party to the Loan Agreement (together with Company, individually or collectively, as the context may require, “Borrower”). All capitalized terms not defined herein shall have the same meaning as defined in the Loan Agreement.
The undersigned is an Officer of Company, knowledgeable of all Company financial matters, and is authorized, on behalf of Company, to provide certification of information regarding Company; hereby certifies, on behalf of Company, that in accordance with the terms and conditions of the Loan Agreement, Company is in compliance for the period ending ___________ of all covenants, conditions and terms and hereby reaffirms that all representations and warranties contained therein are true and correct on and as of the date of this Compliance Certificate with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date, after giving effect in all cases to any standard(s) of materiality contained in the Loan Agreement as to such representations and warranties. Attached are the required documents supporting the above certification. The undersigned further certifies that no Default exists as of the date hereof. The undersigned further certifies that any financial materials delivered with this Compliance Certificate are prepared in accordance with GAAP (except for the absence of footnotes with respect to unaudited financial statement and subject to normal year-end adjustments) and are consistent from one period to the next except as explained below.
| | | | | | | | | | | |
| REPORTING REQUIREMENT | REQUIRED | CHECK IF ATTACHED |
| Interim Financial Statements | Monthly within 30 days | |
| Interim Financial Statements | Quarterly within 30 days | |
| Audited Financial Statements | FYE within 150 days | |
ACCOUNTS OF LOAN PARTIES AND THEIR SUBSIDIARIES AND AFFILIATES
The undersigned hereby also confirms, on behalf of Company, that the below disclosed accounts represent all depository accounts and securities accounts presently open in the name of each Loan Party or their Subsidiary/Affiliate, as applicable.
Each new account that has been opened since delivery of the previous Compliance Certificate is designated below with a “*”.
| | | | | | | | | | | | | | | | | | | | |
| | Depository AC # | Financial Institution | Account Type (Depository / Securities) | Last Month Ending Account Balance | Purpose of Account |
| | | | | | |
LOAN PARTY Name/Address: | | | | | | |
| | | | | | |
| 1 | | | | | |
| | | | | | |
| 2 | | | | | |
| | | | | | |
| 3 | | | | | |
| | | | | | |
| 4 | | | | | |
| | | | | | |
| 5 | | | | | |
| | | | | | |
| 6 | | | | | |
| | | | | | |
| 7 | | | | | |
| | | | | | |
| | | | | | |
| | | | | | |
SUBSIDIARY Name/Address | | | | | | |
| | | | | | |
| 1 | | | | | |
| | | | | | |
| 2 | | | | | |
| | | | | | |
| 3 | | | | | |
| | | | | | |
| 4 | | | | | |
| | | | | | |
| 5 | | | | | |
| | | | | | |
| 6 | | | | | |
| | | | | | |
| 7 | | | | | |
| | | | | | |
| | | | | | |
| | | | | | |
| | | | | | | | | | | | | | |
| Name of Test | Required Level | Actual Level | In Compliance Y/N? | |
| Minimum Qualified Cash | $12,500,000 | $[________] | [__________] | |
| Borrowing Base Limit Period | $30,000,000 | $[________] | [__________] | |
| T6MA Gross Profit | N/A | $[________] | N/A | |
| Borrowing Base multiplier | [1.50][1.25][1.00] | [________] | N/A | |
| Total Indebtedness | $[________] | $[________] | [__________] | |
Available Amount:
Please list itemized amounts from the issuance of shares of Series C Preferred Stock in excess of Forty Million Dollars ($27,500,000) the issuance of additional Equity Interests that were raised that the Borrower intends to count toward the Available Amount:
Please list any portion of the Available Amount that has already been used for a distribution contemplated under any of the following sections of the Loan Agreement:
Section 7.7(f):
| | | | | | | | | | | |
| Date of distribution: | | Amount of distribution: |
| | | |
Permitted Acquisitions:
| | | | | | | | | | | |
| Date of distribution: | | Amount of distribution: |
| | | |
Permitted Indebtedness:
| | | | | | | | | | | |
| Date of distribution: | | Amount of distribution: |
| | | |
Permitted Investments:
| | | | | | | | | | | |
| Date of distribution: | | Amount of distribution: |
| | | |
ADDITIONAL DISCLOSURES
1. MATERIAL CONTINGENCIES: The undersigned hereby also confirms that a report detailing any material contingencies (including the commencement of any material litigation by or against Borrower) or any other occurrence that could reasonably be expected to have a Material Adverse Effect, as certified by Borrower’s chief executive officer or chief financial officer, is attached hereto as Annex I.3
2. INSURANCE POLICIES OF BORROWER AND ITS SUBSIDIARIES
• [The undersigned hereby also confirms that since delivery of the previous Compliance Certificate, neither Borrower nor any of its Subsidiaries has entered into or amended any insurance policy required pursuant to Section 6.1 of the Loan Agreement.]4
• [Since delivery of the previous Compliance Certificate, Borrower and/or one or more of its Subsidiaries have entered into new, or amended existing, insurance policies required pursuant to Section 6.1 of the Loan Agreement. Attached hereto are copies of such new or amended insurance policies and updated insurance certificates with respect to such policies, as required to be delivered pursuant to Section 6.2 of the Loan Agreement.]5
3. [INTELLECTUAL PROPERTY]
• [The following claim(s) have been made to a Loan Party that material part(s) of the Intellectual Property violates the rights of a third party: [ ]]6
4. ORGANIZATIONAL STATUS
• [Each Loan Party’s present name, former names (if any), locations, place of formation, tax identification number, organizational identification number and other information are attached hereto.]7
5. CAPITALIZATION AND SUBSIDIARIES
• [Attached hereto is a true, correct and complete list of each Subsidiary, substantially in the form of Schedule 5.14 to the Loan Agreement.]8
3 Include in Compliance Certificates.
4 Include if neither Borrower nor any of its Subsidiaries has entered into or amended any insurance policies since delivery of the previous Compliance Certificate.
5 Include if Borrower or any of its Subsidiaries has entered into or amended any insurance policies since delivery of the previous Compliance Certificate.
6 Include if any claim(s) have been made to any Loan Party that any material part of the Intellectual Property violates the rights of any third party.
7 Attach updated Exhibit B if updates to organizational status are needed pursuant to Section 5.1 of the Loan Agreement.
8 Attach updated Schedule 5.14 if updates are needed.
6. JOINDER OF SUBSIDIARIES
a. The undersigned hereby confirms that [no Subsidiary was formed or acquired since the delivery of the most recent Compliance Certificate which is a Material Foreign Subsidiary or Domestic Subsidiary][the following Subsidiaries are Domestic Subsidiaries or Material Foreign Subsidiaries].
| | | | | | | | | | | | | | |
| Very Truly Yours, | |
| | | | |
| VOYAGER SPACE HOLDINGS, INC. |
| | | | |
| By: | | | |
| | | | |
| Name: | | | |
| | | | |
| Its: | | | |
EXHIBIT F
FORM OF JOINDER AGREEMENT
This Joinder Agreement (the “Joinder Agreement”) is made and dated as of [ ], 20[ ], and is entered into by and between ____________________., a _____________ corporation (“Subsidiary”), and HERCULES CAPITAL, INC., a Maryland corporation (as “Agent”).
RECITALS
A. Subsidiary’s Affiliate, VOYAGER SPACE HOLDINGS, INC., a Delaware corporation (“Company”), individually or collectively, as the context may require, “Existing Borrower”) has entered into that certain Loan and Security Agreement dated June 28, 2024, with the several banks and other financial institutions or entities from time to time party thereto as lender (collectively, “Lenders”), each other Borrower that is party thereto, each Original Guarantor and each Additional Guarantor from time to time party thereto and Agent, (as may be amended, supplemented or otherwise modified from time to time, the “Loan Agreement”), together with the other agreements executed and delivered in connection therewith; and
B. Subsidiary acknowledges and agrees that it will benefit both directly and indirectly from Existing Borrower’s execution of the Loan Agreement and the other agreements executed and delivered in connection therewith.
AGREEMENT
NOW THEREFORE, Subsidiary and Agent agree as follows:
1. The recitals set forth above are incorporated into and made part of this Joinder Agreement. Capitalized terms not defined herein shall have the meaning provided in the Loan Agreement.
2. By signing this Joinder Agreement, Subsidiary shall be bound by the terms and conditions of the Loan Agreement the same as if it were [Borrower][Guarantor] (as defined in the Loan Agreement) under the Loan Agreement, mutatis mutandis, provided however, that (a) with respect to (i) Section 5.1 of the Loan Agreement, Subsidiary represents that it is an entity duly organized, legally existing and in good standing under the laws of [ ], (b) neither Agent nor Lenders shall have any duties, responsibilities or obligations to Subsidiary arising under or related to the Loan Agreement or the other Loan Documents, (c) that if Subsidiary is covered by Existing Borrower’s insurance, Subsidiary shall not be required to maintain separate insurance or comply with the provisions of Sections 6.1 and 6.2 of the Loan Agreement, and (d) that as long as Existing Borrower satisfies the requirements of Section 7.1 of the Loan Agreement, Subsidiary shall not have to provide Agent separate Financial Statements. To the extent that Agent or Lenders has any duties, responsibilities or obligations arising under or related to the Loan Agreement or the other Loan Documents, those duties, responsibilities or obligations shall flow only to Existing Borrower and not to Subsidiary or any other Person or entity. By way of example (and not an exclusive list): (i) Agent’s providing notice to Existing Borrower in accordance with the Loan Agreement or as otherwise agreed among Existing Borrower, Agent and
Lenders shall be deemed provided to Subsidiary; (ii) [Lenders’ providing an Advance to Existing Borrower shall be deemed an Advance to Subsidiary; and (iii)]9 Subsidiary shall have no right to request an Advance or make any other demand on Lenders.
3. [Subsidiary agrees not to certificate its equity securities without Agent’s prior written consent, which consent may be conditioned on the delivery of such equity securities to Agent in order to perfect Agent’s security interest in such equity securities.]10
4. Subsidiary acknowledges that it benefits, both directly and indirectly, from the Loan Agreement, and hereby waives, for itself and on behalf on any and all successors in interest (including without limitation any assignee for the benefit of creditors, receiver, bankruptcy trustee or itself as debtor-in-possession under any bankruptcy proceeding) to the fullest extent provided by law, any and all claims, rights or defenses to the enforcement of this Joinder Agreement on the basis that (a) it failed to receive adequate consideration for the execution and delivery of this Joinder Agreement or (b) its obligations under this Joinder Agreement are avoidable as a fraudulent conveyance.
5. As security for the prompt, complete and indefeasible payment when due (whether on the payment dates or otherwise) of all the Secured Obligations, Subsidiary grants to Agent a security interest in all of Subsidiary’s right, title, and interest in and to the Collateral.
6. This Joinder Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of New York, excluding conflict of laws principles that would cause the application of laws of any other jurisdiction.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
9 Not required if Subsidiary will join as a Guarantor.
10 Only include if Subsidiary’s equity interests are not certificated as of the joinder date.
[SIGNATURE PAGE TO JOINDER AGREEMENT]
| | | | | | | | | | | | | | | | | | | | |
| SUBSIDIARY: | | | | | | |
| | | | . | | |
| | | | | | |
| By: | | | | | |
| Name: | | | | |
| Title: | | | | | |
| | | | | | |
| Address: | | | | |
| | | | | | |
| Telephone: | | | | |
| email: | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| AGENT: | | | | | | |
| | | | | | |
| | | | | | |
| HERCULES CAPITAL, INC. | | | |
| | | | | | |
| By: | | | | | |
| Name: | | | | |
| Title: | | | |
| | | | | | |
| Address: | | | |
| 400 Hamilton Ave., Suite 310 | | | |
| Palo Alto, CA 94301 | | |
| email: legal@htgc.com | | | |
| Telephone: 650-289-3060 | | |
EXHIBIT G
[RESERVED]
EXHIBIT H
ACH DEBIT AUTHORIZATION AGREEMENT
Hercules Capital, Inc. and
SBA: Hercules Technology III, L.P.
400 Hamilton Avenue, Suite 310
Palo Alto, CA 94301
Re: Loan and Security Agreement dated June 28, 2024 (the “Agreement”) by and among VOYAGER SPACE HOLDINGS, INC., a Delaware corporation (“Company”), and each other Person that has delivered a Joinder Agreement pursuant to Section 7.13 from time to time party to the Agreement (together with Company, individually or collectively, as the context may require, “Borrower”), each Original Guarantor and each Additional Guarantor from time to time party thereto, Hercules Capital, Inc., as administrative agent and collateral agent (“Agent”) and the lenders party thereto (collectively, the “Lenders”)
In connection with the above referenced Agreement, Borrower hereby authorizes Agent or Lenders to initiate debit entries for (i) the periodic payments due under the Agreement and (ii) out-of-pocket legal fees and costs incurred by Agent or Lenders pursuant to Section 11.12 of the Agreement to Borrower’s account indicated below. Borrower authorizes the depository institution named below to debit to such account.
[IF FILED PUBLICLY, ACCOUNT INFO REDACTED FOR SECURITY PURPOSES]
| | | | | | | | | | | |
| DEPOSITORY NAME | | BRANCH |
| CITY | | STATE AND ZIP CODE |
| TRANSIT/ABA NUMBER | | ACCOUNT NUMBER |
This authority will remain in full force and effect so long as any amounts are due under the Agreement.
| | | | | | | | | | | | | | | | | |
| | | | | |
| (Company, on behalf of each Borrower) | |
| | | | | |
| By: | | | | | |
| | | | | |
| Name: | | | |
| | | | | |
| Date: | | | | |
EXHIBIT I
[RESERVED]
EXHIBIT J-1
FORM OF U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)
Reference is hereby made to the Loan and Security Agreement dated as of June 28, 2024 (as amended, supplemented or otherwise modified from time to time, the “Loan Agreement”) by and among VOYAGER SPACE HOLDINGS, INC., a Delaware corporation (“Company”), and each other Person that has delivered a Joinder Agreement pursuant to Section 7.13 from time to time party to the Loan Agreement (together with Company, individually or collectively, as the context may require, “Borrower”), each Original Guarantor and each Additional Guarantor from time to time party thereto, the several banks and other financial institutions or entities from time to time parties to the Loan Agreement (collectively, referred to as the “Lenders”), and HERCULES CAPITAL, INC., a Maryland corporation, in its capacity as administrative agent and collateral agent for itself and Lenders (in such capacity, the “Agent”).
Pursuant to the provisions of Addendum 1 of the Loan Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the Loan(s) (as well as any promissory note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) it is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a “10-percent shareholder” of Borrower within the meaning of Section 871(h)(3)(B) of the Code and (iv) it is not a “controlled foreign corporation” related to Borrower as described in Section 881(c)(3)(C) of the Code.
The undersigned has furnished Agent and Borrower with a certificate of its non-U.S. Person status on IRS Form W-8BEN or IRS Form W-8BEN-E. By executing this certificate, the undersigned agrees that (1) if the information provided in this certificate changes, the undersigned shall promptly so inform Borrower and Agent, and (2) the undersigned shall have at all times furnished Borrower and Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.
Unless otherwise defined herein, terms defined in the Loan Agreement and used herein shall have the meanings given to them in the Loan Agreement.
| | | | | | | | | | | | | | |
| Date: | _____________ ___, 20___ | [NAME OF LENDER] | |
| | | | |
| | By: | | |
| | Name: | | |
| | Title: | | |
EXHIBIT J-2
FORM OF U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)
Reference is hereby made to the Loan and Security Agreement dated as of June 28, 2024 (as amended, supplemented or otherwise modified from time to time, the “Loan Agreement”) by and among VOYAGER SPACE HOLDINGS, INC., a Delaware corporation (“Company”), and each other Person that has delivered a Joinder Agreement pursuant to Section 7.13 from time to time party to the Loan Agreement (together with Company, individually or collectively, as the context may require, “Borrower”), each Original Guarantor and each Additional Guarantor from time to time party thereto, the several banks and other financial institutions or entities from time to time parties to the Loan Agreement (collectively, referred to as the “Lenders”), and HERCULES CAPITAL, INC., a Maryland corporation, in its capacity as administrative agent and collateral agent for itself and Lenders (in such capacity, the “Agent”).
Pursuant to the provisions of Addendum 1 of the Loan Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the participation in respect of which it is providing this certificate, (ii) it is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a “10- percent shareholder” of Borrower within the meaning of Section 871(h)(3)(B) of the Code and (iv) it is not a “controlled foreign corporation” related to Borrower as described in Section 881(c)(3)(C) of the Code.
The undersigned has furnished its participating Lender with a certificate of its non-U.S. Person status on IRS Form W-8BEN or IRS Form W-8BEN-E. By executing this certificate, the undersigned agrees that (1) if the information provided in this certificate changes, the undersigned shall promptly so inform such Lender in writing, and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.
Unless otherwise defined herein, terms defined in the Loan Agreement and used herein shall have the meanings given to them in the Loan Agreement.
| | | | | | | | | | | | | | |
| Date: | _____________ ___, 20___ | [NAME OF PARTICIPANT] | |
| | | | |
| | By: | | |
| | Name: | | |
| | Title: | | |
EXHIBIT J-3
FORM OF U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes)
Reference is hereby made to the Loan and Security Agreement dated as of June 28, 2024 (as amended, supplemented or otherwise modified from time to time, the “Loan Agreement”) by and among VOYAGER SPACE HOLDINGS, INC., a Delaware corporation (“Company”), and each other Person that has delivered a Joinder Agreement pursuant to Section 7.13 from time to time party to the Loan Agreement (together with Company, individually or collectively, as the context may require, “Borrower”), each Original Guarantor and each Additional Guarantor from time to time party thereto, the several banks and other financial institutions or entities from time to time parties to the Loan Agreement (collectively, referred to as the “Lenders”), and HERCULES CAPITAL, INC., a Maryland corporation, in its capacity as administrative agent and collateral agent for itself and Lenders (in such capacity, the “Agent”).
Pursuant to the provisions of Addendum 1 of the Loan Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the participation in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such participation, (iii) with respect to such participation, neither the undersigned nor any of its direct or indirect partners/members is a “bank” extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members is a “10-percent shareholder” of Borrower within the meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or indirect partners/members is a “controlled foreign corporation” related to Borrower as described in Section 881(c)(3)(C) of the Code.
The undersigned has furnished its participating Lender with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or IRS Form W-8BEN-E or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN or IRS Form W-8BEN-E from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption. By executing this certificate, the undersigned agrees that (1) if the information provided in this certificate changes, the undersigned shall promptly so inform such Lender and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.
Unless otherwise defined herein, terms defined in the Loan Agreement and used herein shall have the meanings given to them in the Loan Agreement.
| | | | | | | | | | | | | | |
| Date: | _____________ ___, 20___ | [NAME OF PARTICIPANT] | |
| | | | |
| | By: | | |
| | Name: | | |
| | Title: | | |
EXHIBIT J-4
FORM OF U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)
Reference is hereby made to the Loan and Security Agreement dated as of June 28, 2024 (as amended, supplemented or otherwise modified from time to time, the “Loan Agreement”) by and among VOYAGER SPACE HOLDINGS, INC., a Delaware corporation (“Company”), and each other Person that has delivered a Joinder Agreement pursuant to Section 7.13 from time to time party to the Loan Agreement (together with Company, individually or collectively, as the context may require, “Borrower”), each Original Guarantor and each Additional Guarantor from time to time party thereto, the several banks and other financial institutions or entities from time to time parties to the Loan Agreement (collectively, referred to as the “Lenders”), and HERCULES CAPITAL, INC., a Maryland corporation, in its capacity as administrative agent and collateral agent for itself and Lenders (in such capacity, the “Agent”).
Pursuant to the provisions of Addendum 1 of the Loan Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the Loan(s) (as well as any promissory note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such Loan(s) (as well as any promissory note(s) evidencing such Loan(s)), (iii) with respect to the extension of credit pursuant to this Loan Agreement or any other Loan Document, neither the undersigned nor any of its direct or indirect partners/members is a “bank” extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members is a “10-percent shareholder” of Borrower within the meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or indirect partners/members is a “controlled foreign corporation” related to Borrower as described in Section 881(c)(3)(C) of the Code.
The undersigned has furnished Agent and Borrower with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or IRS Form W-8BEN-E or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN or IRS Form W-8BEN-E from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption. By executing this certificate, the undersigned agrees that (1) if the information provided in this certificate changes, the undersigned shall promptly so inform Borrower and Agent, and (2) the undersigned shall have at all times furnished Borrower and Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.
Unless otherwise defined herein, terms defined in the Loan Agreement and used herein shall have the meanings given to them in the Loan Agreement.
| | | | | | | | | | | | | | |
| Date: | _____________ ___, 20___ | [NAME OF LENDER] | |
| | | | |
| | By: | | |
| | Name: | | |
| | Title: | | |
SCHEDULE 1.1
COMMITMENTS
| | | | | |
LENDERS | TERM COMMITMENT |
Hercules Capital, Inc. | $29,950,000 |
Hercules Capital IV, L.P. | $15,000,000 |
Hercules Private Credit Fund 1 L.P. | $7,250,000 |
Hercules Private Global Venture Growth Fund I L.P. | $5,800,000 |
TOTAL COMMITMENTS | $58,000,000.00 |
Schedule 1
Subsidiaries
1. Altius Space Machines, Inc., a Colorado corporation
2. DreamUp, PBC, a Delaware corporation
3. Nanoracks, LLC, a Nevada limited liability company
4. Nanoracks UK, a private limited company incorporated under the laws of England and Wales
5. Nanoracks Space Outpost Europe, S.r.l., an Italian società a responsabilità limitata
6. Pioneer Invention, LLC, a Colorado limited liability company
7. Space Micro Inc., a Delaware corporation
8. Starlab Space LLC, a Delaware limited liability company
9. The Launch Company, LLC, an Alaska limited liability company
10. Valley Tech Systems, Inc., a California corporation
11. Voyager Space Exploration, LLC, a Delaware limited liability company
12. Voyager Space Force, LLC, a Delaware limited liability company
13. Voyager Space IP Holdings, LLC, a Delaware limited liability company
14. Voyager Space IPX, LLC, a Delaware limited liability company
15. Voyager Space Science Park, LLC, an Ohio limited liability company
16. Voyager Space Services, LLC, a Delaware limited liability company
17. Voyager Ventures, LLC, a Delaware limited liability company
18. XO Airlock, LLC, a Delaware limited liability company
19. XO Markets Holdings, Inc., a Delaware corporation
20. Zin Technologies, Inc., a Delaware corporation
21. Zin Aerospace, Inc., a Delaware corporation
22. Zin Aerospace Ltd., a limited company organized in the United Arab Emirates
Schedule 1A
Existing Indebtedness
1. The Company has unsecured indebtedness to the former shareholders of Space Micro, Inc., a majority-owned subsidiary of the Company in the amount of $30,620,470 USD, as evidenced by the following promissory notes:
a. Promissory Note, dated June 5, 2023, by and between the Company and Barry Shillito for the principal amount of $40,946.40 USD.
b. Promissory Note, dated June 5, 2023, by and between the Company and Baxter Trust for the principal amount of $247,107.20 USD.
c. Promissory Note, dated June 5, 2023, by and between the Company and Carl N. Burrow for the principal amount of $122,049.60 USD.
d. Promissory Note, dated June 5, 2023, by and between the Company and Joe Conway for the principal amount of $60,160.00 USD.
e. Promissory Note, dated May 17, 2023, by and between the Company and David J and Linda G Strobel Family Trust for the principal amount of $8,797,648 USD.
f. Promissory Note, dated June 5, 2023, by and between the Company and Kenneth Rose for the principal amount of $56,964.00 USD.
g. Promissory Note, dated June 5, 2023, by and between the Company and Katherine Conway for the principal amount of $188,000.00 USD.
h. Promissory Note, dated June 5, 2023, by and among the Company, Michael Jacox and Lori Jacox for the principal amount of $102,272.00 USD.
i. Promissory Note, dated June 5, 2023, by and between the Company and Michael Jacox for the principal amount of $767,115.20 USD.
j. Promissory Note, dated June 5, 2023, by and between the Company and Gondy Leroy for the principal amount of $335,805.60 USD.
k. Promissory Note, dated June 5, 2023, by and between the Company and Gregg S Taylor for the principal amount of $848,293.60 USD.
l. Promissory Note, dated June 5, 2023, by and between the Company and Steven Hart for the principal amount of $92,232.80 USD.
m. Promissory Note, dated June 5, 2023, by and between the Company and Patricia Ellison for the principal amount of $587,537.60 USD.
n. Promissory Note, dated June 5, 2023, by and between the Company and Michael Featherby for the principal amount of $1,880.00 USD.
o. Promissory Note, dated June 5, 2023, by and between the Company and Gouri Dongaonkar for the principal amount of $22,259.20 USD.
p. Promissory Note, dated June 5, 2023, by and between the Company and the Dennis Family Trust, March 30, 1993, Martha G Dennis and Edward A Dennis, Trustees for the principal amount of $119,868.80 USD.
q. Promissory Note, dated May 17, 2023, by and between the Company and David R. Czajkowski for the principal amount of $9,423,838.40 USD.
r. Promissory Note, dated May 17, 2023, by and between the Company and David R. and Diane R. Czajkowski for the principal amount of $1,004,672 USD.
s. Promissory Note, dated June 5, 2023, by and between the Company and Charles L Nichols for the principal amount of $239,850.40 USD.
t. Promissory Note, dated June 5, 2023, by and between the Company and Edward Takacs for the principal amount of $59,295.20 USD.
u. Promissory Note, dated June 5, 2023, by and between the Company and Brian F. Swienton for the principal amount of $28,876.80 USD.
v. Promissory Note, dated May 17, 2023, by and between the Company and Strobel Nevada Trust for the principal amount of $921,989.60 USD.
w. Promissory Note, dated June 5, 2023, by and between the Company and Daniel Strich for the principal amount of $128,140.80 USD.
x. Promissory Note, dated May 17, 2023, by and between the Company and Strobel Charitable Remainder Unitrust for the principal amount of $921,989.60 USD.
y. Promissory Note, dated June 5, 2023, by and between the Company and Richard Sanford for the principal amount of $146,489.60 USD.
z. Promissory Note, dated June 5, 2023, by and between the Company and Henry L and Mary J Perret for the principal amount of $73,282.40 USD.
aa. Promissory Note, dated June 5, 2023, by and between the Company and Robert Czajkowski for the principal amount of $131,675.20 USD.
bb. Promissory Note, dated June 5, 2023, by and between the Company and Todd Reid for the principal amount of $48,654.40 USD.
cc. Promissory Note, dated June 5, 2023, by and between the Company and Joshua Patin for the principal amount of $241,166.40 USD.
dd. Promissory Note, dated June 5, 2023, by and between the Company and Lawrence O’Toole for the principal amount of $254,589.60 USD.
ee. Promissory Note, dated June 5, 2023, by and between the Company and Charles L Nichols Trust dated 12-28-1999 for the principal amount of $136,901.60 USD.
ff. Promissory Note, dated June 5, 2023, by and between the Company and James McMahon for the principal amount of $132,239.20 USD.
gg. Promissory Note, dated June 5, 2023, by and between the Company and Michael Dowd Jr for the principal amount of $216,162.40 USD.
hh. Promissory Note, dated June 5, 2023, by and between the Company and Martha Dennis for the principal amount of $394,085.60 USD.
ii. Promissory Note, dated June 5, 2023, by and between the Company and Justin Luczyk for the principal amount of $53,504.80 USD.
jj. Promissory Note, dated June 5, 2023, by and between the Company and John Low for the principal amount of $67,416.80 USD.
kk. Promissory Note, dated June 5, 2023, by and between the Company and Bert Vermeire for the principal amount of $1,352,389.60 USD.
2. Securities Purchase Agreement, dated as of March 10, 2023, among Voyager Space Holdings, Inc., the Stockholders of Valley Tech Systems, Inc. and Michael J. O’Brien, as Sellers’ Representative.
3. Securities Purchase Agreement, dated as of October 1, 2021, among Voyager Space Holdings, Inc., The Daryl Z . Laisure Business Trust, dated September 20, 2018, Carlos Grodsinsky, Ph.D. and Daryl Z. Laisure in his capacity as the Sellers’ Representative.
4. Warrant to Purchase 19,593 Shares of Common Stock at a price of $39.13 per share, by and between the Company and JGB Capital, LP, issued March 10, 2023 and expiring March 10, 2030.
5. Warrant to Purchase 150,211 Shares of Common Stock at a price of $39.13 per share, by and between the Company and JGB Partners, LP, issued March 10, 2023 and expiring March 10, 2030.
6. Warrant to Purchase 37,749 Shares of Common Stock at a price of $40.32 per share, by and between the Company and JGB Partners, LP, issued March 29, 2024 and expiring March 28, 2031.
7. Warrant to Purchase 91,433 Shares of Common Stock at a price of $39.13 per share, by and between the Company and JGB (Cayman) Lakenvelder Ltd., issued March 10, 2023 and expiring March 10, 2030.
8. Warrant to Purchase 93,299 Shares of Common Stock at a price of $39.13 per share, by and between the Company and Chicago Atlantic Credit Opportunities, LLC, issued March 10, 2023 and expiring March 10, 2030.
9. Warrant to Purchase 18,660 Shares of Common Stock at a price of $39.13 per share, by and between the Company and Chicago Atlantic Credit Company, LLC, issued March 10, 2023 and expiring March 10, 2030.
10. Warrant to Purchase 150,211 Shares of Common Stock at a price of $39.13 per share, by and between the Company and JGB Partners, LP, issued March 10, 2023 and expiring March 10, 2030.
11. Warrant to Purchase 83,195 Shares of Common Stock at a price of $39.13 per share, by and between the Company and Atalaya Special Opportunities Fund LP VII LP Voyager Space Holdings, LP, issued March 14, 2023 and expiring March 14, 2030.
12. Warrant to Purchase 10,104 Shares of Common Stock at a price of $39.13 per share, by and between the Company and Atalaya Special Opportunities VIII-E LP Voyager Space Holdings LLC, issued March 14, 2023 and expiring March 14, 2030.
13. Warrant to Purchase 11,723 Shares of Common Stock at a price of $40.32 per share, by and between the Company and Chicago Atlantic Credit Opportunities, LLC, issued March 29, 2024 and expiring March 28, 2031.
14. Warrant to Purchase 4,689 Shares of Common Stock at a price of $40.32 per share, by and between the Company and Chicago Atlantic Credit Company, LLC, issued March 29, 2024 and expiring March 28, 2031.
15. Warrant to Purchase 11,723 Shares of Common Stock at a price of $40.32 per share, by and between the Company and Chicago Atlantic Opportunity Portfolio, LP, issued March 29, 2024 and expiring March 28, 2031.
16. Warrant to Purchase 23,447 Shares of Common Stock at a price of $40.32 per share, by and between the Company and Midtown Madison Management LLC, issued March 29, 2024 and expiring March 28, 2031.
17. Warrant to Purchase 4,924 Shares of Common Stock at a price of $40.32 per share, by and between the Company and JGB Capital, LP, issued March 29, 2024 and expiring March 28, 2031.
18. Warrant to Purchase 22,978 Shares of Common Stock at a price of $40.32 per share, by and between the Company and JGB (Cayman) Lakenvelder Ltd., issued March 29, 2024 and expiring March 28, 2031 ((4) through (18) above, each, a “Warrant”, and collectively, the “Warrants”).
19. An amendment to, or amendment and restatement of, each Warrant, that (i) extends the initial date upon which the holder of such Warrant may exercise its put right thereunder to twelve (12) months following the repayment in full of obligations under that certain Loan and Guaranty Agreement, by and between the Company, the other loan parties party thereto, the lenders party thereto, and JGB Collateral, LLC, (ii) extends the period during which the holder may exercise such put right from fifteen (15) trading dates to six (6) months, (iii) increase the put price from $5.90 per share to $6.90 per share, and (iv) increase the time within which the Company must pay the put price from three (3) trading days to sixty (60) trading days (the “Warrant Amendments”).
Schedule 1B
Permitted Investments
1. Series A Preferred Stock Purchase Agreement, dated May 13, 2021, by and among Atomos Nuclear and Space Corporation and the investors listed on Exhibit A attached thereto. Voyager Space Holdings, Inc. holds Series A-2 Preferred Stock with an initial value of $5,060,000.
2. Series Seed Preferred Stock Purchase Agreement, dated September 30, 2021, by and among Helicity Space, Corp. and the investors listed on Schedule A attached thereto. Voyager Ventures LLC holds Series Seed Preferred Stock with an initial value of $100,000.
3. Preferred Stock Investment Agreement, by and among Kayhan Space Corp., the Purchasers (as defined therein) and the Key Holders (as defined therein). The initial closing occurred on October 12, 2021. Voyager Ventures LLC holds Series Seed-1 Preferred Stock with an initial value of $10,535.62.
4. Securities Purchase Agreement, dated as of March 10, 2023, among Voyager Space Holdings, Inc., the Stockholders of Valley Tech Systems, Inc. and Michael J. O’Brien, as Sellers’ Representative.
5. Convertible Promissory Note, dated March 7, 2022, by and between Altius Space Machines, Inc. and Voyager Space Holdings, Inc. for the principal amount of $1,000,000 USD.
6. Interest-bearing Shareholder Loan Letter, dated August 12, 2022, by and between XO Markets Holdings, Inc. and Nanoracks Space Outpost Europe SrL for the principal amount of €152,505 EUR.
7. The Company has a $3,358,143.25 intercompany balance between the Company and Nanoracks LLC. This is an amount payable to XO Markets Holdings, Inc.
Schedule 1C
Permitted Liens
None.
Schedule 5.3
Consents, Etc.
None.
Schedule 5.6(b)
Laws
Pioneer Invention, LLC previously dealt with hazardous materials and was subject to a fine by OSHA of approximately $9,000 in 2023 relating to their handling of such materials.
Schedule 5.8
Tax Matters
None.
Schedule 5.9
Intellectual Property Claims
None.
Schedule 5.10
Intellectual Property
1. Settlement and Cooperation Agreement, dated as of April 26, 2023, by and between Magswitch Technology, Inc. (“Magswitch”) and Altius Space Machines, Inc. (“Altius”). This Agreement grants a license to Magswitch under the Altius EPM Patents (as defined therein) solely for use in the Outer Space Market in exchange for a license to Altius under the Magswitch Shallow-Field Patents (as defined therein) solely for use in the Inner Space Market. Both Altius and Magswitch are parties to that certain Mutual Nondisclosure Agreement, dated May 13, 2016, and that certain Mutual Nondisclosure Agreement, dated January 14, 2021, pursuant to which Altius and Magswitch disclosed to each other confidential and trade secret information relating to their respective magnetic coupling and lifting technologies.
Schedule 5.10(c)
Intellectual Property
None.
Schedule 5.11
Borrower Products
None.
Schedule 5.13
Employee Loans
None.
Schedule 5.14
Capitalization
| | | | | | | | | | | |
| Company | | Record Owner(s) (indicating percentage ownership) |
| Voyager Space Holdings, Inc. | | Capitalization table attached hereto as Exhibit A |
| Altius Space Machines, Inc. | | Voyager Space Holdings, Inc. (100%) |
| DreamUp, PBC | | XO Markets Holdings, Inc. (88.89%) |
| Nanoracks, LLC | | XO Markets Holdings, Inc. (100%) |
| Pioneer Invention, LLC | | Voyager Space Holdings, Inc. (100%) |
| Space Micro Inc. | | Voyager Space Holdings, Inc. (98%) |
| Starlab Space LLC | | Voyager Space Holdings, Inc. (66.1)% |
| The Launch Company, LLC | | Voyager Space Holdings, Inc. (100%) |
| Valley Tech Systems, Inc. | | Voyager Space Holdings, Inc. (69.6%) |
| Voyager Space Exploration, LLC | | Voyager Space Holdings, Inc. (100%) |
| Voyager Space Force, LLC | | Voyager Space Holdings, Inc. (100%) |
| Voyager Space IP Holdings, LLC | | Voyager Space Holdings, Inc. (100%) |
| Voyager Space IPX, LLC | | Voyager Space Holdings, Inc. (100%) |
| Voyager Space Science Park, LLC | | Voyager Space Holdings, Inc. (100%) |
| Voyager Space Services, LLC | | Voyager Space Holdings, Inc. (100%) |
| Voyager Ventures, LLC | | Voyager Space Holdings, Inc. (100%) |
| XO Airlock, LLC | | XO Markets Holdings, Inc. (100%) |
| XO Markets Holdings, Inc. | | Voyager Space Holdings, Inc. (91%) |
| Nanoracks UK | | XO Markets Holdings, Inc. (100%) |
| Nanoracks Space Outpost Europe, S.r.l. | | XO Markets Holdings, Inc. (100%) |
| ZIN Technologies, Inc. | | Voyager Space Holdings, Inc. (100%) |
| ZIN Aerospace, Inc. | | ZIN Technologies, Inc. (100%) |
Schedule 7.7
Distributions
1. The Warrants.
2. The Warrant Amendments.
Schedule 7.23
Affiliate Transactions
None.
EXHIBIT A
Capitalization Table
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Voyager Space Holdings, Inc. Detailed Cap Table | | | | | | | | | | |
| | | | | | | | | | | |
| Name | Class A Common (CA) | Common (CS) | Class A-1 Preferred (A1) | Class B Preferred (B) | Class C Preferred (C) | Options and RSU's Outstanding Under Voyager Space Holdings, Inc. 2020 Incentive Plan | (CW) Common Stock Warrant | Outstanding Shares | Fully Diluted Shares | Outstanding Ownership | Fully Diluted Ownership |
| 2012 Angel Descendants Trust | | | 86,163 | | 7,042 | | | | | 93,205 | | 93,205 | | .481 | % | .412 | % |
| 4SJ Direct LLC | | | | | 45,642 | | | | 45,642 | | 45,642 | | .235 | % | .202 | % |
| Abbott Hall LLC | | | 86,152 | | 7,042 | | 7,358 | | | | 100,552 | | 100,552 | | .519 | % | .444 | % |
| Abby Dickes | | | | | | 5,000 | | | | 5,000 | | .000 | % | .022 | % |
| ABH Flatirons Holdings, LLC | | 10,537 | | 19,732 | | | | | | 30,269 | | 30,269 | | .156 | % | .134 | % |
| ADBAC Holdings LLC | | | | 38,412 | | | | | 38,412 | | 38,412 | | .198 | % | .170 | % |
| Advanced Care Partners Holdings, Inc. | | | 15,000 | | 1,234 | | | | | 16,234 | | 16,234 | | .084 | % | .072 | % |
| Aken Capital Limited | | | | | 2,282 | | | | 2,282 | | 2,282 | | .012 | % | .010 | % |
| Alan Stern | | 6,533 | | | | | 56,332 | | | 6,533 | | 62,865 | | .034 | % | .278 | % |
| Alex Gilbert | | | | 12,804 | | 1,011 | | | | 13,815 | | 13,815 | | .071 | % | .061 | % |
| Alexander Paul Investment Trust | | | | 12,804 | | | | | 12,804 | | 12,804 | | .066 | % | .057 | % |
| Alexis Johnson | | | | | | 2,000 | | | | 2,000 | | .000 | % | .009 | % |
| Alina Hu | | | 2,500 | | | | | | 2,500 | | 2,500 | | .013 | % | .011 | % |
| Ami Dror | | | 17,261 | | | | | | 17,261 | | 17,261 | | .089 | % | .076 | % |
| Andy Dittmer | | | | | | 3,000 | | | | 3,000 | | .000 | % | .013 | % |
| Apres Capital | | | | 25,608 | | | | | 25,608 | | 25,608 | | .132 | % | .113 | % |
| Arioan Scoop SA, acting through its compartme | | | | 14,430 | | | | | 14,430 | | 14,430 | | .074 | % | .064 | % |
| Arsen Melconian | | | | | | 40,000 | | | | 40,000 | | .000 | % | .177 | % |
| Ashley Donlon | | | | | | 15,000 | | | | 15,000 | | .000 | % | .066 | % |
| ATM I, LLC | | | | 6,402 | | 505 | | | | 6,907 | | 6,907 | | .036 | % | .030 | % |
| AW Holdings, LP | | 52,686 | | | | | | | 52,686 | | 52,686 | | .272 | % | .233 | % |
| Baccarat Trade Investments Limited | | | 480,000 | | 77,000 | | | | | 557,000 | | 557,000 | | 2.872 | % | 2.459 | % |
| Balerion Space Ventures Fund I, L.P. | | | | | 45,641 | | | | 45,641 | | 45,641 | | .235 | % | .202 | % |
| Barbara Schwartz | | | 17,529 | | 1,434 | | 1,497 | | | | 20,460 | | 20,460 | | .106 | % | .090 | % |
| Bella Bleu LLC | | | 30,000 | | 1,280 | | 2,470 | | | | 33,750 | | 33,750 | | .174 | % | .149 | % |
| Bernard Selz Revocable Trust | | | 200,000 | | | | | | 200,000 | | 200,000 | | 1.031 | % | .883 | % |
| Bernard T Selz 2008 20-Year CLAT | | | 100,000 | | | | | | 100,000 | | 100,000 | | .516 | % | .442 | % |
| Bert Vermeire | | | | | | 5,075 | | | | 5,075 | | .000 | % | .022 | % |
| BF LP | | 52,686 | | 14,321 | | 5,506 | | | | | 72,513 | | 72,513 | | .374 | % | .320 | % |
| BGI, LLC | | 21,074 | | | | 3,195 | | | | 24,269 | | 24,269 | | .125 | % | .107 | % |
| Bluparrot LLC | | | 17,375 | | 1,434 | | | | | 18,809 | | 18,809 | | .097 | % | .083 | % |
| Bovamar LLC | | | | 6,402 | | 505 | | | | 6,907 | | 6,907 | | .036 | % | .030 | % |
| Brad Raymond | | | 15,000 | | | | | | 15,000 | | 15,000 | | .077 | % | .066 | % |
| Bradley Cheetham | | | | | | 1,306 | | | | 1,306 | | .000 | % | .006 | % |
| Brian Borowski | | | | | | 2,000 | | | | 2,000 | | .000 | % | .009 | % |
| Brian Finley | | | | | | 7,000 | | | | 7,000 | | .000 | % | .031 | % |
| Brian Shaft | | | | | | 8,000 | | | | 8,000 | | .000 | % | .035 | % |
| Brian Streidel | | 8,348 | | | | 661 | | | | 9,009 | | 9,009 | | .046 | % | .040 | % |
| Brian T Anderson | | | 5,000 | | | | | | 5,000 | | 5,000 | | .026 | % | .022 | % |
| British Colony Investment Company, L.L.C. | | | 14,657 | | 2,945 | | | | | 17,602 | | 17,602 | | .091 | % | .078 | % |
| British Colony Investment Company, LLC | | 21,074 | | | | | | | 21,074 | | 21,074 | | .109 | % | .093 | % |
| Brooke E.V. Taylor 2013 Trust | | 323,347 | | | | | | | 323,347 | | 323,347 | | 1.667 | % | 1.428 | % |
| Brue-PT, LLC | | 21,074 | | 14,625 | | 2,919 | | | | | 38,618 | | 38,618 | | .199 | % | .171 | % |
| Capital Factory Fellowship Fund, LP | | | | | 5,705 | | | | 5,705 | | 5,705 | | .029 | % | .025 | % |
| Capital Factory Ventures, LP - C4 | | | | | 1,141 | | | | 1,141 | | 1,141 | | .006 | % | .005 | % |
| Carlos Grodsinsky | | 29,008 | | | | | 15,000 | | | 29,008 | | 44,008 | | .150 | % | .194 | % |
| Charlotte Houser | | | | | | 3,000 | | | | 3,000 | | .000 | % | .013 | % |
| Cheryl Shavers | | | | | | 39,799 | | | | 39,799 | | .000 | % | .176 | % |
| Chester M Eng | | | 15,000 | | | | | | 15,000 | | 15,000 | | .077 | % | .066 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Chicago Atlantic Credit Company, LLC | | | | | | | 23,349 | | | 23,349 | | .000 | % | .103 | % |
| Chicago Atlantic Credit Opportunities, LLC | | | | | | | 105,022 | | | 105,022 | | .000 | % | .464 | % |
| Chicago Atlantic Portfolio, LP | | | | | | | 11,723 | | | 11,723 | | .000 | % | .052 | % |
| Chris Sheehan | | | | | | 5,000 | | | | 5,000 | | .000 | % | .022 | % |
| Christopher Cummins | | 16,505 | | | | | | | 16,505 | | 16,505 | | .085 | % | .073 | % |
| Clearline Capital Partners Master Fund LP | | | 200,000 | | | | | | 200,000 | | 200,000 | | 1.031 | % | .883 | % |
| Condor Investments II | | | 50,000 | | | | | | 50,000 | | 50,000 | | .258 | % | .221 | % |
| Condor Investments III | | | | 25,608 | | | | | 25,608 | | 25,608 | | .132 | % | .113 | % |
| Cynthia Bernal | | | | | | 500 | | | | 500 | | .000 | % | .002 | % |
| Dan Hoffman | | | 8,681 | | 716 | | | | | 9,397 | | 9,397 | | .048 | % | .041 | % |
| Daniel P. Caruso Development Fund | | | | 38,412 | | | | | 38,412 | | 38,412 | | .198 | % | .170 | % |
| Darrell Sellers | | | | | | 1,000 | | | | 1,000 | | .000 | % | .004 | % |
| Dave Marsh | | | | | | 6,500 | | | | 6,500 | | .000 | % | .029 | % |
| David Czajkowski | | 100 | | | | | | | 100 | | 100 | | .001 | % | .000 | % |
| David Gallers | | 10,537 | | | 867 | | | | | 11,404 | | 11,404 | | .059 | % | .050 | % |
| David Strobel | | 97 | | | | | | | 97 | | 97 | | .001 | % | .000 | % |
| David Toepel Jr | | | 10,000 | | | | | | 10,000 | | 10,000 | | .052 | % | .044 | % |
| Deborah Harmon | | | | 12,804 | | 1,011 | | | | 13,815 | | 13,815 | | .071 | % | .061 | % |
| Derek Hodgins | | | | | | 1,250 | | | | 1,250 | | .000 | % | .006 | % |
| Dirk Hoke | | | | | | 2,500 | | | | 2,500 | | .000 | % | .011 | % |
| Dorsar Alternative Investments - Private Equity | | | 55,000 | | 8,195 | | | | | 63,195 | | 63,195 | | .326 | % | .279 | % |
| Dustin Barr | | | | | | 6,000 | | | | 6,000 | | .000 | % | .026 | % |
| Dylan Taylor | 1 | 5,066,907 | | | | | 266,462 | | | 5,066,908 | | 5,333,370 | | 26.130 | % | 23.548 | % |
| ECM Trust | | | | 15,365 | | | | | 15,365 | | 15,365 | | .079 | % | .068 | % |
| ECM WY Trust | | | | | 1,213 | | | | 1,213 | | 1,213 | | .006 | % | .005 | % |
| Elaine Gay Garner | | 21,074 | | | 1,716 | | 1,799 | | | | 24,589 | | 24,589 | | .127 | % | .109 | % |
| Elefund II, LP | | 105,372 | | 43,374 | | 6,402 | | | | | 155,148 | | 155,148 | | .800 | % | .685 | % |
| Elettra Venosa | | | | | | 4,575 | | | | 4,575 | | .000 | % | .020 | % |
| Ellen Lord | | | | | | 40,000 | | | | 40,000 | | .000 | % | .177 | % |
| Elliot Carol | | 1,558 | | | 2,561 | | | | | 4,119 | | 4,119 | | .021 | % | .018 | % |
| Empty Rain LLC | | | 200,000 | | 12,804 | | | | | 212,804 | | 212,804 | | 1.097 | % | .940 | % |
| Empty Rain LLC | | | | 7,682 | | 17,409 | | | | 25,091 | | 25,091 | | .129 | % | .111 | % |
| Eric R. Wiener and Chally L. Wiener [TBE] | | 21,074 | | | 5,121 | | 2,068 | | | | 28,263 | | 28,263 | | .146 | % | .125 | % |
| Eric Stallmer | | | | | | 25,566 | | | | 25,566 | | .000 | % | .113 | % |
| Esther Dyson | | 13,766 | | | | | | | 13,766 | | 13,766 | | .071 | % | .061 | % |
| Ethan Haase | | | | | | 17,500 | | | | 17,500 | | .000 | % | .077 | % |
| Evgeny Tkachencko | | | | | | 500 | | | | 500 | | .000 | % | .002 | % |
| Filipe De Sousa | | | | | | 65,000 | | | | 65,000 | | .000 | % | .287 | % |
| Fouquet LLC | | | 200,000 | | | | | | 200,000 | | 200,000 | | 1.031 | % | .883 | % |
| Francis Morgan | | | | | | 30,000 | | | | 30,000 | | .000 | % | .132 | % |
| Frank Dingle | | | 1,422 | | | | | | 1,422 | | 1,422 | | .007 | % | .006 | % |
| Gabe Finke | | 59,219 | | | 3,841 | | | 56,332 | | | 63,060 | | 119,392 | | .325 | % | .527 | % |
| Gaingels Voyager Space LLC | | | | 23,841 | | | | | 23,841 | | 23,841 | | .123 | % | .105 | % |
| GAM LSA Private Shares (Cayman) Master Fu | | | | | 22,821 | | | | 22,821 | | 22,821 | | .118 | % | .101 | % |
| George J. Dennis | | | | 8,963 | | 708 | | | | 9,671 | | 9,671 | | .050 | % | .043 | % |
| Giaky Nguyen | | | | | | 500 | | | | 500 | | .000 | % | .002 | % |
| Glenn J Krevlin Revocable Trust dtd 7/25/2007 | | | 150,000 | | | | | | 150,000 | | 150,000 | | .774 | % | .662 | % |
| Goldshire Capital Foundation | | | | | 5,705 | | | | 5,705 | | 5,705 | | .029 | % | .025 | % |
| Goui Dongaonkar | | | | | | 1,050 | | | | 1,050 | | .000 | % | .005 | % |
| Gouri Dongaonkar | | | | | | 3,000 | | | | 3,000 | | .000 | % | .013 | % |
| Great American Insurance Company | | | 400,000 | | 25,608 | | 22,821 | | | | 448,429 | | 448,429 | | 2.313 | % | 1.980 | % |
| Gregory Allen | | 36,880 | | | | | | | 36,880 | | 36,880 | | .190 | % | .163 | % |
| Harrison Industry I SPV LLC | | | | 15,561 | | | | | 15,561 | | 15,561 | | .080 | % | .069 | % |
| Helios Holdings VIII, a series of Helios Holding | | | 482,834 | | | | | | 482,834 | | 482,834 | | 2.490 | % | 2.132 | % |
| Helios Holdings XVII, a series of Helios Holding | | | | 2,640 | | | | | 2,640 | | 2,640 | | .014 | % | .012 | % |
| HJS Transportation Inc. | | | 4,295 | | | 339 | | | | 4,634 | | 4,634 | | .024 | % | .020 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Howard Roth | | | | | | 5,000 | | | | 5,000 | | .000 | % | .022 | % |
| Humble Rogue Ventures, LLC | | | 17,431 | | 1,434 | | | | | 18,865 | | 18,865 | | .097 | % | .083 | % |
| Infinity and Beyond Holdings LLC | | 21,074 | | 14,647 | | 5,480 | | | | | 41,201 | | 41,201 | | .212 | % | .182 | % |
| Inna Kassatkina Irrevocable Trust | | 21,074 | | | 1,716 | | | | | 22,790 | | 22,790 | | .118 | % | .101 | % |
| Iron Gate VSH, LLC | | | | 15,493 | | 11,410 | | | | 26,903 | | 26,903 | | .139 | % | .119 | % |
| Iroquois Capital Investment Group LLC | | | | 3,073 | | | | | 3,073 | | 3,073 | | .016 | % | .014 | % |
| Iroquois Master Fund Ltd. | | | | 2,049 | | | | | 2,049 | | 2,049 | | .011 | % | .009 | % |
| Ivan Koutsarov | | | | | | 60,000 | | | | 60,000 | | .000 | % | .265 | % |
| J. Matthew Brown | | | | 2,561 | | 202 | | | | 2,763 | | 2,763 | | .014 | % | .012 | % |
| Jackson Wojciechowski | | | | | | 500 | | | | 500 | | .000 | % | .002 | % |
| James Bridenstine | | | | | | 20,000 | | | | 20,000 | | .000 | % | .088 | % |
| James C Neuhauser | | | 10,000 | | | | | | 10,000 | | 10,000 | | .052 | % | .044 | % |
| James K Cornell | | | 50,000 | | 4,097 | | | | | 54,097 | | 54,097 | | .279 | % | .239 | % |
| Jamison Fox | | 21,074 | | 14,625 | | 2,938 | | 3,051 | | | | 41,688 | | 41,688 | | .215 | % | .184 | % |
| JCG Capital LLC | | | | 512 | | | | | 512 | | 512 | | .003 | % | .002 | % |
| Jeffrey Frient | | | 17,380 | | | | | | 17,380 | | 17,380 | | .090 | % | .077 | % |
| Jeffrey Higgins | | | | | 2,282 | | | | 2,282 | | 2,282 | | .012 | % | .010 | % |
| Jeffrey M. Frient | | | 10,000 | | | | | | 10,000 | | 10,000 | | .052 | % | .044 | % |
| Jeffrey Manber | | 37,683 | | | | | 45,000 | | | 37,683 | | 82,683 | | .194 | % | .365 | % |
| Jennifer Hiatt | | 6,533 | | | | | 6,533 | | | 6,533 | | 13,066 | | .034 | % | .058 | % |
| Jennifer Hiatt | | | | | | 7,500 | | | | 7,500 | | .000 | % | .033 | % |
| JGB (Cayman) Lakenvelder Ltd. | | | | | | | 114,411 | | | 114,411 | | .000 | % | .505 | % |
| JGB Capital, LP | | | | | | | 24,517 | | | 24,517 | | .000 | % | .108 | % |
| JGB Partners, LP | | | | | | | 187,960 | | | 187,960 | | .000 | % | .830 | % |
| Jim Bontempo | | | | | | 2,000 | | | | 2,000 | | .000 | % | .009 | % |
| Jim Bruewer | | | | | | 2,000 | | | | 2,000 | | .000 | % | .009 | % |
| JKJ Ventures LLC | | | | 12,804 | | 1,011 | | | | 13,815 | | 13,815 | | .071 | % | .061 | % |
| Joe Kissling | | | | | | 2,000 | | | | 2,000 | | .000 | % | .009 | % |
| Joe Pistritto | | 2,748 | | | | 217 | | | | 2,965 | | 2,965 | | .015 | % | .013 | % |
| John Charles Joseph Higgins | | | | | 2,282 | | | | 2,282 | | 2,282 | | .012 | % | .010 | % |
| John D. and Amy C. Childs | | 52,686 | | | | 4,564 | | | | 57,250 | | 57,250 | | .295 | % | .253 | % |
| John Henley | | 6,533 | | | | | | | 6,533 | | 6,533 | | .034 | % | .029 | % |
| John Low | | | | | | 2,000 | | | | 2,000 | | .000 | % | .009 | % |
| John M. Fox and Sandra L. Fox, JTWROS | | | 69,071 | | 5,684 | | 5,902 | | | | 80,657 | | 80,657 | | .416 | % | .356 | % |
| John Richard Higgins | | | | | 2,282 | | | | 2,282 | | 2,282 | | .012 | % | .010 | % |
| Jon Kinning | | 21,074 | | 28,580 | | 4,071 | | | | | 53,725 | | 53,725 | | .277 | % | .237 | % |
| Jonathan Goff | | 3,225 | | | | | | | 3,225 | | 3,225 | | .017 | % | .014 | % |
| Jonathan Price Revocable Trust | | 26,343 | | 8,864 | | 2,894 | | 3,008 | | | | 41,109 | | 41,109 | | .212 | % | .182 | % |
| Josh Spear | | | | | | 6,533 | | | | 6,533 | | .000 | % | .029 | % |
| Joshua M Bledsoe & Lydia A Bledsoe Rev Livi | | | 5,000 | | | | | | 5,000 | | 5,000 | | .026 | % | .022 | % |
| Josue Monterrosa | | | | | | 500 | | | | 500 | | .000 | % | .002 | % |
| JPMorgan Chase Bank, N.A. | | | | | | | 48,311 | | | 48,311 | | .000 | % | .213 | % |
| Juniper Poolings, LLC | | | 691,929 | | 128,041 | | 64,741 | | | | 884,711 | | 884,711 | | 4.562 | % | 3.906 | % |
| Karen Nyberg | | | | | | 6,533 | | | | 6,533 | | .000 | % | .029 | % |
| Keegan Capital Management LLC | | | 15,845 | | | | | | 15,845 | | 15,845 | | .082 | % | .070 | % |
| Keller Seamons | | | | | | 47,465 | | | | 47,465 | | .000 | % | .210 | % |
| Kent Price | | 52,686 | | | 4,328 | | | | | 57,014 | | 57,014 | | .294 | % | .252 | % |
| Kevin Mitchell | | 105,372 | | | | 8,320 | | | | 113,692 | | 113,692 | | .586 | % | .502 | % |
| Kevin Spark | | 10,537 | | 5,428 | | 1,365 | | 1,368 | | | | 18,698 | | 18,698 | | .096 | % | .083 | % |
| KHK Ventures LP | | | | 51,216 | | | | | 51,216 | | 51,216 | | .264 | % | .226 | % |
| Kruszewski Investments LLC | | | 24,418 | | | | | | 24,418 | | 24,418 | | .126 | % | .108 | % |
| Kyle Kemler | | | 3,000 | | | | | | 3,000 | | 3,000 | | .015 | % | .013 | % |
| Lance Weber | | | | | | 10,000 | | | | 10,000 | | .000 | % | .044 | % |
| Lauren Milord | | | | | | 1,000 | | | | 1,000 | | .000 | % | .004 | % |
| LCWM LLC | | 42,148 | | | 12,804 | | 1,141 | | | | 56,093 | | 56,093 | | .289 | % | .248 | % |
| Lichter Investments L.P. | | 26,331 | | | | 2,079 | | | | 28,410 | | 28,410 | | .147 | % | .125 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Lori A. Samuels Trust | | | 8,764 | | 720 | | 749 | | | | 10,233 | | 10,233 | | .053 | % | .045 | % |
| Madeba Limited | | 5,705 | | | | | | | 5,705 | | 5,705 | | .029 | % | .025 | % |
| Mage Software LLC | | 21,074 | | 8,590 | | 2,433 | | | | | 32,097 | | 32,097 | | .166 | % | .142 | % |
| Margaret Vernal | | | | | | 20,000 | | | | 20,000 | | .000 | % | .088 | % |
| Margy Catalan | | | | | | 6,000 | | | | 6,000 | | .000 | % | .026 | % |
| Marian Joh | | | | | | 46,533 | | | | 46,533 | | .000 | % | .205 | % |
| Marital Trust und Terrance Paul 2018 Trust | | | | 25,608 | | | | | 25,608 | | 25,608 | | .132 | % | .113 | % |
| Mark Lewis | | | | | | 5,000 | | | | 5,000 | | .000 | % | .022 | % |
| Marlinspike Disruptive Technology Fund I, LP | | 55,602 | | | 38,412 | | | | | 94,014 | | 94,014 | | .485 | % | .415 | % |
| Marlinspike Disruptive Technology Fund I, LP | | | | 9,013 | | | | | 9,013 | | 9,013 | | .046 | % | .040 | % |
| Marlinspike Voyager Space Private Stock 1, LP | | 54,970 | | | 41,387 | | | | | 96,357 | | 96,357 | | .497 | % | .425 | % |
| Marlinspike Voyager Space Private Stock 1, LP | | | | 5,501 | | | | | 5,501 | | 5,501 | | .028 | % | .024 | % |
| Marshall Smith | | | | | | 30,000 | | | | 30,000 | | .000 | % | .132 | % |
| Martian Transit, LLC | | 31,611 | | | 12,830 | | | | | 44,441 | | 44,441 | | .229 | % | .196 | % |
| Martin Wilson | | 4,675 | | | | | | | 4,675 | | 4,675 | | .024 | % | .021 | % |
| Masoud Shirazi | | 21,074 | | | 1,716 | | | | | 22,790 | | 22,790 | | .118 | % | .101 | % |
| Matthew Alan Hill | | | 10,000 | | | | | | 10,000 | | 10,000 | | .052 | % | .044 | % |
| Matthew Kuta | | 571,805 | | | | | 578,396 | | | 571,805 | | 1,150,201 | | 2.949 | % | 5.078 | % |
| Matthew Simpson | | 10,537 | | | 867 | | | | | 11,404 | | 11,404 | | .059 | % | .050 | % |
| Max Vozoff | | 6,533 | | | | | | | 6,533 | | 6,533 | | .034 | % | .029 | % |
| Megan Thrush | | | | | | 2,000 | | | | 2,000 | | .000 | % | .009 | % |
| Merritt Investments, LLLP | | | | 6,402 | | 505 | | | | 6,907 | | 6,907 | | .036 | % | .030 | % |
| Michael and Elizabeth O'Brien Revocable Trus | | 15,962 | | | | | | | 15,962 | | 15,962 | | .082 | % | .070 | % |
| Michael J Sullivan | | | 20,000 | | | | | | 20,000 | | 20,000 | | .103 | % | .088 | % |
| Michael Klopfer | | 10,537 | | | | 1,000 | | | | 11,537 | | 11,537 | | .059 | % | .051 | % |
| Michael Lopez-Alegria | | 6,533 | | | | | | | 6,533 | | 6,533 | | .034 | % | .029 | % |
| Michael M Collins | | | 25,000 | | | | | | 25,000 | | 25,000 | | .129 | % | .110 | % |
| Michael O'Brien | | | | | | 20,000 | | | | 20,000 | | .000 | % | .088 | % |
| Michelle and Walker Fenton | | | 17,265 | | 1,408 | | 1,474 | | | | 20,147 | | 20,147 | | .104 | % | .089 | % |
| Midtown Madison Management, LLC | | | | | | | 106,642 | | | 106,642 | | .000 | % | .471 | % |
| Midtown Madison Management, LLC | | | | | | | 10,104 | | | 10,104 | | .000 | % | .045 | % |
| Midway Venture Partners, LLC | | | | 460,830 | | 26,701 | | | | 487,531 | | 487,531 | | 2.514 | % | 2.153 | % |
| Mike Bowker | | | | | | 10,492 | | | | 10,492 | | .000 | % | .046 | % |
| Mike Johanson | | | | | | 7,000 | | | | 7,000 | | .000 | % | .031 | % |
| Mike Kaag | | | | | | 15,000 | | | | 15,000 | | .000 | % | .066 | % |
| Mike Lewis | | | | | | 6,000 | | | | 6,000 | | .000 | % | .026 | % |
| Morgan K.V. Taylor 2013 Trust | | 323,347 | | | | | | | 323,347 | | 323,347 | | 1.667 | % | 1.428 | % |
| MTMM Investing LLC | | | | 1,280 | | | | | 1,280 | | 1,280 | | .007 | % | .006 | % |
| Nader Afshar | | | 8,640 | | 711 | | | | | 9,351 | | 9,351 | | .048 | % | .041 | % |
| Navyn Salem | | 6,533 | | | | | | | 6,533 | | 6,533 | | .034 | % | .029 | % |
| Neeraj Gupta | | | | | | 30,000 | | | | 30,000 | | .000 | % | .132 | % |
| Nicholas La Rue | | | | | | 500 | | | | 500 | | .000 | % | .002 | % |
| Nicole Stott | | | | | | 6,533 | | | | 6,533 | | .000 | % | .029 | % |
| Noel Capon | | | | 6,402 | | 1,141 | | | | 7,543 | | 7,543 | | .039 | % | .033 | % |
| Noller Leach Investments LLC | | 21,074 | | | | | | | 21,074 | | 21,074 | | .109 | % | .093 | % |
| Okung Ventures LLC | | 5,268 | | | | | | | 5,268 | | 5,268 | | .027 | % | .023 | % |
| Original Face LLC | | 105,372 | | | 23,944 | | | | | 129,316 | | 129,316 | | .667 | % | .571 | % |
| Oyana Ventures LLC | | | | 6,402 | | | | | 6,402 | | 6,402 | | .033 | % | .028 | % |
| Paul Dellisola | | | 29,500 | | | | | | 29,500 | | 29,500 | | .152 | % | .130 | % |
| Paul G Kaminski Revocable Living Trust | | | 25,000 | | | | | | 25,000 | | 25,000 | | .129 | % | .110 | % |
| Paul Kaminski | | 52,264 | | | | | 6,533 | | | 52,264 | | 58,797 | | .270 | % | .260 | % |
| Paul Madera | | 5,268 | | | | | | | 5,268 | | 5,268 | | .027 | % | .023 | % |
| Paul Schauer | | | | | | 51,132 | | | | 51,132 | | .000 | % | .226 | % |
| Peter Wells | | 21,074 | | 14,577 | | 2,919 | | | | | 38,570 | | 38,570 | | .199 | % | .170 | % |
| Phillip Albright | | | | | | 5,000 | | | | 5,000 | | .000 | % | .022 | % |
| Rafiq R. Hashmani | | 3,207 | | | | | | | 3,207 | | 3,207 | | .017 | % | .014 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Ragan Wilkinson | | | | | | 11,500 | | | | 11,500 | | .000 | % | .051 | % |
| Randy Nichols | | 52,686 | | 36,609 | | 7,042 | | 7,606 | | | | 103,943 | | 103,943 | | .536 | % | .459 | % |
| Reiss Capital Management | | | 40,000 | | | | | | 40,000 | | 40,000 | | .206 | % | .177 | % |
| Richard McConn | | | | | | 6,533 | | | | 6,533 | | .000 | % | .029 | % |
| Richard Pournelle | | 6,492 | | | | | | | 6,492 | | 6,492 | | .033 | % | .029 | % |
| Richard Reiss Revocable Trust | | | 20,000 | | | | | | 20,000 | | 20,000 | | .103 | % | .088 | % |
| Rick L. Kinning | | | | 6,402 | | 505 | | | | 6,907 | | 6,907 | | .036 | % | .030 | % |
| Rick Norman Tumlinson | | 6,533 | | | | | | | 6,533 | | 6,533 | | .034 | % | .029 | % |
| Robbie Harris | | | | | | 10,000 | | | | 10,000 | | .000 | % | .044 | % |
| Robert Dobson | | | | | | 500 | | | | 500 | | .000 | % | .002 | % |
| Robert Garcia | | | | | | 13,500 | | | | 13,500 | | .000 | % | .060 | % |
| Robert Gregg | | | | | | 500 | | | | 500 | | .000 | % | .002 | % |
| Robert Pierson | | | | | | 6,000 | | | | 6,000 | | .000 | % | .026 | % |
| Robert Steven Arciniaga | | 6,533 | | | 1,280 | | | | | 7,813 | | 7,813 | | .040 | % | .034 | % |
| Robert Yarber | | | | | | 3,000 | | | | 3,000 | | .000 | % | .013 | % |
| Robert Zubrin | | 52,686 | | | | | | | 52,686 | | 52,686 | | .272 | % | .233 | % |
| Rocas Pocas LLC | | | | | 2,282 | | | | 2,282 | | 2,282 | | .012 | % | .010 | % |
| Roger Christopher Damery Cockroft | | | | 38,412 | | | | | 38,412 | | 38,412 | | .198 | % | .170 | % |
| Ron Dunklee | | | | | | 5,000 | | | | 5,000 | | .000 | % | .022 | % |
| Rosecliff Venture Partners II, L.P. | | | | 25,608 | | | | | 25,608 | | 25,608 | | .132 | % | .113 | % |
| Ross Culver | | | | | | 1,000 | | | | 1,000 | | .000 | % | .004 | % |
| Roxanne Jamieson | | | | | | 2,000 | | | | 2,000 | | .000 | % | .009 | % |
| Russ Carlson | | | | | | 10,000 | | | | 10,000 | | .000 | % | .044 | % |
| Ryan Frederic | | | | | | 6,533 | | | | 6,533 | | .000 | % | .029 | % |
| Ryan Kriser | | | | | | 10,000 | | | | 10,000 | | .000 | % | .044 | % |
| Sage Investment Properties, LLC | | 21,074 | | 14,625 | | 2,945 | | 3,051 | | | | 41,695 | | 41,695 | | .215 | % | .184 | % |
| Scott Kennedy | | | | | | 20,000 | | | | 20,000 | | .000 | % | .088 | % |
| Scott Parazynski | | | | | | 6,533 | | | | 6,533 | | .000 | % | .029 | % |
| Scott Rodriguez | | | | | | 3,000 | | | | 3,000 | | .000 | % | .013 | % |
| Scout Ventures Fund III LP | | | 172,818 | | 31,439 | | | | | 204,257 | | 204,257 | | 1.053 | % | .902 | % |
| Scout Voyager II SPV LLC | | | | | 114,103 | | | | 114,103 | | 114,103 | | .588 | % | .504 | % |
| Scout Voyager SPV LLC | | | | 546,139 | | | | | 546,139 | | 546,139 | | 2.816 | % | 2.411 | % |
| SCP Voyager LLC | | | | 117,157 | | | | | 117,157 | | 117,157 | | .604 | % | .517 | % |
| Sean C Gormley | | | 13,330 | | | | | | 13,330 | | 13,330 | | .069 | % | .059 | % |
| Selz Family 2011 Trust | | | 100,000 | | | | | | 100,000 | | 100,000 | | .516 | % | .442 | % |
| Senvest Master Fund, LP | | | 700,000 | | 35,851 | | | | | 735,851 | | 735,851 | | 3.795 | % | 3.249 | % |
| Senvest Master Fund, LP | | | | | 15,975 | | | | 15,975 | | 15,975 | | .082 | % | .071 | % |
| Senvest Technology Partners Master Fund, LP | | | 300,000 | | 15,365 | | | | | 315,365 | | 315,365 | | 1.626 | % | 1.392 | % |
| Senvest Technology Partners Master Fund, LP | | | | | 6,846 | | | | 6,846 | | 6,846 | | .035 | % | .030 | % |
| Seraphim Space Investment Trust plc | | | | 64,020 | | 5,055 | | | | 69,075 | | 69,075 | | .356 | % | .305 | % |
| Series108 Affinity Angel Investment Fund III a | | | | | 22,821 | | | | 22,821 | | 22,821 | | .118 | % | .101 | % |
| Shaun Collins | | | 25,000 | | | | | | 25,000 | | 25,000 | | .129 | % | .110 | % |
| Shawn Mobley | | 50,000 | | | | | 5,000 | | | 50,000 | | 55,000 | | .258 | % | .243 | % |
| Sian Proctor | | | | | | 2,500 | | | | 2,500 | | .000 | % | .011 | % |
| Simon Amat | | | 2,500 | | | | | | 2,500 | | 2,500 | | .013 | % | .011 | % |
| Soichi Noguchi | | | | | | 5,000 | | | | 5,000 | | .000 | % | .022 | % |
| Southwest, LLC | | | | 19,206 | | 1,516 | | | | 20,722 | | 20,722 | | .107 | % | .091 | % |
| Space Fund Voyager Space SPV, LLC | | | | 125,816 | | | | | 125,816 | | 125,816 | | .649 | % | .556 | % |
| Stellar III Holding Ltd. | | | | 199,162 | | | | | 199,162 | | 199,162 | | 1.027 | % | .879 | % |
| Steven D Morgan | | | 10,000 | | | | | | 10,000 | | 10,000 | | .052 | % | .044 | % |
| Steven Michael Martin | | | 125,000 | | | | | | 125,000 | | 125,000 | | .645 | % | .552 | % |
| Strear Investment LLC | | 105,372 | | | 12,804 | | 9,331 | | | | 127,507 | | 127,507 | | .658 | % | .563 | % |
| SV Pacific Ventures 268 LLC | | | | 78,725 | | | | | 78,725 | | 78,725 | | .406 | % | .348 | % |
| SV Pacific Ventures 398 LLC | | | | 51,216 | | | | | 51,216 | | 51,216 | | .264 | % | .226 | % |
| SV Pacific Ventures 550 LLC | | | | 62,740 | | | | | 62,740 | | 62,740 | | .324 | % | .277 | % |
| Tacoma Partners LLP | | 2,107 | | 15,505 | | 2,670 | | | | | 20,282 | | 20,282 | | .105 | % | .090 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Talal Al-Kaissi | | | 43,409 | | 3,585 | | | | | 46,994 | | 46,994 | | .242 | % | .207 | % |
| TCC Partners, LP | | | 25,000 | | | | | | 25,000 | | 25,000 | | .129 | % | .110 | % |
| Telesoft-2020, LP | | | | | 34,231 | | | | 34,231 | | 34,231 | | .177 | % | .151 | % |
| Ten Eighty Capital LLC | | | 86,643 | | 7,350 | | 4,564 | | | | 98,557 | | 98,557 | | .508 | % | .435 | % |
| Tenex Holdings, LLC | | | | 8,963 | | | | | 8,963 | | 8,963 | | .046 | % | .040 | % |
| The Carlson Family Trust Declaration of Living | | 9,716 | | | | | | | 9,716 | | 9,716 | | .050 | % | .043 | % |
| The Daryl Z. Laisure Business Trust, dated Sep | | 216,090 | | | | | | | 216,090 | | 216,090 | | 1.114 | % | .954 | % |
| The Kristopher and Briana Lichter 2018 Family | | | | | 1,712 | | | | 1,712 | | 1,712 | | .009 | % | .008 | % |
| The Private Shares Fund | | | | 192,061 | | 11,410 | | | | 203,471 | | 203,471 | | 1.049 | % | .898 | % |
| The Vanderbilt University | | | | | 91,283 | | | | 91,283 | | 91,283 | | .471 | % | .403 | % |
| The Wilkinson Family Trust dated September 6 | | 5,205 | | | | | | | 5,205 | | 5,205 | | .027 | % | .023 | % |
| Theodore Reyes | | | | | | 3,050 | | | | 3,050 | | .000 | % | .013 | % |
| Thomas Ayres | | | | | | 45,000 | | | | 45,000 | | .000 | % | .199 | % |
| Thomas B Michaud | | | 15,000 | | | | | | 15,000 | | 15,000 | | .077 | % | .066 | % |
| Thomas L Corr 2000 Family Trust | | | 25,000 | | | | | | 25,000 | | 25,000 | | .129 | % | .110 | % |
| Thomas Zurbuchen | | | | | | 5,000 | | | | 5,000 | | .000 | % | .022 | % |
| Timothy Kopra | | | | | | 80,000 | | | | 80,000 | | .000 | % | .353 | % |
| Tom Wasserbauer | | | | | | 500 | | | | 500 | | .000 | % | .002 | % |
| Tracy William Krohn Living Trust dtd 5/31/2012 | | | 50,000 | | | | | | 50,000 | | 50,000 | | .258 | % | .221 | % |
| Transient Logistics Inc. | | | 4,295 | | | 339 | | | | 4,634 | | 4,634 | | .024 | % | .020 | % |
| Trent Ward | | | | | | 5,000 | | | | 5,000 | | .000 | % | .022 | % |
| Trust of Janet B Tuck | | 4,251 | | | | | | | 4,251 | | 4,251 | | .022 | % | .019 | % |
| Ty Baumbaugh | | | | | | 97,463 | | | | 97,463 | | .000 | % | .430 | % |
| UMB Financial Corporation | | | 306,593 | | 83,226 | | | | | 389,819 | | 389,819 | | 2.010 | % | 1.721 | % |
| Victor Nesi | | | 24,418 | | | | | | 24,418 | | 24,418 | | .126 | % | .108 | % |
| Voyager Mack LP | | | | | 136,925 | | | | 136,925 | | 136,925 | | .706 | % | .605 | % |
| Voyager Space Feb 2024, a Series of CGF202 | | | | | 15,860 | | | | 15,860 | | 15,860 | | .082 | % | .070 | % |
| Walleye Opportunities Master Fund, Ltd. | | | 500,000 | | 192,061 | | 23,932 | | | 65,709 | | 715,993 | | 781,702 | | 3.692 | % | 3.451 | % |
| Wesley Zank | | | | | | 500 | | | | 500 | | .000 | % | .002 | % |
| William Becker, LLC | | | 100,000 | | | | | | 100,000 | | 100,000 | | .516 | % | .442 | % |
| William Collins | | | 100,000 | | | | | | 100,000 | | 100,000 | | .516 | % | .442 | % |
| William F Farmer | | | 2,500 | | | | | | 2,500 | | 2,500 | | .013 | % | .011 | % |
| William Frank White | | 6,533 | | | | | | | 6,533 | | 6,533 | | .034 | % | .029 | % |
| William Shelton | | 6,533 | | | | | 56,332 | | | 6,533 | | 62,865 | | .034 | % | .278 | % |
| Xavier Van der Ploeg | | | | | | 5,000 | | | | 5,000 | | .000 | % | .022 | % |
| Zainab AL Khudairi | | | | | | 1,000 | | | | 1,000 | | .000 | % | .004 | % |
| Zermatt Partners, LLC | | 21,074 | | | | | | | 21,074 | | 21,074 | | .109 | % | .093 | % |
| Options and RSU's issued and outstanding | | | | | | 2,233,374 | | | | | | |
| Shares available for issuance under the plan | | | | | | 326,139 | | | | 326,139 | | | 1.440 | % |
| Fully diluted shares | 1 | | 8,283,782 | | | | | 2,559,513 | | 697,748 | | | 22,648,748 | | | 100.000 | % |
| Fully diluted ownership | .000% | 36.575% | | | | 11.301% | 3.081% | | 100.000 | % | | |
| Total Shares outstanding | 1 | | 8,283,782 | | 6,967,720 | | 3,285,995 | | 853,989 | | | | 19,391,487 | | | 100.000 | % | |
| Percentage outstanding | .000% | 42.719% | 35.932 | % | 16.946% | 4.404% | | | 100.000 | % | | | |
| Price per share | | | $ | 10.00 | | $ | 39.05 | | $ | 43.82 | | | | | | | |
CREDIT AGREEMENT
dated as of
May 30, 2025
among
VOYAGER TECHNOLOGIES, INC.,
as the Borrower,
THE OTHER LOAN PARTIES PARTY HERETO,
THE LENDERS PARTY HERETO,
and
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent
___________________________
JPMORGAN CHASE BANK, N.A.,
BARCLAYS BANK PLC,
KEYBANK NATIONAL ASSOCIATION, AND
TEXAS CAPITAL BANK
as Joint Lead Arrangers
TABLE OF CONTENTS
| | | | | | | | | | | |
| | | Page |
| | | |
| ARTICLE I DEFINITIONS | 1 |
| | | |
| SECTION 1.01 | Defined Terms | 1 |
| SECTION 1.02 | Classification of Loans and Borrowings | 41 |
| SECTION 1.03 | Terms Generally | 41 |
| SECTION 1.04 | Accounting Terms; GAAP | 42 |
| SECTION 1.05 | Status of Obligations | 42 |
| SECTION 1.06 | Interest Rates; Benchmark Notification | 42 |
| SECTION 1.07 | Pro Forma Calculations | 43 |
| SECTION 1.08 | [Intentionally Omitted] | 43 |
| SECTION 1.09 | Letter of Credit Amounts | 43 |
| SECTION 1.10 | Divisions | 43 |
| SECTION 1.11 | Currency Translation | 43 |
| | | |
| ARTICLE II THE CREDITS | 43 |
| | | |
| SECTION 2.01 | Revolving Commitments | 43 |
| SECTION 2.02 | Loans and Borrowings | 44 |
| SECTION 2.03 | Requests for Revolving Borrowings | 44 |
| SECTION 2.04 | [Intentionally Omitted] | 45 |
| SECTION 2.05 | Swingline Loans | 45 |
| SECTION 2.06 | Letters of Credit | 47 |
| SECTION 2.07 | Funding of Borrowings | 51 |
| SECTION 2.08 | Interest Elections | 52 |
| SECTION 2.09 | Termination and Reduction of Commitments | 53 |
| SECTION 2.10 | Repayment of Loans; Evidence of Debt | 54 |
| SECTION 2.11 | Prepayment of Loans | 54 |
| SECTION 2.12 | Fees | 55 |
| SECTION 2.13 | Interest | 56 |
| SECTION 2.14 | Alternate Rate of Interest | 57 |
| SECTION 2.15 | Increased Costs | 59 |
| SECTION 2.16 | Break Funding Payments | 60 |
| SECTION 2.17 | Payments Free of Taxes | 60 |
| SECTION 2.18 | Payments Generally; Allocation of Proceeds; Pro Rata Treatment; Sharing of |
| | Setoffs | 64 |
| SECTION 2.19 | Mitigation Obligations; Replacement of Lenders | 66 |
| SECTION 2.20 | Defaulting Lenders | 67 |
| SECTION 2.21 | [Intentionally Omitted] | 69 |
| SECTION 2.22 | Expansion Option; Incremental Facilities | 69 |
| SECTION 2.23 | Banking Services and Swap Agreements | 70 |
| | | |
| ARTICLE III REPRESENTATIONS AND WARRANTIES | 71 |
| | | |
| SECTION 3.01 | Organization; Powers | 71 |
| SECTION 3.02 | Authorization; Enforceability | 71 |
| SECTION 3.03 | Governmental Approvals; No Conflicts | 71 |
| SECTION 3.04 | Financial Condition; No Material Adverse Change | 71 |
| | | | | | | | | | | |
| SECTION 3.05 | Properties; Intellectual Property | 72 |
| SECTION 3.06 | Litigation and Environmental Matters | 72 |
| SECTION 3.07 | Compliance with Laws and Agreements | 73 |
| SECTION 3.08 | Investment Company Status | 73 |
| SECTION 3.09 | Taxes | 73 |
| SECTION 3.10 | ERISA | 73 |
| SECTION 3.11 | Disclosure | 73 |
| SECTION 3.12 | No Default | 74 |
| SECTION 3.13 | Solvency | 74 |
| SECTION 3.14 | Insurance | 74 |
| SECTION 3.15 | Capitalization and Subsidiaries | 74 |
| SECTION 3.16 | Security Interest in Collateral | 74 |
| SECTION 3.17 | Employment Matters | 75 |
| SECTION 3.18 | Margin Regulations | 75 |
| SECTION 3.19 | Burdensome Restrictions | 75 |
| SECTION 3.20 | Anti-Corruption and Anti-Terrorism Laws and Sanctions | 75 |
| SECTION 3.21 | Federal Reserve Regulations | 75 |
| SECTION 3.22 | EEA Financial Institutions | 76 |
| SECTION 3.23 | Plan Assets; Prohibited Transactions | 76 |
| SECTION 3.24 | Outbound Investment Rules | 76 |
| | | |
| ARTICLE IV CONDITIONS | 76 |
| | | |
| SECTION 4.01 | Effective Date | 76 |
| SECTION 4.02 | Commitment Effectiveness Date | 78 |
| SECTION 4.03 | Availability Date | 78 |
| SECTION 4.04 | Each Credit Event | 79 |
| | | |
| ARTICLE V AFFIRMATIVE COVENANTS | 79 |
| | | |
| SECTION 5.01 | Financial Statements and Other Information | 80 |
| SECTION 5.02 | Notices of Material Events | 81 |
| SECTION 5.03 | Existence; Conduct of Business | 82 |
| SECTION 5.04 | Payment of Obligations | 82 |
| SECTION 5.05 | Maintenance of Properties | 82 |
| SECTION 5.06 | Books and Records; Inspection Rights | 82 |
| SECTION 5.07 | Compliance with Laws and Material Contractual Obligations | 83 |
| SECTION 5.08 | Use of Proceeds and Letters of Credit | 83 |
| SECTION 5.09 | Insurance | 83 |
| SECTION 5.10 | Additional Subsidiaries | 84 |
| SECTION 5.11 | Additional Collateral; Further Assurances | 84 |
| SECTION 5.12 | Accuracy of Information | 85 |
| SECTION 5.13 | Post-Effective Date Covenant | 85 |
| SECTION 5.14 | Depository Banks | 85 |
| SECTION 5.15 | Compliance with Data Protection Regulations | 85 |
| SECTION 5.16 | Cash Management | 86 |
| | | |
| ARTICLE VI NEGATIVE COVENANTS | 86 |
| | | |
| SECTION 6.01 | Indebtedness | 86 |
| SECTION 6.02 | Liens | 89 |
| | | | | | | | | | | |
| SECTION 6.03 | Fundamental Changes | 89 |
| SECTION 6.04 | Investments, Loans, Advances, Guarantees and Acquisitions | 90 |
| SECTION 6.05 | Asset Sales | 92 |
| SECTION 6.06 | Swap Agreements | 93 |
| SECTION 6.07 | Restricted Payments; Certain Payments of Indebtedness | 93 |
| SECTION 6.08 | Transactions with Affiliates | 94 |
| SECTION 6.09 | Restrictive Agreements | 94 |
| SECTION 6.10 | Financial Condition Covenants | 95 |
| SECTION 6.11 | Amendment of Material Documents | 95 |
| SECTION 6.12 | Outbound Investment Rules | 96 |
| | | |
| ARTICLE VII EVENTS OF DEFAULT | 96 |
| | | |
| ARTICLE VIII THE ADMINISTRATIVE AGENT | 99 |
| | | |
| SECTION 8.01 | Authorization and Action | 99 |
| SECTION 8.02 | Administrative Agent’s Reliance, Indemnification, Etc. | 101 |
| SECTION 8.03 | Posting of Communications | 103 |
| SECTION 8.04 | The Administrative Agent Individually | 104 |
| SECTION 8.05 | Successor Administrative Agent | 104 |
| SECTION 8.06 | Acknowledgements of Lenders and Issuing Banks | 105 |
| SECTION 8.07 | Collateral Matters | 107 |
| SECTION 8.08 | Credit Bidding | 108 |
| SECTION 8.09 | Certain ERISA Matters | 109 |
| SECTION 8.10 | Subordination and Intercreditor Agreements | 110 |
| SECTION 8.11 | Borrower Communications | 110 |
| | | |
| ARTICLE IX MISCELLANEOUS | 111 |
| | | |
| SECTION 9.01 | Notices | 111 |
| SECTION 9.02 | Waivers; Amendments | 113 |
| SECTION 9.03 | Expenses; Limitation of Liability; Indemnity; Damage Waiver | 115 |
| SECTION 9.04 | Successors and Assigns | 117 |
| SECTION 9.05 | Survival | 121 |
| SECTION 9.06 | Counterparts; Integration; Effectiveness; Electronic Execution | 121 |
| SECTION 9.07 | Severability | 122 |
| SECTION 9.08 | Right of Setoff | 122 |
| SECTION 9.09 | Governing Law; Jurisdiction; Consent to Service of Process | 123 |
| SECTION 9.10 | WAIVER OF JURY TRIAL | 124 |
| SECTION 9.11 | Headings | 124 |
| SECTION 9.12 | Confidentiality | 124 |
| SECTION 9.13 | Several Obligations; Nonreliance; Violation of Law | 125 |
| SECTION 9.14 | USA PATRIOT Act and Beneficial Ownership | 125 |
| SECTION 9.15 | Disclosure | 125 |
| SECTION 9.16 | Appointment for Perfection | 125 |
| SECTION 9.17 | Interest Rate Limitation | 125 |
| SECTION 9.18 | No Fiduciary Duty, etc. | 126 |
| SECTION 9.19 | [Intentionally Omitted] | 126 |
| SECTION 9.20 | Acknowledgement and Consent to Bail-In of Affected Financial Institutions |
| | | 126 |
| SECTION 9.21 | Acknowledgement Regarding Any Supported QFCs | 127 |
| | | | | | | | | | | |
| ARTICLE X LOAN GUARANTY | 128 |
| | | |
| SECTION 10.01 | Guaranty | 128 |
| SECTION 10.02 | Guaranty of Payment | 128 |
| SECTION 10.03 | No Discharge or Diminishment of Loan Guaranty | 128 |
| SECTION 10.04 | Defenses Waived | 129 |
| SECTION 10.05 | Rights of Subrogation | 129 |
| SECTION 10.06 | Reinstatement; Stay of Acceleration | 129 |
| SECTION 10.07 | Information | 130 |
| SECTION 10.08 | Termination | 130 |
| SECTION 10.09 | Taxes | 130 |
| SECTION 10.10 | Maximum Liability | 130 |
| SECTION 10.11 | Contribution | 131 |
| SECTION 10.12 | Liability Cumulative | 131 |
| SECTION 10.13 | Keepwell | 131 |
| SECTION 10.14 | Release of Guarantors | 132 |
SCHEDULES:
| | | | | | | | |
| Schedule 2.01 | - | Commitments |
| | |
| Schedule 3.05 | - | Properties; Intellectual Property |
| | |
| Schedule 3.06 | - | Disclosed Matters |
| | |
| Schedule 3.14 | - | Insurance |
| | |
| Schedule 3.15 | - | Subsidiaries |
| | |
| Schedule 4.01(b) | - | Collateral Documents |
| | |
| Schedule 5.13 | - | Post-Closing Covenant |
| | |
| Schedule 6.01 | - | Existing Indebtedness |
| | |
| Schedule 6.02 | - | Existing Liens |
| | |
| Schedule 6.04 | - | Existing Investments |
| | |
| Schedule 6.09 | - | Existing Restrictions |
EXHIBITS:
| | | | | | | | |
| Exhibit A | - | Form of Assignment and Assumption |
| | |
| Exhibit B | - | Compliance Certificate |
| | |
| Exhibit C | - | Joinder Agreement |
| | |
| Exhibit D-1 | - | U.S. Tax Compliance Certificate (For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes) |
| | |
| Exhibit D-2 | - | U.S. Tax Compliance Certificate (For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes) |
| | |
| Exhibit D-3 | - | U.S. Tax Compliance Certificate (For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes) |
| | |
| Exhibit D-4 | - | U.S. Tax Compliance Certificate (For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes) |
| | |
| Exhibit E | - | Form of Increasing Lender Supplement - Existing Lender |
| | |
| | | | | | | | |
| Exhibit F | - | Form of Augmenting Lender Supplement - New Lender |
| | |
| Exhibit G | - | [Intentionally Omitted] |
| | |
| Exhibit H | - | Form of Solvency Certificate |
| | |
| Exhibit I | - | Form of Note |
| | |
| Exhibit J | - | Form of Security Agreement |
| | |
| Exhibit K | - | [Intentionally Omitted] |
| | |
| Exhibit L | - | Form of Intercompany Note |
| | |
| Exhibit M | - | Form of Intercreditor Agreement |
CREDIT AGREEMENT dated as of May 30, 2025 (as it may be amended, modified, restated, or otherwise supplemented from time to time, this “Agreement”), among VOYAGER TECHNOLOGIES, INC., a Delaware corporation, as the Borrower, the other Loan Parties party hereto, the Lenders and Issuing Banks party hereto, and JPMORGAN CHASE BANK, N.A., as the Administrative Agent.
WHEREAS, the Borrower has requested that the Lenders extend credit to the Borrower in the form of a revolving credit facility (including a letter of credit subfacility) in an aggregate principal amount of $200,000,000 pursuant to this Agreement; and
WHEREAS, the proceeds of Borrowings hereunder will be used (x) to consummate the refinancing and replacement of the Hercules Debt and (y) for working capital and other general corporate purposes of the Borrower and its Subsidiaries (including Permitted Acquisitions, capital expenditures, and other Investments and Restricted Payments, in each case, to the extent permitted under this Agreement).
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 Defined Terms. As used in this Agreement, the following terms have the meanings specified below:
“ABR” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, bear interest at a rate determined by reference to the Alternate Base Rate.
“Acceptable Subordination or Intercreditor Agreement” means (x) the Effective Date Intercreditor Agreement, (y) any intercreditor agreement substantially in the form of Exhibit M or otherwise reasonably acceptable to the Required Lenders or (z) any subordination agreement reasonably acceptable to the Required Lenders.
“Account” has the meaning assigned to such term in the Security Agreement.
“Account Debtor” means any Person obligated on an Account.
“Acquisition” means any transaction or series of related transactions by the Borrower or any Subsidiaries of the Borrower resulting, directly or indirectly, in (a) the acquisition of all or substantially all of the assets of any Person (other than an existing Subsidiary), or any business or division of any Person (other than an existing Subsidiary), (b) the acquisition of in excess of fifty percent (50%) of the stock (or other Equity Interests) with ordinary voting power of any Person (other than an existing Subsidiary), or (c) the acquisition of another Person (other than an existing Subsidiary) by a merger, amalgamation or consolidation or any other combination with such Person.
“Acquisition Consideration” shall mean the sum of the purchase price for any Permitted Acquisition payable at or prior to the closing date of such Permitted Acquisition (and which, for the avoidance of doubt, shall not include any purchase price adjustment, royalty, earn-out, contingent payment, working capital adjustment or any other deferred payment of a similar nature) plus the aggregate amount of Indebtedness assumed on such date in connection with such Permitted Acquisition.
“Adjusted Daily Simple SOFR” means an interest rate per annum equal to (a) the Daily Simple SOFR, plus (b) the related Benchmark Replacement Adjustment; provided that if the Adjusted Daily Simple
SOFR as so determined would be less than the Floor, such rate shall be deemed to be equal to the Floor for the purposes of this Agreement.
“Adjusted Term SOFR Rate” means for any Interest Period, an interest rate per annum equal to (a) the Term SOFR Rate for such Interest Period, plus (b) the Term SOFR Adjustment; provided that if the Adjusted Term SOFR Rate as so determined would be less than the Floor, such rate shall be deemed to be equal to the Floor for the purposes of this Agreement.
“Administrative Agent” means JPMorgan Chase Bank, N.A. (or any of its designated branch offices or affiliates), in its capacity as administrative agent for the Lenders hereunder.
“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent to the Borrower or any Lender, as the context requires.
“Affected Financial Institution” means (a) any EEA Financial Institution or (b) any UK Financial Institution.
“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.
“Agent-Related Person” has the meaning assigned to it in Section 9.03(d).
“Aggregate Credit Exposure” means, at any time, the aggregate Credit Exposure of all the Lenders at such time.
“Agreement” has the meaning assigned to it in the introductory paragraph of this Agreement.
“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the NYFRB Rate in effect on such day plus ½ of 1%, and (c) the Adjusted Term SOFR Rate for a one-month Interest Period as published two (2) U.S. Government Securities Business Days prior to such day (or if such day is not a U.S. Government Securities Business Day, the immediately preceding U.S. Government Securities Business Day) plus 1%, provided that, for the purpose of this definition, the Adjusted Term SOFR Rate for any day shall be based on the Term SOFR Reference Rate at approximately 5:00 a.m. Chicago time on such day (or any amended publication time for the Term SOFR Reference Rate, as specified by the CME Term SOFR Administrator in the Term SOFR Reference Rate methodology). Any change in the Alternate Base Rate due to a change in the Prime Rate, the NYFRB Rate or the Adjusted Term SOFR Rate shall be effective from and including the effective date of such change in the Prime Rate, the NYFRB Rate or the Adjusted Term SOFR Rate, respectively. If the Alternate Base Rate is being used as an alternate rate of interest pursuant to Section 2.14 (for the avoidance of doubt, only until the Benchmark Replacement has been determined pursuant to Section 2.14(b)), then the Alternate Base Rate shall be the greater of clauses (a) and (b) above and shall be determined without reference to clause (c) above. For the avoidance of doubt, if the Alternate Base Rate as determined pursuant to the foregoing would be less than 1.00%, such rate shall be deemed to be 1.00% for purposes of this Agreement.
“Ancillary Document” has the meaning assigned to it in Section 9.06(b).
“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to the Borrower or any Subsidiaries of the Borrower from time to time concerning or relating to bribery or corruption, including without limitation the U.S. Foreign Corrupt Practices Act of 1977, as amended and the UK Bribery Act of 2010, as amended.
“Anti-Money Laundering Laws” means any U.S. or relevant foreign laws concerning or relating to money laundering or terrorism financing, including without limitation, the USA PATRIOT ACT, as amended, the Bank Secrecy Act of 1970, as amended, 18 U.S.C. Sections 1956 and 1957, the Beneficial Ownership Regulation, Executive Order No. 13224 on Terrorist Financing (effective September 23, 2001), and the laws administered and enforced by the U.S. Department of Treasury’s Financial Crimes Enforcement Network (FinCEN).
“Applicable Commitment Fee” means a percentage per annum equal to the applicable amount set forth under the heading “Commitment Fee” in the definition of “Applicable Rate” and as determined in accordance with that definition.
“Applicable Parties” has the meaning assigned to such term in Section 8.03(c).
“Applicable Percentage” means, at any time with respect to any Lender, a percentage equal to a fraction the numerator of which is such Lender’s Commitment at such time and the denominator of which is the aggregate Commitments at such time (provided that if the Commitments have terminated or expired, the Applicable Percentages shall be determined based upon such Lender’s share of the Aggregate Credit Exposure at such time); provided that, in accordance with Section 2.20, so long as any Lender shall be a Defaulting Lender, such Defaulting Lender’s Commitment shall be disregarded in the calculations above.
“Applicable Rate” means, for any day, with respect to any ABR Loan, Term Benchmark Loan or Commitment Fee, the percentage per annum, as determined by reference to the Liquidity of the Borrower in effect on such date as set forth below:
| | | | | | | | | | | | | | |
| Level | Liquidity | Applicable Rate for ABR Loans | Applicable Rate for Term Benchmark Loans | Commitment Fee |
| I | > $350,000,000 | 1.25% | 2.25% | 0.25% |
| | | | |
| II | ≤ $350,000,000 but > $250,000,000 | 1.50% | 2.50% | 0.275% |
| III | ≤ $250,000,000 | 1.75% | 2.75% | 0.30% |
For purposes of the foregoing,
(i) Level III shall be deemed applicable for the period from the Effective Date until three (3) Business Days after the date that a Compliance Certificate of the Borrower is required to be delivered pursuant to Section 5.01(c) for the first full fiscal quarter ended after the Effective Date;
(ii) if at any time the Borrower fails to deliver the Compliance Certificate required to be delivered pursuant to Section 5.01(c) on or before the date such required Compliance Certificate is due pursuant to such Section 5.01(c), Level III shall be deemed applicable for the period commencing three (3) Business Days after the required date of delivery and ending on the date which is three (3) Business Days after such required Compliance Certificate is actually delivered, after which the Level shall be determined in accordance with the table above as applicable; and
(iii) adjustments, if any, to the Level then in effect shall be effective three (3) Business Days after the Administrative Agent has received the applicable Compliance Certificate required to be delivered pursuant to Section 5.01(c) (it being understood and agreed that each change in
Level shall apply during the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next such change).
“Approved Borrower Portal” has the meaning assigned to it in Section 8.11(a).
“Approved Electronic Platform” has the meaning assigned to it in Section 8.03(a).
“Approved Fund” has the meaning assigned to it in Section 9.04(b).
“Assignment and Assumption” means an assignment and assumption agreement entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 9.04), and accepted by the Administrative Agent, in the form of Exhibit A or any other form (including electronic records generated by the use of an electronic platform) approved by the Administrative Agent.
“Augmenting Lender” has the meaning assigned to such term in Section 2.22(a).
“Availability” means an amount equal to (a) the Commitment minus (b) the Aggregate Credit Exposure (calculated, with respect to any Defaulting Lender, as if such Defaulting Lender had funded its Applicable Percentage of all outstanding Borrowings).
“Availability Date” means the first date on which the conditions specified in Section 4.03 are satisfied (or waived in accordance with Section 9.02).
“Availability Period” means the period from and including the Availability Date to but excluding the earlier of the Maturity Date and the date of termination of the Commitments.
“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, any tenor for such Benchmark (or component thereof) or payment period for interest calculated with reference to such Benchmark (or component thereof), as applicable, that is or may be used for determining the length of an Interest Period for any term rate or otherwise, for determining any frequency of making payments of interest calculated pursuant to this Agreement as of such date and not including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of “Interest Period” pursuant to clause (e) of Section 2.14.
“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable Resolution Authority in respect of any liability of an Affected Financial Institution.
“Bail-In Legislation” means (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law, regulation, rule or requirement for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other than through liquidation, administration or other insolvency proceedings).
“Banking Services” means each and any of the following bank services provided to any Loan Party or any Subsidiary by any Lender or any of its Affiliates: (a) credit cards for commercial customers (including, without limitation, “commercial credit cards” and purchasing cards), (b) stored value cards, (c) merchant processing services, and (d) treasury management services (including, without limitation,
controlled disbursement, automated clearinghouse transactions, return items, any direct debit scheme or arrangement, overdrafts and interstate depository network services and cash pooling services).
“Banking Services Obligations” means any and all obligations of the Loan Parties and their Subsidiaries, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor) in connection with Banking Services.
“Bankruptcy Code” means Title 11 of the United States Code entitled “Bankruptcy”, as now and hereafter in effect, or any successor statute.
“Bankruptcy Event” means, with respect to any Person, such Person becomes the subject of a voluntary or involuntary bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors or similar Person charged with the reorganization or liquidation of its business appointed for it, or, in the good faith determination of the Administrative Agent, has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such proceeding or appointment or has had any order for relief in such proceeding entered in respect thereof; provided that a Bankruptcy Event shall not result solely by virtue of any ownership interest, or the acquisition of any ownership interest, in such Person by a Governmental Authority or instrumentality thereof, unless such ownership interest results in or provides such Person with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permits such Person (or such Governmental Authority or instrumentality) to reject, repudiate, disavow or disaffirm any contracts or agreements made by such Person.
“Benchmark” means, initially, with respect to any (i) RFR Loan, the Daily Simple SOFR or (ii) Term Benchmark Loan, the Term SOFR Rate; provided that if a Benchmark Transition Event, and the related Benchmark Replacement Date have occurred with respect to the Daily Simple SOFR or Term SOFR Rate, as applicable, or the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to clause (b) of Section 2.14.
“Benchmark Replacement” means, for any Available Tenor, the first alternative set forth in the order below that can be determined by the Administrative Agent for the applicable Benchmark Replacement Date:
(a) the Adjusted Daily Simple SOFR; or
(b) the sum of: (a) the alternate benchmark rate that has been selected by the Administrative Agent and the Borrower as the replacement for the then-current Benchmark for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for dollar-denominated syndicated credit facilities at such time in the United States and (b) the related Benchmark Replacement Adjustment.
If the Benchmark Replacement as determined pursuant to clause (a) or (b) above would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Loan Documents.
“Benchmark Replacement Adjustment” means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement for any applicable Interest Period and Available Tenor for any setting of such Unadjusted Benchmark Replacement, the spread adjustment, or method for calculating or determining such spread adjustment (which may be a positive or negative value or zero) that has been selected by the Administrative Agent and the Borrower for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body on the applicable Benchmark Replacement Date and/or (ii) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for dollar-denominated syndicated credit facilities at such time.
“Benchmark Replacement Conforming Changes” means, with respect to any Benchmark Replacement and/or any Term Benchmark Revolving Loan, any technical, administrative or operational changes (including changes to the definition of “Alternate Base Rate,” the definition of “Business Day,” the definition of “U.S. Government Securities Business Day,” the definition of “Interest Period,” timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, length of lookback periods, the applicability of breakage provisions, and other technical, administrative or operational matters) that the Administrative Agent decides may be appropriate to reflect the adoption and implementation of such Benchmark and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or if the Administrative Agent determines that no market practice for the administration of such Benchmark exists, in such other manner of administration as the Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents).
“Benchmark Replacement Date” means, with respect to any Benchmark, the earliest to occur of the following events with respect to such then-current Benchmark:
(a) in the case of clause (1) or (2) of the definition of “Benchmark Transition Event,” the later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof); or
(b) in the case of clause (3) of the definition of “Benchmark Transition Event,” the first date on which such Benchmark (or the published component used in the calculation thereof) has been or, if such Benchmark is a term rate, all Available Tenors of such Benchmark (or component thereof) have been determined and announced by the regulatory supervisor for the administrator of such Benchmark (or such component thereof) to be no longer representative; provided, that such non-representativeness will be determined by reference to the most recent statement or publication referenced in such clause (3) and even if such Benchmark (or component thereof) or, if such Benchmark is a term rate, any Available Tenor of such Benchmark (or such component thereof) continues to be provided on such date;
For the avoidance of doubt, (i) if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier than, the Reference Time in respect of any determination, the Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for such determination and (ii) the “Benchmark Replacement Date” will be deemed to have occurred in the case of clause (1) or (2)
with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).
“Benchmark Transition Event” means, with respect to any Benchmark, the occurrence of one or more of the following events with respect to such then-current Benchmark:
(a) a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide such Benchmark (or such component thereof) or, if such Benchmark is a term rate, any Available Tenor of such Benchmark (or such component thereof);
(b) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Federal Reserve Board, the NYFRB, the CME Term SOFR Administrator, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component), in each case, which states that the administrator of such Benchmark (or such component) has ceased or will cease to provide such Benchmark (or such component thereof) or, if such Benchmark is a term rate, all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely; provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide such Benchmark (or such component thereof) or, if such Benchmark is a term rate, any Available Tenor of such Benchmark (or such component thereof); or
(c) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such Benchmark (or such component thereof) or, if such Benchmark is a term rate, all Available Tenors of such Benchmark (or such component thereof) are no longer, or as of a specified future date will no longer be, representative.
For the avoidance of doubt, a “Benchmark Transition Event” will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof).
“Benchmark Unavailability Period” means, with respect to any Benchmark, the period (if any) (x) beginning at the time that a Benchmark Replacement Date pursuant to clauses (1) or (2) of that definition has occurred if, at such time, no Benchmark Replacement has replaced such then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 2.14 and (y) ending at the time that a Benchmark Replacement has replaced such then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 2.14.
“Beneficial Ownership Certification” means a certification regarding beneficial ownership or control as required by the Beneficial Ownership Regulation.
“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.
“Benefit Plan” means any of (a) an “employee benefit plan” (as defined in Section 3(3) of ERISA) that is subject to Title I of ERISA, (b) a “plan” as defined in Section 4975 of the Code to which Section 4975 of the Code applies, and (c) any Person whose assets include (for purposes of the Plan Asset Regulations or otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such “employee benefit plan” or “plan”.
“BHC Act Affiliate” of a party means an “affiliate” (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 1841(k)) of such party.
“Board” means the Board of Governors of the Federal Reserve System of the United States of America.
“Borrower” means Voyager Technologies, Inc., a Delaware corporation.
“Borrowing” means (a) Revolving Borrowing or (b) a Swingline Borrowing.
“Borrowing Request” means a request by the Borrower for a Revolving Borrowing in accordance with Section 2.03, which shall be substantially in the form approved by the Administrative Agent and separately provided to the Borrower.
“Burdensome Restrictions” means any consensual encumbrance or restriction of the type described in clause (a) or (b) of Section 6.09.
“Business Day” means any day (other than a Saturday or a Sunday) on which banks are open for business in New York City; provided that, in addition to the foregoing, a Business Day shall be any such day that is only a U.S. Government Securities Business Day (a) in relation to RFR Loans and any interest rate settings, fundings, disbursements, settlements or payments of any such RFR Loan, or any other dealings of such RFR Loan and (b) in relation to Loans referencing the Adjusted Term SOFR Rate and any interest rate settings, fundings, disbursements, settlements or payments of any such Loans referencing the Adjusted Term SOFR Rate or any other dealings of such Loans referencing the Adjusted Term SOFR Rate.
“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases or financing leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP (subject to, for the avoidance of doubt, Section 1.04).
“CFC” means a Foreign Subsidiary that is a “controlled foreign corporation” (as defined in Section 957(a) of the Code).
“Change in Control” means (a) at any time prior to the IPO, any combination of Permitted Holders shall fail to own beneficially (within the meaning of Rules 13d-3 and 13d-5 of the Exchange Act as in effect on the Effective Date), directly or indirectly, in the aggregate, Equity Interests representing at least a majority of the aggregate ordinary voting power represented by the issued and outstanding Equity Interests of the Borrower or (b) at any time on and after the IPO, any person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act as in effect on the Effective Date), but excluding (x) any employee benefit plan of such person and its Subsidiaries and any person or entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan and (y) any combination of Permitted Holders, shall have, directly or indirectly, acquired beneficial ownership of Equity Interests representing 35% or more of the aggregate voting power represented by the issued and outstanding Equity Interests of the
Borrower and the Permitted Holders shall own, directly or indirectly, less than such person or “group” of the aggregate voting power represented by the issued and outstanding Equity Interests of the Borrower.
“Change in Law” means the occurrence after the date of this Agreement of: (a) the adoption of or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) compliance by any Lender or Issuing Bank (or, for purposes of Section 2.15(b), by any lending office of such Lender or by such Lender’s or Issuing Bank’s holding company, if any) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement; provided that, notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith or in the implementation thereof, and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the U.S. or foreign regulatory authorities, in each case pursuant to Basel III, shall, in each case, be deemed to be a “Change in Law”, regardless of the date enacted, adopted, issued or implemented.
“Charges” has the meaning assigned to such term in Section 9.17.
“Class” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans or Swingline Loans.
“Class A-1 Preferred Stock” means the Borrower’s Class A-1 redeemable preferred stock.
“Class B Preferred Stock” means the Borrower’s Class B preferred stock.
“CME Term SOFR Administrator” means CME Group Benchmark Administration Limited as administrator of the forward-looking term SOFR (or a successor administrator).
“Code” means the Internal Revenue Code of 1986, as amended.
“Collateral” means any and all property owned, leased or operated by a Person covered by the Collateral Documents and any and all other property of any Loan Party, now existing or hereafter acquired, that may at any time be, become or be intended to be, subject to a security interest or Lien in favor of the Administrative Agent, on behalf of itself and other Secured Parties, to secure the Secured Obligations; provided that Collateral shall not include any Excluded Property.
“Collateral Documents” means, collectively, the Security Agreement, the Control Account Agreements and all other agreements, instruments and documents executed in connection with this Agreement that are intended to create, perfect or evidence Liens to secure the Secured Obligations, including, all other security agreements, pledge agreements, mortgages, deeds of trust, loan agreements, notes, guarantees, subordination agreements (including any Acceptable Subordination or Intercreditor Agreement), pledges, powers of attorney relating to any of the foregoing and collateral assignments or similar collateral documents whether heretofore, now or hereafter executed by any Loan Party and delivered to the Administrative Agent.
“Commitment” means, with respect to each Lender, the amount set forth on Schedule 2.01 opposite such Lender’s name, or in the Assignment and Assumption or other documentation or record (as such term is defined in Section 9-102(a)(70) of the New York Uniform Commercial Code) as provided in Section 9.04(b)(ii)(3), pursuant to which such Lender shall have assumed its Commitment, as applicable, and giving effect to (a) any reduction in such amount from time to time pursuant to Section 2.09, (b) any reduction or
increase in such amount from time to time pursuant to assignments by or to such Lender pursuant to Section 9.04 and (c) any increase from time to time pursuant to Section 2.22; provided that at no time shall the Credit Exposure of any Lender exceed its Commitment. The initial aggregate amount of the Lenders’ Commitments is $200,000,000; provided that, for the avoidance of doubt, the aggregate Commitments shall be $0 from the period from the Effective Date until the Commitment Effectiveness Date.
“Commitment Effectiveness Date” means the date on which the conditions specified in Section 4.02 are satisfied (or waived in accordance with Section 9.02).
“Commitment Fee” has the meaning set forth in Section 2.12(a).
“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.
“Communications” has the meaning assigned to such term in Section 8.03(c).
“Competitor” means any Person (a) that is an operating company directly and primarily engaged in substantially similar business operations as the Borrower and (b) any of such Person’s subsidiaries, in each case, identified in writing to the Administrative Agent from time to time.
“Competitor Controller” means any (a) direct or indirect parent company of a Competitor to the extent reasonably identifiable on the basis of such parent’s name and (b) Person that is Controlled by such Competitor in each case identified in writing to the Administrative Agent, excluding in each case of (a) and (b) any Person that is a financial institution, a debt fund or an investment vehicle that is engaged in the business of making, purchasing, holding or otherwise investing in loans, notes, bonds and similar extensions of credit or securities in the ordinary course of business to or of unaffiliated third parties.
“Compliance Certificate” means a certificate of a Financial Officer in substantially the form of Exhibit B.
“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.
“Consolidated” or “consolidated” means, with reference to any term defined herein, that term as applied to the accounts of the Borrower and its Subsidiaries, consolidated in accordance with GAAP.
“Consolidated EBITDA” means, with reference to any period, Consolidated Net Income for such period plus
(a) without duplication and, except with respect to amounts added back pursuant to clauses (xii) (solely in the case of amounts constituting the proceeds of business interruption insurance that are not already included in Consolidated Net Income) or (xv), to the extent deducted (and not added back) in determining such Consolidated Net Income for such period,
(i) Consolidated Interest Expense (including net losses (or gains) on Swap Obligations or other derivative instruments entered into for the purpose of hedging interest rate risk, unused line fees, letter of credit fees, facing fees and bank guaranty fees), net of interest income;
(ii) the provision for taxes based on income, revenue, profits or capital, including federal, foreign, state, local, franchise, excise, value added and similar taxes paid or accrued during
such period (including in respect of repatriated funds and any future taxes or other levies which replace or are intended to be in lieu of such taxes and any penalties and interest related to such taxes or arising from tax examinations and any Tax Distributions permitted hereunder) net of any tax credits;
(iii) depreciation expense and amortization expense;
(iv) impairment of goodwill and other long-lived assets;
(v) non-cash expenses (including non-cash stock and equity-based compensation expenses) for such period;
(vi) non-recurring fees, costs and expenses incurred during such period in connection with any issuances of Equity Interests (including, without limitation, the IPO, but for the avoidance of doubt, excluding ongoing public company costs following the IPO), any Permitted Acquisitions, sale of assets outside the ordinary course of business, Restricted Payments permitted under Section 6.06, any Indebtedness permitted under Section 6.01 and Investments permitted under Section 6.04, whether consummated or not consummated, during such period; provided, that amounts added back in the determination of Consolidated EBITDA pursuant to this clause (vi) shall not exceed $5,000,000 for any Test Period; provided further that such limitation shall not apply if such expenses are funded with the net cash proceeds of capital contributions to, and issuance of Qualified Equity Interests by, the Borrower to persons other than its Subsidiaries;
(vii) any loss from any sale of long-lived assets outside the ordinary course of business;
(viii) non-recurring fees and expenses incurred during such period in connection with the Loan Documents;
(ix) extraordinary, unusual or non-recurring losses or expenses;
(x) the amount of severance costs and earn-out obligations in connection with any Permitted Acquisition, disposition, restructuring, cost savings initiative, or other similar initiative;
(xi) the amount of fees, costs, prepayment premiums and expenses previously paid in cash and capitalized and subsequently expensed in connection with the repayment of Indebtedness and any required prepayment premiums in connection therewith during such period;
(xii) proceeds of business interruption insurance and any expenses and payments covered by third party indemnification, insurance, reimbursement, guaranty, purchase price adjustment or similar arrangement, or otherwise reimbursed or reimbursable by a third party, to the extent that such expenses and payments have been paid or reimbursed in cash during such period;
(xiii) the amount of any cash restructuring and similar charges, severance costs, lease termination costs, retention, recruiting and relocation costs, integration and other business optimization expenses, signing costs, retention or completion bonuses, stock-option or equity-based compensation expenses, transition costs, costs related to the closure or consolidation of facilities, future lease commitments and curtailments or modifications to pension and post-retirement employee benefit plans (including any settlement of pension liabilities), including, without limitation, any one-time expense relating to enhanced accounting function or other transaction costs, and other one-time expenses not otherwise added back to Consolidated EBITDA;
provided, that amounts added back in the determination of Consolidated EBITDA pursuant to this clause (xiii) shall not exceed $5,000,000 for any Test Period;
(xiv) [Intentionally Omitted];
(xv) the net amount, if any, by which consolidated deferred revenues increased during such period;
(xvi) to the extent not already covered in clauses (a)(i) through (a)(xv) above, all other non-cash charges, write-downs, expenses, losses or other similar items for such period, including the impact of purchase accounting; and
(xvii) currency translation losses related to currency remeasurements of assets or liabilities (including the net loss resulting from hedging agreements for currency exchange risk and revaluations of intercompany balances);
provided that, for any Test Period, the foregoing adjustments set forth in clauses (a)(v) through (a)(xvii) shall not exceed 30% of Consolidated EBITDA (calculated after giving effect to such adjustments) for such Test Period;
minus (b) without duplication and except with respect to clauses (iii) and (v) to the extent included in such Consolidated Net Income for such period, (i) any cash payments made during such period in respect of items described in clauses (a)(v), (a)(vii), (a)(ix) or (a)(xvi) above subsequent to the fiscal quarter in which the relevant non-cash expenses or losses were taken or incurred, (ii) extraordinary, unusual or non-recurring income or gains, (iii) currency translation gains related to currency remeasurements of assets or liabilities (including the net gain resulting from hedging agreements for currency exchange risk and revaluations of intercompany balances), (iv) gains on disposal of long-lived assets outside the ordinary course of business, and (v) the net amount, if any, by which consolidated deferred revenues decreased during such period.
For the purposes of calculating Consolidated EBITDA for any Test Period, (x) if at any time during such Test Period, the Borrower or any Subsidiary shall have made any sale or disposition of assets or series of related sales or dispositions of assets (other than to the Borrower or its Subsidiaries), the Consolidated EBITDA for such Test Period shall be reduced by an amount equal to the Consolidated EBITDA (if positive) attributable to the assets that are the subject of such sale or disposition for such Test Period or increased by an amount equal to the Consolidated EBITDA (if negative) attributable thereto for such period, and (y) if during such Test Period, the Borrower or any Subsidiary shall have made any Permitted Acquisition or other Investments permitted hereunder, Consolidated EBITDA for such Test Period shall be calculated after giving effect thereto on a pro forma basis as if such Permitted Acquisition or other Investment (including the incurrence or assumption of any Indebtedness in connection therewith) had occurred on the first (1st) day of such Test Period, without duplicating any other add-back to Consolidated EBITDA.
“Consolidated Interest Expense” means, for any period, for the Borrower and its Subsidiaries calculated in accordance with GAAP on a consolidated basis for such period (without duplication), all cash interest expense (including interest expense under Finance Lease Obligations that is treated as interest in accordance with GAAP and regularly scheduled dividends paid in cash for such period on or with respect to Disqualified Equity Interests) with respect to all outstanding Indebtedness of the Borrower and its Subsidiaries allocable to such period in accordance with GAAP (including all commissions, discounts and other fees and charges owed with respect to letters of credit and net costs under interest rate Swap Agreements to the extent such costs are allocable to such period in accordance with GAAP) less interest income, excluding (a) one-time cash costs associated with breakage in respect of interest rate Swap
Agreements, (b) any “additional interest” or “liquidated damages” with respect to securities for failure to comply with registration rights obligations, (c) penalties and interest relating to taxes, and (d) any expensing of bridge, commitment and other financing fees (including annual agency fees paid to any administrative agent or collateral agent under any credit facilities or the debt instruments or documents).
“Consolidated Net Income” means, with reference to any period, the net income (or loss) of the Borrower and its Subsidiaries calculated in accordance with GAAP on a consolidated basis for such period; provided, however, that there will not be included in such Consolidated Net Income (without duplication): (a) the income (or deficit) of any Person (other than a Subsidiary) in which the Borrower or any Subsidiary has an ownership interest, except to the extent that any such income is actually received by the Borrower or such Subsidiary in the form of dividends or similar distributions, (b) the cumulative effect of a change in accounting principles; (c) any unrealized gains or losses in respect of Swap Obligations or any ineffectiveness recognized in earnings related to qualifying hedge transactions or the fair value of changes therein recognized in earnings for derivatives that do not qualify as hedge transactions, in each case, in respect of Swap Obligations; and (d) any recapitalization or purchase accounting effects including, but not limited to, adjustments to inventory, property and equipment, software and other intangible assets and deferred revenue in component amounts required or permitted by GAAP and related authoritative pronouncements (including the effects of such adjustments pushed down to the Borrower and its Subsidiaries), as a result of any consummated acquisition, or the amortization or write off of any amounts thereof.
“Consolidated Total Assets” means the total assets of the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP, as shown on the most recent balance sheet of the Borrower delivered pursuant to Section 5.01(a) or (b).
“Consolidated Total Revenues” means the gross revenues of the Borrower and its Subsidiaries, determined on a consolidated basis in accordance with GAAP, as shown on the most recent income statement of the Borrower delivered pursuant to Section 5.01(a) or (b).
“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.
“Control Account Agreement” means any tri-party agreement by and among a Loan Party, the Administrative Agent and a depository bank or securities intermediary at which such Loan Party maintains a Controlled Account, in each case in form and substance reasonably satisfactory to the Administrative Agent.
“Control Account Agreement Period” has the meaning assigned to such term in Section 5.16.
“Controlled Account” has the meaning assigned to such term in Section 5.16.
“Corresponding Tenor” with respect to any Available Tenor means, as applicable, either a tenor (including overnight) or an interest payment period having approximately the same length (disregarding business day adjustment) as such Available Tenor.
“Covered Entity” means any of the following:
(i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b);
(ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or
(iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).
“Covered Party” has the meaning assigned to it in Section 9.21(b).
“Credit Exposure” means, with respect to any Lender, at any time, the sum of the aggregate outstanding principal amount of such Lender’s Revolving Loans, its Swingline Exposure and LC Exposure at such time.
“Credit Party” means the Administrative Agent, the Swingline Lender, each Issuing Bank or any other Lender.
“Daily Simple SOFR” means, for any day, (a “SOFR Rate Day”), a rate per annum equal to SOFR for the day (such day “SOFR Determination Date”) that is five (5) U.S. Government Securities Business Days prior to (i) if such SOFR Rate Day is a U.S. Government Securities Business Day, such SOFR Rate Day or (ii) if such SOFR Rate Day is not a U.S. Government Securities Business Day, the U.S. Government Securities Business Day immediately preceding such SOFR Rate Day, in each case, as such SOFR is published by the SOFR Administrator on the SOFR Administrator’s Website. Any change in Daily Simple SOFR due to a change in SOFR shall be effective from and including the effective date of such change in SOFR without notice to the Borrower. If by 5:00 p.m. (New York City time) on the second (2nd) U.S. Government Securities Business Day immediately following any SOFR Determination Date, SOFR in respect of such SOFR Determination Date has not been published on the SOFR Administrator’s Website and a Benchmark Replacement Date with respect to the Daily Simple SOFR has not occurred, then SOFR for such SOFR Determination Date will be SOFR as published in respect of the first preceding U.S. Government Securities Business Day for which such SOFR was published on the SOFR Administrator’s Website.
“Debtor Relief Laws” means the Bankruptcy Code, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.
“Default” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.
“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.
“Defaulting Lender” means any Lender that (a) has failed, within two (2) Business Days of the date required to be funded or paid, to (i) fund any portion of its Loans, (ii) fund any portion of its participations in Letters of Credit or Swingline Loans or (iii) pay over to any Credit Party any other amount required to be paid by it hereunder, unless, in the case of clause (i) above, such Lender notifies the Administrative Agent in writing that such failure is the result of such Lender’s good faith determination that a condition precedent to funding (specifically identified and including the particular default, if any) has not been satisfied, (b) has notified the Borrower or any Credit Party in writing, or has made a public statement to the effect, that it does not intend or expect to comply with any of its funding obligations under this Agreement (unless such writing or public statement indicates that such position is based on such Lender’s good faith determination that a condition precedent (specifically identified and including the
particular default, if any) to funding a loan under this Agreement cannot be satisfied) or generally under other agreements in which it commits to extend credit, (c) has failed, within three (3) Business Days after request by a Credit Party, acting in good faith, to provide a certification in writing from an authorized officer of such Lender that it will comply with its obligations (and is financially able to meet such obligations as of the date of certification) to fund prospective Loans and participations in then outstanding Letters of Credit and Swingline Loans under this Agreement; provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon such Credit Party’s receipt of such certification in form and substance satisfactory to it and the Administrative Agent, or (d) has become the subject of (A) a Bankruptcy Event or (B) a Bail-In Action.
“Disclosed Matters” means the actions, suits and proceedings and the environmental matters disclosed in Schedule 3.06.
“Disposition” or “Dispose” means the sale, transfer, license, lease or other disposition (in one transaction or in a series of transactions and whether effected pursuant to a Division or otherwise) of any property (including Intellectual Property) by any Person (including any sale and leaseback transaction and any issuance of Equity Interests by a Subsidiary of such Person), including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith.
“Disqualified Equity Interests” means Equity Interests that by their terms (or by the terms of any security into which they are convertible or for which they are exchangeable), or upon the happening of any event, (a) require the payment of any dividends (other than dividends payable solely in shares of Qualified Equity Interests), (b) mature or are mandatorily redeemable or subject to mandatory repurchase or redemption or repurchase at the option of the holders thereof (other than solely for Equity Interests in such Person or the Borrower that do not constitute Disqualified Equity Interests and cash in lieu of fractional shares of such Equity Interests), in whole or in part and whether upon the occurrence of any event, pursuant to a sinking fund obligation, on a fixed date or otherwise, prior to the date that is ninety one (91) days following the then Latest Maturity Date at such time (other than upon (i) a “change in control” or (ii) an asset sale or similar event; provided that such “change in control”, asset sale or similar event results in the prior payment in full of the Obligations (other than the contingent obligations for which no claim has been made) and termination of the Commitments), or (c) are convertible or exchangeable, automatically or at the option of any holder thereof, into any debt securities or any Equity Interest (other than solely for Equity Interests in such Person or the Borrower that do not constitute Disqualified Equity Interests and cash in lieu of fractional shares of such Equity Interests) referred to in clause (a) or (b) above, prior to the date that is ninety one (91) days following the then Latest Maturity Date at such time; provided that if such Equity Interests are issued pursuant to a plan for the benefit of employees of the Borrower or any Subsidiary (or any parent entity thereof), such Equity Interests shall not constitute Disqualified Equity Interests solely because they may be required to be repurchased by the Borrower or its Subsidiaries in order to satisfy applicable statutory or regulatory obligations or as a result of such employee’s termination, death or disability.
“Dividing Person” has the meaning assigned to it in the definition of “Division.”
“Division” means the division of the assets, liabilities and/or obligations of a Person (the “Dividing Person”) among two or more Persons (whether pursuant to a “plan of division” or similar arrangement), which may or may not include the Dividing Person and pursuant to which the Dividing Person may or may not survive.
“Division Successor” means any Person that, upon the consummation of a Division of a Dividing Person, holds all or any portion of the assets, liabilities and/or obligations previously held by such Dividing
Person immediately prior to the consummation of such Division. A Dividing Person which retains any of its assets, liabilities and/or obligations after a Division shall be deemed a Division Successor upon the occurrence of such Division.
“Document” has the meaning assigned to such term in the Security Agreement.
“Dollars”, “dollars” or “$” refers to lawful money of the U.S.
“Domestic Subsidiary” means a Subsidiary of the Borrower or any other Loan Party to the extent such Subsidiary is organized under the laws of a jurisdiction located in the U.S.; provided, however, no Foreign Subsidiary Holding Company shall be considered a Domestic Subsidiary.
“ECP” means an “eligible contract participant” as defined in Section 1(a)(18) of the Commodity Exchange Act or any regulations promulgated thereunder and the applicable rules issued by the Commodity Futures Trading Commission and/or the SEC.
“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
“EEA Resolution Authority” means any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
“Effective Date” means the date on which the conditions specified in Section 4.01 are satisfied (or waived in accordance with Section 9.02).
“Effective Date Intercreditor Agreement” means that certain junior lien intercreditor agreement, dated as of the Effective Date, among the Borrower, each other Loan Party, the Administrative Agent and Hercules Capital, Inc., as administrative agent under the Hercules Loan and Security Agreement.
“Electronic Signature” means an electronic sound, symbol, or process attached to, or associated with, a contract or other record and adopted by a Person with the intent to sign, authenticate or accept such contract or record.
“Environmental Laws” means all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, notices or binding agreements issued, promulgated or entered into by any Governmental Authority, relating in any way to (i) the environment, (ii) preservation or reclamation of natural resources, (iii) the management, release or threatened release of any Hazardous Material or (iv) health and safety matters.
“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrower or any Subsidiary directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c)
exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.
“Equipment” has the meaning assigned to such term in the Security Agreement.
“Equity Financed Permitted Acquisition” means any Permitted Acquisition described in clause (a) of the definition thereof.
“Equity Interests” means shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests in a trust or other equity ownership interests in a Person, and any warrants, options or other rights entitling the holder thereof to purchase or acquire any such equity interest, but excluding any debt securities convertible into any of the foregoing.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations promulgated thereunder.
“ERISA Affiliate” means any trade or business (whether or not incorporated) that, together with the Borrower, is treated as a single employer under Section 414(b) or (c) of the Code or Section 4001(14) of ERISA or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.
“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (other than an event for which the 30 day notice period is waived); (b) the failure to satisfy the “minimum funding standard” (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the Borrower or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal of the Borrower or any of its ERISA Affiliates from any Plan or Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition upon the Borrower or any of its ERISA Affiliates of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.
“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.
“Events of Default” has the meaning assigned to such term in Article VII.
“Excluded Property” has the meaning assigned to such term in the Security Agreement.
“Excluded Subsidiary” means (a) any Subsidiary that is by applicable law or regulation or contractual obligations existing on the date of this Agreement (or, in the case of any newly acquired or organized Subsidiary, in existence at the time of acquisition or organization but not entered into in contemplation thereof) prohibited from Guaranteeing the Obligations, (b) any Subsidiary with respect to which the Administrative Agent and the Borrower agree that the burden or cost or other consequences (including any material adverse tax consequences) of providing a Guarantee of the Obligations would be
excessive in view of the practical benefits to be obtained by the Secured Parties therefrom, (c) any Foreign Subsidiary, (d) Subsidiary of a CFC, (e) any not-for-profit Subsidiary, (f) any Subsidiary that is a captive insurance company, (g) any Subsidiary that is a special purpose entity reasonably satisfactory to the Administrative Agent, (h) any Immaterial Subsidiary, (i) any joint venture that is not solely owned between or among the Borrower and its Subsidiaries (and was not a Guarantor prior to the creation of such joint venture) and (j) any Subsidiary that is a broker-dealer.
“Excluded Swap Obligation” means, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guarantee of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an ECP at the time the Guarantee of such Guarantor or the grant of such security interest becomes or would become effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guarantee or security interest is or becomes illegal.
“Excluded Taxes” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient: (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan, Letter of Credit or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan, Letter of Credit or Commitment (other than pursuant to an assignment request by the Borrower under Section 2.19(b)) or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 2.17, amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender acquired the applicable interest in a Loan, Letter of Credit or Commitment or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient’s failure to comply with Section 2.17(f) and (d) any withholding Taxes imposed under FATCA.
“FATCA” means Sections 1471 through 1474 of the Code as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, any agreement entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities and implementing such Sections of the Code.
“Federal Funds Effective Rate” means, for any day, the rate calculated by the NYFRB based on such day’s federal funds transactions by depositary institutions, as determined in such manner as shall be set forth on the NYFRB’s Website from time to time, and published on the next succeeding Business Day by the NYFRB as the effective federal funds rate; provided that if the Federal Funds Effective Rate as so determined would be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement.
“Fee Letter” means that certain Fee Letter, dated as of April 17, 2025, among the Borrower and the Administrative Agent
“Fiduciary Account” means (i) any account maintained in the ordinary course of business by the Borrower or any of its Subsidiaries in order to hold, as a fiduciary or on a contractual basis, funds owned by another Person or (ii) any escrow account.
“Finance Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required, subject to Section 1.04, to be classified and accounted for as a balance sheet liability of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP. For the avoidance of doubt, an operating lease will not be a Finance Lease Obligation.
“Financial Officer” means the chief financial officer, chief operating officer, general counsel, principal accounting officer, treasurer, controller or any other officer of similar and comparable title of the Borrower.
“Financial Statements” means the financial statements to be furnished pursuant to Sections 5.01(a) and (b).
“Floor” means the benchmark rate floor, if any, provided in this Agreement initially (as of the execution of this Agreement, the modification, amendment or renewal of this Agreement or otherwise) with respect to the Adjusted Term SOFR Rate or the Adjusted Daily Simple SOFR, as applicable. For the avoidance of doubt, the initial Floor for each of the Adjusted Term SOFR Rate and the Adjusted Daily Simple SOFR shall be 0.00%.
“Foreign Lender” means any Lender that is not a U.S. Person.
“Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.
“Foreign Subsidiary Holding Company” means a Subsidiary (a) substantially all of the assets of which are Equity Interests, or Equity Interests and Indebtedness, in one or more CFCs or (b) that is treated as a disregarded entity for U.S. federal income tax purposes and holds Equity Interests in one or more CFCs.
“Funding Account” means the deposit account of the Borrower designated from time to time in writing to the Administrative Agent to which the Administrative Agent is authorized by the Borrower to transfer the proceeds of any Borrowings requested or authorized pursuant to this Agreement.
“GAAP” means generally accepted accounting principles in the U.S.
“Governmental Authority” means the government of the U.S., any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition
or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation; provided, that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business.
“Guaranteed Obligations” has the meaning assigned to such term in Section 10.01.
“Guarantor Payment” has the meaning assigned to such term in Section 10.11(a).
“Guarantors” means the Borrower (with respect to the Banking Services Obligations and Swap Agreement Obligations of each other Guarantor) and each direct or indirect Material Domestic Subsidiary of the Borrower, and the term “Guarantor” means each or any one of them individually.
“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.
“Hercules Debt” means the term loans (and other obligations) incurred pursuant to the Hercules Loan and Security Agreement.
“Hercules Debt Repayment” means, collectively, (i) the refinancing, replacement and repayment in full from the proceeds of the Loans of all obligations outstanding under the Hercules Loan and Security Agreement (including accrued interest and fees) and any guarantees thereof, (ii) the termination of all commitments thereunder and (iii) the release of all Liens securing the obligations under the Hercules Loan and Security Agreement.
“Hercules Loan and Security Agreement” means that certain Loan and Security Agreement, dated as of June 28, 2024, by and among the Borrower, the Borrower’s Domestic Subsidiaries, the lenders party thereto and Hercules Capital, Inc., as administrative agent and collateral agent.
“Immaterial Subsidiary” means each Subsidiary (other than Subsidiaries that are Excluded Subsidiaries (other than pursuant to subsection (h) thereof)) (a) which, as of the most recent fiscal quarter of the Borrower, for the period of four consecutive fiscal quarters then ended (determined in accordance with GAAP), has not contributed greater than five percent (5.0%) of Consolidated Total Revenues of the Borrower and its Subsidiaries for such period and (b) which has not contributed greater than five percent (5.0%) of Consolidated Total Assets as of such date; provided that, if at any time the aggregate amount of Consolidated Total Revenues or Consolidated Total Assets attributable to all Domestic Subsidiaries that are Immaterial Subsidiaries (other than Domestic Subsidiaries that are otherwise Excluded Subsidiaries) exceeds ten percent (10.0%) of Consolidated Total Revenues for any such period or ten percent (10.0%) of Consolidated Total Assets as of the end of any such fiscal quarter, the Borrower (or, in the event the Borrower has failed to do so within ten (10) days, the Administrative Agent) shall designate sufficient Domestic Subsidiaries as “non-Immaterial Subsidiaries” to eliminate such excess.
“Increasing Lender” has the meaning assigned to such term in Section 2.22(a).
“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) [intentionally omitted], (d) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (e) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred
in the ordinary course of business), (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit, letters of guaranty, and bankers’ acceptances, in each case, only to the extent not cash collateralized, as applicable, (j) [intentionally omitted], (k) obligations under any earn-out (or similar contingent obligations) solely to the extent due and payable, (l) all obligations of such Person to purchase, redeem, retire or otherwise acquire for value any Disqualified Equity Interests, (m) [intentionally omitted] and (n) net obligations payable at the termination of any and all Swap Agreements determined by reference to the termination value thereof to the extent not cash collateralized. The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor. Notwithstanding anything to the contrary set forth herein, in no event shall the following constitute Indebtedness: (i) accruals for (A) payroll and (B) other non-interest bearing liabilities accrued in the ordinary course of business, (ii) trade accounts payable, deferred revenues, liabilities associated with customer prepayments and deposits and other accrued obligations, in each case incurred in the ordinary course of business, (iii) transfer pricing and accruals for payroll and other operating expenses accrued in the ordinary course of business, in each case incurred in the ordinary course of business, (iv) operating leases (including, without limitation, real property leases that, pursuant to GAAP, would not be classified and accounted for as a balance sheet liability), (v) customary obligations under employment agreements and deferred compensation, and (vi) prepaid or deferred revenue and deferred tax liabilities.
“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in (a) hereof, Other Taxes.
“Indemnitee” has the meaning assigned to such term in Section 9.03(c).
“Ineligible Institution” has the meaning assigned to it in Section 9.04(b).
“Information” has the meaning assigned to it in Section 9.12.
“Intellectual Property” has the meaning assigned to such term in the Security Agreement.
“Intercompany Note” means that certain intercompany note in the form of Exhibit L, dated as of the Effective Date, among the Borrower and its Subsidiaries.
“Interest Election Request” means a request by the Borrower to convert or continue a Revolving Borrowing in accordance with Section 2.08, which shall be substantially in the form approved by the Administrative Agent and separately provided to the Borrower.
“Interest Payment Date” means (a) with respect to any ABR Loan (other than a Swingline Loan), the last day of each March, June, September and December and the Maturity Date, (b) with respect to any RFR Loan, (1) each date that is on the numerically corresponding day in each calendar month that is one month after the Borrowing of such Loan (or, if there is no such numerically corresponding day in such month, then the last day of such month) and (2) the Maturity Date, (c) with respect to any Term Benchmark Loan, the last day of each Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a Term Benchmark Borrowing with an Interest Period of more than three (3) months’ duration, each day prior to the last day of such Interest Period that occurs at intervals of three (3) months’ duration
after the first (1st) day of such Interest Period and the Maturity Date and (d) with respect to any Swingline Loan, the day that such Loan is required to be repaid and the Maturity Date.
“Interest Period” means with respect to any Term Benchmark Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one (1), three (3) or six (6) months thereafter (in each case, subject to the availability for the Benchmark applicable to the relevant Loan or Commitment), as the Borrower may elect; provided that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (ii) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period, and (iii) no tenor that has been removed from this definition pursuant to Section 2.14(e) shall be available for specification in such Borrowing Request or Interest Election Request. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and, in the case of a Revolving Borrowing, thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.
“Inventory” has the meaning assigned to such term in the Security Agreement.
“Investment” means, as applied to the Borrower and its Subsidiaries, (a) the purchase or acquisition of any Equity Interest, indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of any other Person (including any Subsidiary), (b) any loan, advance or extension of credit (excluding accounts receivable, credit card and debt receivables and trade credit, in each case arising in the ordinary course of business) to, or contribution to the capital of, or Guarantee of any obligations of, any other Person (including any Subsidiary), and (c) any Acquisition. The amount of any Investment shall be the original principal or capital amount thereof less all returns of principal or equity thereon (without adjustment by reason of the financial condition of such other Person) and shall, if made by the transfer or exchange of property other than cash, be deemed to have been made in an original principal or capital amount equal to the fair market value of such property exchanged.
“IPO” means the proposed initial public offering and distribution of certain of the common Equity Interests of the Borrower pursuant to the Form S-1 Registration Statement under the Securities Act of 1933, as amended, that was filed March 16, 2025 (as amended prior to the consummation of the IPO).
“IPO Proceeds Condition” means (a)(x) if the Hercules Debt Repayment is not consummated substantially concurrently with the consummation of the IPO, the Borrower shall have received minimum Net IPO Proceeds of $300,000,000 or (y) if the Hercules Debt Repayment is consummated substantially concurrently with the consummation of the IPO, the Borrower shall have received minimum Net IPO Proceeds of $250,000,000 and (b) the Borrower shall have delivered to the Administrative Agent a certificate of a Responsible Officer of the Borrower certifying that the foregoing clause (a) has been satisfied (specifying the applicable prong by which clause (a) was satisfied) and including a reasonably detailed calculation of Net IPO Proceeds in connection therewith. For the purposes of this Agreement, the phrase “substantially concurrently with the consummation of the IPO” shall mean any date up to and including July 1, 2025.
“IRS” means the United States Internal Revenue Service.
“Issuing Bank” means JPMorgan Chase Bank, N.A. and any other Lender that agrees to act as an Issuing Bank (in each case, through itself or through one of its designated affiliates or branch offices), each in its capacity as the issuer of Letters of Credit hereunder, and its successors in such capacity as provided
in Section 2.06(i). Any Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by Affiliates of such Issuing Bank, in which case the term “Issuing Bank” shall include any such Affiliate with respect to Letters of Credit issued by such Affiliate. Each reference herein to the “Issuing Bank” in connection with a Letter of Credit or other matter shall be deemed to be a reference to the relevant Issuing Bank with respect thereto.
“Issuing Bank Sublimit” means, as of the Effective Date, (a) in the case of JPMorgan, $25,000,000 and (b) in the case of any other Issuing Bank, such amount as shall be designated to the Administrative Agent and the Borrower in writing by an Issuing Bank; provided that any Issuing Bank shall be permitted at any time to increase or reduce its Issuing Bank Sublimit upon providing five (5) Business Days’ prior written notice thereof to the Administrative Agent and the Borrower.
“Joinder Agreement” means a Joinder Agreement in substantially the form of Exhibit C.
“JPM Side Letter” means that certain side letter, dated as of the Effective Date, between the Borrower and JPMorgan.
“JPMorgan” means JPMorgan Chase Bank, N.A., a national banking association, in its individual capacity, and its successors.
“Junior Indebtedness” means (x) Subordinated Indebtedness, (y) Junior Lien Indebtedness and (z) unsecured Indebtedness.
“Junior Lien Indebtedness” means any Indebtedness of the Borrower or any Subsidiary that is secured on a junior lien basis to the Liens securing the Secured Obligations.
“Latest Maturity Date” means, at any date of determination, the latest maturity date applicable to any Loan or Commitment hereunder at such time (and excluding any earlier acceleration of the Loans or termination of the Commitments), in each case as extended in accordance with this Agreement from time to time.
“LC Collateral Account” has the meaning assigned to such term in Section 2.06(j).
“LC Disbursement” means a payment made by an Issuing Bank pursuant to a Letter of Credit.
“LC Exposure” means, at any time, the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time, plus (b) the aggregate amount of all LC Disbursements that have not yet been reimbursed by or on behalf of the Borrower at such time. The LC Exposure of any Lender at any time shall be its Applicable Percentage of the aggregate LC Exposure at such time. For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Article 29(a) of the Uniform Customs and Practice for Documentary Credits, International Chamber of Commerce Publication No. 600 (or such later version thereof as may be in effect at the applicable time) or Rule 3.13 or Rule 3.14 of the International Standby Practices, International Chamber of Commerce Publication No. 590 (or such later version thereof as may be in effect at the applicable time) or similar terms in the governing rules or laws or of the Letter of Credit itself, or if compliant documents have been presented but not yet honored, such Letter of Credit shall be deemed to be “outstanding” and “undrawn” in the amount so remaining available to be paid, and the obligations of the Borrower and each Lender shall remain in full force and effect until the Issuing Bank and the Lenders shall have no further obligations to make any payments or disbursements under any circumstances with respect to any Letter of Credit.
“Lead Arrangers” means each of JPMorgan, Barclays Bank PLC, KeyBank National Association and Texas Capital Bank, each in its capacity as joint lead arranger.
“Lender Parent” means, with respect to any Lender, any Person as to which such Lender is, directly or indirectly, a subsidiary.
“Lender-Related Person” has the meaning assigned to such term in Section 9.03(b).
“Lenders” means the Persons listed on Schedule 2.01 and any other Person that shall have become a party hereto pursuant to an Assignment and Assumption or otherwise, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption or otherwise. Unless the context otherwise requires, the term “Lenders” includes the Swingline Lender and the Issuing Banks. The term “Lender” means each or any one of the Lenders individually.
“Letter of Credit Agreement” has the meaning assigned to it in Section 2.06(b).
“Letters of Credit” means the letters of credit issued pursuant to this Agreement, and the term “Letter of Credit” means any one of them or each of them singularly, as the context may require. For the avoidance of doubt, each Issuing Bank shall only be required to issue standby Letters of Credit.
“Liabilities” means any losses, claims (including intraparty claims), demands, damages or liabilities of any kind.
“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities. In no event shall an operating lease be deemed to be a Lien.
“Liquidity” means, as of any date of determination, the sum of (a)(i) during the Control Account Agreement Period, the aggregate amount of unrestricted cash and Permitted Investments of the Loan Parties at such time and (ii) following the Control Account Agreement Period, the aggregate amount of unrestricted cash and Permitted Investments held at such time by any Loan Party in deposit accounts or securities accounts subject to Control Account Agreements in favor of the Administrative Agent, plus (b) Availability.
“Loan Documents” means, collectively, this Agreement, each note delivered pursuant to this Agreement, each Letter of Credit application, continuing agreement or other letter of credit agreement, the Collateral Documents, the JPM Side Letter and any other agreements, instruments, documents and certificates executed by or on behalf of any Loan Party and delivered to or in favor of the Credit Parties concurrently herewith or hereafter in connection with the Transactions hereunder. Any reference in this Agreement or any other Loan Document to a Loan Document shall include all appendices, exhibits or schedules thereto, and all amendments, restatements, supplements or other modifications thereto, and shall refer to such Loan Document as the same may be in effect at any and all times such reference becomes operative.
“Loan Guaranty” means Article X of this Agreement.
“Loan Parties” means, collectively, the Borrower and each Guarantor and their respective successors and assigns, and the term “Loan Party” shall mean any one of them or all of them individually, as the context may require.
“Loans” means the loans made by the Lenders to the Borrower pursuant to this Agreement.
“Margin Stock” means margin stock within the meaning of Regulations T, U and X, as applicable.
“Material Adverse Effect” means a material adverse effect on (i) the business, assets, operations, prospects or condition, financial or otherwise, of the Borrower and its Subsidiaries (including, for purposes hereof, Starlab JV and its subsidiaries) taken as a whole, (ii) the ability of the Loan Parties, taken as a whole, to perform any of their payment obligations under the Loan Documents to which they are a party, or (iii) the rights of or benefits available to the Administrative Agent, Issuing Banks or the other Credit Parties under the Loan Documents, taken as a whole.
“Material Agreement” means each contract or agreement of the Borrower and its Subsidiaries as to which the breach, nonperformance, cancellation or failure to renew by any party thereto, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.
“Material Domestic Subsidiary” means any Domestic Subsidiary of the Borrower which is not an Immaterial Subsidiary.
“Material Indebtedness” means Indebtedness (other than the Loans and Letters of Credit), or obligations in respect of one or more Swap Agreements, of any one or more of the Borrower and its Subsidiaries in an aggregate principal amount exceeding the Threshold Amount. For purposes of determining Material Indebtedness, the “principal amount” of the obligations of the Borrower or any Subsidiary in respect of any Swap Agreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that the Borrower or such Subsidiary would be required to pay if such Swap Agreement were terminated at such time.
“Maturity Date” means [May 30], 2029; provided that if such date is not a Business Day, the Maturity Date shall be the next preceding Business Day.
“Maximum Liability” has the meaning assigned to such term in Section 10.10.
“Maximum Rate” has the meaning assigned to such term in Section 9.17.
“Moody’s” means Moody’s Investors Service, Inc.
“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.
“Net IPO Proceeds” means the amount of cash proceeds actually received by the Borrower from the issuance of shares pursuant to the IPO, net of (i) underwriting discounts and other fees, commissions and expenses related to, and required to be paid by the Borrower in connection with, the IPO and (ii) Taxes paid or payable to any taxing authorities by the Borrower in connection with the IPO.
“Non-Consenting Lender” has the meaning assigned to such term in Section 9.02(d).
“Non-Loan Party Sublimit” means an aggregate principal amount equal to, when taken together with the aggregate outstanding principal amount of Investments incurred by non-Loan Parties pursuant to Sections 6.04(c), (d), (k) and (m), $5,000,000.
“Note” means a promissory note of the Borrower payable to any Lender or its registered assigns, substantially in the form of Exhibit I hereto, evidencing the aggregate Indebtedness of the Borrower to such Lender resulting from the Loans made by such Lender.
“NYFRB” means the Federal Reserve Bank of New York.
“NYFRB Rate” means, for any day, the greater of (a) the Federal Funds Effective Rate in effect on such day and (b) the Overnight Bank Funding Rate in effect on such day (or for any day that is not a Business Day, for the immediately preceding Business Day); provided that if none of such rates are published for any day that is a Business Day, the term “NYFRB Rate” means the rate for a federal funds transaction quoted at 11:00 a.m. New York City time on such day received by the Administrative Agent from a federal funds broker of recognized standing selected by it; provided, further, that if any of the aforesaid rates as so determined would be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.
“NYFRB’s Website” means the website of the NYFRB at http://www.newyorkfed.org, or any successor source.
“Obligated Party” has the meaning assigned to such term in Section 10.02.
“Obligations” means all advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party arising under any Loan Document or otherwise with respect to any Loan or Letter of Credit, whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrue after the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed or allowable claims in such proceeding. Without limiting the foregoing, the Obligations include (a) the obligation to pay principal, interest, Letter of Credit commissions, charges, expenses, fees, indemnities and other amounts payable by any Loan Party under any Loan Document and (b) the obligation of the Borrower to reimburse any amount in respect of any of the foregoing that the Administrative Agent or any Lender, in each case in its sole discretion, may elect to pay or advance on behalf of the Borrower.
“Original Indebtedness” has the meaning assigned to such term in Section 6.01(f).
“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan, Letter of Credit or Loan Document).
“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 2.19).
“Outbound Investment Rules” means the regulations administered and enforced, together with any related public guidance issued, by the United States Treasury Department under U.S. Executive Order 14105 of August 9, 2023, or any similar law or regulation; as of the date of this Agreement, and as codified at 31 C.F.R. § 850.101 et seq.
“Outside Date” means September 30, 2025.
“Overnight Bank Funding Rate” means, for any day, the rate comprised of both overnight federal funds and overnight eurodollar transactions denominated in Dollars by U.S.-managed banking offices of depository institutions, as such composite rate shall be determined by the NYFRB as set forth on the NYFRB’s Website from time to time, and published on the next succeeding Business Day by the NYFRB as an overnight bank funding rate.
“Paid in Full” or “Payment in Full” means, (a) the indefeasible payment in full in cash of all outstanding Loans and LC Disbursements, together with accrued and unpaid interest thereon, (b) the termination, expiration, or cancellation and return of all outstanding Letters of Credit (or alternatively, with respect to each such Letter of Credit, the furnishing to the Administrative Agent of a cash deposit, or at the discretion of the Administrative Agent a backup standby letter of credit satisfactory to the Administrative Agent and the Issuing Bank, in an amount equal to 103% of the LC Exposure as of the date of such payment), (c) the indefeasible payment in full in cash of the accrued and unpaid fees, (d) the indefeasible payment in full in cash of all reimbursable expenses and other Secured Obligations (other than Unliquidated Obligations for which no claim has been made and other obligations expressly stated to survive such payment and termination of this Agreement), together with accrued and unpaid interest thereon, (e) the termination of all Commitments, and (f) the termination of the Swap Agreement Obligations and the Banking Services Obligations or entering into other arrangements satisfactory to the Secured Parties counterparties thereto.
“Participant” has the meaning assigned to such term in Section 9.04(c).
“Participant Register” has the meaning assigned to such term in Section 9.04(d).
“Participation Fee” has the meaning assigned to such term in Section 2.12(b).
“Payment” has the meaning assigned to it in Section 8.06(c).
“Payment Notice” has the meaning assigned to it in Section 8.06(c).
“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.
“Permitted Acquisition” means any Acquisition by the Borrower or any Subsidiary of (i) all or substantially all the assets of (or all or substantially all the assets constituting a business unit, division, product line or line of business of) or (ii) all or substantially all the Equity Interests in, a Person or division or line of business of a Person or, if in each case, at the time of and immediately after giving effect thereto:
(a) Equity Financed Permitted Acquisitions. If the Acquisition Consideration (including deferred payment obligations) for such Acquisition solely consists of (x) the Qualified Equity Interests of the Borrower, (y) the proceeds from an offering of Qualified Equity Interests of the Borrower received from persons other than its Subsidiaries for the purpose of financing, such Acquisition and/or (z) Indebtedness assumed by the Borrower or any Subsidiary (and permitted by Section 6.01) in connection with such Acquisition, then such Acquisition shall be a “Permitted Acquisition” if:
(i) no Default or Event of Default shall have occurred and be continuing or would result from the consummation of such Acquisition; and
(ii) the Borrower shall have provided the Administrative Agent with reasonable calculations signed by a Financial Officer of the Borrower evidencing that on a pro forma basis the Borrower and its Subsidiaries are in compliance with the financial covenants set forth in Section
6.10 for the four fiscal quarters ended immediately prior to the proposed date of consummation of such Acquisition. Upon request, the Borrower shall provide the Administrative Agent with copies of final documents and or amendments and waivers after the closing of such Acquisition.
(b) Cash Consideration Permitted Acquisitions. If the Acquisition Consideration (including deferred payment obligations) for such Acquisition is made up in whole or in part of cash (other than cash proceeds referred to in clause (a)(y) above but including proceeds of any Indebtedness), then in either case such Acquisition shall be a “Permitted Acquisition” if:
(i) no Default or Event of Default shall have occurred and be continuing or would result from the consummation of such Acquisition;
(ii) (x) if Liquidity immediately prior to the consummation of such Acquisition and after giving pro forma effect to such Acquisition is less than $250,000,000, the cash portion of the Acquisition Consideration for such Acquisition does not exceed $30,000,000 (and if such Acquisition is of a Person that will not become a Loan Party or such assets acquired will not be owned by a Loan Party, $10,000,000) individually and the cash portion of the Acquisition Consideration for all such Acquisitions permitted under this clause (b)(ii)(x) shall not exceed $60,000,000 (and if such Acquisition is of a Person that will not become a Loan Party or such assets acquired will not be owned by a Loan Party, $30,000,000) in the aggregate or (y) if Liquidity immediately prior to the consummation of such Acquisition and after giving pro forma effect to such Acquisition is equal to or greater than $250,000,000, the cash portion of the Acquisition Consideration for any such Acquisition does not exceed $50,000,000 (and if such Acquisition is of a Person that will not become a Loan Party or such assets acquired will not be owned by a Loan Party, $25,000,000) individually and the cash portion of the Acquisition Consideration for all such Acquisitions permitted under this clause (b)(ii)(y) shall not exceed $100,000,000 (and if such Acquisition is of a Person that will not become a Loan Party or such assets acquired will not be owned by a Loan Party, $40,000,000) in the aggregate;
(iii) solely with respect to an Acquisition under this clause (b) with cash consideration in excess of $10,000,000, the Borrower shall have provided the Administrative Agent with (x) historical financial statements of the target and (y) pro forma balance sheets and profit and loss statements of the Borrower and its Subsidiaries, prepared on a basis consistent with the target’s historical financial statements for the four fiscal quarters ended immediately prior to the proposed date of consummation of such Acquisition;
(iv) the Borrower shall have provided the Administrative Agent with reasonable calculations signed by a Financial Officer of the Borrower evidencing that on a pro forma basis the Borrower and its Subsidiaries are in compliance with the financial covenants set forth in Section 6.10 for the four fiscal quarters ended immediately prior to the proposed date of consummation of such Acquisition; and
(v) solely with respect to an Acquisition under this clause (b) with the cash consideration in excess of $50,000,000, the Borrower shall have provided the Administrative Agent with a quality of earnings report prepared by independent registered public accountants of recognized regional standing or any other accounting firm reasonably acceptable to the Administrative Agent; provided that, notwithstanding the foregoing and irrespective of the Acquisition Consideration, if a quality of earnings report is otherwise obtained by the Borrower for such Acquisition, a copy shall be provided to the Administrative Agent.
(c) With respect to an Acquisition under clause (a) or clause (b) above, the target whose stock is being acquired did not have pro forma Consolidated EBITDA (calculated as though all references to the Borrower and its Subsidiaries contained in such definition or any other defined term used in such definition refer to the target) that is negative in excess of negative $10,000,000 (after taking into account reasonable adjustments, including the effects of proposed consolidation and restructuring by the Borrower after such Acquisition), and that the pro forma Consolidated EBITDA of all such targets acquired by the Borrower does not exceed negative $40,000,000 in the aggregate.
Upon request, the Borrower shall provide the Administrative Agent with copies of final documents and or amendments and waivers after the closing of such acquisition.
“Permitted Holders” means each owner of Equity Interests of the Borrower as of the Effective Date and (a) their Affiliates and (b)(x) trusts (including voting trusts) for estate planning purposes whereby such owner of Equity Interests of the Borrower as of the Effective Date maintains voting power of such Equity Interests of the Borrower and (y) any such owner’s grantor retained annuity trusts.
“Permitted Investments” means:
(a) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the U.S. (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the U.S.), in each case maturing within one year from the date of acquisition thereof;
(b) investments in commercial paper maturing within two hundred seventy (270) days from the date of acquisition thereof and having, at such date of acquisition, the highest credit rating obtainable from S&P or from Moody’s;
(c) investments in certificates of deposit, bankers’ acceptances and time deposits maturing within one hundred eighty (180) days from the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, any domestic office of any commercial bank organized under the laws of the U.S. or any State thereof which has a combined capital and surplus and undivided profits of not less than $500,000,000;
(d) fully collateralized repurchase agreements with a term of not more than thirty (30) days for securities described in clause (a) above and entered into with a financial institution satisfying the criteria described in clause (c) above;
(e) money market funds that (i) comply with the criteria set forth in SEC Rule 2a-7 under the Investment Company Act of 1940, (ii) are rated AAA by S&P and Aaa by Moody’s and (iii) have portfolio assets of at least $5,000,000,000;
(f) cash, denominated in dollars, the national currency of any Participating Member State of the European Union (as it is constituted on the Effective Date) and, with respect to any Foreign Subsidiaries, other currencies held by such Foreign Subsidiary in the ordinary course of business; and
(g) solely with respect to any Subsidiary that is a Foreign Subsidiary, investments of comparable tenor and credit quality to those described in the foregoing clauses (a) through (f) customarily utilized in countries in which such Foreign Subsidiary operates for cash management purposes.
“Permitted Liens” means:
(a) Liens created pursuant to any Loan Document;
(b) Liens imposed by law for Taxes that are not yet due or are being contested in compliance with Section 5.04;
(c) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens imposed by law, arising in the ordinary course of business and securing obligations that are not overdue by more than thirty (30) days or are being contested in compliance with Section 5.04;
(d) pledges and deposits made in the ordinary course of business and trading in compliance with workers’ compensation, unemployment insurance and other social security laws or regulations or employment laws or to secure other public, statutory or regulatory obligations or arising by operation of law;
(e) pledges and deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business;
(f) judgment Liens in respect of judgments that do not constitute an Event of Default under clause (k) of Article VII or securing appeal or surety bonds related to such judgments;
(g) easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or materially interfere with the ordinary conduct of business of the Borrower or any Subsidiary;
(h) any interest or title of a lessor or sublessor under any lease of real estate;
(i) leases, non-exclusive licenses, subleases or non-exclusive sublicenses granted to others in the ordinary course of business and not interfering in any material respect with the business of the Borrower or any Subsidiaries;
(j) purported Liens evidenced by the filing of precautionary Uniform Commercial Code financing statements or similar filings (to the extent applicable);
(k) any Lien on any property or asset of the Borrower or any Subsidiary existing on the date hereof and set forth in Schedule 6.02 securing Indebtedness permitted under Section 6.01 and any amendments, modifications, extensions, refinancings, renewals and replacements thereof; provided that (i) such Lien shall not encumber any other property or asset of the Borrower or any Subsidiary other than improvements thereon and proceeds from the disposition of such property or asset and (ii) such Lien shall secure only those obligations which it secures on the date hereof and amendments, modifications, extensions, refinancings, renewals and replacements thereof that do not increase the outstanding principal amount thereof (other than as permitted by Section 6.01);
(l) any Lien existing on any property or asset prior to the acquisition thereof by a Loan Party or any Subsidiary or existing on any property or asset of any Person that becomes a Subsidiary after the date hereof prior to the time such Person becomes a Subsidiary and any amendments, modifications, extensions, refinancings, renewals and replacements thereof; provided that (i) such Lien is not created in contemplation of or in connection with such acquisition or such Person becoming a Subsidiary, as the case may be, (ii) such Lien shall not encumber any other property or assets of a Loan Party or any Subsidiary and (iii) such Lien shall secure only those obligations which it secures on the date of such acquisition or
the date such Person becomes a Subsidiary, as the case may be, and amendments, modifications, extensions, refinancings, renewals and replacements thereof that do not increase the outstanding principal amount thereof (other than as permitted by Section 6.01);
(m) Liens on fixed or capital assets (including capital leases) acquired, constructed or improved by a Loan Party or any Subsidiary; provided that (i) such Liens secure Indebtedness or Capital Lease Obligations permitted by Section 6.01, (ii) such Liens and the Indebtedness secured thereby are incurred prior to or within one hundred eighty (180) days after such acquisition or the completion of such construction or improvement, (iii) the Indebtedness secured thereby does not exceed the cost of acquiring, constructing or improving such fixed or capital assets and (iv) such Liens shall not encumber any other property or assets of the Borrower or any Subsidiary other than improvements thereon or proceeds from the disposition of such property or assets;
(n) Liens on assets of Foreign Subsidiaries that secure Indebtedness permitted under Section 6.01(g); provided that such Liens shall not encumber any other property or assets of the Borrower or any Subsidiary other than the assets of the applicable Foreign Subsidiary;
(o) Liens granted by a Subsidiary that is not a Loan Party in favor of the Borrower or another Loan Party in respect of Indebtedness owed by such Subsidiary to the Borrower or such other Loan Party;
(p) Liens arising out of any conditional sale, title retention, consignment or other similar arrangements for the sale of goods entered into by a Loan Party or any of its Subsidiaries in the ordinary course of business;
(q) Liens pursuant to insurance premium financing arrangements securing insurance proceeds solely to the extent of such premiums;
(r) Liens in favor of collecting banks having a right of setoff, revocation, refund or chargeback with respect to money or instruments of a Loan Party or any of its Subsidiaries on deposits which are in the possession of such banks, other than related to Indebtedness;
(s) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods in the ordinary course of business;
(t) Liens on any cash earnest money deposits made by a Loan Party or any of its Subsidiaries in connection with a Permitted Acquisition, including, without limitation, in connection with any letter of intent or purchase agreement relating thereto;
(u) in connection with the sale or transfer of any assets in a transaction permitted under Section 6.03, customary rights and restrictions contained in agreements relating to such sale or transfer pending the completion thereof;
(v) Liens in the nature of the right of setoff in favor of counterparties to contractual agreements with the Loan Parties in the ordinary course of business;
(w) dispositions and other sales of assets permitted under Section 6.03 or Section 6.05;
(x) Liens on the Collateral securing Indebtedness permitted under Section 6.01(n)(y), so long as such Liens shall be subordinated to the Liens granted under the Loan Documents pursuant to an Acceptable Subordination or Intercreditor Arrangement;
(y) Liens not otherwise permitted by this definition so long as neither (i) the aggregate outstanding principal amount of the obligations secured thereby nor (ii) the aggregate fair market value (determined as of the date such Lien is incurred) of the assets subject thereto exceeds (as to the Borrower and its Subsidiaries) (x) $10,000,000 or (y) solely to the extent that Liquidity immediately prior to, and after giving pro forma effect to, granting such Lien is equal to or greater than $300,000,000, $25,000,000, at any one time outstanding; and
(z) prior to the Availability Date, Liens securing the Hercules Debt, to the extent subject to the Effective Date Intercreditor Agreement.
“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.
“Personal Data” has the meaning assigned to it in Section 5.15.
“Plan” means any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.
“Plan Asset Regulations” means 29 CFR § 2510.3-101 et seq., as modified by Section 3(42) of ERISA, as amended from time to time.
“Prime Rate” means the rate of interest last quoted by The Wall Street Journal as the “Prime Rate” in the U.S. or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate published by the Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest Rates) as the “bank prime loan” rate or, if such rate is no longer quoted therein, any similar rate quoted therein (as determined by the Administrative Agent) or any similar release by the Board (as determined by the Administrative Agent). Each change in the Prime Rate shall be effective from and including the date such change is publicly announced or quoted as being effective.
“Pro Forma Basis” or “pro forma basis” means, with respect to any determination of Liquidity, Consolidated Total Assets, Consolidated Total Revenue, or Consolidated EBITDA (including component definitions thereof), that:
(a) in the case of (i) any Disposition of all or substantially all of the Equity Interests of any Subsidiary or any division and/or product line of the Borrower or any Subsidiary, income statement items (whether positive or negative) attributable to the property or Person subject to such Specified Transaction, shall be excluded as of the first day of the applicable Test Period with respect to any test or covenant for which the relevant determination is being made and (ii) in the case of any Permitted Acquisition and Investment described in the definition of the term “Specified Transaction”, income statement items (whether positive or negative) attributable to the property or Person subject to such Specified Transaction shall be included as of the first day of the applicable Test Period with respect to any test or covenant for which the relevant determination is being made,
(b) any retirement or repayment of Indebtedness (other than normal fluctuations in revolving Indebtedness incurred for working capital purposes) shall be deemed to have occurred as of the first day of the applicable Test Period with respect to any test or covenant for which the relevant determination is being made,
(c) any Indebtedness incurred by the Borrower or any of its Subsidiaries in connection therewith shall be deemed to have occurred as of the first day of the applicable Test Period with respect to any test or covenant for which the relevant determination is being made; provided that, (x) if such Indebtedness has a floating or formula rate, such Indebtedness shall have an implied rate of interest for the applicable Test Period for purposes of this definition determined by utilizing the rate that is or would be in effect with respect to such Indebtedness at the relevant date of determination (taking into account any interest hedging arrangements applicable to such Indebtedness), (y) interest on any obligation with respect to any Capital Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a Responsible Officer of the Borrower to be the rate of interest implicit in such obligation in accordance with GAAP and (z) interest on any Indebtedness that may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a eurocurrency interbank offered rate or other rate shall be determined to have been based upon the rate actually chosen, or if none, then based upon such optional rate chosen by the Borrower; and
(d) the acquisition of any asset and/or the amount of cash or Permitted Investments, whether pursuant to any Specified Transaction or any Person becoming a subsidiary or merging, amalgamating or consolidating with or into the Borrower or any of its Subsidiaries, or the Disposition of any asset described in the definition of “Specified Transaction” shall be deemed to have occurred as of the last day of the applicable Test Period with respect to any test or covenant for which such calculation is being made.
Notwithstanding anything to the contrary set forth in the immediately preceding paragraph, for the avoidance of doubt, when calculating Liquidity and Consolidated Total Revenues for purposes of the definition of “Applicable Rate” and for purposes of Section 6.10 (other than for the purpose of determining pro forma compliance with Section 6.10 as a condition to taking any action under this Agreement), the events described in the immediately preceding paragraph that occurred subsequent to the end of the applicable Test Period shall not be given pro forma effect.
“Proceeding” means any claim, litigation, investigation, action, suit, arbitration or administrative, judicial or regulatory action or proceeding in any jurisdiction.
“PTE” means a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be amended from time to time.
“QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D).
“QFC Credit Support” has the meaning assigned to it in Section 9.21(a).
“Qualified ECP Guarantor” means, in respect of any Swap Obligation, each Loan Party that has total assets exceeding $10,000,000 at the time the relevant Loan Guaranty or grant of the relevant security interest becomes or would become effective with respect to such Swap Obligation or such other person as constitutes an “eligible contract participant” under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another person to qualify as an “eligible contract participant” at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.
“Qualified Equity Interests” means any Equity Interests other than Disqualified Equity Interests.
“Recipient” means (a) the Administrative Agent, (b) any Lender and (c) any Issuing Bank, as applicable.
“Reference Time” with respect to any setting of the then-current Benchmark means (1) if such Benchmark is the Term SOFR Rate, 5:00 a.m. (Chicago time) on the day that is two U.S. Government Securities Business Days preceding the date of such setting, (2) following a Benchmark Transition Event and a Benchmark Replacement Date with respect to the Term SOFR Rate, such Benchmark is Daily Simple SOFR, then four U.S. Government Securities Business Days prior to such setting or (3) if such Benchmark is none of the Term SOFR Rate or Daily Simple SOFR, the time determined by the Administrative Agent in its reasonable discretion.
“Refinance Indebtedness” has the meaning assigned to such term in Section 6.01(f).
“Register” has the meaning assigned to such term in Section 9.04(b)(v).
“Regulation D” means Regulation D of the Board, as in effect from time to time and all official rulings and interpretations thereunder or thereof.
“Regulation T” means Regulation T of the Board, as in effect from time to time and all official rulings and interpretations thereunder or thereof.
“Regulation U” means Regulation U of the Board, as in effect from time to time and all official rulings and interpretations thereunder or thereof.
“Regulation X” means Regulation X of the Board, as in effect from time to time and all official rulings and interpretations thereunder or thereof.
“Related Parties” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, employees, agents and advisors of such Person and such Person’s Affiliates.
“Relevant Governmental Body” means the Board and/or the NYFRB, or a committee officially endorsed or convened by the Board and/or the NYFRB or, in each case, any successor thereto.
“Relevant Rate” means (i) with respect to any Term Benchmark Borrowing, the Adjusted Term SOFR Rate or (ii) with respect to any RFR Borrowing, the Adjusted Daily Simple SOFR, as applicable.
“Required Lenders” means, subject to Section 2.20, (a) at any time prior to the earlier of the Loans becoming due and payable pursuant to Article VII or the Commitments terminating or expiring, Lenders having Credit Exposure and Unfunded Commitments representing more than 50% of the sum of the Aggregate Credit Exposure and Unfunded Commitments at such time, provided that, solely for purposes of declaring the Loans to be due and payable pursuant to Article VII, the Unfunded Commitment of each Lender shall be deemed to be zero; and (b) for all purposes after the Loans become due and payable pursuant to Article VII or the Commitments expire or terminate, Lenders having Credit Exposure representing more than 50% of the Aggregate Credit Exposure at such time; provided that, in the case of clauses (a) and (b) above, (x) the Credit Exposure of the Swingline Lender shall be deemed to exclude any amount of its Swingline Exposure in excess of its Applicable Percentage of all outstanding Swingline Loans, adjusted to give effect to any reallocation under Section 2.20 of the Swingline Exposures of Defaulting Lenders in effect at such time, and the Unfunded Commitment of such Lender shall be determined on the basis of its Credit Exposure excluding such excess amount and (y) if there are two (2) or more Lenders, then Required Lenders must include at least two (2) Lenders (with Lenders that are Affiliates or Approved Funds of a Lender deemed to be a single Lender for purposes of this proviso).
“Requirement of Law” means, with respect to any Person, (a) the charter, articles or certificate of organization or incorporation and bylaws or operating, management or partnership agreement, or other
organizational or governing documents of such Person and (b) any statute, law (including common law), treaty, rule, regulation, code, ordinance, order, decree, writ, judgment, injunction or determination of any arbitrator or court or other Governmental Authority (including Environmental Laws), in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.
“Resolution Authority” means an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution Authority.
“Responsible Officer” of any Person means the chief executive officer, president, vice president or any Financial Officer of such Person, and any other officer (or, in the case of any such Person that is a Foreign Subsidiary, director or managing partner or similar official) of such Person with responsibility for the administration of the obligations of such Person under this Agreement.
“Restricted Payment” means (i) any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests in the Borrower or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such Equity Interests or any option, warrant or other right to acquire any such Equity Interests and (ii) any voluntary prepayment of principal of, premium, if any, or redemption, purchase, retirement, defeasance (including in-substance or legal defeasance), sinking fund or similar payment with respect to, any Junior Indebtedness.
“Reuters” means, as applicable, Thomson Reuters Corp, Refinitiv, or any successor thereto.
“Revolving Borrowing” means Revolving Loans of the same Type, made, converted or continued on the same date and, in the case of Term Benchmark Loans, as to which a single Interest Period is in effect.
“Revolving Facility” means, the four-year revolving credit facility in the amount of the stated Commitment hereunder.
“Revolving Loan” means a Loan made pursuant to Section 2.03.
“RFR Borrowing” means, as to any Borrowing, the RFR Loans comprising such Borrowing.
“RFR Loan” means a Loan that bears interest at a rate based on the Adjusted Daily Simple SOFR.
“S&P” means Standard & Poor’s Rating Services, a Standard & Poor’s Financial Services LLC business.
“Sanctioned Country” means, at any time, a country, region or territory which is itself the subject or target of any Sanctions (at the time of this Agreement, the so-called Donetsk People’s Republic, the so-called Luhansk People’s Republic, the Crimea, Kherson and Zaporizhzhia regions of Ukraine, Cuba, Iran, North Korea and Syria).
“Sanctioned Person” means, at any time, any Person subject or target of any Sanctions, including (a) any Person listed in any Sanctions-related list of designated Persons maintained by the U.S. government, including by Office of Foreign Assets Control of the U.S. Department of the Treasury, the U.S. Department of State, U.S. Department of Commerce, or by the United Nations Security Council, the European Union, any European Union member state, His Majesty’s Treasury of the United Kingdom or other relevant sanctions authority, (b) any Person operating, organized or resident in a Sanctioned Country, (c) any Person owned or controlled by any such Person or Persons described in the foregoing clauses (a) or (b) (including,
without limitation for purposes of defining a Sanctioned Person, as ownership and control may be defined and/or established in and/or by any applicable laws, rules, regulations, or orders).
“Sanctions” means all economic or financial sanctions, trade embargoes or similar restrictions imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, any European Union member state, His Majesty’s Treasury of the United Kingdom, or other relevant sanctions authority.
“SEC” means the Securities and Exchange Commission of the United States of America.
“Secured Obligations” means all Obligations, together with all Banking Services Obligations and Swap Agreement Obligations owing to one or more Lenders or their respective Affiliates by any Loan Party; provided that (x) obligations of any Loan Party under any Banking Services Obligations and Swap Agreement Obligations shall be secured and guaranteed only to the extent that, and for so long as, the other Obligations are so secured and guaranteed, (y) any release of Collateral or Guarantors effected in the manner permitted by this Agreement shall not require the consent of holders of Banking Services Obligations and Swap Agreement Obligations and (z) the definition of “Secured Obligations” shall not create any guarantee by any Guarantor of (or grant of security interest by any Guarantor to support, as applicable) any Excluded Swap Obligations of such Guarantor for purposes of determining any obligations of any Guarantor.
“Secured Parties” means (a) the Lenders, (b) the Administrative Agent, (c) each Issuing Bank, (d) each provider of Banking Services, to the extent the Banking Services Obligations in respect thereof constitute Secured Obligations, (e) each counterparty to any Swap Agreement, to the extent the obligations thereunder constitute Secured Obligations, (f) the beneficiaries of each indemnification obligation undertaken by any Loan Party under any Loan Document and (g) the successors and permitted assigns of each of the foregoing.
“Security Agreement” means that certain Pledge and Security Agreement (including any and all supplements thereto), substantially in the form of Exhibit J hereto, to be dated as of the Effective Date, among the Loan Parties and the Administrative Agent, for the benefit of the Administrative Agent and the other Secured Parties, and any other pledge or security agreement securing the Secured Obligations entered into, after the date of this Agreement by such Loan Parties (as required by this Agreement or any other Loan Document) or any other Loan Party for the benefit of the Administrative Agent and the Secured Parties, as the same may be amended, modified, restated or otherwise supplemented from time to time.
“SOFR” means a rate equal to the secured overnight financing rate as administered by the SOFR Administrator.
“SOFR Administrator” means the NYFRB (or a successor administrator of the secured overnight financing rate).
“SOFR Administrator’s Website” means the NYFRB’s website, currently at http://www.newyorkfed.org, or any successor source for the secured overnight financing rate identified as such by the SOFR Administrator from time to time.
“SOFR Determination Date” has the meaning specified in the definition of “Daily Simple SOFR”.
“SOFR Rate Day” has the meaning specified in the definition of “Daily Simple SOFR”.
“Solvency Certificate” means the solvency certificate executed and delivered by a Financial Officer of the Borrower on the Effective Date, substantially in the form of Exhibit H.
“Solvent” means, as to any Person as of any date of determination, that on such date (a) the fair value of the property of such Person is greater than the total amount of liabilities, including contingent liabilities, of such Person, (b) the present fair saleable value of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts, including contingent debts, as they become absolute and matured, (c) such Person does not intend to, and does not believe that it will, incur debts or liabilities, including contingent debts and liabilities, beyond such Person’s ability to pay such debts and liabilities as they mature and (d) such Person is not engaged in a business or a transaction, and is not about to engage in a business or a transaction, for which such Person’s property would constitute an unreasonably small capital. The amount of any contingent liability at any time shall be computed as the amount that, in light of all of the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.
“Specified Transaction” means any (a) Disposition of any product line, business unit, line of business or division of the Borrower or Subsidiary for which historical financial statements are available, (b) Permitted Acquisitions, (c) Investment, (d) proposed incurrence of Indebtedness or making of a Restricted Payment or payment in respect of Indebtedness in respect of which compliance with any financial test or ratio is by the terms of this Agreement required to be calculated on a Pro Forma Basis or (e) cost savings initiative, operating improvement, restructuring or other initiative, action or event.
“Starlab Available Amount” means (a) for the period from the Effective Date to the date that is 24 months from the Effective Date, an amount equal to (i) $20,000,000 plus (ii) 90% of the excess of (x) Net IPO Proceeds over (y) (A) if clause (a) of the IPO Proceeds Condition is satisfied by reference to prong (x) thereof, $300,000,000 or (B) if clause (a) of the IPO Proceeds Condition is satisfied by reference to prong (y) thereof, $250,000,000; provided that the foregoing amount under this clause (a)(ii) shall not exceed $85,000,000 in the aggregate; and (b) for each twelve (12) month period ending thereafter, an amount not to exceed $2,000,000 during such period.
“Starlab JV” means Starlab Space LLC.
“Starlab JV Equity” means the Equity Interests in Starlab JV held by any Loan Party.
“Starlab JV Equity Proceeds” has the meaning specified in the Security Agreement.
“Subordinated Indebtedness” means any Indebtedness of the Borrower or any Subsidiary that is expressly subordinated by a written agreement in right of payment and performance to the Obligations.
“subsidiary” means, with respect to any Person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other entity the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other entity (a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held, or (b) that is, as of such date, otherwise Controlled, by the parent and/or one or more subsidiaries of the parent.
“Subsidiary” means any direct or indirect subsidiary of the Borrower; provided that, unless otherwise specified herein or therein, Starlab JV and any subsidiary of Starlab JV shall not be considered a
Subsidiary for purposes of this Agreement or any other Loan Document. For the avoidance of doubt, Starlab JV and any subsidiary of Starlab JV shall not be included in any financial covenant calculation under this Agreement.
“Supported QFC” has the meaning assigned to it in Section 9.21(a).
“Swap Agreement” means any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions; provided that no phantom stock or similar plan providing for payments only on account of services provided by current or former directors, officers, employees or consultants of the Borrower or its Subsidiaries shall be a Swap Agreement.
“Swap Agreement Obligations” means any and all obligations of the Loan Parties and their Subsidiaries, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor), under (a) any Swap Agreement permitted hereunder with a Lender or an Affiliate of a Lender, and (b) any cancellations, buy backs, reversals, terminations or assignments of any Swap Agreement transaction permitted hereunder with a Lender or an Affiliate of a Lender.
“Swap Obligation” means, with respect to any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act or any rules or regulations promulgated thereunder.
“Swingline Borrowing” means a borrowing of a Swingline Loan.
“Swingline Commitment” means $10,000,000.
“Swingline Exposure” means, at any time, the aggregate principal amount of all Swingline Loans outstanding at such time. The Swingline Exposure of any Lender at any time shall be the sum of (a) its Applicable Percentage of the aggregate principal amount of all Swingline Loans outstanding at such time (excluding, in the case of any Lender that is the Swingline Lender, Swingline Loans made by it that are outstanding at such time to the extent that the other Lenders shall not have funded their participations in such Swingline Loans), adjusted to give effect to any reallocation under Section 2.20 of the Swingline Exposure of Defaulting Lenders in effect at such time, and (b) in the case of the Swingline Lender, the aggregate principal amount of all Swingline Loans made by the Swingline Lender outstanding at such time, less the amount of participations funded by the other Lenders in such Swingline Loans.
“Swingline Lender” means JPMorgan Chase Bank, N.A. (or any of its designated branch offices or affiliates), in its capacity as a lender of Swingline Loans hereunder.
“Swingline Loan” means a Loan made pursuant to Section 2.05.
“Tax Distribution” means any distribution made to the Borrower (or any other direct or indirect parent company of the Borrower) to (i) permit Borrower (or any other direct or indirect parent company of the Borrower) to pay U.S. federal and state income taxes then due and owing by the consolidated, combined or similar income tax group for U.S. federal and/or applicable state or local income tax purposes of which the Borrower (or any other direct or indirect parent company of the Borrower) is the common parent and of which the Borrower or any Subsidiary are members, and (ii) pay any administrative, overhead and related
expenses (including franchise Taxes) of Borrower (or any other direct or indirect parent company of the Borrower). A Tax Distribution shall not exceed the amount of taxes that would be paid by the Borrower on a stand-alone basis, or as the parent of a consolidated, combined, or similar income tax group in which the Borrower is the common parent.
“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), value added taxes, or any other goods and services, use or sales taxes, assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
“Term Benchmark” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Adjusted Term SOFR Rate.
“Term Benchmark Borrowing” has the meaning given in Section 1.02.
“Term Benchmark Loan” has the meaning given in Section 1.02.
“Term SOFR Adjustment” means a percentage per annum equal to 0.10%.
“Term SOFR Determination Day” has the meaning assigned to it under the definition of Term SOFR Reference Rate.
“Term SOFR Rate” means, with respect to any Term Benchmark Borrowing and for any tenor comparable to the applicable Interest Period, the Term SOFR Reference Rate at approximately 5:00 a.m., Chicago time, two U.S. Government Securities Business Days prior to the commencement of such tenor comparable to the applicable Interest Period, as such rate is published by the CME Term SOFR Administrator.
“Term SOFR Reference Rate” means, for any day and time (such day, the “Term SOFR Determination Day”), with respect to any Term Benchmark Borrowing denominated in Dollars and for any tenor comparable to the applicable Interest Period, the rate per annum published by the CME Term SOFR Administrator and identified by the Administrative Agent as the forward-looking term rate based on SOFR. If by 5:00 pm (New York City time) on such Term SOFR Determination Day, the “Term SOFR Reference Rate” for the applicable tenor has not been published by the CME Term SOFR Administrator and a Benchmark Replacement Date with respect to the Term SOFR Rate has not occurred, then, so long as such day is otherwise a U.S. Government Securities Business Day, the Term SOFR Reference Rate for such Term SOFR Determination Day will be the Term SOFR Reference Rate as published in respect of the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate was published by the CME Term SOFR Administrator, so long as such first preceding U.S. Government Securities Business Day is not more than five (5) U.S. Government Securities Business Days prior to such Term SOFR Determination Day.
“Test Period” shall mean, for any date of determination under this Agreement, the four consecutive fiscal quarters of the Borrower most recently ended on or prior to such date of determination and for which financial statements shall have been delivered (or were required to be delivered) under Section 5.01 to the Administrative Agent (or, before the first delivery of such financial statements, the most recent period of four fiscal quarters at the end of which financial statements are available).
“Threshold Amount” means $5,000,000.
“Transactions” means the execution, delivery and performance by each Loan Party of each Loan Document to which it is a party, the borrowing of Loans, the use of the proceeds of the Loans hereunder and the issuance of Letters of Credit hereunder.
“Type”, when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted Term SOFR Rate, the Adjusted Daily Simple SOFR or the Alternate Base Rate.
“UCC” means the Uniform Commercial Code as in effect from time to time in the State of New York or in any other state, the laws of which are required to be applied in connection with the issue of perfection of security interests.
“UK Financial Institutions” means any BRRD Undertaking (as such term is defined under the PRA Rulebook (as amended from time to time) promulgated by the United Kingdom Prudential Regulation Authority) or any person falling within IFPRU 11.6 of the FCA Handbook (as amended from time to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit institutions and investment firms, and certain affiliates of such credit institutions or investment firms.
“UK Resolution Authority” means the Bank of England or any other public administrative authority having responsibility for the resolution of any UK Financial Institution.
“Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.
“Unfunded Commitment” means, with respect to each Lender, the Commitment of such Lender less its Credit Exposure.
“Unliquidated Obligations” means, at any time, any Secured Obligations (or portion thereof) that are contingent in nature or unliquidated at such time, including any Secured Obligation that is: (a) an obligation to reimburse a bank for drawings not yet made under a letter of credit issued by it; (b) any other obligation (including any guarantee) that is contingent in nature at such time; or (c) an obligation to provide collateral to secure any of the foregoing types of obligations.
“Unrestricted Account” has the meaning assigned to such term in Section 5.16.
“U.S.” or “United States” means the United States of America.
“U.S. Government Securities Business Day” means any day except for (i) a Saturday, (ii) a Sunday or (iii) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.
“U.S. Person” means (i) for purposes of Sections 3.24 and 6.12 hereof, any United States citizen, lawful permanent resident, entity organized under the laws of the United States or any jurisdiction within the United States, including any foreign branch of any such entity, or any person in the United States and (ii) for all other purposes, a “United States person” within the meaning of Section 7701(a)(30) of the Code.
“U.S. Special Resolution Regime” has the meaning assigned to it in Section 9.21(a).
“USA Patriot Act” has the meaning assigned to such term in Section 9.14.
“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
“Write-Down and Conversion Powers” means, (a) with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom, any powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change the form of a liability of any UK Financial Institution or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers.
SECTION 1.02 Classification of Loans and Borrowings. For purposes of this Agreement, Loans may be classified and referred to by Class (e.g., a “Revolving Loan”) or by Type (e.g., a “Term Benchmark Loan” or an “RFR Loan”) or by Class and Type (e.g., a “Term Benchmark Revolving Loan” or an “RFR Revolving Loan”). Borrowings also may be classified and referred to by Class (e.g., a “Revolving Borrowing”) or by Type (e.g., a “Term Benchmark Borrowing” or an “RFR Borrowing”) or by Class and Type (e.g., a “Term Benchmark Revolving Borrowing” or an “RFR Revolving Borrowing”).
SECTION 1.03 Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “law” shall be construed as referring to all statutes, rules, regulations, codes and other laws (including official rulings and interpretations thereunder having the force of law or with which affected Persons customarily comply) and all judgments, orders and decrees of all Governmental Authorities. The word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, restated, supplemented or otherwise modified (including pursuant to any permitted refinancing, extension, renewal, replacement, restructuring or increase (in each case, whether pursuant to one or more agreements or with different lenders or different agents), but subject to any restrictions on such amendments, restatements, supplements or modifications set forth herein), (b) any definition of or reference to any law, statute, rule or regulation shall, unless otherwise specified, be construed as referring thereto as from time to time amended, supplemented or otherwise modified (including by succession of comparable successor laws), (c) any reference herein to any Person shall be construed to include such Person’s successors and assigns (subject to any restrictions on assignments set forth herein) and, in the case of any Governmental Authority, any other Governmental Authority that shall have succeeded to any or all functions thereof, (d) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (e) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, (f) any reference in any definition to the phrase “at any time” or “for any period” shall refer to the same time or period for all calculations or determinations within such definition, (g) all reference to “knowledge” or “awareness” of any Loan Party or a Subsidiary thereof means the actual knowledge of a Responsible Officer of a Loan Party or such Subsidiary and (h) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.
SECTION 1.04 Accounting Terms; GAAP. (a) Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time; provided that, if the Borrower notifies the Administrative Agent that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the date hereof in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Borrower that the Required Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith. Notwithstanding any other provision contained herein, all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made, without giving effect to (i) any election under Financial Accounting Standards Board Accounting Standards Codification 825 (or any other Financial Accounting Standard having a similar result or effect) to value any Indebtedness or other liabilities of the Borrower or any Subsidiary at “fair value”, as defined therein and (ii) any treatment of Indebtedness under Accounting Standards Codification 470-20 or 2015-03 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any such Indebtedness in a reduced or bifurcated manner as described therein, and such Indebtedness shall at all times be valued at the full stated principal amount thereof.
(b) Notwithstanding anything to the contrary contained in Section 1.04(a) or in the definition of “Capital Lease Obligations,” any change in accounting for leases pursuant to GAAP resulting from the adoption of Financial Accounting Standards Board Accounting Standards Update No. 2016-02, Leases (Topic 842) (“FAS 842”), to the extent such adoption would require treating any lease (or similar arrangement conveying the right to use) as a capital lease where such lease (or similar arrangement) would not have been required to be so treated under GAAP as in effect on December 31, 2015, such lease shall not be considered a capital lease, and all calculations and deliverables under this Agreement or any other Loan Document shall be made or delivered, as applicable, in accordance therewith.
SECTION 1.05 Status of Obligations. In the event that any Loan Party shall at any time issue or have outstanding any Subordinated Indebtedness, the Borrower shall take or cause such other Loan Party to take all such actions as shall be necessary to cause the Secured Obligations to constitute senior indebtedness (however denominated) in respect of such Subordinated Indebtedness. Without limiting the foregoing, the Secured Obligations are hereby designated as “senior indebtedness” and as “designated senior indebtedness” and words of similar import under and in respect of any indenture or other agreement or instrument under which such Subordinated Indebtedness is outstanding.
SECTION 1.06 Interest Rates; Benchmark Notification. The interest rate on a Loan denominated in dollars may be derived from an interest rate benchmark that may be discontinued or is, or may in the future become, the subject of regulatory reform. Upon the occurrence of a Benchmark Transition Event, Section 2.14(b) provides a mechanism for determining an alternative rate of interest. The Administrative Agent does not warrant or accept any responsibility for, and shall not have any liability with respect to, the administration, submission, performance or any other matter related to any interest rate used in this Agreement, or with respect to any alternative or successor rate thereto, or replacement rate thereof, including without limitation, whether the composition or characteristics of any such alternative, successor or replacement reference rate will be similar to, or produce the same value or economic equivalence of, the existing interest rate being replaced or have the same volume or liquidity as did any existing interest rate prior to its discontinuance or unavailability. The Administrative Agent and its affiliates and/or other related entities may engage in transactions that affect the calculation of any interest rate used in this Agreement or any alternative, successor or alternative rate (including any Benchmark Replacement) and/or any relevant adjustments thereto, in each case, in a manner adverse to the Borrower. The Administrative Agent may
select information sources or services in its reasonable discretion to ascertain any interest rate used in this Agreement, any component thereof, or rates referenced in the definition thereof, in each case pursuant to the terms of this Agreement, and shall have no liability to the Borrower, any Lender or any other person or entity for damages of any kind, including direct or indirect, special, punitive, incidental or consequential damages, costs, losses or expenses (whether in tort, contract or otherwise and whether at law or in equity), for any error or calculation of any such rate (or component thereof) provided by any such information source or service.
SECTION 1.07 Pro Forma Calculations. With respect to any period during which the Transactions or any Specified Transaction occurs, for purposes of the calculation of Consolidated EBITDA, Consolidated Total Assets, Consolidated Total Revenue, Liquidity or for any other similar purpose hereunder, with respect to such period shall be made on a Pro Forma Basis.
SECTION 1.08 [Intentionally Omitted].
SECTION 1.09 Letter of Credit Amounts. Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit available to be drawn at such time; provided that with respect to any Letter of Credit that, by its terms, provides for one or more automatic increases in the available amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum amount is available to be drawn at such time.
SECTION 1.10 Divisions. For all purposes under the Loan Documents, in connection with any Division or plan of division under Delaware law (or any comparable event under a different jurisdiction’s laws): (a) if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person to the subsequent Person, and (b) if any new Person comes into existence, such new Person shall be deemed to have been organized and acquired on the first date of its existence by the holders of its Equity Interests at such time.
SECTION 1.11 Currency Translation. For purposes of determining compliance as of any date after the Effective Date with Section 6.01, Section 6.02, Section 6.03, Section 6.04, Section 6.05, Section 6.06, Section 6.07, Section 6.08 or Section 6.10, or for purposes of making any determination under clauses (f), (g) or (k) of Article VII, or for any other specified purpose hereunder, amounts incurred or outstanding in currencies other than Dollars shall be translated into Dollars at currency exchange rates in effect on the last Business Day of the fiscal month immediately preceding the fiscal month in which such determination occurs or in respect of which such determination is being made (as applicable), as such currency exchange rates shall be determined in good faith by the Borrower by reference to customary indices. No Default or Event of Default shall arise as a result of any limitation or threshold set forth in Dollars in Section 6.01, Section 6.02, Section 6.03, Section 6.04, Section 6.05, Section 6.06, Section 6.07, Section 6.08, Section 6.10 or clauses (f), (g) or (k) of Article VII, being exceeded solely as a result of changes in currency exchange rates from those rates applicable on the last day of the fiscal month immediately preceding the fiscal month in which such determination occurs or in respect of which such determination is being made (as applicable).
ARTICLE II
THE CREDITS
SECTION 2.01 Revolving Commitments. Subject to the terms and conditions set forth herein, each Lender (acting through any of its branches or affiliates) severally (and not jointly) agrees to make Revolving Loans in Dollars to the Borrower from time to time during the Availability Period in an aggregate
principal amount that will not result (after giving effect to any application of proceeds of such Borrowing pursuant to Section 2.10) in (a) such Lender’s Credit Exposure exceeding such Lender’s Commitment or (b) the Aggregate Credit Exposure exceeding the aggregate Commitments. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Revolving Loans.
SECTION 2.02 Loans and Borrowings.
(a) Each Revolving Loan shall be made as part of a Borrowing consisting of Revolving Loans made by the Lenders ratably in accordance with their respective Commitments. The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender’s failure to make Loans as required.
(b) Subject to Section 2.14, each Revolving Borrowing shall be comprised entirely of ABR Loans or Term Benchmark Loans as the Borrower may request in accordance herewith. Each Swingline Loan shall be an ABR Loan. Each Lender at its option may make any Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan (and in the case of an Affiliate, the provisions of Section 2.14, 2.15, 2.16 and 2.17 shall apply to such Affiliate to the same extent as to such Lender); provided that any exercise of such option shall not affect the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement.
(c) At the commencement of each Interest Period for any Term Benchmark Revolving Borrowing, such Borrowing shall be in an aggregate amount that is (x) an integral multiple of $100,000 and not less than $500,000 or (y) such lesser amount constituting the remaining undrawn Commitments. At the time that each ABR Revolving Borrowing is made, such Borrowing shall be in an aggregate amount that is (x) an integral multiple of $100,000 and not less than $500,000 or (y) such lesser amount constituting the remaining undrawn Commitments; provided that an ABR Revolving Borrowing may be in an aggregate amount that is equal to the entire unused balance of the total Commitments or that is required to finance the reimbursement of an LC Disbursement as contemplated by Section 2.06(e). Each Swingline Loan shall be in an amount that is an integral multiple of $100,000 and not less than $100,000. Borrowings of more than one Type and Class may be outstanding at the same time; provided that there shall not at any time be more than a total of ten (10) Term Benchmark Revolving Borrowings or RFR Borrowings outstanding.
(d) Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to request, or to elect to convert or continue, any Borrowing if the Interest Period requested with respect thereto would end after the Maturity Date.
SECTION 2.03 Requests for Revolving Borrowings. To request a Revolving Borrowing, the Borrower shall notify the Administrative Agent of such request by submitting a Borrowing Request (a) (i) in the case of a Term Benchmark Borrowing, not later than 11:00 a.m., New York City time, three (3) U.S. Government Securities Business Days before the date of the proposed Borrowing or (ii) in the case of an RFR Borrowing, not later than 11:00 a.m., New York City time, five (5) U.S. Government Securities Business Days before the date of the proposed Borrowing or (b) in the case of an ABR Borrowing, not later than 11:00 a.m., New York City time, one Business Day before the date of the proposed Borrowing; provided that any such notice of an ABR Revolving Borrowing to finance the reimbursement of an LC Disbursement as contemplated by Section 2.06(e) may be given not later than 10:00 a.m., New York City time, on the date of the proposed Borrowing. Each such Borrowing Request shall be irrevocable and shall be signed by a Responsible Officer of the Borrower; provided that, if such Borrowing Request is submitted through an Approved Borrower Portal, the foregoing signature requirement may be waived at the sole
discretion of the Administrative Agent. Each such Borrowing Request shall specify the following information in compliance with Section 2.02:
(i) the aggregate amount of the requested Borrowing;
(ii) the date of such Borrowing, which shall be a Business Day;
(iii) whether such Borrowing is to be an ABR Borrowing, a Term Benchmark Borrowing or an RFR Borrowing;
(iv) in the case of a Term Benchmark Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term “Interest Period”; and
(v) the location and number of the Borrower’s account to which funds are to be disbursed, which shall comply with the requirements of Section 2.07.
If no election as to the Type of Revolving Borrowing is specified, then the requested Revolving Borrowing shall be an ABR Borrowing. If no Interest Period is specified with respect to any requested Term Benchmark Revolving Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one (1) month’s duration. Promptly following receipt of a Borrowing Request in accordance with this Section 2.03, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing.
Notwithstanding the foregoing, in no event shall the Borrower be permitted to request pursuant to this Section 2.03 prior to a Benchmark Transition Event and Benchmark Replacement Date with respect to the Term SOFR Rate, an RFR Loan bearing interest based on Daily Simple SOFR (it being understood and agreed that Daily Simple SOFR shall only apply to the extent provided in Sections 2.14(a) and 2.14(f)), as applicable.
SECTION 2.04 [Intentionally Omitted].
SECTION 2.05 Swingline Loans.
(a) Subject to the terms and conditions set forth herein, from time to time during the Availability Period, the Swingline Lender may, but shall have not obligation to, make Swingline Loans to the Borrower in an aggregate principal amount at any time outstanding that will not result in (i) the aggregate principal amount of outstanding Swingline Loans made by the Swingline Lender exceeding the Swingline Commitment or (ii) any Lender’s Credit Exposure exceeding its Commitment; provided that the Swingline Lender shall not be required to make a Swingline Loan to refinance an outstanding Swingline Loan. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Swingline Loans.
(b) To request a Swingline Loan, the Borrower shall submit a written notice to the Administrative Agent by email (or transmit by electronic communication including an Approved Borrower Portal, if arrangements for such transmission have been approved by the Administrative Agent) not later than 12:00 noon, New York City time, on the day of a proposed Swingline Loan. Each such notice shall be in a form approved by the Administrative Agent, shall be irrevocable and shall specify the requested date (which shall be a Business Day) and amount of the requested Swingline Loan. The Administrative Agent will promptly advise the Swingline Lender of any such notice received from the Borrower. The Swingline Lender shall make the requested Swingline Loan available to the Borrower by means of a credit to an account of the Borrower with the Administrative Agent designated for such purpose (or, in the case of a
Swingline Loan made to finance the reimbursement of an LC Disbursement as provided in Section 2.06(e), by remittance to the Issuing Bank) by 3:00 p.m., New York City time, on the requested date of such Swingline Loan.
(c) [Intentionally omitted].
(d) The Swingline Lender may by written notice given to the Administrative Agent require the Lenders to acquire participations in all or a portion of its Swingline Loans outstanding. Such notice shall specify the aggregate amount of Swingline Loans in which Lenders will participate. Promptly upon receipt of such notice, the Administrative Agent will give notice thereof to each Lender, specifying in such notice such Lender’s Applicable Percentage of such Swingline Loans. Each Lender hereby absolutely and unconditionally agrees, promptly upon receipt of such notice from the Administrative Agent (and in any event, if such notice is received by 12:00 noon, New York City time, on a Business Day no later than 5:00 p.m. New York City time on such Business Day and if received after 12:00 noon, New York City time, on a Business Day shall mean no later than 10:00 a.m. New York City time on the immediately succeeding Business Day), to pay to the Administrative Agent, for the account of the Swingline Lender, such Lender’s Applicable Percentage of such Swingline Loans. Each Lender acknowledges and agrees that its obligation to acquire participations in Swingline Loans pursuant to this paragraph is absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever. Each Lender shall comply with its obligation under this paragraph by wire transfer of immediately available funds, in the same manner as provided in Section 2.07 with respect to Loans made by such Lender (and Section 2.07 shall apply, mutatis mutandis, to the payment obligations of the Lenders), and the Administrative Agent shall promptly pay to the Swingline Lender the amounts so received by it from the Lenders. The Administrative Agent shall notify the Borrower of any participations in any Swingline Loan acquired pursuant to this paragraph, and thereafter payments in respect of such Swingline Loan shall be made to the Administrative Agent and not to the Swingline Lender. Any amounts received by a Swingline Lender from the Borrower (or other party on behalf of the Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender of the proceeds of a sale of participations therein shall be promptly remitted to the Administrative Agent; any such amounts received by the Administrative Agent shall be promptly remitted by the Administrative Agent to the Lenders that shall have made their payments pursuant to this paragraph and to the Swingline Lender, as their interests may appear; provided that any such payment so remitted shall be repaid to the Swingline Lender or to the Administrative Agent, as applicable, if and to the extent such payment is required to be refunded to the Borrower for any reason. The purchase of participations in a Swingline Loan pursuant to this paragraph shall not relieve the Borrower of any default in the payment thereof.
(e) The Swingline Lender may be replaced at any time by written agreement among the Borrower, the Administrative Agent, the replaced Swingline Lender and the successor Swingline Lender. The Administrative Agent shall notify the Lenders of any such replacement of the Swingline Lender. At the time any such replacement shall become effective, the Borrower shall pay all unpaid interest accrued for the account of the replaced Swingline Lender pursuant to Section 2.13(a). From and after the effective date of any such replacement, (x) the successor Swingline Lender shall have all the rights and obligations of the replaced Swingline Lender under this Agreement with respect to Swingline Loans made thereafter and (y) references herein to the term “Swingline Lender” shall be deemed to refer to such successor or to any previous Swingline Lender, or to such successor and all previous Swingline Lenders, as the context shall require. After the replacement of a Swingline Lender hereunder, the replaced Swingline Lender shall remain a party hereto and shall continue to have all the rights and obligations of a Swingline Lender under this Agreement with respect to Swingline Loans made by it prior to its replacement, but shall not be required to make additional Swingline Loans.
(f) Subject to the appointment and acceptance of a successor Swingline Lender, the Swingline Lender may resign as the Swingline Lender at any time upon thirty days’ prior written notice to the Administrative Agent, the Borrower and the Lenders, in which case, the Swingline Lender shall be replaced in accordance with Section 2.05(e) above.
SECTION 2.06 Letters of Credit.
(a) General. Subject to the terms and conditions set forth herein, the Borrower may request any Issuing Bank to issue Letters of Credit denominated in Dollars as the applicant thereof for the support of its or its Subsidiaries’ obligations, in a form reasonably acceptable to such Issuing Bank, at any time and from time to time during the Availability Period; provided no Issuing Bank shall be under any obligation to issue a Letter of Credit that would result in more than a total of 20 Letters of Credit outstanding.
(b) Notice of Issuance, Amendment, Extension; Certain Conditions. To request the issuance of a Letter of Credit (or the amendment or extension of an outstanding Letter of Credit), the Borrower shall deliver (or transmit by electronic communication, including an Approved Borrower Portal, if arrangements for doing so have been approved by the respective Issuing Bank) to an Issuing Bank selected by it and to the Administrative Agent (reasonably in advance of the requested date of issuance, amendment or extension, but in any event no less than three (3) Business Days) a written notice requesting the issuance of a Letter of Credit, or identifying the Letter of Credit to be amended or extended, and specifying the date of issuance, amendment or extension (which shall be a Business Day), the date on which such Letter of Credit is to expire (which shall comply with paragraph (c) of this Section 2.06), the amount of such Letter of Credit, the name and address of the beneficiary thereof, and such other information as shall be necessary to prepare, amend or extend such Letter of Credit. In addition, as a condition to any such Letter of Credit issuance, the Borrower shall have entered into a continuing agreement (or other letter of credit agreement) for the issuance of letters of credit and/or shall submit a letter of credit application, in each case, as required by the respective Issuing Bank and using such Issuing Bank’s standard form (each, a “Letter of Credit Agreement”). In the event of any conflict between the terms and conditions of this Agreement and the terms and conditions of any Letter of Credit Agreement, the terms and conditions of this Agreement shall control. A Letter of Credit shall be issued, amended or extended only if (and upon issuance, amendment or extension of each Letter of Credit the Borrower shall be deemed to represent and warrant that), after giving effect to such issuance, amendment or extension (i) (x) the aggregate undrawn amount of all outstanding Letters of Credit issued by any Issuing Bank at such time plus (y) the aggregate amount of all LC Disbursements made by such Issuing Bank that have not yet been reimbursed by or on behalf of the Borrower at such time shall not exceed its Issuing Bank Sublimit, (ii) the LC Exposure shall not exceed the Issuing Bank Sublimit and (iii) no Lender’s Credit Exposure shall exceed its Commitment. The Borrower may, at any time and from time to time, reduce the Letter of Credit Commitment of any Issuing Bank with the consent of such Issuing Bank; provided that the Borrower shall not reduce the Letter of Credit Commitment of any Issuing Bank if, after giving effect of such reduction, the conditions set forth in clauses (i) through (iii) above shall not be satisfied.
An Issuing Bank shall not be under any obligation to issue, amend or extend any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain such Issuing Bank from issuing, amending or extending such Letter of Credit, or any Requirement of Law relating to such Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuing Bank shall prohibit, or request that such Issuing Bank reform from, the issuance, amendment or extension of letters of credit generally or such Letter of Credit in particular, or shall impose upon such Issuing Bank with respect to such Letter of Credit any
restriction, reserve or capital or liquidity requirement (for which such Issuing Bank is not otherwise compensated hereunder) not in effect on the Effective Date, or shall impose upon such Issuing Bank any unreimbursed loss, cost or expense that was not applicable on the Effective Date and that such Issuing Bank in good faith deems material to it; or
(ii) the issuance, amendment or extension of such Letter of Credit would violate one or more policies of such Issuing Bank applicable to letters of credit generally.
(c) Expiration Date. Each Letter of Credit shall expire (or be subject to termination or non-extension by notice from the applicable Issuing Bank to the beneficiary thereof) at or prior to the close of business on the earlier of (i) the date that is one year after the date of the issuance of such Letter of Credit (or, in the case of any extension of the expiration date thereof, one year after such extension) and (ii) the date that is five (5) Business Days prior to the Maturity Date; provided that any Letter of Credit with a one year tenor may contain customary automatic extension provisions acceptable to the Issuing Bank pursuant to which the expiration date of such Letter of Credit shall be automatically extended for a period of up to twelve (12) months (but not to a date later than the date set forth in clause (ii) above, except to the extent otherwise cash collateralized or backstopped pursuant to arrangements reasonably acceptable to the Issuing Bank and the Administrative Agent).
(d) Participations. By the issuance of a Letter of Credit (or an amendment to a Letter of Credit increasing the amount or extending the term thereof) and without any further action on the part of the applicable Issuing Bank or the Lenders, such Issuing Bank hereby grants to each Lender, and each Lender hereby acquires from such Issuing Bank, a participation in such Letter of Credit equal to such Lender’s Applicable Percentage of the aggregate amount available to be drawn under such Letter of Credit. In consideration and in furtherance of the foregoing, each Lender hereby absolutely and unconditionally agrees to pay to the Administrative Agent, for the account of the respective Issuing Bank, such Lender’s Applicable Percentage of each LC Disbursement in Dollars made by such Issuing Bank and not reimbursed by the Borrower on the date due as provided in paragraph (e) of this Section 2.06, or of any reimbursement payment required to be refunded to the Borrower for any reason, including after the Maturity Date. Each such payment shall be made without any offset, abatement, withholding or reduction whatsoever. Each Lender acknowledges and agrees that its obligations to acquire participations pursuant to this paragraph in respect of Letters of Credit and to make payments in respect of such acquired participations are absolute and unconditional and shall not be affected by any circumstance whatsoever, including any amendment or extension of any Letter of Credit or the occurrence and continuance of a Default or reduction or termination of the Commitments.
(e) Reimbursement. If an Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such LC Disbursement by paying to the Administrative Agent an amount equal to such LC Disbursement not later than 12:00 noon, New York City time, on the date that such LC Disbursement is made, if the Borrower shall have received notice of such LC Disbursement prior to 10:00 a.m., New York City time, on such date, or, if such notice has not been received by the Borrower prior to such time on such date, then not later than 12:00 noon, New York City time, on the Business Day immediately following the day that the Borrower receives such notice, if such notice is not received prior to such time on the day of receipt; provided that if such LC Disbursement is greater than or equal to $1,000,000, the Borrower may, subject to the conditions to borrowing set forth herein, request in accordance with Section 2.03 or 2.05 that such payment be financed with an ABR Revolving Borrowing or Swingline Loan in an equivalent amount, to the extent so financed, the Borrower’s obligation to make such payment shall be discharged and replaced by the resulting ABR Revolving Borrowing or Swingline Loan, as applicable. If the Borrower fails to make such payment when due, the Administrative Agent shall notify each Lender of the applicable LC Disbursement, the payment then due from the Borrower in respect thereof and such Lender’s Applicable Percentage thereof. Promptly following receipt of such notice, each Lender
shall pay to the Administrative Agent its Applicable Percentage of the payment then due from the Borrower, in the same manner as provided in Section 2.07 with respect to Loans made by such Lender (and Section 2.07 shall apply, mutatis mutandis, to the payment obligations of the Lenders), and the Administrative Agent shall promptly pay to the respective Issuing Bank the amounts so received by it from the Lenders. Promptly following receipt by the Administrative Agent of any payment from the Borrower pursuant to this paragraph, the Administrative Agent shall distribute such payment to the respective Issuing Bank or, to the extent that Lenders have made payments pursuant to this paragraph to reimburse such Issuing Bank, then to such Lenders and such Issuing Bank as their interests may appear. Any payment made by a Lender pursuant to this paragraph to reimburse an Issuing Bank for any LC Disbursement (other than the funding of ABR Revolving Loans or a Swingline Loan as contemplated above) shall not constitute a Loan and shall not relieve the Borrower of its obligation to reimburse such LC Disbursement.
(f) Obligations Absolute. The Borrower’s obligation to reimburse LC Disbursements as provided in paragraph (e) of this Section shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit, any Letter of Credit Agreement or this Agreement, or any term or provision therein or herein, (ii) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect, (iii) payment by the respective Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit or (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of, or provide a right of setoff against, the Borrower’s obligations hereunder. Neither the Administrative Agent, the Lenders nor any Issuing Bank, nor any of their respective Related Parties, shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, document, notice or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any error in interpretation of technical terms, any error in translation or any consequence arising from causes beyond the control of the respective Issuing Bank; provided that the foregoing shall not be construed to excuse an Issuing Bank from liability to the Borrower to the extent of any direct damages (as opposed to special, indirect, consequential or punitive damages, claims in respect of which are hereby waived by the Borrower to the extent permitted by applicable law) suffered by the Borrower that are caused by such Issuing Bank’s failure to exercise care when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof. The parties hereto expressly agree that, in the absence of gross negligence or willful misconduct on the part of an Issuing Bank (as finally determined by a court of competent jurisdiction), such Issuing Bank shall be deemed to have exercised care in each such determination. In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, an Issuing Bank may, in its sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.
(g) Disbursement Procedures. The Issuing Bank for any Letter of Credit shall, within the time allowed by applicable law or the specific terms of the Letter of Credit following its receipt thereof, examine all documents purporting to represent a demand for payment under such Letter of Credit. Such Issuing Bank shall promptly after such examination notify the Administrative Agent and the Borrower by telephone or email of such demand for payment if such Issuing Bank has made or will make an LC Disbursement thereunder; provided that such notice need not be given prior to payment by the Issuing Bank and any
failure to give or delay in giving such notice shall not relieve the Borrower of its obligation to reimburse such Issuing Bank and the Lenders with respect to any such LC Disbursement.
(h) Interim Interest. If the Issuing Bank for any Letter of Credit shall make any LC Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in full on the date such LC Disbursement is made, the unpaid amount thereof shall bear interest, for each day from and including the date such LC Disbursement is made to but excluding the date that the reimbursement is due and payable at the rate per annum then applicable to ABR Revolving Loans and such interest shall be due and payable on the date when such reimbursement is payable; provided that, if the Borrower fails to reimburse such LC Disbursement when due pursuant to paragraph (e) of this Section, then Section 2.13(d) shall apply. Interest accrued pursuant to this paragraph shall be for the account of such Issuing Bank, except that interest accrued on and after the date of payment by any Lender pursuant to paragraph (e) of this Section to reimburse such Issuing Bank for such LC Disbursement shall be for the account of such Lender to the extent of such payment.
(i) Replacement and Resignation of an Issuing Bank.
(i) An Issuing Bank may be replaced at any time by written agreement among the Borrower, the Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank. The Administrative Agent shall notify the Lenders of any such replacement of an Issuing Bank. At the time any such replacement shall become effective, the Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank pursuant to Section 2.12(b). From and after the effective date of any such replacement, (x) the successor Issuing Bank shall have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit to be issued by it thereafter and (y) references herein to the term “Issuing Bank” shall be deemed to refer to such successor or to any previous Issuing Bank, or to such successor and all previous Issuing Banks, as the context shall require. After the replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto and shall continue to have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit issued by it prior to such replacement, but shall not be required to issue additional Letters of Credit or extend or otherwise amend any existing Letter of Credit.
(ii) Subject to the appointment and acceptance of a successor Issuing Bank, any Issuing Bank may resign as an Issuing Bank at any time upon thirty (30) days’ prior written notice to the Administrative Agent, the Borrower and the Lenders, in which case, such resigning Issuing Bank shall be replaced in accordance with Section 2.06(i)(i) above.
(j) Cash Collateralization. If any Event of Default shall occur and be continuing, on the Business Day that the Borrower receives notice from the Administrative Agent or the Required Lenders (or, if the maturity of the Loans has been accelerated, Lenders with LC Exposure representing greater than 50% of the total LC Exposure) demanding the deposit of cash collateral pursuant to this paragraph, the Borrower shall deposit in an account or accounts with the Administrative Agent, in the name of the Administrative Agent and for the benefit of the Lenders, or that is subject to a control agreement (the “LC Collateral Account”), an amount in cash (or in a manner otherwise acceptable to the Administrative Agent) equal to 103% of the LC Exposure as of such date plus any accrued and unpaid interest thereon; provided that the obligation to deposit such cash collateral shall become effective immediately, and such deposit shall become immediately due and payable, without demand or other notice of any kind, upon the occurrence of any Event of Default with respect to the Borrower described in clause (h) or (i) of Article VII. The Borrower also shall deposit cash collateral in accordance with this paragraph as and to the extent required by Section 2.11(b) or 2.20. Such deposit shall be held by the Administrative Agent as collateral for the payment and performance of the Secured Obligations of the Borrower under this Agreement. In
addition, and without limiting the foregoing or paragraph (c) of this Section, if any LC Exposure remain outstanding after the expiration date specified in said paragraph (c), the Borrower shall immediately deposit into the LC Collateral Account an amount in cash equal to 103% of such LC Exposure as of such date plus any accrued and unpaid interest thereon.
The Administrative Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over the LC Collateral Account and the Borrower hereby grant the Administrative Agent a security interest in the LC Collateral Account and all moneys or other assets on deposit therein or credited thereto. Other than any interest earned on the investment of such deposits, which investments shall be made at the option and sole discretion of the Administrative Agent and at the Borrower’s risk and expense, such deposits shall not bear interest. Interest or profits, if any, on such investments shall accumulate in such account. Moneys in such account shall be applied by the Administrative Agent to reimburse each Issuing Bank for LC Disbursements for which it has not been reimbursed, together with related fees, costs and customary processing charges, and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the Borrower for the LC Exposure at such time or, if the maturity of the Loans has been accelerated (but subject to the consent of Lenders with LC Exposure representing greater than 50% of the total LC Exposure), be applied to satisfy other Obligations. If the Borrower is required to provide an amount of cash collateral hereunder as a result of the occurrence of an Event of Default, such amount (to the extent not applied as aforesaid) shall be returned to the Borrower within three (3) Business Days after all Events of Default have been cured or waived.
(k) Letters of Credit Issued for Account of Subsidiaries. Notwithstanding that a Letter of Credit issued or outstanding hereunder supports any obligations of, or is for the account of, a Subsidiary, or states that a Subsidiary is the “account party,” “applicant,” “customer,” “instructing party,” or the like of or for such Letter of Credit, and without derogating from any rights of the applicable Issuing Bank (whether arising by contract, at law, in equity or otherwise) against such Subsidiary in respect of such Letter of Credit, the Borrower (i) shall reimburse, indemnify and compensate the applicable Issuing Bank hereunder for such Letter of Credit (including to reimburse any and all drawings thereunder) as if such Letter of Credit had been issued solely for the account of the Borrower and (ii) irrevocably waives any and all defenses that might otherwise be available to it as a guarantor or surety of any or all of the obligations of such Subsidiary in respect of such Letter of Credit. The Borrower hereby acknowledges that the issuance of such Letters of Credit for its Subsidiaries inures to the benefit of the Borrower, and that the Borrower’s business derives substantial benefits from the businesses of such Subsidiaries.
SECTION 2.07 Funding of Borrowings.
(a) Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof solely by wire transfer of immediately available funds, by 12:00 noon, New York City time, to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Lenders in an amount equal to such Lender’s Applicable Percentage; provided that Swingline Loans shall be made as provided in Section 2.05. Except in respect of the provisions of this Agreement covering the reimbursement of Letters of Credit, the Administrative Agent will make such Loans available to the Borrower by promptly crediting the funds so received in the aforesaid account of the Administrative Agent to the Funding Account(s); provided that ABR Revolving Loans made to finance the reimbursement of an LC Disbursement as provided in Section 2.06(e) shall be remitted by the Administrative Agent to the Issuing Bank.
(b) Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with paragraph (a) of this Section and may, in reliance upon
such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of such Lender, the greater of the NYFRB Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation or (ii) in the case of the Borrower, the interest rate applicable to ABR Loans. If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such Lender’s Loan included in such Borrowing; provided that any interest received from the Borrower by the Administrative Agent during the period beginning when Administrative Agent funded the Borrowing until such Lender pays such amount shall be solely for the account of the Administrative Agent.
SECTION 2.08 Interest Elections.
(a) Each Revolving Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Term Benchmark Revolving Borrowing, shall have an initial Interest Period as specified in such Borrowing Request. Thereafter, the Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and, in the case of a Term Benchmark Revolving Borrowing, may elect Interest Periods therefor, all as provided in this Section 2.08. The Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing. This Section shall not apply to Swingline Borrowings, which may not be converted or continued.
(b) To make an election pursuant to this Section, the Borrower shall notify the Administrative Agent of such election by the time that a Borrowing Request would be required under Section 2.03 if the Borrower were requesting a Revolving Borrowing of the Type resulting from such election to be made on the effective date of such election. Each such Interest Election Request shall be irrevocable and shall be signed by a Responsible Officer of the Borrower; provided that, if such Interest Election Request is submitted through an Approved Borrower Portal, the foregoing signature requirement may be waived at the sole discretion of the Administrative Agent.
(c) Each Interest Election Request shall specify the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a Term Benchmark Borrowing; and
(iv) if the resulting Borrowing is a Term Benchmark Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period”.
If any such Interest Election Request requests a Term Benchmark Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one (1) month’s duration.
Notwithstanding the foregoing, in no event shall the Borrower be permitted to request pursuant to this Section 2.08(c) prior to a Benchmark Transition Event and Benchmark Replacement Date with respect to the Term SOFR Rate, an RFR Loan bearing interest based on Daily Simple SOFR (it being understood and agreed that Daily Simple SOFR shall only apply to the extent provided in Sections 2.14(a) and 2.14(f)), as applicable.
(d) Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender of the details thereof and of such Lender’s portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election Request with respect to a Term Benchmark Revolving Borrowing prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be deemed to have an Interest Period of one (1) month. Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing and the Administrative Agent, at the request of the Required Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing (i) no outstanding Revolving Borrowing may be converted to or continued as a Term Benchmark Borrowing or an RFR Borrowing and (ii) unless repaid, (A) each Term Benchmark Borrowing shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto and (B) each RFR Borrowing shall be converted to an ABR Borrowing on the last day of the calendar month.
SECTION 2.09 Termination and Reduction of Commitments.
(a) Unless previously terminated, the Commitments shall terminate on the Maturity Date.
(b) The Borrower may at any time terminate, or from time to time reduce, the Commitments; provided that (i) each reduction of the Commitments shall be in an amount that is (x) an integral multiple of $250,000 and not less than $500,000 or (y) such lesser amount constituting the remaining undrawn Commitments and (ii) the Borrower shall not terminate or reduce the Commitments if, after giving effect to any concurrent prepayment of the Loans in accordance with Section 2.11, (a) any Lender’s Credit Exposure would exceed its Commitment or (b) the Aggregate Credit Exposure would exceed the aggregate Commitments.
(c) The Borrower shall notify the Administrative Agent of any election to terminate or reduce the Commitments under paragraph (b) of this Section 2.09 at least three (3) Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof. Promptly following receipt of any notice, the Administrative Agent shall advise the Lenders of the contents thereof. Each notice delivered by the Borrower pursuant to this Section 2.09 shall be irrevocable; provided that a notice of termination of the Commitments delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied. Any termination or reduction of the Commitments shall be permanent. Each reduction of the Commitments shall be made ratably among the Lenders in accordance with their respective Commitments.
(d) To the extent the Availability Date has not occurred by such date, the Commitments shall terminate on the Outside Date.
(e) (i) if the amount of Net IPO Proceeds received by the Borrower is less than $250,000,000 the Commitments shall terminate on the date the IPO is consummated or (ii) if the IPO Proceeds Condition is not satisfied substantially concurrently with the consummation of the IPO, the Commitments shall terminate on the later of (x) July 1, 2025 or (y) the date the IPO is consummated.
SECTION 2.10 Repayment of Loans; Evidence of Debt.
(a) The Borrower hereby unconditionally promises to pay (i) to the Administrative Agent for the account of each Lender the then unpaid principal amount of each Revolving Loan on the Maturity Date and (ii) to the Administrative Agent for the account of the Swingline Lender the then unpaid principal amount of each Swingline Loan on the earlier of the Maturity Date and the fifth Business Days after such Swingline Loan is made; provided that on each date that a Revolving Borrowing is made, the Borrower shall repay all Swingline Loans then outstanding and the proceeds of any such Borrowing shall be applied by the Administrative Agent to repay any Swingline Loans outstanding.
(b) Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the Indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.
(c) The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the Class and Type thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of the Lenders and each Lender’s share thereof.
(d) The entries made in the accounts maintained pursuant to paragraph (b) or (c) of this Section 2.10 shall be prima facie evidence of the existence and amounts of the Obligations recorded therein; provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans made by it be evidenced by a promissory note. In such event, the Borrower shall prepare, execute and deliver to such Lender a promissory note payable to such Lender (or, if requested by such Lender, to such Lender and its registered assigns) and in a form approved by the Administrative Agent. Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment pursuant to Section 9.04) be represented by one or more promissory notes in such form.
SECTION 2.11 Prepayment of Loans.
(a) The Borrower shall have the right at any time and from time to time to prepay any Borrowing in whole or in part, subject to prior notice in accordance with paragraph (b) of this Section 2.11; provided that each prepayment shall be in an aggregate amount that is (x) an integral multiple of $250,000 and not less than $500,000 or (y) such lesser amount constituting the entire outstanding amount of such Borrowing. In the absence of such direction by the Borrower, voluntary repayments shall be applied first, to any outstanding ABR Loans until such ABR Loans are repaid in full, and then, to any outstanding Term Benchmark Loans (in each case, in direct order of maturity).
(b) The Borrower shall notify the Administrative Agent (and, in the case of prepayment of Swingline Loans, the Swingline Lender) by telephone or email (confirmed by electronic communication,
including an Approved Borrower Portal, if arrangements for doing so have been approved by the Administrative Agent and, if relevant, the Swingline Lender) of any prepayment hereunder (i) in the case of prepayment of (1) a Term Benchmark Revolving Borrowing, not later than 11:00 a.m., New York City time, three (3) Business Days before the date of prepayment or (2) an RFR Revolving Borrowing, not later than 11:00 a.m., New York City time, five (5) Business Days before the date of prepayment, (ii) in the case of prepayment of an ABR Revolving Borrowing, not later than 11:00 a.m., New York City time, one Business Day before the date of prepayment or (iii) in the case of prepayment of a Swingline Loan, not later than 12:00 noon, New York City time, on the date of prepayment. Each such notice shall be irrevocable and shall specify the prepayment date and the principal amount of each Borrowing or portion thereof to be prepaid; provided that, if a notice of prepayment is given in connection with a conditional notice of termination of the Commitments as contemplated by Section 2.09 or is otherwise conditioned upon the consummation of a transaction, then such notice of prepayment may be revoked (or extended) if such notice of termination is revoked or extended in accordance with Section 2.09 or such transaction does not occur. Promptly following receipt of any such notice relating to a Revolving Borrowing, the Administrative Agent shall advise the Lenders of the contents thereof. Each partial prepayment of any Revolving Borrowing shall be in an amount that would be permitted in the case of an advance of a Revolving Borrowing of the same Type as provided in Section 2.02, except as necessary to apply fully the required amount of a mandatory prepayment. Each prepayment of a Revolving Borrowing shall be applied ratably to the Loans included in the prepaid Borrowing. Prepayments shall be accompanied by accrued but unpaid interest to the extent required by Section 2.13 and any break funding payments required by Section 2.16.
SECTION 2.12 Fees.
(a) The Borrower agrees to pay to the Administrative Agent for the account of each Lender a commitment fee (a “Commitment Fee”), which shall accrue at the rate equal to the Applicable Commitment Fee on the daily unused amount of the Commitment of such Lender during the period from and including the Effective Date to but excluding the date on which such Commitment terminates. Commitment fees accrued through and including the last day of March, June, September and December of each year shall be payable in arrears on the fifteenth (15th) day following such last day and on the date on which the Commitments terminate, commencing on the first such date to occur after the date hereof. The Commitment Fee shall be computed on the basis of a year of three hundred and sixty (360) days and shall be payable for the actual number of days elapsed (including the first (1st) day and the last day of each period but excluding the date on which the Commitments terminate). For the avoidance of doubt, a Lender’s Swingline Exposure shall not be considered usage in calculating the Commitment Fee above.
(b) The Borrower agrees to pay (i) to the Administrative Agent for the account of each Lender a participation fee with respect to its participations in each outstanding Letter of Credit (the “Participation Fee”), which shall accrue on the daily maximum stated amount then available to be drawn under such Letter of Credit at the same Applicable Rate used to determine the interest rate applicable to Term Benchmark Revolving Loans, during the period from and including the Effective Date to but excluding the later of the date on which such Lender’s Commitment terminates and the date on which such Lender ceases to have any LC Exposure, and (ii) to each Issuing Bank for its own account a fronting fee with respect to each Letter of Credit issued by such Issuing Bank, which shall accrue at the rate or rates per annum separately agreed upon between the Borrower and such Issuing Bank on the daily maximum stated amount then available to be drawn under such Letter of Credit, during the period from and including the Effective Date to but excluding the later of the date of termination of the Commitments and the date on which there ceases to be any LC Exposure with respect to Letters of Credit issued by such Issuing Bank, as well as such Issuing Bank’s standard fees with respect to the issuance, amendment or extension of any Letter of Credit and other processing fees, and other standard costs and charges, of such Issuing Bank relating to Letters of Credit as from time to time in effect. Participation Fees and fronting fees accrued through and including the last day of March, June, September and December of each year shall be payable on the fifteenth (15th) day following
such last day, commencing on the first such date to occur after the Effective Date; provided that all such fees shall be payable on the date on which the Commitments terminate and any such fees accruing after the date on which the Commitments terminate shall be payable on demand. Any other fees payable to an Issuing Bank pursuant to this paragraph shall be payable within ten (10) days after demand. All Participation Fees and fronting fees shall be computed on the basis of a year of three hundred and sixty (360) days and shall be payable for the actual number of days elapsed (including the first (1st) day but excluding the last day).
(c) The Borrower agrees to pay to the Administrative Agent and the Lead Arrangers, for their own respective accounts, fees payable in the amounts and at the times separately agreed upon in writing between the Borrower, on the one hand, and the Administrative Agent and the Lead Arrangers, on the other.
(d) All fees payable hereunder shall be paid on the dates due, in dollars in immediately available funds, to the Administrative Agent (or to an Issuing Bank, in the case of fees payable to it) for distribution, in the case of Commitment Fees and Participation Fees, to the Lenders. Fees paid shall not be refundable under any circumstances.
SECTION 2.13 Interest.
(a) The Loans comprising each ABR Borrowing (including each Swingline Loan) shall bear interest at the Alternate Base Rate plus the Applicable Rate.
(b) The Loans comprising each Term Benchmark Borrowing shall bear interest in the case of a Term Benchmark Revolving Loan, at the Adjusted Term SOFR Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate.
(c) Each RFR Loan shall bear interest at a rate per annum equal to the Adjusted Daily Simple SOFR plus the Applicable Rate.
(d) Notwithstanding the foregoing, if any principal of or interest on any Loan or any fee or other amount payable by the Borrower hereunder is not paid when due, whether at stated maturity, upon acceleration or otherwise, such overdue amount shall bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section or (ii) in the case of any other amount, 2% plus the rate applicable to ABR Loans as provided in paragraph (a) of this Section.
(e) Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan and, in the case of Revolving Loans, upon termination of the Commitments; provided that (i) interest accrued pursuant to paragraph (d) of this Section 2.13 shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Revolving Loan prior to the end of the Availability Period), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Term Benchmark Revolving Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.
(f) Interest computed by reference to the Term SOFR Rate or Daily Simple SOFR and the ABR (except when based on the Prime Rate) hereunder shall be computed on the basis of a year of 360 days. Interest computed by reference to the Alternate Base Rate only at times when the Alternate Base Rate is based on the Prime Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year). In each case, interest shall be payable for the actual number of days elapsed (including the first day but excluding the last day). All interest hereunder on any Loan shall be computed on a daily basis based upon the outstanding principal amount of such Loan as of the applicable date of determination. A determination
of the applicable Alternate Base Rate, Adjusted Term SOFR Rate, Term SOFR Rate, Adjusted Daily Simple SOFR or Daily Simple SOFR shall be determined by the Administrative Agent, and such determination shall be conclusive absent manifest error.
SECTION 2.14 Alternate Rate of Interest.
(a) Subject to clauses (b), (c), (d), (e) and (f) of this Section 2.14, if:
(i) the Administrative Agent determines (which determination shall be conclusive absent manifest error) (A) prior to the commencement of any Interest Period for a Term Benchmark Borrowing, that adequate and reasonable means do not exist for ascertaining the Adjusted Term SOFR Rate (including because the Term SOFR Reference Rate is not available or published on a current basis), for such Interest Period or (B) at any time, that adequate and reasonable means do not exist for ascertaining the applicable Adjusted Daily Simple SOFR; or
(ii) the Administrative Agent is advised by the Required Lenders that (A) prior to the commencement of any Interest Period for a Term Benchmark Borrowing, the Adjusted Term SOFR Rate for such Interest Period will not adequately and fairly reflect the cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in such Borrowing for such Interest Period or (B) at any time, Adjusted Daily Simple SOFR will not adequately and fairly reflect the cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in such Borrowing;
then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telephone or email as promptly as practicable thereafter and, until (x) the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist with respect to the relevant Benchmark and (y) the Borrower delivers a new Interest Election Request in accordance with the terms of Section 2.08 or a new Borrowing Request in accordance with the terms of Section 2.03, (A) any Interest Election Request that requests the conversion of any Revolving Borrowing to, or continuation of any Revolving Borrowing as, a Term Benchmark Borrowing and any Borrowing Request that requests a Term Benchmark Revolving Borrowing shall instead be deemed to be an Interest Election Request or a Borrowing Request, as applicable, for (1) an RFR Borrowing so long as the Adjusted Daily Simple SOFR is not also the subject of Section 2.14(a)(i) or (ii) above or (2) an ABR Borrowing if the Adjusted Daily Simple SOFR also is the subject of Section 2.14(a)(i) or (ii) above and (B) any Borrowing Request that requests an RFR Borrowing shall instead be deemed to be a Borrowing Request, as applicable, for an ABR Borrowing; provided that if the circumstances giving rise to such notice affect only one Type of Borrowings, then all other Types of Borrowings shall be permitted. Furthermore, if any Term Benchmark Loan or RFR Loan is outstanding on the date of the Borrower’s receipt of the notice from the Administrative Agent referred to in this Section 2.14(a) with respect to a Relevant Rate applicable to such Term Benchmark Loan or RFR Loan, then until (x) the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist with respect to the relevant Benchmark and (y) the Borrower delivers a new Interest Election Request in accordance with the terms of Section 2.08 or a new Borrowing Request in accordance with the terms of Section 2.03, (1) any Term Benchmark Loan shall on the last day of the Interest Period applicable to such Loan, be converted by the Administrative Agent to, and shall constitute, (x) an RFR Borrowing so long as the Adjusted Daily Simple SOFR is not also the subject of Section 2.14(a)(i) or (ii) above or (y) an ABR Loan if the Adjusted Daily Simple SOFR also is the subject of Section 2.14(a)(i) or (ii) above, on such day, and (2) any RFR Loan shall on and from such day be converted by the Administrative Agent to, and shall constitute an ABR Loan.
(b) Notwithstanding anything to the contrary herein or in any other Loan Document (and any Swap Agreement shall be deemed not to be a “Loan Document” for purposes of this Section 2.14), if a
Benchmark Transition Event and its related Benchmark Replacement Date have occurred prior to the Reference Time in respect of any setting of the then-current Benchmark, then (x) if a Benchmark Replacement is determined in accordance with clause (1) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark (including any related adjustments) for all purposes hereunder and under any Loan Document in respect of such Benchmark setting and subsequent Benchmark settings without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document and (y) if a Benchmark Replacement is determined in accordance with clause (2) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of any Benchmark setting at or after 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date notice of such Benchmark Replacement is provided to the Lenders without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document so long as the Administrative Agent has not received, by such time, written notice of objection to such Benchmark Replacement from Lenders comprising the Required Lenders.
(c) Notwithstanding anything to the contrary herein or in any other Loan Document, the Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Loan Document.
(d) The Administrative Agent will promptly notify the Borrower and the Lenders of (i) any occurrence of a Benchmark Transition Event, (ii) the implementation of any Benchmark Replacement, (iii) the effectiveness of any Benchmark Replacement Conforming Changes, (iv) the removal or reinstatement of any tenor of a Benchmark pursuant to Section 2.14(f) and (v) the commencement or conclusion of any Benchmark Unavailability Period. Any determination, decision or election that may be made by the Administrative Agent or, if applicable, any Lender (or group of Lenders) pursuant to this Section 2.14, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party to this Agreement or any other Loan Document, except, in each case, as expressly required pursuant to this Section 2.14.
(e) Notwithstanding anything to the contrary herein or in any other Loan Document, at any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a term rate (including the Term SOFR Rate) and either (A) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion or (B) the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is or will be no longer representative, then the Administrative Agent may modify the definition of “Interest Period” for any Benchmark settings at or after such time to remove such unavailable or non-representative tenor and (ii) if a tenor that was removed pursuant to clause (i) above either (A) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (B) is not, or is no longer, subject to an announcement that it is or will no longer be representative for a Benchmark (including a Benchmark Replacement), then the Administrative Agent may modify the definition of “Interest Period” for all Benchmark settings at or after such time to reinstate such previously removed tenor.
(f) Upon the Borrower’s receipt of notice of the commencement of a Benchmark Unavailability Period, the Borrower may revoke any request for (i) a Term Benchmark Borrowing,
conversion to or continuation of Term Benchmark Loans to be made, converted or continued or (ii) a RFR Borrowing or conversion to RFR Loans, during any Benchmark Unavailability Period and, failing that, the Borrower will be deemed to have converted any request for a Term Benchmark Borrowing or RFR Borrowing, as applicable, into a request for a Borrowing of or conversion to (A) solely with respect to any such request for a Term Benchmark Borrowing, an RFR Borrowing so long as the Adjusted Daily Simple SOFR is not the subject of a Benchmark Transition Event or (B) an ABR Borrowing if the Adjusted Daily Simple SOFR is the subject of a Benchmark Transition Event. During any Benchmark Unavailability Period or at any time that a tenor for the then-current Benchmark is not an Available Tenor, the component of ABR based upon the then-current Benchmark or such tenor for such Benchmark, as applicable, will not be used in any determination of ABR. Furthermore, if any Term Benchmark Loan or RFR Loan is outstanding on the date of the Borrower’s receipt of notice of the commencement of a Benchmark Unavailability Period with respect to a Relevant Rate applicable to such Term Benchmark Loan or RFR Loan, then until such time as a Benchmark Replacement is implemented pursuant to this Section 2.14, (1) any Term Benchmark Loan shall on the last day of the Interest Period applicable to such Loan, be converted by the Administrative Agent to, and shall constitute, (x) an RFR Borrowing so long as the Adjusted Daily Simple SOFR is not the subject of a Benchmark Transition Event or (y) an ABR Loan if the Adjusted Daily Simple SOFR is the subject of a Benchmark Transition Event, on such day and (2) any RFR Loan shall on and from such day be converted by the Administrative Agent to, and shall constitute an ABR Loan.
SECTION 2.15 Increased Costs.
(a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit, liquidity or similar requirement (including any compulsory loan requirement, insurance charge or other assessment) against assets of, deposits with or for the account of, or credit extended by, any Lender or Issuing Bank;
(ii) impose on any Lender or Issuing Bank or the applicable offshore interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or Loans made by such Lender or any Letter of Credit or participation therein; or
(iii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto;
and the result of any of the foregoing shall be to increase the cost to such Lender, Issuing Bank or such other Recipient of making, continuing, converting or maintaining any Loan (or of maintaining its obligation to make any such Loan) or to increase the cost to such Lender, such Issuing Bank or such other Recipient of participating in, issuing or maintaining any Letter of Credit or to reduce the amount of any sum received or receivable by such Lender, Issuing Bank or such other Recipient hereunder (whether of principal, interest or otherwise), then the Borrower will pay to such Lender, such Issuing Bank or such other Recipient, as the case may be, such additional amount or amounts as will compensate such Lender, such Issuing Bank or such other Recipient, as the case may be, for such additional costs incurred or reduction suffered.
(b) If any Lender or Issuing Bank determines that any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s or the Issuing Bank’s capital or on the capital of such Lender’s or Issuing Bank’s holding company, if any, as a consequence of this Agreement or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by such Issuing Bank, to a level below that which such Lender or
Issuing Bank or such Lender’s or Issuing Bank’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or Issuing Bank’s policies and the policies of such Lender’s or Issuing Bank’s holding company with respect to capital adequacy and liquidity), then from time to time the Borrower will pay to such Lender or Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or Issuing Bank or such Lender’s or Issuing Bank’s holding company for any such reduction suffered.
(c) A certificate of a Lender or Issuing Bank setting forth the amount or amounts necessary to compensate such Lender or Issuing Bank or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section 2.15 shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender or Issuing Bank, as the case may be, the amount shown as due on any such certificate within ten (10) days after receipt thereof.
(d) Failure or delay on the part of any Lender or Issuing Bank to demand compensation pursuant to this Section 2.15 shall not constitute a waiver of such Lender’s or Issuing Bank’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender or Issuing Bank pursuant to this Section 2.15 for any increased costs or reductions incurred more than two hundred and seventy (270) days prior to the date that such Lender or Issuing Bank, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or Issuing Bank’s intention to claim compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the two hundred and seventy (270) day period referred to above shall be extended to include the period of retroactive effect thereof.
SECTION 2.16 Break Funding Payments. (a) With respect to Loans that are not RFR Loans, in the event of (i) the payment of any principal of any Term Benchmark Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default or an optional or mandatory prepayment of Loans), (ii) the conversion of any Term Benchmark Loan other than on the last day of the Interest Period applicable thereto, (iii) the failure to borrow, convert, continue or prepay any Term Benchmark Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may be revoked under Sections 2.09(b) or 2.11(b) and is revoked in accordance therewith) or (iv) the assignment of any Term Benchmark Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.19 or 9.02(d), then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within ten (10) days after receipt thereof.
(b) With respect to RFR Loans, in the event of (i) the payment of any principal of any RFR Loan other than on the Interest Payment Date applicable thereto (including as a result of an Event of Default or an optional or mandatory prepayment of Loans), (ii) the failure to borrow or prepay any RFR Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may be revoked under Section 2.11(b) and is revoked in accordance therewith) or (iii) the assignment of any RFR Loan other than on the Interest Payment Date applicable thereto as a result of a request by the Borrower pursuant to Section 2.19, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within ten (10) days after receipt thereof.
SECTION 2.17 Payments Free of Taxes.
(a) Any and all payments by or on account of any obligation of any Loan Party under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by applicable law. If any applicable law (as determined in the good faith discretion of an applicable withholding agent) requires the deduction or withholding of any Tax from any such payment by a withholding agent, then the applicable withholding agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by the applicable Loan Party shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section 2.17) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.
(b) Payment of Other Taxes by the Loan Parties. The Loan Parties shall timely pay to the relevant Governmental Authority in accordance with applicable law, or at the option of the Administrative Agent timely reimburse it for, Other Taxes.
(c) Evidence of Payments. As soon as practicable after any payment of Taxes by any Loan Party to a Governmental Authority pursuant to this Section 2.17, such Loan Party shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.
(d) Indemnification by the Loan Parties. The Loan Parties shall jointly and severally indemnify each Recipient, within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 2.17) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.
(e) Indemnification by the Lenders. Each Lender shall severally indemnify the Administrative Agent, within ten (10) days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that any Loan Party has not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 9.04(c) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to setoff and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this paragraph (e).
(f) Status of Lenders.
(i) Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower and the
Administrative Agent, at the time or times reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 2.17(f)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.
(ii) Without limiting the generality of the foregoing, in the event that the Borrower is a U.S. Person,
(A) any Lender that is a U.S. Person shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), an executed copy of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;
(B) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), whichever of the following is applicable:
(1) in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the U.S. is a party (x) with respect to payments of interest under any Loan Document, an executed copy of IRS Form W-8BEN-E or IRS Form W-8BEN establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN-E or IRS Form W-8BEN establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;
(2) in the case of a Foreign Lender claiming that its extension of credit will generate U.S. effectively connected income, an executed copy of IRS Form W-8ECI;
(3) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit D-1 to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10-percent shareholder” of the Borrower within the meaning of Section 871(h)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) an executed copy of IRS Form W-8BEN-E or IRS Form W-8BEN; or
(4) to the extent a Foreign Lender is not the beneficial owner, an executed copy of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN-E, IRS Form W-8BEN, a U.S. Tax Compliance Certificate substantially in the form of Exhibit D-2 or Exhibit D-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit D-4 on behalf of each such direct and indirect partner;
(C) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed copies of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and
(D) if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.
Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and the Administrative Agent in writing of its legal inability to do so.
(g) Treatment of Certain Refunds. If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 2.17 (including by the payment of additional amounts pursuant to this Section 2.17), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section 2.17 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this paragraph (g) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (g), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (g) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified
party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This paragraph (g) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.
(h) Survival. Each party’s obligations under this Section 2.17 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.
(i) Defined Terms. For purposes of this Section 2.17, the term “applicable law” includes FATCA.
SECTION 2.18 Payments Generally; Allocation of Proceeds; Pro Rata Treatment; Sharing of Setoffs.
(a) The Borrower shall make each payment or prepayment required to be made by it hereunder (whether of principal, interest, fees or reimbursement of LC Disbursements, or of amounts payable under Section 2.15, 2.16 or 2.17, or otherwise) in Dollars prior to 12:00 noon, New York City time, on the date when due or the date fixed for any prepayment hereunder, in immediately available funds, without setoff, recoupment or counterclaim. Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Administrative Agent at its applicable office or offices as described in the Administrative Questionnaire provided by the Administrative Agent to the Borrower from time to time, except payments to be made directly to Issuing Banks or the Swingline Lender as expressly provided herein and except that payments pursuant to Sections 2.15, 2.16, 2.17 and 9.03 shall be made directly to the Persons entitled thereto. The Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof. If any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension. All payments hereunder shall be made in Dollars.
(b) Any proceeds of Collateral received by the Administrative Agent (i) not constituting either (A) a specific payment of principal, interest, fees or other sum payable under the Loan Documents (which shall be applied as specified by the Borrower), or (B) a mandatory prepayment (which shall be applied in accordance with Section 2.11) or (ii) after an Event of Default has occurred and is continuing and the Administrative Agent so elects or the Required Lenders so direct, shall be applied, subject to the terms of any applicable Acceptable Subordination or Intercreditor Agreement, ratably first, to pay any fees, indemnities, or expense reimbursements then payable to the Administrative Agent from the Borrower (other than in connection with Banking Services Obligations or Swap Agreement Obligations), second, to pay any fees, indemnities, or expense reimbursements (other than principal, reimbursement obligations in respect of LC Disbursements, interest and Letter of Credit fees) payable to the Lenders and Issuing Banks from the Borrower (other than in connection with Banking Services Obligations or Swap Agreement Obligations), third, to pay accrued and unpaid Letter of Credit fees, interest on unreimbursed LC Disbursements and interest on the Loans, ratably among the Lenders and Issuing Banks, fourth, (A) to pay unpaid principal on the Loans and unreimbursed LC Disbursements, (B) to pay any then-owing regularly scheduled payments or termination payments (whether as a result of the occurrence of any event of default or other termination event) under any Swap Agreement Obligations and Banking Services Obligations up to and including the amount most recently provided to the Administrative Agent pursuant to Section 2.23 and (C) to cash
collateralize that portion of LC Exposure comprising the undrawn amount of Letters of Credit in an amount equal to one hundred three percent (103%) of such LC Exposure, to the extent not otherwise cash collateralized by the Borrower pursuant to Section 2.06 or Section 2.20, ratably among the Lenders, Issuing Banks, Swap Agreement counterparties and Banking Services providers; provided that (x) any such amounts applied pursuant to subclause (C) above shall be paid to the Administrative Agent for the ratable account of the applicable Issuing Banks to cash collateralize Obligations in respect of Letters of Credit, (y) subject to Section 2.06 or Section 2.20, amounts used to cash collateralize the aggregate amount of Letters of Credit pursuant to this subclause (C) shall be used to satisfy drawings under such Letters of Credit as they occur and (z) upon the expiration of any Letter of Credit (without any pending drawings), the pro rata share of cash collateral shall be distributed to the other Obligations, if any, in the order set forth in this Section 2.18(b), and fifth, to the payment of any other Secured Obligation due to the Administrative Agent, any Lender or any other Secured Party from the Borrower or any other Loan Party. Notwithstanding anything to the contrary contained in this Agreement, unless so directed by the Borrower, or unless an Event of Default has occurred and is continuing, neither the Administrative Agent nor any Lender shall apply any payment which it receives to any Term Benchmark Loan, except (i) on the expiration date of the Interest Period applicable thereto, or (ii) in the event, and only to the extent, that there are no outstanding ABR Loans and, in any such event, the Borrower shall pay the break funding payment required in accordance with Section 2.16. The Administrative Agent and the Lenders shall have the continuing and exclusive right to apply and reverse and reapply any and all such proceeds and payments to any portion of the Secured Obligations. Notwithstanding the foregoing, Secured Obligations arising under Banking Services Obligations or Swap Agreement Obligations shall be excluded from the application described above and paid in clause sixth if the Administrative Agent has not received written notice thereof, together with such supporting documentation as the Administrative Agent may have reasonably requested from the applicable provider of such Banking Services or Swap Agreements.
(c) At the election of the Administrative Agent during the continuance of an Event of Default, all payments of principal, interest, LC Disbursements, fees, premiums, reimbursable expenses (including, without limitation, all reimbursement for fees, costs and expenses pursuant to Section 9.03), and other sums payable under the Loan Documents, may be paid from the proceeds of Borrowings made hereunder (regardless of the conditions set forth in Section 4.04 not having been satisfied), whether made following a request by the Borrower pursuant to Section 2.03 or a deemed request as provided in this Section, or may be deducted from any deposit account of the Borrower maintained with the Administrative Agent. The Borrower hereby irrevocably authorizes, during the continuance of an Event of Default, (i) the Administrative Agent to make a Borrowing for the purpose of paying each payment of principal, interest and fees as it becomes due and payable hereunder or any other amount due and payable under the Loan Documents and agrees that all such amounts charged shall constitute Revolving Loans, and that all such Borrowings shall be deemed to have been requested pursuant to Section 2.03, and (ii) the Administrative Agent to charge any deposit account of the Borrower maintained with the Administrative Agent for each payment of principal, interest and fees as it becomes due and payable hereunder or any other amount due and payable under the Loan Documents.
(d) If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, unreimbursed LC Disbursements, interest and fees then due hereunder, such funds shall be applied (i) first, towards payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, towards payment of principal and unreimbursed LC Disbursements then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal and unreimbursed LC Disbursements then due to such parties.
(e) If any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Revolving Loans or participations in LC
Disbursements or Swingline Loans resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its Revolving Loans and participations in LC Disbursements and Swingline Loans and accrued interest thereon than the proportion received by any other Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Revolving Loans and participations in LC Disbursements and Swingline Loans of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Revolving Loans and participations in LC Disbursements and Swingline Loans; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this paragraph shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in LC Disbursements to any assignee or participant, other than to the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions of this paragraph shall apply). The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.
(f) Unless the Administrative Agent shall have received, prior to any date on which any payment is due to the Administrative Agent for the account of the Lenders or the Issuing Banks pursuant to the terms hereof or any other Loan Document (including any date that is fixed for prepayment by notice from the Borrower to the Administrative Agent pursuant to Section 2.11(b)), notice from the Borrower that the Borrower will not make such payment or prepayment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the Issuing Banks, as the case may be, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders or the Issuing Banks, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or Issuing Bank with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the NYFRB Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.
SECTION 2.19 Mitigation Obligations; Replacement of Lenders.
(a) If any Lender requests compensation under Section 2.15, or if the Borrower is required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.17, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Sections 2.15 or 2.17, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees, subject to Section 9.03(a), to pay all reasonable and documented out-of-pocket costs and expenses incurred by any Lender in connection with any such designation or assignment.
(b) If any Lender requests compensation under Section 2.15, or if the Borrower is required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.17, or if any Lender becomes a Defaulting Lender or a Non-Consenting Lender, then, in each case, the Borrower may, at its sole expense and effort, upon notice to such
Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 9.04), all its interests, rights (other than its existing rights to payments pursuant to Sections 2.15 or 2.17) and obligations under this Agreement and the other Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) to the extent required under Section 9.04, the Borrower shall have received the prior written consent of the Administrative Agent (and if a Commitment is being assigned, the Issuing Banks and Swingline Lender), which consent shall not unreasonably be withheld or delayed, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and funded participations in LC Disbursements and Swingline Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts) and (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.15 or payments required to be made pursuant to Section 2.17, such assignment will result in a reduction in such compensation or payments. A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation permanently cease to apply. Each party hereto agrees that (i) an assignment and delegation required pursuant to this paragraph may be effected pursuant to an Assignment and Assumption executed by the Borrower, the Administrative Agent and the assignee (or, to the extent applicable, an agreement incorporating an Assignment and Assumption by reference pursuant to an Approved Electronic Platform as to which the Administrative Agent and such parties are participants), and (ii) the Lender required to make such assignment and delegation need not be a party thereto in order for such assignment to be effective and shall be deemed to have consented to and be bound by the terms thereof; provided that, following the effectiveness of any such assignment, the other parties to such assignment agree to execute and deliver such documents necessary to evidence such assignment as reasonably requested by the applicable Lender; provided further that any such documents shall be without recourse to or warranty by the parties thereto.
SECTION 2.20 Defaulting Lenders. Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the following provisions shall apply for so long as such Lender is a Defaulting Lender:
(a) Commitment Fees shall cease to accrue on the unfunded portion of the Commitment of such Defaulting Lender pursuant to Section 2.12(a);
(b) any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Section 2.18(b) or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 9.08 shall be applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to any Issuing Bank or the Swingline Lender hereunder; third, to cash collateralize LC Exposure with respect to such Defaulting Lender in accordance with this Section 2.20; fourth, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth, if so determined by the Administrative Agent and the Borrower, to be held in a deposit account and released pro rata in order to (x) satisfy such Defaulting Lender’s potential future funding obligations with respect to Loans under this Agreement and (y) cash collateralize future LC Exposure with respect to such Defaulting Lender with respect to future Letters of Credit issued under this Agreement, in accordance with this Section 2.20; sixth, to the payment of any amounts owing to the Lenders, the Issuing Banks or the Swingline Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender, the Issuing Banks or the Swingline Lender against such Defaulting
Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement or under any other Loan Document; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement or under any other Loan Document; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans or LC Disbursements in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made or the related Letters of Credit were issued at a time when the conditions set forth in Section 4.04 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and LC Disbursements owed to, all non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or LC Disbursements owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in the Borrower’s obligations corresponding to such Defaulting Lender’s LC Exposure and Swingline Loans are held by the Lenders pro rata in accordance with the Commitments without giving effect to clause (d) below. Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post cash collateral pursuant to this Section 2.20 shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.
(c) the Commitment and Credit Exposure of such Defaulting Lender shall not be included in determining whether the Required Lenders have taken or may take any action hereunder (including any consent to any amendment, waiver or other modification pursuant to Section 9.02); provided that this clause (c) shall not apply to the vote of a Defaulting Lender in the case of an amendment, waiver or other modification requiring the consent of all Lenders or each affected Lender;
(d) if any Swingline Exposure or LC Exposure exists at the time such Lender becomes a Defaulting Lender then:
(i) all or any part of the Swingline Exposure and LC Exposure of such Defaulting Lender (other than, in the case of a Defaulting Lender that is the Swingline Lender, the portion of such Swingline Exposure referred to in clause (b) of the definition of such term) shall be reallocated among the non-Defaulting Lenders in accordance with their respective Applicable Percentages but only to the extent that such reallocation does not, as to any non-Defaulting Lender, cause such non-Defaulting Lender’s Credit Exposure to exceed its Commitment;
(ii) if the reallocation described in clause (i) above cannot, or can only partially, be effected, the Borrower shall within one Business Day following notice by the Administrative Agent (x) first, prepay such Swingline Exposure and (y) second, cash collateralize for the benefit of the Issuing Banks only the Borrower’s obligations corresponding to such Defaulting Lender’s LC Exposure (after giving effect to any partial reallocation pursuant to clause (i) above) in accordance with the procedures set forth in Section 2.06(j) for so long as such LC Exposure is outstanding;
(iii) if the Borrower cash collateralizes any portion of such Defaulting Lender’s LC Exposure pursuant to clause (ii) above, the Borrower shall not be required to pay any fees to such Defaulting Lender pursuant to Section 2.12(b) with respect to such Defaulting Lender’s LC Exposure during the period such Defaulting Lender’s LC Exposure is cash collateralized;
(iv) if the LC Exposure of the non-Defaulting Lenders is reallocated pursuant to clause (i) above, then the fees payable to the Lenders pursuant to Section 2.12(a) and 2.12(b) shall be adjusted in accordance with such non-Defaulting Lenders’ Applicable Percentages; and
(v) if all or any portion of such Defaulting Lender’s LC Exposure is neither reallocated nor cash collateralized pursuant to clause (i) or (ii) above, then, without prejudice to any rights or remedies of any Issuing Bank or any other Lender hereunder, all letter of credit fees payable under Section 2.12(b) with respect to such Defaulting Lender’s LC Exposure shall be payable to the Issuing Banks until and to the extent that such LC Exposure is reallocated and/or cash collateralized; and
(e) so long as such Lender is a Defaulting Lender, the Swingline Lender shall not be required to fund any Swingline Loan and no Issuing Bank shall be required to issue, amend or increase any Letter of Credit, unless it is satisfied that the related exposure and the Defaulting Lender’s then outstanding LC Exposure will be 100% covered by the Commitments of the non-Defaulting Lenders and/or cash collateral will be provided by the Borrower in accordance with Section 2.20(d), and Swingline Exposure related to any newly made Swingline Loan or LC Exposure related to any newly issued or increased Letter of Credit shall be allocated among non-Defaulting Lenders in a manner consistent with Section 2.20(d)(i) (and such Defaulting Lender shall not participate therein).
If (i) a Bankruptcy Event or a Bail-In Action with respect to a Lender Parent shall occur following the date hereof and for so long as such event shall continue or (ii) the Swingline Lender or any Issuing Bank has a good faith belief that any Lender has defaulted in fulfilling its obligations under one or more other agreements in which such Lender commits to extend credit, no Swingline Lender shall be required to fund any Swingline Loan and no Issuing Bank shall be required to issue, amend or increase any Letter of Credit, unless the Swingline Lender or the Issuing Banks, as the case may be, shall have entered into arrangements with the Borrower or such Lender, satisfactory to such Swingline Lender or Issuing Bank, as the case may be, to defease any risk to it in respect of such Lender hereunder.
In the event that each of the Administrative Agent, the Borrower, the Swingline Lender and each Issuing Bank agrees that a Defaulting Lender has adequately remedied all matters that caused such Lender to be a Defaulting Lender, then the Swingline Exposure and LC Exposure of the Lenders shall be readjusted to reflect the inclusion of such Lender’s Commitment and on such date such Lender shall purchase at par such of the Loans of the other Lenders (other than Swingline Loans) as the Administrative Agent shall determine may be necessary in order for such Lender to hold such Loans in accordance with its Applicable Percentage.
SECTION 2.21 [Intentionally Omitted].
SECTION 2.22 Expansion Option; Incremental Facilities.
(a) The Borrower may from time to time elect to increase the Commitments in a minimum amount of $5,000,000 and an integral multiple of $1,000,000 in excess thereof so long as, after giving effect thereto, the aggregate amount of all such Commitment increases does not exceed $150,000,000. Each request from the Borrower pursuant to this Section 2.22 shall set forth the requested amount and proposed terms of the relevant Commitment increase. The Borrower may arrange for any such Commitment increase to be provided by one or more Lenders (each Lender so agreeing to an increase in its Commitment, an “Increasing Lender”), or by one or more new banks, financial institutions or other entities (each such new bank, financial institution or other entity, an “Augmenting Lender”), to increase the existing Commitments; provided, that (i) each Augmenting Lender (other than any Affiliate of an existing Lender) shall, to the extent required by Section 9.04, be subject to the approval of the Administrative Agent and the Issuing Bank and the Swingline Lender, which approvals shall not be unreasonably withheld, conditioned or delayed, and (ii) (A) in the case of an Increasing Lender, the Borrower and such Increasing Lender execute an agreement substantially in the form of Exhibit E, and (B) in the case of an Augmenting Lender, the Borrower and such Augmenting Lender execute an agreement substantially in the form of Exhibit F hereto.
No existing Lender shall have any obligation or be required to provide any Commitment increase unless it expressly so agrees. No consent of any Lender (other than the Lenders participating in such Commitment increase) shall be required for any such increase pursuant to this Section 2.22.
(b) Commitment increases created pursuant to this Section 2.22 shall become effective on the date agreed by the Borrower, the Administrative Agent and the relevant Increasing Lenders or Augmenting Lenders, and the Administrative Agent shall notify each Lender thereof. Notwithstanding the foregoing, no increase in the Commitments (or in the Commitment of any Lender) shall become effective under this paragraph unless (i) on the proposed date of the effectiveness of such Commitment increase: (A) (1) the representations and warranties of the Loan Parties and their Subsidiaries set forth in this Agreement are true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representation or warranty to the extent that it is already qualified or modified by materiality in the text thereof) as of such date (except to the extent any such representation or warranty expressly relates to an earlier date, in which case, such representation or warranty shall be true and correct in all material respects as of such earlier date (except that such materiality qualifier shall not be applicable to any representation or warranty to the extent that it is already qualified or modified by materiality in the text thereof)); and (2) no Default or Event of Default exists on such date; and (B) the Borrower shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 6.10, recomputed (1) as if such Commitment increase (and the application of proceeds thereof to the repayment of any other Indebtedness) had occurred on the first (1st) day of the Test Period then most recently ended for which the Borrower has delivered Financial Statements (treating all such Commitment increases as fully drawn), and (2) with Consolidated EBITDA measured for the Test Period then most recently ended for which the Borrower has delivered Financial Statements; and (ii) solely to the extent the Borrower in its sole discretion have agreed to pay additional fees to the Administrative Agent or the Lenders in connection with such Commitment increase, the Borrower shall have paid to the Administrative Agent and the Lenders such fees; provided, however, that the conditions set forth in clauses (i) and (ii) shall be subject to Section 5.10.
(c) On the effective date of any increase in the Commitments, (i) to the extent applicable, each relevant Increasing Lender and Augmenting Lender shall make available to the Administrative Agent such amounts in immediately available funds as the Administrative Agent shall determine, for the benefit of the other Lenders, as being required in order to cause, after giving effect to such Commitment increase and the use of such amounts to make payments to such other Lenders, each Lender’s portion of the outstanding Loans of all the Lenders to equal its Applicable Percentage of such outstanding Loans and (ii) the Borrower shall be deemed to have repaid and reborrowed all outstanding Loans as of the date of any increase in the Commitments (with such reborrowing to consist of the Types of Loans, with related Interest Periods if applicable, specified in a notice delivered by the Borrower, in accordance with the requirements of Section 2.03). The deemed payments made pursuant to clause (ii) of the immediately preceding sentence shall be accompanied by payment of all accrued interest on the amount prepaid and, in respect of each Term Benchmark Loan, shall be subject to indemnification by the Borrower pursuant to the provisions of Section 2.16 if the deemed payment occurs other than on the last day of the related Interest Periods. The terms (including interest and fees) of any increase in the Commitments shall be the same to those of the existing Commitments.
(d) The Borrower and the Administrative Agent may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent, to effect the provisions of this Section 2.22. Nothing contained in this Section 2.22 shall constitute, or otherwise be deemed to be, a commitment on the part of any Lender to increase its Commitment hereunder at any time.
SECTION 2.23 Banking Services and Swap Agreements. Each Lender or Affiliate thereof providing Banking Services for, or having Swap Agreements with, any Loan Party or any Subsidiary shall
deliver to the Administrative Agent, promptly after entering into such Banking Services or Swap Agreements, written notice setting forth the aggregate amount of all Banking Services Obligations and Swap Agreement Obligations of such Loan Party or Subsidiary thereof to such Lender or Affiliate (whether matured or unmatured, absolute or contingent). In furtherance of that requirement, each such Lender or Affiliate thereof shall furnish the Administrative Agent, from time to time after a significant change therein or upon a request therefor, a summary of the amounts due or to become due in respect of such Banking Services Obligations and Swap Agreement Obligations. The most recent information provided to the Administrative Agent shall be used in determining which tier of the waterfall, contained in Section 2.18(b), such Banking Services Obligations and/or Swap Agreement Obligations will be placed. For the avoidance of doubt, so long as JPMorgan or its Affiliate is the Administrative Agent, neither JPMorgan nor any of its Affiliates providing Banking Services for, or having Swap Agreements with, any Loan Party shall be required to provide any notice described in this Section 2.23 (and shall be deemed to have provided notices for all such amounts due or to become due for purposes hereof) in respect of such Banking Services or Swap Agreements.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Borrower and each other Loan Party represents and warrants to the Lenders that:
SECTION 3.01 Organization; Powers. Each Loan Party and each Subsidiary is (a) duly organized or incorporated, validly existing and in good standing under the laws of the jurisdiction of its organization or incorporation, has all requisite power and authority to carry on its business as now conducted and (b) is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required, except (in the case of this clause (b)) where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.02 Authorization; Enforceability. The Transactions are within each Loan Party’s organizational or constitutional powers and have been duly authorized by all necessary organizational and, if required, stockholder or other equity holder action. Each Loan Document to which each Loan Party is a party has been duly executed and delivered by such Loan Party and constitutes a legal, valid and binding obligation of such Loan Party, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.
SECTION 3.03 Governmental Approvals; No Conflicts. The Transactions (i) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect, except for filings necessary to perfect Liens created pursuant to the Loan Documents and except as would not reasonably be expected to result in a Material Adverse Effect, (ii) will not violate in any respect any applicable law or regulation or the charter, by-laws or other organizational or constitutional documents of each Loan Party or any Subsidiaries or any order of any Governmental Authority except as would not reasonably be expected to result in a Material Adverse Effect, (iii) will not violate or result in a default under any indenture, agreement or other instrument binding upon each Loan Party or any Subsidiary or its assets, or give rise to a right thereunder to require any payment to be made by each Loan Party or any Subsidiary except as would not reasonably be expected to result in a Material Adverse Effect, and (iv) will not result in the creation or imposition of any Lien on any asset of any Loan Party or any Subsidiary (other than Liens created pursuant to or otherwise permitted under the Loan Documents).
SECTION 3.04 Financial Condition; No Material Adverse Change.
(a) The Borrower has heretofore furnished to the Lenders its (i) audited consolidated and balance sheet and statements of income, stockholders equity and cash flows of the Borrower and its Subsidiaries as of and for the fiscal years ended December 31, 2023 and December 31, 2024, reported on by its independent public accountants, (ii) unaudited consolidated balance sheet and related statements of operations, stockholders’ equity and cash flow as of the end of and for the fiscal quarter ended March 31, 2025 and the then elapsed portion of the fiscal year and (iii) reconciliations of the foregoing statements described in clauses (i) and (ii) excluding the impact of Starlab JV and its subsidiaries. Other than as described on Schedule 3.04, all such financial statements are prepared in accordance in all material respects with GAAP, subject to normal year-end audit adjustments and to any other adjustments described therein (including the notes thereto, if any) and present fairly, in all material respects, the financial position of the Borrower and its Subsidiaries as of such dates and the results of the operations and cash flows of the Borrower and its Subsidiaries for such periods.
(b) Since December 31, 2024, there has been no event, development or circumstance that, individually or in the aggregate, has had or would reasonably be expected to have a Material Adverse Effect.
SECTION 3.05 Properties; Intellectual Property.
(a) As of the date of this Agreement, Schedule 3.05 sets forth the address of each parcel of real property that is owned or leased by any Loan Party. Each of the Loan Parties and each Subsidiary has good title to, or valid leasehold interests in, all its real and personal property material to its business, except (x) for defects in title that do not interfere with its ability to conduct its business as conducted from time to time or to utilize such properties for their intended purposes and (y) to the extent encumbered by Liens permitted under the Loan Documents.
(b) A correct and complete list of all intellectual property owned by or exclusively licensed to any Loan Party or any Subsidiary that is registered or applied for with the United States Patent and Trademark Office, the United States Copyright Office or, solely with respect to any Loan Party or Domestic Subsidiary, any other similar government or administrative agency, as of the date of this Agreement, is set forth on Schedule 3.05, and each item is subsisting, unexpired, valid, enforceable and has not been abandoned or cancelled. Each Loan Party and each Subsidiary owns, or is licensed to use, free and clear of all Liens other than Permitted Liens, all Intellectual Property necessary and material to its business as currently conducted, and, to the knowledge of each Loan Party, the operation of their respective business by each Loan Party and each Subsidiary does not infringe upon, misappropriate or violate the rights of any other Person (and no proceeding is pending alleging same), and no Person is infringing, misappropriating or violating the Intellectual Property owned by such Loan Party or such Subsidiary, except for any such infringements, misappropriations or violations that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.06 Litigation and Environmental Matters.
(a) There are no actions, suits, proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of any Loan Party, threatened in writing against any Loan Party or any Subsidiary (i) as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, would reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect (other than the Disclosed Matters) or (ii) that involve any Loan Document or the Transactions.
(b) Except for the Disclosed Matters (i) no Loan Party nor any of its Subsidiaries has received written notice of any claim with respect to any Environmental Liability or knows of any basis for any such Environmental Liability, in each case, except as would not reasonably be expected to result in a Material
Adverse Effect and (ii) except with respect to any other matters that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, no Loan Party nor any of its Subsidiaries (1) has failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law or (2) has become subject to any Environmental Liability.
(c) Since the date of this Agreement, there has been no change in the status of the Disclosed Matters that, individually or in the aggregate, has resulted in, or materially increased the likelihood of, a Material Adverse Effect.
SECTION 3.07 Compliance with Laws and Agreements. Each Loan Party and each Subsidiary is in compliance with all laws, regulations and orders of any Governmental Authority applicable to it or its property and all indentures, agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.08 Investment Company Status. No Loan Party nor any Subsidiary is an “investment company” as defined in, or subject to regulation under, the Investment Company Act of 1940.
SECTION 3.09 Taxes. Each Loan Party and each Subsidiary has timely filed or caused to be filed all U.S. federal income and all other material Tax returns and reports required to have been filed and has paid or caused to be paid all material Taxes (including withholding Taxes) required to have been paid by it, except Taxes that are being contested in good faith by appropriate proceedings and for which such Loan Party or such Subsidiary has set aside on its books adequate reserves in accordance with GAAP. No claims or investigations are being or, to the knowledge of any Loan Party, reasonably likely to be, made or conducted against any Loan Party with respect to Taxes except as would not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.10 ERISA.
(a) No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect. The present value of all accumulated benefit obligations under each Plan (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the most recent financial statements reflecting such amounts, exceed the fair market value of the assets of such Plan.
(b) As of the Effective Date, the Borrower is not and will not be using “plan assets” (within the meaning of the Plan Asset Regulations) of one or more Benefit Plans in connection with the Loans, the Letters of Credit or the Commitments.
SECTION 3.11 Disclosure.
(a) No written information of a factual nature other than the projections, other forward-looking information and information of a general economic or industry specific nature furnished by or by a representative of the Loan Parties on behalf of the Loan Parties or any Subsidiary in connection with this Agreement or any other Loan Document (as modified or supplemented by other information so furnished) when taken as a whole contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, when taken as a whole, not materially misleading in light of the circumstances under which such statements are made; provided that, with respect to any projections, other forward-looking information and information
of a general economic or industry specific nature, the Loan Parties represent only that such projections, other forward-looking information and information of a general economic or industry specific nature were prepared in good faith based upon assumptions believed to be reasonable at the time delivered and, if such projections were delivered prior to the Effective Date, as of the Effective Date, it being recognized by Lenders that any such projections, other forward-looking information and information of a general economic or industry specific nature are subject to significant uncertainties and contingencies, many of which are beyond the Loan Parties’ control, that no assurance can be given that any particular projections will be realized and that actual results may differ and that such differences may be material and are not a guarantee of performance.
(b) As of the Effective Date, to the best knowledge of the Borrower, the information included in the Beneficial Ownership Certification provided on or prior to the Effective Date to any Lender in connection with this Agreement is true and correct in all respects.
SECTION 3.12 No Default. No Default or Event of Default exists or would result from the incurrence by the Borrower or any Subsidiary of any Obligations hereunder or under any other Loan Document.
SECTION 3.13 Solvency. The Loan Parties and their Subsidiaries, on a consolidated basis, are Solvent.
SECTION 3.14 Insurance. Schedule 3.14 sets forth a description of all insurance maintained by or on behalf of the Loan Parties as of the Effective Date. The Loan Parties believe that the insurance maintained by or on behalf of the Loan Parties and their Subsidiaries is adequate and customary for companies engaged in the same or similar businesses of similar size operating in the same or similar locations.
SECTION 3.15 Capitalization and Subsidiaries. As of the Effective Date, Schedule 3.15 is a complete list of each of the Borrower’s Subsidiaries and such Subsidiary’s jurisdiction of incorporation. All of the issued and outstanding Equity Interests owned by any Loan Party in each of its Subsidiaries have been (to the extent such concepts are relevant with respect to such ownership interests) duly authorized and issued and are fully paid and non-assessable.
SECTION 3.16 Security Interest in Collateral. The provisions of this Agreement and the other Loan Documents create legal, valid and enforceable (subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law) Liens on and security interests in, all the Collateral purported to be secured by the Collateral Documents in favor of the Administrative Agent, for the benefit of the Secured Parties, and (a) when all appropriate filings, notices or recordings are made in appropriate offices, corporate records or with the appropriate Persons as may be required under applicable laws and/or any Collateral Documents (which filings, notices or recordings shall be made to the extent required by any Collateral Document) and (b) upon the taking of possession or control by the Administrative Agent of such Collateral with respect to which a security interest may be perfected only by possession or control (which possession or control shall be given to the Administrative Agent to the extent required by any Collateral Document), such Liens will constitute perfected and continuing Liens on the Collateral, securing the Secured Obligations and having priority over all other Liens on the Collateral except (i) Permitted Liens to the extent any such Permitted Liens would have priority over the Liens in favor of the Administrative Agent pursuant to any applicable law, (ii) Liens perfected only by possession (including possession of any certificate of title), but only to the extent the Administrative Agent has not obtained or does not maintain possession of such Collateral and (iii) any other Liens not required to be perfected under the Loan Documents or by the Administrative Agent.
SECTION 3.17 Employment Matters. There are no strikes, lockouts or slowdowns against any Loan Party or any Subsidiary pending or, to the knowledge of any Loan Party, threatened in writing that could reasonably be expected to result in a Material Adverse Effect. The hours worked by and payments made to employees of the Loan Parties and their Subsidiaries have not been in violation of the Fair Labor Standards Act or any other applicable federal, state, local or foreign law dealing with such matters in a manner resulting in liabilities that could reasonably be expected to result in a Material Adverse Effect. All payments due from any Loan Party or any Subsidiary, or for which any claim may be made against any Loan Party or any Subsidiary, on account of wages and employee health and welfare insurance and other benefits, have been paid or accrued as a liability on the books of such Loan Party or such Subsidiary to the extent required by GAAP.
SECTION 3.18 Margin Regulations. No Loan Party is engaged and will not engage, principally or as one of its important activities, in the business of purchasing or carrying Margin Stock, or extending credit for the purpose of purchasing or carrying Margin Stock, and no part of the proceeds of any Borrowing and no Letter of Credit hereunder will be used to buy or carry any Margin Stock. Following the application of the proceeds of each Borrowing or drawing under each Letter of Credit, not more than 25% of the value of the assets (either of any Loan Party only or of the Loan Parties and their Subsidiaries on a consolidated basis) will be Margin Stock.
SECTION 3.19 Burdensome Restrictions. No Loan Party is subject to any Burdensome Restrictions except Burdensome Restrictions permitted under Section 6.09.
SECTION 3.20 Anti-Corruption and Anti-Terrorism Laws and Sanctions.
(a) Each Loan Party has implemented and maintains in effect policies and procedures designed to ensure compliance by such Loan Party, its Subsidiaries (including, for purposes of this clause (a), Starlab JV and its subsidiaries) and their respective directors, officers, employees and agents with Anti-Corruption Laws, Anti-Money Laundering Laws and applicable Sanctions, and such Loan Party, its Subsidiaries (including, for purposes of this clause (a), Starlab JV and its subsidiaries) and their respective officers, directors and employees and, to the knowledge of such Loan Party, its agents, are and have been in compliance with Anti-Corruption Laws, Anti-Money Laundering Laws and applicable Sanctions. None of (a) any Loan Party or any Subsidiary (including, for purposes of this clause (a), Starlab JV and its subsidiaries) or any of their Affiliates or any of their respective directors or officers or employees, or (b) to the knowledge of any such Loan Party or Subsidiary (including, for purposes of this clause (a), Starlab JV and its subsidiaries) or any of their Affiliates, any agent of such Loan Party or any Subsidiary (including, for purposes of this clause (a), Starlab JV and its subsidiaries) or any of their Affiliates that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person. No Borrowing or Letter of Credit, use of proceeds, Transaction or other transaction contemplated by this Agreement or the other Loan Documents will violate Anti-Corruption Laws, Anti-Money Laundering Laws or applicable Sanctions.
(b) Use of Proceeds. The proceeds of the Loans will be used only (i) to consummate the refinancing and replacement of the Hercules Debt, (ii) to pay fees, costs and expenses incurred in connection with the Transactions and (iii) for working capital and other general corporate purposes of the Borrower and the Subsidiaries (including the financing of Permitted Acquisitions, capital expenditures, Investments, Restricted Payments and the refinancing of Indebtedness, in each case, not prohibited by the Loan Documents).
SECTION 3.21 Federal Reserve Regulations. Neither the Borrower nor any Subsidiary is engaged principally, or as one of its important activities, in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying margin stock (as defined in Regulation U
of the Board), and no part of the proceeds of any Loan will be used, directly or indirectly, to buy or carry, or to extend credit to others to buy or carry, any margin stock or for any other purpose that entails a violation of any Regulations of the Board, including Regulations T, U and X.
SECTION 3.22 EEA Financial Institutions. No Loan Party is an Affected Financial Institution.
SECTION 3.23 Plan Assets; Prohibited Transactions. None of the Loan Parties or any of their Subsidiaries is an entity deemed to hold “plan assets” (within the meaning of the Plan Asset Regulations), and neither the execution, delivery nor performance of the transactions contemplated under this Agreement, including the making of any Loan and the issuance of any Letter of Credit hereunder, will give rise to a non-exempt prohibited transaction under Section 406(a) of ERISA or Section 4975(c)(1)(A), (B), (C) or (D) of the Code, assuming that none of the Lenders use “plan assets” (within the meaning of the Plan Asset Regulations) of one or more Benefit Plans in connection with the Loans or the Letters of Credit.
SECTION 3.24 Outbound Investment Rules. Neither the Borrower nor any of its Subsidiaries (including, for purposes hereof, Starlab JV and its subsidiaries) is a ‘covered foreign person’ as that term is used in the Outbound Investment Rules. Neither the Borrower nor any of its Subsidiaries (including, for purposes hereof, Starlab JV and its subsidiaries) currently engages, or has any present intention to engage in the future, directly or indirectly, in (i) a “covered activity” or a “covered transaction”, as each such term is defined in the Outbound Investment Rules, (ii) any activity or transaction that would constitute a “covered activity” or a “covered transaction”, as each such term is defined in the Outbound Investment Rules, if the Borrower were a U.S. Person or (iii) any other activity that would cause the Administrative Agent or any Lender to be in violation of the Outbound Investment Rules or cause the Administrative Agent or any Lender to be legally prohibited by the Outbound Investment Rules from performing under this Agreement.
ARTICLE IV
CONDITIONS
SECTION 4.01 Effective Date. The Agreement shall be effective and valid and binding on each party hereto on the date on which each of the following conditions is satisfied (or waived in accordance with Section 9.02):
(a) The Administrative Agent (or its counsel) shall have received from each party hereto (i) a counterpart of this Agreement signed on behalf of such party (which, subject to Section 9.06(b), may include any Electronic Signatures transmitted by email pdf. or any other electronic means that reproduces an image of an actual executed signature page) and (ii) duly executed copies of the other Loan Documents.
(b) The Administrative Agent (or its counsel) shall have received:
(i) subject to Section 5.13, from the Loan Parties executed counterparts of the Collateral Documents set forth on Schedule 4.01(b) to be entered into on and as of the Effective Date;
(ii) with respect to each Loan Party, UCC-1 financing statements in a form appropriate for filing in the state of organization of such Loan Party;
(iii) subject to Section 5.13, delivery of original stock or share certificates for certificated Equity Interests of each Subsidiary that constitutes Collateral, together with appropriate duly executed instruments of transfer endorsed in blank;
(iv) all promissory notes evidencing the Collateral accompanied by instruments of transfer endorsed in blank; and
(v) insurance certificates satisfying the requirements of Section 5.09.
(c) The Administrative Agent shall have received a favorable written opinion (addressed to the Administrative Agent and the Lenders and dated the Effective Date) of Morgan, Lewis & Bockius LLP, counsel for the Loan Parties, and Fennemore Craig, P.C., special Nevada counsel for the Loan Parties, and covering such other matters relating to the Loan Parties, this Agreement, the other Loan Documents, or the Transactions as the Administrative Agent shall reasonably request. The Borrower hereby requests such counsel to deliver such opinion.
(d) The Administrative Agent shall have received: (i) a copy of each organizational or constitutional document of each Loan Party and, to the extent applicable, certified as of a recent date by the appropriate governmental official; (ii) incumbency certificates of the officers of the Loan Parties executing the Loan Documents to which it is a party as of the Effective Date; (iii) resolutions of the board of directors (or, if applicable, shareholders) or similar governing body of each Loan Party approving and authorizing the execution, delivery and performance of this Agreement and the other Loan Documents to which such Loan Party is a party as of the Effective Date and certified as of the Effective Date by such Loan Party as being in full force and effect without modification or amendment; and (iv) a good standing certificate (to the extent such concept is known in the relevant jurisdiction) from the applicable Governmental Authority of each Loan Party’s respective jurisdiction of incorporation, organization or formation dated as of a recent date prior to the Effective Date.
(e) [Intentionally Omitted]
(f) The results of a recent lien search in the jurisdiction of organization of each Loan Party and its respective Subsidiaries and each jurisdiction where assets of each Loan Party and its respective Subsidiaries are located, and the results of search reports in respect of the Intellectual Property of each Loan Party and its Subsidiaries, and such search shall reveal no Liens on any of the assets of such Loan Parties and its Subsidiaries except for liens permitted by Section 6.02 or discharged on or prior to the Effective Date pursuant to a pay-off letter or other documentation reasonably satisfactory to the Administrative Agent;
(g) The Administrative Agent shall have received a Solvency Certificate.
(h) (A) The Administrative Agent shall have received at least five (5) days prior to the Effective Date, all documentation and other information with respect to the Borrower and the Guarantors required under applicable “know your customer” and anti-money laundering rules and regulations, including the USA Patriot Act, to the extent shall have reasonably requested in writing of the Borrower at least ten (10) days prior to the Effective Date and (B) to the extent the Borrower qualifies as a “legal entity customer” under the Beneficial Ownership Regulation, at least five (5) days prior to the Effective Date, any Lender that has requested, in a written notice to the Borrower at least ten (10) days prior to the Effective Date, a Beneficial Ownership Certification in relation to the Borrower shall have received such Beneficial Ownership Certification (provided that, upon the execution and delivery by such Lender of its signature page to this Agreement, the condition set forth in this clause (B) shall be deemed to be satisfied).
(i) The representations and warranties of the Borrower and each Loan Party set forth in this Agreement shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representation or warranty to the extent that it is already qualified or modified by materiality in the text thereof) on and as of such date (except to the extent any such representation or
warranty expressly relates to an earlier date, in which case, such representation or warranty shall be true and correct in all materials respects (or all respects, as applicable) as of such earlier date).
(j) No Default or Event of Default hereunder shall have occurred and be continuing.
(k) Since December 31, 2024, no Material Adverse Effect shall have occurred or exist, and there has been no event, development or circumstance that, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.
(l) The Administrative Agent shall have received a certificate of a Responsible Officer of the Borrower certifying that each of the conditions specified in paragraphs (i), (j) and (k) of this Section 4.01 has been satisfied.
(m) The Administrative Agent shall have received (i) the audited financial statements and the unaudited quarterly financial statements of the Borrower referred to in Section 3.04 and (ii) reasonably detailed financial projections of the Borrower and its Subsidiaries for its fiscal years ending December 31, 2025, December 31, 2026 and December 31, 2027.
(n) The Administrative Agent (or its counsel) shall have received executed counterparts of the Effective Date Intercreditor Agreement, entered into on and as of the Effective Date.
(o) Each document (including any Uniform Commercial Code financing statement or federal intellectual property filings) required by the Collateral Documents or under law or reasonably requested by the Administrative Agent to be filed, registered or recorded in order to create in favor of the Administrative Agent, for the benefit of the Secured Parties, a perfected Lien on the Collateral described therein, prior and superior in right to any other Person (other than with respect to Liens expressly permitted by Section 6.02), shall be in proper form for filing, registration or recordation.
SECTION 4.02 Commitment Effectiveness Date. The effectiveness of the Commitment of each Lender hereunder is subject to the satisfaction (or waiver in accordance with Section 9.02) of the following conditions:
(a) The Administrative Agent shall have received satisfactory evidence that (i) the IPO shall have been consummated, and (ii) the IPO Proceeds Condition shall have been satisfied.
(b) The Effective Date shall have occurred.
(c) The Outside Date shall not have occurred.
(d) The Administrative Agent shall have received all fees due and payable hereunder or under the Fee Letter on or prior to the Commitment Effectiveness Date, and, to the extent invoiced at least one (1) day prior to the Commitment Effectiveness Date, shall have been reimbursed, subject to Section 9.03(a), for all out of pocket expenses (including reasonable legal fees and expenses) required to be reimbursed or paid by the Borrower hereunder.
SECTION 4.03 Availability Date. The obligation of each Lender to make Loans hereunder (which obligation, for the avoidance of doubt, shall be subject to the additional conditions set forth in Section 4.04) shall not become effective until the first date (the “Availability Date”) on which each of the following conditions have been satisfied (or waived in accordance with Section 9.02):
(a) The Commitment Effectiveness Date shall have occurred.
(b) The Outside Date shall not have occurred.
(c) The representations and warranties of the Borrower and each Loan Party set forth in this Agreement shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representation or warranty to the extent that it is already qualified or modified by materiality in the text thereof) on and as of such date (except to the extent any such representation or warranty expressly relates to an earlier date, in which case, such representation or warranty shall be true and correct in all materials respects (or all respects, as applicable) as of such earlier date).
(d) No Default or Event of Default hereunder shall have occurred and be continuing.
(e) The Hercules Debt Repayment shall have been, or, substantially concurrently with the occurrence of the Availability Date, shall be, consummated.
(f) The Administrative Agent shall have received from a Responsible Officer of the Borrower (i) notice confirming that the Availability Date has occurred and (ii) a certificate certifying that each of the conditions specified in clauses (c), (d) and (e) of this Section 4.03 has been satisfied.
SECTION 4.04 Each Credit Event. The obligation of each Lender to make a Loan on the occasion of any Borrowing and of the Issuing Bank to issue, amend or extend any Letter of Credit, in each case, is subject to the satisfaction of each of the following conditions:
(a) The representations and warranties of the Borrower and each Loan Party set forth in this Agreement or the other Loan Documents shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representation or warranty to the extent that it is already qualified or modified by materiality in the text thereof) on and as of the date of such Borrowing or the date of issuance, amendment or extension of such Letter of Credit, as applicable (except to the extent any such representation or warranty expressly relates to an earlier date, in which case, such representation or warranty shall be true and correct in all material respects (or all respects, as applicable) as of such earlier date).
(b) At the time of and immediately after giving effect to such Borrowing or the issuance, amendment or extension of such Letter of Credit, as applicable, no Default or Event of Default shall have occurred and be continuing.
(c) The Administrative Agent shall have received a Borrowing Request meeting the requirements of Section 2.03.
Each Borrowing (provided that a conversion or a continuation of a Borrowing shall not constitute a “Borrowing” for purposes of this Section 4.04) and each issuance, amendment or extension of a Letter of Credit shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in paragraphs (a) and (b) of this Section 4.04.
ARTICLE V
AFFIRMATIVE COVENANTS
Until the Commitments have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall have been Paid in Full and all Letters of Credit shall have expired or terminated, in each case, without any pending draw, and all LC Disbursements shall have been reimbursed (or cash collateralized in accordance with the terms herein), the Borrower covenants and agrees with the Lenders that:
SECTION 5.01 Financial Statements and Other Information. The Borrower will furnish to the Administrative Agent (for prompt distribution to the Lenders):
(a) within one hundred twenty (120) days after the end of each fiscal year of the Borrower (commencing with the fiscal year ending December 31, 2025), its (i) audited consolidated balance sheet and related statements of operations, stockholders’ equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year, all reported on by independent public accountants of recognized national standing or any other accounting firm reasonably acceptable to the Administrative Agent (without a “going concern” or like qualification, commentary or exception and without any qualification or exception as to the scope of such audit other than a qualification resulting solely from an upcoming maturity date for the Loans occurring within one year from the time such opinion is delivered) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Borrower and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes and (ii) reconciliations of the foregoing statements excluding the impact of Starlab JV and its subsidiaries; provided that following the IPO, the financial statements required to be delivered under this clause (a) shall be permitted to be delivered within five (5) days after the date on which such financial statements are required to be filed by the Borrower or its Affiliates with the SEC;
(b) within forty-five (45) days after the end of each of the fiscal quarters of each fiscal year of the Borrower (commencing with the fiscal quarter ending June 30, 2025), its consolidated balance sheet, stockholders’ equity and related statements of operations and cash flows as of the end of and for such fiscal quarter and the then elapsed portion of such fiscal year, setting forth in each case in comparative form the figures as of the end of and for the corresponding period or periods of the previous fiscal year, all certified by a Financial Officer as presenting fairly in all material respects the financial condition and results of operations of the Borrower and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes and (ii) reconciliations of the foregoing statements excluding the impact of Starlab JV and its subsidiaries; provided that following the IPO, the financial statements required to be delivered under this clause (b) shall be permitted to be delivered within five (5) days after the date on which such financial statements are required to be filed by the Borrower or its Affiliates with the SEC (after giving effect to any permitted extensions);
(c) concurrently with any delivery of financial statements under clause (a) or (b) above, a Compliance Certificate of a Financial Officer of the Borrower (i) certifying as to whether a Default has occurred and, if a Default has occurred, specifying the details thereof and any action taken or proposed to be taken with respect thereto, (ii) setting forth reasonably detailed calculations demonstrating compliance with Section 6.10 and (iii) setting forth the information required under the Security Agreement;
(d) promptly following its presentation to the Borrower’s Board of Directors, but in any event no later than ninety (90) days after the end of each fiscal year of the Borrower and its Subsidiaries, (i) a consolidated budget for the following fiscal year in each case in the form normally prepared and presented to management and (ii) a narrative report containing management’s discussion and analysis of the financial position and financial performance for such fiscal year in reasonable form and detail;
(e) promptly following any request therefor, such other information regarding the operations, business affairs and financial condition of the Borrower or any Subsidiary (including, for purposes of this clause (e), Starlab JV and its subsidiaries), or compliance with the terms of any Loan Document, as the Administrative Agent (or any Lender through the Administrative Agent) may reasonably request and to the extent reasonably available to the Borrower; provided, none of the Borrower or any Subsidiary will be required to disclose or deliver information (i) in respect of which disclosure to the Administrative Agent or
any Lender (or their respective representatives or contractors) is prohibited by any law or regulation, any fiduciary duty or by any binding agreement, (ii) that constitutes trade secrets or (iii) that is subject to attorney-client privilege or constitutes attorney work product;
(f) promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed by the Borrower or any Subsidiary (including, for purposes of this clause (f), Starlab JV and its subsidiaries) with the SEC or any Governmental Authority succeeding to any or all of the functions of said commission or with any national securities exchange, or distributed by the Borrower to its shareholders generally, as the case may be;
(g) promptly after receipt thereof by the Borrower or any Subsidiary, copies of each notice or other correspondence received from the SEC (or comparable agency in any applicable non-U.S. jurisdiction) concerning any investigation or possible investigation or other inquiry by the SEC or such other agency regarding financial or other operational results of the Borrower or any Subsidiary thereof;
(h) promptly following any request therefor, information and documentation reasonably requested by the Administrative Agent or any Lender for purposes of compliance with applicable “know your customer” and anti-money laundering rules and regulations, including the USA Patriot Act and the Beneficial Ownership Regulation, as applicable.
Documents required to be delivered pursuant to Section 5.01(a), (b) or (f) (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and, if so delivered, shall be deemed to have been delivered on the date (i) on which such materials are publicly available as posted on the Electronic Data Gathering, Analysis and Retrieval system (EDGAR); or (ii) on which such documents are posted on the Borrower’s behalf on an Internet or intranet website made available by the Administrative Agent to which each Lender has access.
SECTION 5.02 Notices of Material Events. The Borrower will furnish to the Administrative Agent (for prompt distribution to the Lenders) prompt written notice of the following:
(a) promptly upon becoming aware of the existence of any condition or event that constitutes a Default or Event of Default, written notice thereof specifying the nature and duration, thereof and the action being or proposed to be taken with respect thereto;
(b) promptly upon becoming aware of any litigation or of any investigative proceedings by a Governmental Authority commenced or threatened in writing against the Borrower or any of its Subsidiaries (including, for purposes of this clause (b), Starlab JV and its subsidiaries) of which they have notice, the outcome of which, if adversely determined, could reasonably be expected to have a Material Adverse Effect on the Borrower and its Subsidiaries (including, for purposes of this clause (b), Starlab JV and its subsidiaries) on a consolidated basis, written notice thereof and the action being or proposed to be taken with respect thereto;
(c) promptly upon becoming aware of the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, could reasonably be expected to result in liability of the Borrower and its Subsidiaries (including, for purposes of this clause (c), Starlab JV and its subsidiaries) in an aggregate amount exceeding the Threshold Amount;
(d) promptly upon becoming aware of the existence of any casualty or other insured damage to any portion of the Collateral with a value in excess of the Threshold Amount or the commencement of any action or proceeding for the taking of any portion of the Collateral in excess of the Threshold Amount or interest therein under power of eminent domain or by condemnation or similar proceeding;
(e) promptly after any occurrence or after becoming aware of any condition affecting the Borrower or any Subsidiary (including, for purposes of this clause (e), Starlab JV and its subsidiaries) that results in, or would reasonably be expected to result in, a Material Adverse Effect; and
(f) any change in the information provided in the Beneficial Ownership Certification delivered to such Lender that would result in a change to the list of beneficial owners identified in such certification.
Each notice delivered under this Section 5.02 (i) shall be in writing, (ii) shall contain a heading or a reference line that reads “Notice under Section 5.02 of Voyager Technologies, Inc. Credit Agreement dated May 30, 2025” and (iii) shall be accompanied by a statement of a Financial Officer or other executive officer of the Borrower setting forth the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.
SECTION 5.03 Existence; Conduct of Business. Each Loan Party will, and will cause each Subsidiary to, do or cause to be done all things reasonably necessary to preserve, renew and keep in full force and effect its legal existence and the rights, qualifications, licenses, permits, franchises, governmental authorizations, intellectual property rights, licenses and permits material to the conduct of the Borrower’s business when taken as a whole, and maintain all requisite authority to conduct its business in each jurisdiction in which its business is conducted, except, in each case, where failure to maintain such requisite authority or failure to maintain such right, qualification, license, permit, franchise, governmental authorization, intellectual property right, license or permit would not reasonably be expected to result in a Material Adverse Effect; provided that the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under Section 6.03.
SECTION 5.04 Payment of Obligations. Each Loan Party will, and will cause each Subsidiary to, pay or discharge all U.S. federal and all other material Taxes (which may, for the avoidance of doubt, be effected through the payment of a Tax Distribution), before the same shall become delinquent or in default (taking into account applicable grace periods), except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) such Loan Party or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (c) the failure to make payment pending such contest could not reasonably be expected to result in a Material Adverse Effect; provided, that each Loan Party will, and will cause each Subsidiary to, remit material withholding Taxes and other payroll Taxes to appropriate Governmental Authorities as and when due and payable, notwithstanding the foregoing exceptions.
SECTION 5.05 Maintenance of Properties. Each Loan Party will, and will cause each Subsidiary to, keep and maintain all property, including Intellectual Property, material to the conduct of its business in good working order and condition, ordinary wear and tear and damage by fire or other casualty excepted.
SECTION 5.06 Books and Records; Inspection Rights. Each Loan Party will, and will cause each Subsidiary to, (a) keep proper books of record and account in which true and complete entries in all material respects in accordance with GAAP will be made reflecting all of its and its Subsidiaries business and financial transactions; provided that, it being understood and agreed that Foreign Subsidiaries may maintain individual books and records in conformity with generally accepted accounting principles that are applicable in their respective jurisdiction of organization, and (b) permit any representatives designated by the Administrative Agent on behalf of the Lenders (including employees of the Administrative Agent, any Lender or any consultants, accountants, lawyers, agents and appraisers retained by the Administrative Agent, in each case, who have signed a non-disclosure agreement in form and substance reasonably satisfactory to the Borrower), upon reasonable prior written notice, to visit and inspect its properties, to examine and make copies from its books and records, including to discuss its affairs, finances and condition
with its officers, all at such reasonable times during Borrower’s normal business hours; provided, however, that so long as no Event of Default has occurred and is continuing, such visits shall be limited to no more than once per fiscal year. The Loan Parties acknowledge that the Administrative Agent, after exercising its rights of inspection, may prepare and distribute to the Lenders certain reports pertaining to the Loan Parties’ assets for internal use by the Administrative Agent and the Lenders. In the absence of a continuing Event of Default only one (1) such examination in any period of twelve (12) consecutive calendar months shall be conducted (as coordinated by the Administrative Agent) and shall be at the Borrower’s expense, and during the continuance of an Event of Default all such examinations shall be at the Borrower’s expense (and may occur with greater frequency); provided, that any and all expenses incurred by a Lender pursuant to this Section 5.06 in the absence of a continuing Event of Default shall be solely at such Lender’s expense and Borrower shall have no obligation to reimburse any such Lender’s expenses. Notwithstanding anything to the contrary in this Section 5.06, no Borrower nor any Subsidiary will be required to disclose, permit the inspection, examination or making copies of abstracts of, or discussion of, any document, information or other matter (i) in respect of which disclosure to the Administrative Agent or any Lender (or their respective representatives or contractors) is prohibited by any law or regulation or by any binding agreement or (ii) that is subject to attorney-client privilege or constitutes attorney work product.
SECTION 5.07 Compliance with Laws and Material Contractual Obligations. Each Loan Party will, and will cause each of its Subsidiaries to, (i) comply with all material laws, rules, regulations and orders of any Governmental Authority applicable to it or its property (including without limitation Environmental Laws) and (ii) perform in all material respects its obligations under Material Agreements to which it is a party, except, in each case, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. Each Loan Party will maintain in effect and enforce policies and procedures designed to ensure compliance in all material respects by Loan Party, its Subsidiaries (including, for purposes hereof, Starlab JV and its subsidiaries) and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions.
SECTION 5.08 Use of Proceeds and Letters of Credit. The proceeds of the Loans will be used only for purposes permitted under Section 3.20(b). No part of the proceeds of any Loan will be used, whether directly or indirectly, to buy or carry, or to extend credit to others to buy or carry, any Margin Stock or for any other purpose that entails a violation of any of the Regulations of the Board, including Regulations T, U and X. All Letters of Credit will be issued only to support general corporate purposes of the Borrower and its Subsidiaries. The Borrower will not request any Borrowing or Letter of Credit, and the Borrower shall not use, and shall procure that its Subsidiaries and its or their respective directors, officers, employees and agents shall not use the proceeds of any Borrowing or use any Letter of Credit (a) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws, (b) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, except to the extent permitted for a Person required to comply with Sanctions, or (c) in any manner that would result in the violation of any Anti-Money Laundering Laws or Sanctions applicable to any party hereto.
SECTION 5.09 Insurance. Each Loan Party will, and will cause each Subsidiary to, maintain with financially sound and reputable carriers (a) insurance in such amounts (with no greater risk retention) and against such risks and such other hazards, as the senior officers of the Borrower in the exercise of their reasonable judgment deem to be adequate, as are customary in the industry for companies of established reputation engaged in the same or similar business in the same or similar locations and owning or operating similar properties and shall be reasonably satisfactory to the Administrative Agent (it being agreed that insurance that is substantially similar to that in effect on the Effective Date is reasonably satisfactory to the Administrative Agent), and (b) all insurance required pursuant to the Collateral Documents. The Borrower will furnish to the Administrative Agent, upon reasonable request of the Administrative Agent, information
in reasonable detail as to the insurance so maintained. The Borrower shall deliver, within ninety (90) days (or such later date as may be agreed by the Administrative Agent, in its reasonable discretion) after the Effective Date, to the Administrative Agent endorsements (x) to all property or casualty insurance policies covering Collateral naming the Administrative Agent as lender loss payee, (y) to all general liability and other liability policies naming the Administrative Agent an additional insured, which endorsements shall be in effect at all times and (z) providing that thirty (30) days’ advance notice will be given to Administrative Agent prior to any cancellation or non-renewal of such policy (or ten (10) days’ advance notice prior to any such cancellation due to non-payment of premium). In the event the Borrower or any Subsidiary at any time hereafter shall fail to obtain or maintain any of the policies or insurance required herein or to pay any premium in whole or in part relating thereto, then the Administrative Agent, without waiving or releasing any obligations or resulting Default hereunder, may at any time or times thereafter (but shall be under no obligation to do so), in consultation with the Borrower, obtain and maintain such policies of insurance and pay such premiums and take any other action with respect thereto which the Administrative Agent reasonably deems advisable to ensure compliance under this Section 5.09. All sums so disbursed by the Administrative Agent shall constitute part of the Obligations, payable as provided in this Agreement. No later than ninety (90) days (or such later date as may be agreed by the Administrative Agent, in its reasonable discretion) after the Effective Date (or the date any such insurance is obtained, renewed or extended in the case of insurance obtained, renewed or extended after the Effective Date), the Borrower will cause all property and casualty insurance policies with respect to Collateral to be endorsed or otherwise amended to include a lender’s loss payable, mortgagee or additional insured, as applicable, endorsement, or otherwise reasonably satisfactory to the Administrative Agent.
SECTION 5.10 Additional Subsidiaries. In the event (i) the Borrower acquires or creates any Subsidiary (other than an Excluded Subsidiary) or (ii) any Excluded Subsidiary ceases to be an Excluded Subsidiary after the Effective Date, the Borrower shall forthwith promptly (and in any event within sixty (60) days (or such longer time as the Administrative Agent may agree in its reasonable discretion) after the acquisition or creation of such Subsidiary, or change in such Subsidiary’s status as an Excluded Subsidiary) cause such Subsidiary to become a Guarantor by delivering to the Administrative Agent (x) a Joinder Agreement, duly executed by such Subsidiary, pursuant to which such Subsidiary agrees to be bound by the terms and provisions of this Agreement, and (y) such joinders or supplements to the Security Agreement and/or the other relevant Collateral Documents and such other documents as the Administrative Agent shall deem necessary or advisable to perfect the Lien in any property of such Subsidiary which constitutes Collateral in accordance with all applicable Requirements of Law, including the filing of financing statements in such jurisdictions as may be reasonably requested by the Administrative Agent and such joinders to be accompanied by appropriate corporate resolutions, other corporate organizational documentation and customary legal opinions upon the reasonable request of the Administrative Agent in form and substance reasonably satisfactory to the Administrative Agent and its counsel.
SECTION 5.11 Additional Collateral; Further Assurances.
(a) The Borrower will, and each Subsidiary (other than an Excluded Subsidiary) will, cause (i) all of its personal property (whether tangible, intangible or mixed, subject to the exceptions expressly contained in the Security Agreement), (ii) [intentionally omitted] and (iii) all outstanding equity interests of the Borrower’s Subsidiaries (limited to 65% of the equity interests of any Foreign Subsidiary Holding Company or any CFC (a) to the extent a pledge of a greater percentage could reasonably be expected to result in adverse tax consequences and (b) so long as the Lenders’ ability to be repaid in full will not be impaired), to be subject at all times to first priority, perfected Liens in favor of the Administrative Agent for the benefit of the Secured Parties to secure the Secured Obligations in accordance with the terms and conditions of the Collateral Documents, subject in any case to Liens permitted by Section 6.02.
(b) Without limiting the foregoing, the Borrower will, and will cause each Subsidiary (other than an Excluded Subsidiary) to, execute and deliver, or cause to be executed and delivered, to the Administrative Agent such documents, agreements and instruments, and will take or cause to be taken such further actions (including the filing and recording of financing statements and other documents and such other actions or deliveries of the type required by Section 4.01, as applicable), which may be required by law or which the Administrative Agent may, from time to time, reasonably request to carry out the terms and conditions of this Agreement and the other Loan Documents and to ensure perfection and priority of the Liens created or intended to be created by the Collateral Documents (and subject to the exceptions set forth therein), all in form and substance reasonably satisfactory to the Administrative Agent.
(c) [Intentionally omitted].
(d) Notwithstanding the foregoing, under no circumstance will any Loan Party be required to execute any Collateral Documents governed by the laws of any jurisdiction other than the United States.
SECTION 5.12 Accuracy of Information. The Borrower will ensure that any written information of a factual nature other than the projections, other forward-looking information and information of a general economic or industry specific nature furnished by it or by a representative of the Borrower on behalf of the Borrower or any Subsidiaries in connection with this Agreement or any other Loan Document (as modified or supplemented by other information so furnished) when taken as a whole does not contain any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, when taken as a whole, not materially misleading in light of the circumstances under which such statements are made; provided, that with respect to any projections, the Borrower covenants only that it will cause the projections to be prepared in good faith based upon assumptions believed by the Borrower to be reasonable at the time made, it being recognized by Lenders that such projections as to future events are not to be viewed as facts, are subject to significant uncertainties and contingencies, many of which are beyond the Loan Parties’ control, that no assurance can be given that any particular projections will be realized and that actual results during the period or periods covered by any such projections may differ materially from the projected results.
SECTION 5.13 Post-Effective Date Covenant. The Borrower agrees to deliver, or cause to be delivered (or to use commercially reasonable efforts to deliver or cause to be delivered, to the extent applicable and specified on Schedule 5.13), to the Administrative Agent, the items described on Schedule 5.13 hereof on or before the dates specified with respect to such items, or such later dates as may be agreed to by the Administrative Agent in its reasonable discretion.
SECTION 5.14 Depository Banks. The Borrower shall maintain JPMorgan as its primary banking partner pursuant to, and in accordance with, the terms of the JPM Side Letter.
SECTION 5.15 Compliance with Data Protection Regulations. Each Loan Party and each of its Subsidiaries shall (i) operate their respective businesses in a manner compliant in all material respects with all privacy, data security and data protection laws and regulations applicable to each Loan Party’s and its Subsidiaries’ receipt, collection, handling, processing, sharing, transfer, usage, disclosure or storage of all information that relates to an identified or identifiable individual (“Personal Data”), (ii) maintain its compliance with policies and procedures designed to ensure the privacy, integrity, security and confidentiality of all Personal Data handled, processed, collected, shared, transferred, used, disclosed and/or stored by each Loan Party or its Subsidiaries in connection with each Loan Party’s and its Subsidiaries’ operation of their respective businesses, (iii) maintain compliance with policies and procedures designed to ensure privacy and data protection laws are complied with and (iv) require all third parties to which they provide any Personal Data to maintain the privacy and security of such Personal Data, except, in each case,
where the failure to so comply would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on the Loan Parties and their Subsidiaries, taken as a whole.
SECTION 5.16 Cash Management. The Borrower shall, and shall cause each Loan Party to, within 120 days after the Effective Date (or such later date as the Administrative Agent may reasonably agree) (the period commencing on the Effective Date and ending on such date, the “Control Account Agreement Period”), use commercially reasonable efforts to enter into a Control Account Agreement with the Administrative Agent and each bank or other financial institution with which the Borrower or any Loan Party maintains a deposit account or securities account (other than (i) any account in which the aggregate average daily maximum balance over a 30-day period does not at any time exceed (x) $500,000 for any single deposit account or securities account or (y) $2,000,000 in the aggregate for all such accounts, (ii) zero-balance accounts solely for the purpose of managing local disbursements, payroll and withholding, (iii) Fiduciary Accounts and (iv) accounts solely holding cash collateral that is subject of a deposit or pledge constituting a Lien securing obligations other than the Secured Obligations, which Lien is expressly permitted hereunder (collectively, the accounts described in clauses (i) through (iv) above, the “Unrestricted Accounts”)) (each, a “Controlled Account”). In addition, each Loan Party shall use commercially reasonable efforts to enter into a Control Account Agreement with respect to any new deposit account or securities account (other than any Unrestricted Account), in each case within 120 days (or such longer period as the Administrative Agent may reasonably agree) after such account is established. Each Controlled Account shall be a cash collateral account, with all cash, Permitted Investments, checks and other similar items of payment in such account securing payment of the Secured Obligations, in which the applicable Loan Party shall have granted a first priority Lien to the Administrative Agent, on behalf of the Secured Parties. If any Default or Event of Default has occurred and is continuing, the Administrative Agent may in its reasonable discretion, and is hereby authorized to, cause the applicable depositary bank or securities intermediary to honor the instructions of the Administrative Agent with respect to any Controlled Account in accordance with the terms of the applicable Control Account Agreement.
ARTICLE VI
NEGATIVE COVENANTS
Until the Commitments have expired or terminated and the principal of and interest on each Loan and all fees payable hereunder have been Paid in Full and all Letters of Credit have expired or terminated, in each case, without any pending draw, and all LC Disbursements shall have been reimbursed (or cash collateralized or backstopped in accordance with the terms herein), the Borrower covenants and agrees with the Lenders that:
SECTION 6.01 Indebtedness. No Loan Party will, nor will any Loan Party permit any of its respective Subsidiaries to, create, incur assume or suffer to exist any Indebtedness, except:
(a) the Secured Obligations;
(b) Indebtedness existing on the date hereof and set forth in Schedule 6.01 and any extensions, renewals, refinancings and replacements of any such Indebtedness in accordance with clause (t) hereof;
(c) Indebtedness of the Borrower to any Subsidiary and of any Subsidiary to the Borrower or any other Subsidiary, provided that (i) Indebtedness of any Subsidiary that is not a Loan Party to the Borrower or any other Loan Party shall be subject to Section 6.04, and (ii) Indebtedness of any Loan Party to any Subsidiary that is not a Loan Party shall be subordinated to the Obligations on terms reasonably satisfactory to the Administrative Agent (it being understood that the subordination terms of the Intercompany Note are satisfactory to the Administrative Agent);
(d) Guarantees by a Loan Party of Indebtedness or other obligations of any other Loan Party and by any Subsidiary that is not a Loan Party of Indebtedness of any Loan Party or any other Subsidiary;
(e) Indebtedness of any Loan Party or Subsidiary incurred to finance the acquisition, construction or improvement of any fixed or capital assets, including Capital Lease Obligations and any Indebtedness assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof, and amendments, modifications, extensions, refinancings, renewals and replacements of any such Indebtedness; provided that (i) such Indebtedness is incurred prior to or within one hundred eighty (180) days after such acquisition or the completion of such construction or improvement and (ii) the aggregate outstanding principal amount of Indebtedness at any time outstanding permitted by this clause (e) shall not exceed $10,000,000;
(f) Indebtedness of a Loan Party or any Subsidiary as an account party in respect of commercial letters of credit;
(g) Indebtedness of any Foreign Subsidiary that is not a Loan Party; provided that the aggregate outstanding principal amount of Indebtedness permitted by this clause (g) shall not exceed $5,000,000 at any time outstanding
(h) Indebtedness owed to any Person providing workers’ compensation, health, disability or other employee benefits or property, casualty or liability insurance, pursuant to reimbursement or indemnification obligations to such Person, in each case incurred in the ordinary course of business or existing on the Effective Date;
(i) Indebtedness representing deferred compensation, severance, pension, and health and welfare retirement benefits or the equivalent to current and former employees of any Loan Party and its Subsidiaries incurred in the ordinary course of business or existing on the Effective Date;
(j) Indebtedness of any Loan Party in respect of performance bonds, bid bonds, appeal bonds, surety bonds and similar obligations, in each case provided in the ordinary course of business, not to exceed $2,500,000 at any one time outstanding;
(k) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business;
(l) Indebtedness arising out of judgments or awards under circumstances not giving rise to an Event of Default;
(m) additional Indebtedness of the Borrower or any of its Subsidiaries in an aggregate principal amount (for the Borrower and all Subsidiaries) not to exceed (x) $10,000,000 or (y) solely to the extent that Liquidity immediately prior to the incurrence of such Indebtedness and after giving pro forma effect to the incurrence of such Indebtedness is equal to or greater than $300,000,000, $25,000,000 at any one time outstanding;
(n) (x) Subordinated Indebtedness and (y) Junior Lien Indebtedness in an aggregate principal amount for all such Junior Lien Indebtedness at any time outstanding, not to exceed, together with amounts incurred under clause (v) below, $20,000,000; provided that (i) in each case in this clause (n), (A) such Indebtedness shall have a stated final maturity that is no earlier than 91 days after the Latest Maturity Date and (B) such Indebtedness shall be subject to an Acceptable Subordination or Intercreditor Agreement and (ii) solely with respect to Junior Lien Indebtedness, (x) no Subsidiary that is not a Loan Party shall have
Guarantee obligations with respect to obligations of the borrower thereunder and (y) such Indebtedness shall not be secured by a Lien on any asset that does not constitute Collateral;
(o) Indebtedness of any Loan Party constituting charge backs in the ordinary course to a Subsidiary that is not a Loan Party so long as such Loan Party does not repay any such Indebtedness until the Commitments have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall have been paid in full and all Letters of Credit shall have expired or terminated, in each case, without any pending draw, or shall have been cash collateralized in accordance with Section 2.06(j), and all LC Disbursements shall have been reimbursed;
(p) Indebtedness of any Person that becomes a Subsidiary after the Effective Date; provided that (i) such Indebtedness exists at the time such Person becomes a Subsidiary and is not created in contemplation of or in connection with such Person becoming a Subsidiary and (ii) the aggregate principal amount of Indebtedness permitted by this clause (p) shall not exceed $10,000,000 at any time outstanding;
(q) Indebtedness incurred by the Borrower or its Subsidiaries arising from agreements providing for indemnification, adjustment of purchase price, working capital or similar obligations (including customary earn-outs, and any other deferred payments of a similar nature incurred in connection with any investment by any Subsidiary), in each case, whether or not evidenced by a note, and incurred or assumed in connection with any Permitted Acquisition or any asset sale permitted under the this Agreement or Investment permitted under the this Agreement;
(r) Indebtedness in respect of treasury, depositary, cash management and netting services, automatic clearing house arrangements, overdraft protections and other financial accommodations of the nature described in the definition of “Banking Services” and otherwise in connection with securities accounts, deposit accounts and employees’ credit or purchase cards, in each case incurred in the ordinary course of business;
(s) Indebtedness consisting of promissory notes issued to current or former officers, directors and employees of the Borrower or any Subsidiary, their respective estates, spouses or former spouses issued in exchange for the purchase or redemption by the Borrower or such Subsidiary of its Equity Interests to the extent permitted by Section 6.07(a);
(t) Indebtedness which represents extensions, renewals, refinancing or replacements (such new Indebtedness being referred to herein as the “Refinance Indebtedness”) of any of the Indebtedness described in clauses (b), (e), (g), (m), (n), (p), and (v) hereof (such Indebtedness being referred to herein as the “Original Indebtedness”); provided that (i) such Refinance Indebtedness does not increase the principal amount of the Original Indebtedness, other than in respect of any fees, costs and premiums incurred in connection therewith, (ii) any Liens securing such Refinance Indebtedness are not extended to any additional property of any Loan Party or any Subsidiary unless such Lien is otherwise permitted by this Agreement, (iii) no Loan Party or any Subsidiary that is not originally obligated with respect to repayment of such Original Indebtedness shall become obligated with respect to such Refinance Indebtedness, (iv) such Refinance Indebtedness does not result in a shortening of the average weighted maturity of such Original Indebtedness, (v) the non-economic terms of such Refinance Indebtedness are not materially less favorable to the obligor thereunder than the original terms of such Original Indebtedness as reasonably determined in good faith by any Loan Party or any Subsidiary, (vi) if such Original Indebtedness was subordinated in right of payment or security to the Secured Obligations, then the terms and conditions of such Refinance Indebtedness must include subordination terms and conditions that are at least as favorable to the Administrative Agent and the Lenders as those that were applicable to such Original Indebtedness and (vii) the Original Indebtedness shall be deemed to remain outstanding for purposes of determining capacity under clauses (b), (e), (g), (m), (n), (p), and/or (v), as applicable, of this Section 6.01;
(u) Indebtedness incurred pursuant to the issuance of senior unsecured notes by the Borrower in an aggregate principal amount not to exceed $100,000,000; provided that such unsecured Indebtedness shall have a stated final maturity that is no earlier than 91 days after the Latest Maturity Date;
(v) unsecured Indebtedness in an aggregate principal amount at any time outstanding not to exceed, together with Indebtedness incurred under clause (n)(y) above, $20,000,000; provided that such unsecured Indebtedness shall have a stated final maturity that is no earlier than 91 days after the Latest Maturity Date; and
(w) prior to the Availability Date, the Hercules Debt.
SECTION 6.02 Liens. No Loan Party will, nor will any Loan Party permit any of its respective Subsidiaries to, create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it, except Permitted Liens; provided that, notwithstanding anything to the contrary in this Agreement, no Loan Party will, nor will any Loan Party permit any of its respective Subsidiaries to, create, incur, assume or permit to exist any Lien on the Starlab JV Equity or the Starlab JV Equity Proceeds, except to the extent such Liens constitute (i) Permitted Liens pursuant to clauses (a) or (z) under the definition of thereof or (ii) non-consensual Liens arising solely by operation of law.
SECTION 6.03 Fundamental Changes.
(a) No Loan Party will, nor will any Loan Party permit its respective Subsidiaries to, merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or otherwise Dispose of all or substantially all of its assets, or all or substantially all of the stock of any of its respective Subsidiaries (in each case, whether now owned or hereafter acquired), or liquidate, divide or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing:
(i) any Subsidiary may merge into or liquidate or dissolve into, or consolidate with a Loan Party in a transaction in which such Loan Party is the surviving entity;
(ii) any Loan Party may merge into or liquidate or dissolve into, or consolidate with any other Loan Party in a transaction in which the surviving entity is a Loan Party (provided that any such merger involving the Borrower must result in the Borrower as the surviving entity); and
(iii) any Subsidiary that is not a Loan Party may liquidate, divide or dissolve if the Borrower determines in good faith that such liquidation, division or dissolution is in the best interests of the Borrower and is not materially disadvantageous to the Lenders; provided that any such merger involving a Person that is not a wholly owned Subsidiary immediately prior to such merger shall not be permitted unless also permitted by Section 6.04.
(b) No Loan Party will, nor will any Loan Party permit its respective Subsidiaries to, consummate a Division as the Dividing Person, without the prior written consent of the Administrative Agent. Without limiting the foregoing, if any Loan Party that is a limited liability company consummates a Division (with or without the prior consent of the Administrative Agent as required above), each Division Successor shall be required to comply with the obligations set forth in Section 5.10 and the other further assurances obligations set forth in the Loan Documents and become a Loan Party under this Agreement and the other Loan Documents.
(c) No Loan Party will, nor will any Loan Party permit its respective Subsidiaries to, engage to any material extent in any business other than businesses of the type engaged in by the Borrower and its
Subsidiaries on the date hereof and businesses reasonably related thereto or ancillary thereto or similar or complementary thereto or reasonable extensions thereof (and non-core incidental businesses acquired in connection with any Permitted Acquisition or other permitted Investment).
SECTION 6.04 Investments, Loans, Advances, Guarantees and Acquisitions. No Loan Party will, nor will any Loan Party permit its respective Subsidiaries to, purchase, hold or acquire (including pursuant to any merger with any Person that was not a Loan Party and a wholly owned Subsidiary prior to such merger) any Equity Interests, evidences of indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make or permit to exist any loans or advances to, Guarantee any obligations of, or make or permit to exist any investment or any other interest in, any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person constituting a business unit, division, product line or line of business of such Person (whether through purchase of assets, merger or otherwise), except:
(a) Permitted Investments, subject to control agreements in favor of the Administrative Agent or otherwise subject to a perfected security interest in favor of the Administrative Agent to the extent required under this Agreement;
(b) investments in existence on the date hereof and described in Schedule 6.04 and any extensions or amendments thereto not increasing the principal or capital amount thereof;
(c) investments by the Borrower and the Subsidiaries in Equity Interests in, or capital or asset contributions to, their respective Subsidiaries, provided that (i) any such Equity Interests held by a Loan Party (other than Equity Interests in Immaterial Subsidiaries) shall be pledged pursuant to the relevant Collateral Documents and (ii) the aggregate amount of investments made pursuant to this clause (c) by Loan Parties in Persons that are not Loan Parties shall not exceed, when taken together with investments by Loan Parties in Persons that are not Loan Parties incurred pursuant to Sections 6.04(d), (k) and (m), the Non-Loan Party Sublimit (in each case determined without regard to any write-downs or write-offs);
(d) additional investments, loans or advances made by any Loan Party to any Subsidiary and made by any Subsidiary to a Loan Party or any other Subsidiary, provided that (i) any such loans and advances made by a Loan Party shall be evidenced by a promissory note pledged pursuant to the relevant Collateral Documents and (ii) the amount of such investments, loans and advances made pursuant to this clause (d) by Loan Parties to Subsidiaries that are not Loan Parties shall not exceed, when taken together with investments and Guarantees by Loan Parties in Persons that are not Loan Parties incurred pursuant to Sections 6.04(c), (k) and (m), the Non-Loan Party Sublimit at any time outstanding (in each case determined without regard to any write-downs or write-offs);
(e) loans or advances made by a Loan Party to its officers, directors or employees on an arms-length basis in the ordinary course of business consistent with past practices for travel and entertainment or education expenses, relocation costs and similar purposes up to a maximum of $2,000,000 in the aggregate at any one time outstanding;
(f) notes payable, or stock or other securities issued by Account Debtors to a Loan Party pursuant to negotiated agreements with respect to settlement of such Account Debtor’s Accounts in the ordinary course of business, consistent with past practices;
(g) Investments by any Person existing on the date such Person is acquired as part of a Permitted Acquisition and not made in contemplation thereof;
(h) extensions of trade credit or the holding of receivables in the ordinary course of business;
(i) investments constituting deposits described in the definition of “Permitted Liens”;
(j) investments in the form of Swap Agreements permitted by Section 6.06;
(k) Guarantees constituting Indebtedness permitted by Section 6.01, provided that the aggregate principal amount of Indebtedness of Subsidiaries or joint-ventures that are not Loan Parties that is guaranteed by any Loan Party shall not exceed, when taken together with investments, loans and advances by Loan Parties in Persons that are not Loan Parties incurred pursuant to Sections 6.04(c), (d) and (m), the Non-Loan Party Sublimit (in each case determined without regard to any write-downs or write-offs);
(l) Investments constituting Permitted Acquisitions;
(m) in addition to investments otherwise expressly permitted by this Section 6.04, investments by the Borrower or any of its Subsidiaries in an aggregate amount (valued at cost) not to exceed (x) $15,000,000 or (y) solely to the extent that Liquidity immediately prior to such Investment and after giving pro forma effect to such Investment is equal to or greater than $300,000,000, $25,000,000; provided that the aggregate amount of investments made by Loan Parties pursuant to this clause (m) in Persons that are not Loan Parties shall not exceed, when taken together with investments, loans, advances and Guarantees by Loan Parties in Persons that are not Loan Parties incurred pursuant to Sections 6.04(c), (d) and (k), the Non-Loan Party Sublimit;
(n) investments received in connection with the disposition of assets permitted by Section 6.05;
(o) advances of payroll payments to employees in the ordinary course of business and Investments made pursuant to employment and severance arrangements of officers and employees in the ordinary course of business and transactions pursuant to stock option plans and employee benefit plans and arrangements in the ordinary course of business;
(p) to the extent constituting Investments, advances in respect of transfer pricing and cost-sharing arrangements (i.e. “cost-plus” arrangements) and associated “true-up” payments, in each case, that are in the ordinary course of business;
(q) the Borrower and its Subsidiaries may acquire and hold receivables and similar items owing to them in the ordinary course of business and payable or dischargeable in accordance with customary trade terms;
(r) [intentionally omitted];
(s) Investments made by any Loan Party or any Subsidiary in (or to acquire Equity Interests in) Starlab JV, in an aggregate amount not to exceed the Starlab Available Amount; provided that, with respect to any Investment made in reliance on clause (a) of the definition of Starlab Available Amount, (i) if the Consolidated EBITDA for the most recently ended Test Period is less than negative $10,000,000, Liquidity after giving pro forma effect to such Investment shall be no less than $300,000,000 and (ii) if the Consolidated EBITDA for the most recently ended Test Period is greater than negative $10,000,000, Liquidity after giving pro forma effect to such Investment shall be no less than $250,000,000; and
(t) Investments (other than an Investment that would qualify as an Equity Financed Permitted Acquisition) to the extent that the consideration for such Investments solely consists of the Qualified Equity Interests of the Borrower;
provided that, for the avoidance of doubt, Investments by any Loan Party or Subsidiary in Starlab JV shall only be permitted to be made (i) to the extent in existence on the date hereof and described in Schedule 6.04 and (ii) pursuant to clause (s) above and not withstanding anything to the contrary set forth herein.
SECTION 6.05 Asset Sales. No Loan Party will, nor will any Loan Party permit its respective Subsidiaries to, Dispose of any asset, including any Equity Interest owned by it, nor will the Borrower permit any Subsidiary to issue any additional Equity Interest in such Subsidiary (other than to another Borrower or another Subsidiary in compliance with Section 6.04), except:
(a) Dispositions of (i) Inventory in the ordinary course of business and (ii) used, obsolete, worn out or surplus Equipment or property in the ordinary course of business;
(b) Dispositions of assets from one Loan Party to another Loan Party;
(c) Dispositions of Accounts (excluding sales or dispositions in a factoring arrangement) in connection with the compromise, settlement or collection thereof;
(d) Dispositions of cash and Permitted Investments in the ordinary course of business;
(e) Dispositions resulting from any casualty or other insured damage to, or any taking under power of eminent domain or by condemnation or similar proceeding of, any property or asset of the Borrower or any Subsidiary;
(f) Dispositions of assets by any Subsidiary that is not a Loan Party to a Loan Party or to a Subsidiary that is not a Loan Party;
(g) Dispositions constituting Liens permitted under Section 6.02, Dispositions permitted under Section 6.03 or Investments permitted under Section 6.04;
(h) Dispositions of intellectual property that is, in the reasonable judgment of the Borrower, no longer economically practicable to maintain or useful in the conduct of the business of the Borrower and the Subsidiaries, taken as a whole;
(i) Dispositions of non-core assets acquired in a Permitted Acquisition;
(j) non-exclusive licenses of patents, trademarks, copyrights, trade secrets and other intellectual property rights granted by Borrower or its Subsidiaries in the ordinary course of business and not interfering in any respect with the ordinary conduct of the business of the Borrower or such Subsidiary and leases, subleases, licenses or sublicenses of any real or personal property;
(k) [intentionally ommitted];
(l) Dispositions of assets (other than Equity Interests in a Subsidiary unless all Equity Interests in such Subsidiary are sold) that are not permitted by any other clause of this Section 6.05, provided that the aggregate fair market value of all assets Disposed of in reliance upon this paragraph (l) shall not exceed $3,000,000 in any fiscal year; provided that all Dispositions pursuant to Section 6.05(l) shall be made for fair value and at least 75% of the consideration from such Disposition received by any Loan Party or Subsidiary, as applicable, shall be in the form of cash or Permitted Investments;
(m) Dispositions or worn-out, obsolete or surplus property at fair market value in the ordinary course of business and other property no longer used in or useful to the conduct of the business;
(n) sales, transfers or other Dispositions of Investments in joint ventures permitted under Section 6.04(s) to the extent required by, or made pursuant to customary buy/sell arrangements between, the parties set forth in joint venture arrangements and similar binding agreements (and not included in such joint venture arrangements and similar binding agreements in contemplation of such sale, transfer or other Disposition).
SECTION 6.06 Swap Agreements. No Loan Party will, nor will any Loan Party permit its respective Subsidiaries to, enter into any Swap Agreement, except (a) Swap Agreements entered into to hedge or mitigate risks to which the Borrower or any Subsidiary has actual exposure (other than those in respect of Equity Interests of the Borrower or any Subsidiary (including, for purposes hereof, Starlab JV and its subsidiaries)), and (b) Swap Agreements entered into in order to effectively cap, collar or exchange interest rates (from floating to fixed rates, from one floating rate to another floating rate or otherwise) with respect to any interest-bearing liability or investment of the Borrower or any Subsidiary. Neither the Borrower nor any Subsidiary will enter into any Swap Agreement for speculative purposes.
SECTION 6.07 Restricted Payments; Certain Payments of Indebtedness. No Loan Party will, nor will any Loan Party permit its respective Subsidiaries to, declare or make, or agree to declare or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so, except (i) each Loan Party may declare and pay dividends or make other Restricted Payments with respect to its common stock payable solely in additional shares of its common stock, and, with respect to its preferred stock, payable solely in additional shares of such preferred stock or in shares of its common stock, (ii) Subsidiaries may declare and pay dividends ratably with respect to their Equity Interests, (iii) so long as no Default or Event of Default has occurred and is continuing or would arise after giving effect (including giving effect on a pro forma basis) thereto, any Loan Party may purchase Equity Interests from present or former officers, directors or employees of the Borrower or any Subsidiary upon the death, disability, retirement or termination of employment or service of such officer, director or employee, in an aggregate amount not exceeding (x) $5,000,000 or (y) solely to the extent that Liquidity immediately prior to such purchase of Equity Interests and after giving pro forma effect to the purchase of such Equity Interests is equal to or greater than $250,000,000, $20,000,000, (iv) the Loan Parties may make Restricted Payments pursuant to and in accordance with stock option plans or other benefit plans for management or employees of the Borrower and its Subsidiaries in the ordinary course of business and consistent with past practice, (v) the Borrower may make Restricted Payments of up to an aggregate of (x) $10,000,000 or (y) solely to the extent that Liquidity immediately prior to the making of such Restricted Payments and after giving pro forma effect to such Restricted Payments is equal to or greater than $250,000,000, $20,000,000; provided, that under this clause (v), no Event of Default shall exist and be continuing at the time of the making of such Restricted Payment or would result therefrom, (vi) Tax Distributions may be paid annually or in multiple installments, based on the Borrower’s good-faith and reasonable estimate of income to be generated by the Borrower’s or its Subsidiaries’ business in any such year or period, (vii) Restricted Payments made to consummate the Hercules Debt Repayment, (viii) repurchases by the Borrower of its Class A-1 Preferred Stock in an aggregate amount not exceeding $2,000,000, so long as no Default or Event of Default has occurred and is continuing or would arise after giving effect (including giving effect on a pro forma basis) thereto, (ix) within sixty (60) days of the Effective Date, the Borrower may declare and make a one-time dividend payment in respect of its Class A-1 Preferred Stock in an aggregate amount not exceeding $43,200,000 and (x) within sixty (60) days of the Effective Date, the Borrower may declare and make a one-time dividend payment in respect of its Class B Preferred Stock in an aggregate amount not exceeding $27,584,000; and
(b) No Loan Party will, nor will any Loan Party permit its respective Subsidiaries to, make or agree to pay or make, directly or indirectly, any optional payment or other distribution (whether in cash, securities or other property) of or in respect of principal of or interest on any Subordinated Indebtedness or Junior Lien Indebtedness, or any payment or other distribution (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any Indebtedness to the extent prohibited by any Acceptable Subordination or Intercreditor Agreement applicable thereto.
SECTION 6.08 Transactions with Affiliates. No Loan Party will, nor will any Loan Party permit its respective Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates, except (a) transactions between Loan Parties and their Subsidiaries on fair and reasonable terms in the ordinary course of business, (b) the payment of reasonable fees and reasonable expense reimbursements to directors of any Loan Party or any of its Subsidiaries, and compensation and indemnification of, and other employment agreements and arrangements, employee benefit plans and stock incentive plans paid to directors, officers and employees of any Loan Party or any of its Subsidiaries in the ordinary course of business, (c) transactions undertaken in good faith for the purpose of improving the consolidated tax efficiency of a Loan Party and its Subsidiaries, (d) loans, advances, investments and other transactions to the extent expressly permitted by the terms of this Agreement, (e) transactions that are at prices and on other terms and conditions, taken as a whole, not materially less favorable to such Loan Party or such Subsidiary than could be obtained on an arm’s-length basis from unrelated third parties (as determined in good faith by such Loan Party or Subsidiary), and (f) transactions involving amounts less than $1,000,000 in the aggregate for any fiscal year of the Borrower.
SECTION 6.09 Restrictive Agreements. No Loan Party will, nor will any Loan Party permit its respective Subsidiaries to, directly or indirectly enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of such Loan Party or any Subsidiary to create, incur or permit to exist any Lien upon any of its property or assets, or (b) the ability of any Subsidiary to pay dividends or other distributions with respect to any Equity Interests or to make or repay loans or advances to the Borrower or any other Subsidiary or to Guarantee Indebtedness of the Borrower or any other Subsidiary; provided that (i) the foregoing shall not apply to (A) restrictions and conditions imposed by law or by any Loan Document, (B) restrictions and conditions existing on the date hereof identified on Schedule 6.09 and any amendments or modifications thereof that do not materially expand the scope of any such restriction or condition (as determined in good faith by the Borrower) taken as a whole, (C) restrictions and conditions imposed by agreements relating to Indebtedness of any Subsidiary in existence at the time such Subsidiary became a Subsidiary and any amendments or modifications thereof that do not materially expand the scope of any such restriction or condition taken as a whole, provided that such restrictions and conditions apply only to such Subsidiary, (D) customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary pending such sale, provided such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder, (E) customary restrictions and conditions contained in any agreement relating to the disposition of any property permitted by Section 6.03 or Section 6.05 pending the consummation of such disposition, (F) restrictions in the transfers of assets encumbered by a Lien permitted by Section 6.02, (G) restrictions or conditions set forth in any agreement governing Indebtedness permitted by Section 6.01; provided that such restrictions and conditions are no more restrictive, taken as a whole, than the comparable restrictions and conditions set forth in this Agreement as determined in the good faith judgment of the board of directors of the Borrower, (H) customary provisions restricting assignment of any agreement entered into in the ordinary course of business, (I) customary provisions in shareholders agreements, joint venture agreements, organizational or constitutive documents or similar binding agreements relating to any joint venture and other similar agreements applicable to joint ventures and in each case applicable solely to such joint venture and the Equity Interests issued thereby and (J) restrictions on cash or other deposits (including
escrowed funds) or net worth imposed under contracts entered into in the ordinary course of business; provided that such restrictions and conditions apply only to such Subsidiary and to any Equity Interests in such Subsidiary and (ii) clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Indebtedness, nor to customary provisions in leases and other contracts restricting the assignment thereof.
SECTION 6.10 Financial Condition Covenants. The Borrower will not, and will not permit any of its Subsidiaries to:
(a) permit Liquidity, as of the last day of each fiscal quarter (commencing with the fiscal quarter ending June 30, 2025), to be less than the greater of (x) $100,000,000 or (y) solely to the extent Consolidated EBITDA for the Test Period ended on such date is negative, the absolute value of the Consolidated EBITDA for such Test Period; or
(b) permit Consolidated Total Revenues for any Test Period ending on any date set forth below to be less than the amount set forth below opposite such date:
| | | | | | | | | | | | | | | | | |
| | Date of Determination | Minimum Revenue | |
| | | | | |
| | | | | |
| | June 30, 2025 | $110,658,584 | | | |
| | | | | |
| | September 30, 2025 | $112,374,003 | | | |
| | | | | |
| | December 31, 2025 | $120,000,278 | | | |
| | | | | |
| | March 31, 2026 | $126,745,345 | | | |
| | | | | |
| | June 30, 2026 | $135,200,447 | | | |
| | | | | |
| | September 30, 2026 | $143,910,446 | | | |
| | | | | |
| | December 31, 2026 | $154,532,839 | | | |
| | | | | |
| | March 31, 2027 | $156,464,500 | | | |
| | | | | |
| | June 30, 2027 | $158,396,160 | | | |
| | | | | |
| | September 30, 2027 | $160,327,820 | | | |
| | | | | |
| | December 31, 2027 | $162,259,481 | | | |
| | | | | |
| | March 31, 2028 | $164,287,724 | | | |
| | | | | |
| | June 30, 2028 | $166,315,968 | | | |
| | | | | |
| | September 30, 2028 | $168,344,212 | | | |
| | | | | |
| | December 31, 2028 | $170,372,455 | | | |
| | | | | |
| | March 31, 2029 | $172,502,111 | | | |
SECTION 6.11 Amendment of Material Documents. No Loan Party will, nor will any Loan Party permit its respective Subsidiaries to, amend, modify or waive any of its rights under (a) any agreement relating to any Subordinated Indebtedness or Junior Lien Indebtedness except as permitted under any related subordination agreement (including any Acceptable Subordination or Intercreditor Agreement, as applicable), or (b) its charter, articles or certificate of organization or incorporation and bylaws or operating,
management or partnership agreement, or other organizational or governing documents in a manner materially adverse to the Lenders.
SECTION 6.12 Outbound Investment Rules. The Borrower will not, and will not permit any of its Subsidiaries (including, for purposes hereof, Starlab JV and its subsidiaries) to, (a) be or become a “covered foreign person”, as that term is defined in the Outbound Investment Rules, or (b) engage, directly or indirectly, in (i) a “covered activity” or a “covered transaction”, as each such term is defined in the Outbound Investment Rules, (ii) any activity or transaction that would constitute a “covered activity” or a “covered transaction”, as each such term is defined in the Outbound Investment Rules, if the Borrower were a U.S. Person or (iii) any other activity that would cause the Administrative Agent or any Lender to be in violation of the Outbound Investment Rules or cause the Administrative Agent or any Lender to be legally prohibited by the Outbound Investment Rules from performing under this Agreement.
ARTICLE VII
EVENTS OF DEFAULT
If any of the following events (“Events of Default”) shall occur:
(a) the Borrower shall fail to pay any principal of any Loan or any reimbursement obligation in respect of any LC Disbursement when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;
(b) the Borrower or any other Loan Party shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in clause (a) of this Article) payable under this Agreement or any other Loan Document, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of five (5) Business Days;
(c) any representation or warranty made or deemed made by any Loan Party in this Agreement or any other Loan Document shall prove to have been incorrect in any material respect (or in any respect if such representation or warranty is already qualified by concepts of materiality) when made or deemed made;
(d) any Loan Party shall fail to observe or perform any covenant, condition or agreement contained in Section 5.02(a), 5.03 (solely with respect to legal existence of the Loan Parties), 5.08 or in Article VI of this Agreement or Article IV of the Security Agreement;
(e) any Loan Party shall fail to observe or perform any covenant, condition or agreement contained in this Agreement or in any other Loan Document (other than those which constitute a default under another Section of this Article), and such failure shall continue unremedied or unwaived for a period of (i) in the case of any such failure in respect of Section 5.01(a) through (d), 5.02 (other than 5.02(a)), 5.04 or 5.09, five (5) Business Days and (ii) in the case of any such failure in respect of any other provision, thirty (30) days after the earlier of any Loan Party’s knowledge of such breach or written notice thereof from the Administrative Agent (which notice will be given at the request of any Lender);
(f) any Loan Party or any Subsidiary shall fail to make any payment (whether of principal or interest and regardless of amount) in respect of any Material Indebtedness, when and as the same shall become due and payable after giving effect to any applicable grace periods provided in the applicable instrument or agreement under which such Material Indebtedness was created; provided that this clause (f) shall not apply to any such failure that is (x) remedied by the Loan Parties or any Subsidiary or (y) waived (including in the form of amendment) by the requisite holders of the applicable item of Material Indebtedness;
(g) any event or condition occurs (after all applicable grace periods have expired and all required notices have been given) that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits (with or without the giving of notice, the lapse of time or both) the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity; provided that this clause (g) shall not apply to (A) secured Indebtedness that becomes due as a result of the voluntary sale, transfer or other disposition (including as a result of a casualty or condemnation event) of the property or assets securing such Indebtedness, (B) Indebtedness which is convertible into Equity Interests and converts to Equity Interests in accordance with its terms or (C) any breach or default that (x) is remedied by the Borrower or any applicable Subsidiary or (y) is waived (including in the form of an amendment) by the requisite holders of the applicable item of Material Indebtedness;
(h) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of the Borrower or any Subsidiary or its debts, or of a substantial part of its assets, under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the involuntary appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for any Loan Party or any Subsidiary or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for sixty (60) days or an order or decree approving or ordering any of the foregoing shall be entered;
(i) any Loan Party or any Subsidiary shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) of this Article, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for such Loan Party or any Subsidiary of any Loan Party or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;
(j) any Loan Party or any Subsidiary shall become unable, admit in writing its inability to, or publicly declare its intention not to, or fail generally to pay its debts as they become due;
(k) one or more final, non-appealable judgments for the payment of money in an aggregate amount in excess of $10,000,000, to the extent not covered by insurance or which is not otherwise covered by an indemnification in favor of any Loan Party or any Subsidiary of any Loan Party, as applicable, shall be rendered against any Loan Party, any Subsidiary or any combination thereof and the same shall remain undischarged for a period of sixty (60) consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of any Loan Party or any Subsidiary to enforce any such judgment;
(l) an ERISA Event shall have occurred that, in the opinion of the Required Lenders, when taken together with all other ERISA Events that have occurred, would reasonably be expected to result in a Material Adverse Effect;
(m) a Change in Control shall have occurred;
(n) except as permitted by the terms of this Agreement, the Loan Guaranty shall fail to remain in full force or effect or any action shall be taken to discontinue or to assert the invalidity or unenforceability of the Loan Guaranty, or any Guarantor shall fail to comply with any of the terms or provisions of the Loan
Guaranty to which it is a party, or any Guarantor shall deny that it has any further liability under the Loan Guaranty to which it is a party, or shall give notice to such effect, including any notice of termination delivered pursuant to Section 10.08;
(o) except as permitted by the terms of any Collateral Document, (i) any Collateral Document shall for any reason fail to create a valid security interest in any material portion of the Collateral, taken as a whole, as required by this Agreement or any Collateral Document, or (ii) any Lien on any material portion of the Collateral, taken as a whole, securing any Secured Obligation shall cease to be a perfected (if and to the extent required to be perfected under the Collateral Documents), first priority Lien, except (A) as a result of the release of a Loan Party or the sale, transfer or other disposition to a Person that is not a Loan Party or a Subsidiary of the applicable Collateral in each case, in a transaction permitted under the Loan Documents, (B) as a result of the Administrative Agent’s or any other Secured Party no longer having possession of any stock certificates, promissory notes or other instruments actually delivered to it under the Collateral Documents or (C) UCC continuation statements not being timely filed; or
(p) any material provision of any Loan Document, at any time after its execution and delivery, for any reason other than as expressly permitted hereunder or thereunder or as a result of the termination of the Commitments and the Payment in Full the Obligations of the Loan Parties thereunder, shall cease to be in full force and effect; or any Loan Party or any other Person shall contest in any manner the validity or enforceability of any Loan Document or shall purport to revoke, terminate or rescind any Loan Document;
then, and in every such event (other than an event with respect to the Borrower described in clause (h) or (i) of this Article), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to the Borrower, take any or all of the following actions, at the same or different times: (i) terminate the Commitments (including the Issuing Bank Sublimit and Swingline Commitment), and thereupon the Commitments shall terminate immediately, (ii) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued but unpaid interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall become due and payable immediately, in each case without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower, and (iii) require that the Borrower provide cash collateral for the LC Exposure in accordance with Section 2.06(j) hereof; and in case of any event with respect to the Borrower described in clause (h) or (i) of this Article, the Commitments shall automatically terminate and the principal of the Loans then outstanding and cash collateral for the LC Exposure, together with accrued but unpaid interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall automatically become due and payable, and the obligation of the Borrower to cash collateralize the LC Exposure as provided in clause (iii) above shall automatically become effective, in each case, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower. Upon the occurrence and during the continuance of an Event of Default, the Administrative Agent may, and at the request of the Required Lenders shall, exercise any rights and remedies provided to the Administrative Agent under the Loan Documents or at law or equity, including all remedies provided under the UCC.
In addition to any other rights and remedies granted to the Administrative Agent and the Lenders in the Loan Documents, if any Event of Default has occurred and is continuing, the Administrative Agent on behalf of the Lenders may exercise all rights and remedies of a secured party under the New York Uniform Commercial Code or any other applicable law. Without limiting the generality of the foregoing, if any Event of Default has occurred and is continuing, the Administrative Agent, without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except for any notice of default to the extent expressly required under the Loan Documents and/or any notice required by
law referred to below) to or upon any Loan Party or any other Person (all and each of which demands, defenses, advertisements and notices are hereby waived), may in such circumstances forthwith collect, receive, appropriate and realize upon the Collateral, or any part thereof, or consent to the use by the Loan Party of any cash collateral arising in respect of the Collateral on such terms as the Administrative Agent deems reasonable, and/or may forthwith sell, lease, assign give an option or options to purchase or otherwise dispose of and deliver, or acquire by credit bid on behalf of the Lenders, the Collateral or any part thereof (or contract to do any of the foregoing), in one or more parcels at public or private sale or sales, at any exchange, broker’s board or office of the Administrative Agent or any Lender or elsewhere, upon such terms and conditions as it may deem advisable and at such prices as it may deem best, for cash or on credit or for future delivery, all without assumption of any credit risk. With respect to any public or private sales referred to in the preceding sentence, the Administrative Agent or any Lender shall have the right upon any such public sale or sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the whole or any part of the Collateral so sold, free of any right or equity of redemption in any Loan Party, which right or equity is hereby waived and released. Each Loan Party further agrees, at the Administrative Agent’s request, to assemble the Collateral and make it available to the Administrative Agent at places which the Administrative Agent shall reasonably select, whether at such Loan Party’s premises or elsewhere. The Administrative Agent shall apply the net proceeds of any action taken by it pursuant to this Article VII, after deducting all reasonable costs and expenses of every kind incurred in connection therewith or incidental to the care or safekeeping of any of the Collateral or in any other way relating to the Collateral or the rights of the Administrative Agent and the Lenders hereunder, including reasonable attorneys’ fees and disbursements to the extent payable hereunder, to the payment in whole or in part of the obligations of the Loan Parties under the Loan Documents, in such order as the Administrative Agent may elect, and only after such application and after the payment by the Administrative Agent of any other amount required by any provision of law, including Section 9-615(a)(3) of the New York UCC, need the Administrative Agent account for the surplus, if any, to any Loan Party. To the extent permitted by applicable law, each Loan Party waives all claims, damages and demands it may acquire against the Administrative Agent or any Lender arising out of the exercise by them of any rights hereunder. If any notice of a proposed sale or other disposition of Collateral shall be required by law, such notice shall be deemed reasonable and proper if given at least ten (10) days before such sale or other disposition.
ARTICLE VIII
THE ADMINISTRATIVE AGENT
SECTION 8.01 Authorization and Action.
(a) Each Lender and each Issuing Bank hereby irrevocably appoints the entity named as Administrative Agent in the heading of this Agreement and its successors and assigns to serve as the administrative agent and collateral agent under the Loan Documents and each Lender and each Issuing Bank authorizes the Administrative Agent to take such actions as agent on its behalf and to exercise such powers under this Agreement and the other Loan Documents as are delegated to the Administrative Agent under such agreements and to exercise such powers as are reasonably incidental thereto. In addition, to the extent required under the laws of any jurisdiction other than within the U.S., each Lender and each Issuing Bank hereby grants to the Administrative Agent any required powers of attorney to execute and enforce any Collateral Document governed by the laws of such jurisdiction on such Lender’s or such Issuing Bank’s behalf. Without limiting the foregoing, each Lender and each Issuing Bank hereby authorizes the Administrative Agent to execute and deliver, and to perform its obligations under, each of the Loan Documents to which the Administrative Agent is a party, and to exercise all rights, powers and remedies that the Administrative Agent may have under such Loan Documents.
(b) As to any matters not expressly provided for herein and in the other Loan Documents (including enforcement or collection), the Administrative Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the written instructions of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, pursuant to the terms in the Loan Documents), and, unless and until revoked in writing, such instructions shall be binding upon each Lender and each Issuing Bank; provided, however, that the Administrative Agent shall not be required to take any action that (i) the Administrative Agent in good faith believes exposes it to liability unless the Administrative Agent receives an indemnification and is exculpated in a manner satisfactory to it from the Lenders and the Issuing Banks with respect to such action or (ii) is contrary to this Agreement or any other Loan Document or applicable law, including any action that may be in violation of the automatic stay under any requirement of law relating to bankruptcy, insolvency or reorganization or relief of debtors or that may effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any requirement of law relating to bankruptcy, insolvency or reorganization or relief of debtors; provided, further, that the Administrative Agent may seek clarification or direction from the Required Lenders prior to the exercise of any such instructed action and may refrain from acting until such clarification or direction has been provided. Except as expressly set forth in the Loan Documents, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower, any Subsidiary or any Affiliate of any of the foregoing that is communicated to or obtained by the Person serving as Administrative Agent or any of its Affiliates in any capacity. Nothing in this Agreement shall require the Administrative Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.
(c) In performing its functions and duties hereunder and under the other Loan Documents, the Administrative Agent is acting solely on behalf of the Lenders and the Issuing Banks, any other Secured Party (except in limited circumstances expressly provided for herein relating to the maintenance of the Register), and its duties are entirely mechanical and administrative in nature. The motivations of the Administrative Agent are commercial in nature and not to invest in the general performance or operations of the Borrower. Without limiting the generality of the foregoing:
(i) the Administrative Agent does not assume and shall not be deemed to have assumed any obligation or duty or any other relationship as the agent, fiduciary or trustee of or for any Lender, Issuing Bank, any other Secured Party or holder of any other obligation other than as expressly set forth herein and in the other Loan Documents, regardless of whether a Default or an Event of Default has occurred and is continuing (and it is understood and agreed that the use of the term “agent” (or any similar term) herein or in any other Loan Document with reference to the Administrative Agent is not intended to connote any fiduciary duty or other implied (or express) obligations arising under agency doctrine of any applicable law, and that such term is used as a matter of market custom and is intended to create or reflect only an administrative relationship between contracting parties); additionally, each Lender agrees that it will not assert any claim against the Administrative Agent based on an alleged breach of fiduciary duty by the Administrative Agent in connection with this Agreement and/or the transactions contemplated hereby; and
(ii) nothing in this Agreement or any Loan Document shall require the Administrative Agent to account to any Lender for any sum or the profit element of any sum received by the Administrative Agent for its own account;
(d) The Administrative Agent may perform any of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any of their
respective duties and exercise their respective rights and powers through their respective Related Parties. The exculpatory provisions of this Article shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities pursuant to this Agreement. The Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agent except to the extent that a court of competent jurisdiction determines in a final and nonappealable judgment that the Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub-agent.
(e) The Lead Arrangers shall have no obligations or duties whatsoever in such capacity under this Agreement or any other Loan Document and shall incur no liability hereunder to the Lenders or thereunder in such capacity, but all such persons shall have the benefit of the indemnities provided for hereunder.
(f) In case of the pendency of any proceeding with respect to any Loan Party under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, the Administrative Agent (irrespective of whether the principal of any Loan or any reimbursement obligation shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered (but not obligated) by intervention in such proceeding or otherwise:
(i) to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, LC Disbursements and all other Secured Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders, the Issuing Banks and the Administrative Agent (including any claim under Sections 2.12, 2.13, 2.15, 2.17 and 9.03) allowed in such judicial proceeding; and
(ii) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such proceeding is hereby authorized by each Lender, each Issuing Bank and each other Secured Party to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders, the Issuing Banks or the other Secured Parties, to pay to the Administrative Agent any amount due to it, in its capacity as the Administrative Agent, under the Loan Documents (including under Section 9.03). Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender or Issuing Bank any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or Issuing Bank or to authorize the Administrative Agent to vote in respect of the claim of any Lender or Issuing Bank in any such proceeding.
(g) The provisions of this Article are solely for the benefit of the Administrative Agent, the Lenders and the Issuing Banks, and, except solely to the extent of the Borrower’s rights to consent pursuant to and subject to the conditions set forth in this Article, none of the Borrower or any Subsidiary, or any of their respective Affiliates, shall have any rights as a third party beneficiary under any such provisions. Each Secured Party, whether or not a party hereto, will be deemed, by its acceptance of the benefits of the Collateral and of the Guarantees of the Obligations provided under the Loan Documents, to have agreed to the provisions of this Article.
SECTION 8.02 Administrative Agent’s Reliance, Indemnification, Etc.
(a) Neither the Administrative Agent nor any of its Related Parties shall be (i) liable for any action taken or omitted to be taken by such party, the Administrative Agent or any of its Related Parties under or in connection with this Agreement or the other Loan Documents (x) with the consent of or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith to be necessary, under the circumstances as provided in the Loan Documents) or (y) in the absence of its own gross negligence or willful misconduct (such absence to be presumed unless otherwise determined by a court of competent jurisdiction by a final and nonappealable judgment) or (ii) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by any Loan Party or any officer thereof contained in this Agreement or any other Loan Document or in any certificate, report, statement or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, this Agreement or any other Loan Document or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document (including, for the avoidance of doubt, in connection with the Administrative Agent’s reliance on any Electronic Signature transmitted by emailed pdf or any other electronic means that reproduces an image of an actual executed signature page) or for any failure of any Loan Party to perform its obligations hereunder or thereunder.
(b) The Administrative Agent shall be deemed not to have knowledge of any (i) notice of any of the events or circumstances set forth or described in Section 5.02 unless and until written notice thereof stating that it is a “notice under Section 5.02” in respect of this Agreement and identifying the specific clause under said Section is given to the Administrative Agent by the Borrower, or (ii) notice of any Default or Event of Default unless and until written notice thereof (stating that it is a “notice of Default” or a “notice of an Event of Default”) is given to the Administrative Agent by the Borrower, a Lender or an Issuing Bank. Further, the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report or other document delivered thereunder or in connection therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth in any Loan Document or the occurrence of any Default or Event of Default, (iv) the sufficiency, validity, enforceability, effectiveness or genuineness of any Loan Document or any other agreement, instrument or document, (v) the satisfaction of any condition set forth in Article IV or elsewhere in any Loan Document, other than to confirm receipt of items (which on their face purport to be such items) expressly required to be delivered to the Administrative Agent or satisfaction of any condition that expressly refers to the matters described therein being acceptable or satisfactory to the Administrative Agent or (vi) the creation, perfection or priority of Liens on the Collateral.
(c) Without limiting the foregoing, the Administrative Agent (i) may treat the payee of any promissory note as its holder until such promissory note has been assigned in accordance with Section 9.04, (ii) may rely on the Register to the extent set forth in Section 9.04(b), (iii) may consult with legal counsel (including counsel to the Borrower), independent public accountants and other experts selected by it, and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts, (iv) makes no warranty or representation to any Lender or Issuing Bank and shall not be responsible to any Lender or Issuing Bank for any statements, warranties or representations made by or on behalf of any Loan Party in connection with this Agreement or any other Loan Document, (v) in determining compliance with any condition hereunder to the making of a Loan, or the issuance of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or an Issuing Bank, may presume that such condition is satisfactory to such Lender or Issuing Bank unless the Administrative Agent shall have received notice to the contrary from such Lender or Issuing Bank sufficiently in advance of the making of such Loan or the issuance of such Letter of Credit and (vi) shall be entitled to rely on, and shall incur no liability under or in respect of this Agreement or any other Loan Document by acting upon, any notice, consent, certificate or other instrument or writing (which writing may be a fax, any electronic message, Internet or intranet website posting or other distribution) or any
statement made to it orally or by telephone and believed by it to be genuine and signed or sent or otherwise authenticated by the proper party or parties (whether or not such Person in fact meets the requirements set forth in the Loan Documents for being the maker thereof).
SECTION 8.03 Posting of Communications.
(a) The Borrower agrees that the Administrative Agent may, but shall not be obligated to, make any Communications available to the Lenders and the Issuing Banks by posting the Communications on IntraLinks™, DebtDomain, SyndTrak, ClearPar or any other electronic platform chosen by the Administrative Agent to be its electronic transmission system (the “Approved Electronic Platform”).
(b) Although the Approved Electronic Platform and its primary web portal are secured with generally-applicable security procedures and policies implemented or modified by the Administrative Agent from time to time (including, as of the Effective Date, a user ID/password authorization system) and the Approved Electronic Platform is secured through a per-deal authorization method whereby each user may access the Approved Electronic Platform only on a deal-by-deal basis, each of the Lenders, each of the Issuing Banks and the Borrower acknowledges and agrees that the distribution of material through an electronic medium is not necessarily secure, that the Administrative Agent is not responsible for approving or vetting the representatives or contacts of any Lender that are added to the Approved Electronic Platform, and that there may be confidentiality and other risks associated with such distribution. Each of the Lenders, each of the Issuing Banks and the Borrower hereby approves distribution of the Communications through the Approved Electronic Platform and understands and assumes the risks of such distribution.
(c) THE APPROVED ELECTRONIC PLATFORM AND THE COMMUNICATIONS ARE PROVIDED “AS IS” AND “AS AVAILABLE”. THE APPLICABLE PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE COMMUNICATIONS, OR THE ADEQUACY OF THE APPROVED ELECTRONIC PLATFORM AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS OR OMISSIONS IN THE APPROVED ELECTRONIC PLATFORM AND THE COMMUNICATIONS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE APPLICABLE PARTIES IN CONNECTION WITH THE COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM. IN NO EVENT SHALL THE ADMINISTRATIVE AGENT, THE LEAD ARRANGERS OR ANY OF THEIR RESPECTIVE RELATED PARTIES (COLLECTIVELY, “APPLICABLE PARTIES”) HAVE ANY LIABILITY TO ANY LOAN PARTY, ANY LENDER, ANY ISSUING BANK OR ANY OTHER PERSON OR ENTITY FOR DAMAGES OF ANY KIND, INCLUDING DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES (WHETHER IN TORT, CONTRACT OR OTHERWISE) ARISING OUT OF ANY LOAN PARTY’S OR THE ADMINISTRATIVE AGENT’S TRANSMISSION OF COMMUNICATIONS THROUGH THE INTERNET OR THE APPROVED ELECTRONIC PLATFORM.
“Communications” means, collectively, any notice, demand, communication, information, document or other material provided by or on behalf of any Loan Party pursuant to any Loan Document or the transactions contemplated therein which is distributed by the Administrative Agent, any Lender or any Issuing Bank by means of electronic communications pursuant to this Section, including through an Approved Electronic Platform.
(d) Each Lender and each Issuing Bank agrees that notice to it (as provided in the next sentence) specifying that Communications have been posted to the Approved Electronic Platform shall constitute effective delivery of the Communications to such Lender for purposes of the Loan Documents.
Each Lender and Issuing Bank agrees (i) to notify the Administrative Agent in writing (which could be in the form of electronic communication) from time to time of such Lender’s or Issuing Bank’s (as applicable) email address to which the foregoing notice may be sent by electronic transmission and (ii) that the foregoing notice may be sent to such email address.
(e) Each of the Lenders, each of the Issuing Banks and the Borrower agrees that the Administrative Agent may, but (except as may be required by applicable law) shall not be obligated to, store the Communications on the Approved Electronic Platform in accordance with the Administrative Agent’s generally applicable document retention procedures and policies.
(f) Nothing herein shall prejudice the right of the Administrative Agent, any Lender or any Issuing Bank to give any notice or other communication pursuant to any Loan Document in any other manner specified in such Loan Document.
SECTION 8.04 The Administrative Agent Individually. With respect to its Commitment, Loans (including Swingline Loans), Issuing Bank Sublimit and Letters of Credit, the Person serving as the Administrative Agent shall have and may exercise the same rights and powers hereunder and is subject to the same obligations and liabilities as and to the extent set forth herein for any other Lender or Issuing Bank, as the case may be. The terms “Issuing Banks”, “Swingline Lender”, “Lenders”, “Required Lenders” and any similar terms shall, unless the context clearly otherwise indicates, include the Administrative Agent in its individual capacity as a Lender, Issuing Bank, Swingline Lender or as one of the Required Lenders, as applicable. The Person serving as the Administrative Agent and its Affiliates may accept deposits from, lend money to, own securities of, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of banking, trust or other business with, any Loan Party, any Subsidiary or any Affiliate of any of the foregoing as if such Person was not acting as the Administrative Agent and without any duty to account therefor to the Lenders or the Issuing Banks.
SECTION 8.05 Successor Administrative Agent.
(a) The Administrative Agent may resign at any time by giving thirty (30) days’ prior written notice thereof to the Lenders, the Issuing Banks and the Borrower, whether or not a successor Administrative Agent has been appointed. Upon any such resignation, (i) the Administrative Agent may appoint one of its Affiliates acting through an office in the United States as a successor Administrative Agent and (ii) if the Administrative Agent has not appointed one of its Affiliates acting through an office in the United States. as a successor Administrative Agent pursuant to clause (i) above, the Required Lenders shall have the right to appoint a successor Administrative Agent. If no successor Administrative Agent shall have been so appointed by the Required Lenders, and shall have accepted such appointment, within thirty (30) days after the retiring Administrative Agent’s giving of notice of resignation, then the retiring Administrative Agent may, on behalf of the Lenders and the Issuing Banks, appoint a successor Administrative Agent, which shall be a bank with an office in New York, New York or an Affiliate of any such bank. In either case (other than if the Administrative Agent appoints one of its Affiliates acting through an office in the European Union as a successor Administrative Agent pursuant to clause (i) above), such appointment shall be subject to the prior written approval of the Borrower (which approval may not be unreasonably withheld and shall not be required while an Event of Default has occurred and is continuing). Upon the acceptance of any appointment as Administrative Agent by a successor Administrative Agent, such successor Administrative Agent shall succeed to, and become vested with, all the rights, powers, privileges and duties of the retiring Administrative Agent. Upon the acceptance of appointment as Administrative Agent by a successor Administrative Agent, the retiring Administrative Agent shall be discharged from its duties and obligations under this Agreement and the other Loan Documents. Prior to any retiring Administrative Agent’s resignation hereunder as Administrative Agent, the retiring
Administrative Agent shall take such action as may be reasonably necessary to assign to the successor Administrative Agent its rights as Administrative Agent under the Loan Documents.
(b) Notwithstanding paragraph (a) of this Section, in the event no successor Administrative Agent shall have been so appointed and shall have accepted such appointment within thirty (30) days after the retiring Administrative Agent gives notice of its intent to resign, the retiring Administrative Agent may give notice of the effectiveness of its resignation to the Lenders, the Issuing Banks and the Borrower, whereupon, on the date of effectiveness of such resignation stated in such notice, (i) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents; provided that, solely for purposes of maintaining any security interest granted to the Administrative Agent under any Collateral Document for the benefit of the Secured Parties, the retiring Administrative Agent shall continue to be vested with such security interest as collateral agent for the benefit of the Secured Parties, and continue to be entitled to the rights set forth in such Collateral Document and Loan Document, and, in the case of any Collateral in the possession of the Administrative Agent, shall continue to hold such Collateral, in each case until such time as a successor Administrative Agent is appointed and accepts such appointment in accordance with this Section (it being understood and agreed that the retiring Administrative Agent shall have no duty or obligation to take any further action under any Collateral Document, including any action required to maintain the perfection of any such security interest), and (ii) the Required Lenders shall succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent; provided that (A) all payments required to be made hereunder or under any other Loan Document to the Administrative Agent for the account of any Person other than the Administrative Agent shall be made directly to such Person (it being understood that the fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor) and (B) all notices and other communications required or contemplated to be given or made to the Administrative Agent shall directly be given or made to each Lender and each Issuing Bank. Following the effectiveness of the Administrative Agent’s resignation from its capacity as such, the provisions of this Article, Section 2.17(d) and Section 9.03, as well as any exculpatory, reimbursement and indemnification provisions set forth in any other Loan Document, shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent and in respect of the matters referred to in the proviso under clause (i) above.
SECTION 8.06 Acknowledgements of Lenders and Issuing Banks.
(a) Each Lender and each Issuing Bank represents and warrants that (i) the Loan Documents set forth the terms of a commercial lending facility, (ii) in participating as a Lender, it is engaged in making, acquiring or holding commercial loans and in providing other facilities set forth herein as may be applicable to such Lender or Issuing Bank, in each case in the ordinary course of business, and not for the purpose of investing in the general performance or operations of the Borrower, or for the purpose of purchasing, acquiring or holding any other type of financial instrument such as a security (and each Lender and each Issuing Bank agrees not to assert a claim in contravention of the foregoing, such as a claim under the federal or state securities laws), (iii) it has, independently and without reliance upon the Administrative Agent or any other Lender or Issuing Bank, or any of the Related Parties of any of the foregoing, and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement as a Lender, and to make, acquire or hold Loans hereunder and (iv) it is sophisticated with respect to decisions to make, acquire and/or hold commercial loans and to provide other facilities set forth herein, as may be applicable to such Lender or such Issuing Bank, and either it, or the Person exercising discretion in making its decision to make, acquire and/or hold such commercial loans or to provide such other facilities, is experienced in making, acquiring or holding such commercial loans or providing such other facilities. Each Lender and each Issuing Bank also acknowledges that it will,
independently and without reliance upon the Administrative Agent or any other Lender or Issuing Bank, or any of the Related Parties of any of the foregoing, and based on such documents and information (which may contain material, non-public information within the meaning of the United States securities laws concerning the Borrower and its Affiliates) as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.
(b) Each Lender, by delivering its signature page to this Agreement on the Effective Date, or delivering its signature page to an Assignment and Assumption or any other Loan Document pursuant to which it shall become a Lender hereunder, shall be deemed to have acknowledged receipt of, and consented to and approved, this Agreement.
(c)
(i) Each Lender hereby agrees that (x) if the Administrative Agent notifies such Lender that the Administrative Agent has determined in its sole discretion that any funds received by such Lender from the Administrative Agent or any of its Affiliates (whether as a payment, prepayment or repayment of principal, interest, fees or otherwise; individually and collectively, a “Payment”) were erroneously transmitted to such Lender (whether or not known to such Lender), and demands the return of such Payment (or a portion thereof), such Lender shall promptly, but in no event later than one (1) Business Day thereafter (or such later date as the Administrative Agent, may, in its sole discretion, specify in writing), return to the Administrative Agent the amount of any such Payment (or portion thereof) as to which such a demand was made in same day funds, together with interest thereon (except to the extent waived in writing by the Administrative Agent) in respect of each day from and including the date such Payment (or portion thereof) was received by such Lender to the date such amount is repaid to the Administrative Agent at the greater of the NYFRB Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation from time to time in effect, and (y) to the extent permitted by applicable law, such Lender shall not assert, and hereby waives, as to the Administrative Agent, any claim, counterclaim, defense or right of setoff or recoupment with respect to any demand, claim or counterclaim by the Administrative Agent for the return of any Payments received, including without limitation any defense based on “discharge for value” or any similar doctrine. A notice of the Administrative Agent to any Lender under this Section 8.06(c) shall be conclusive, absent manifest error.
(ii) Each Lender hereby further agrees that if it receives a Payment from the Administrative Agent or any of its Affiliates (x) that is in a different amount than, or on a different date from, that specified in a notice of payment sent by the Administrative Agent (or any of its Affiliates) with respect to such Payment (a “Payment Notice”) or (y) that was not preceded or accompanied by a Payment Notice, it shall be on notice, in each such case, that an error has been made with respect to such Payment. Each Lender agrees that, in each such case, or if it otherwise becomes aware a Payment (or portion thereof) may have been sent in error, such Lender shall promptly notify the Administrative Agent of such occurrence and, upon demand from the Administrative Agent, it shall promptly, but in no event later than one (1) Business Day thereafter (or such later date as the Administrative Agent, may, in its sole discretion, specify in writing), return to the Administrative Agent the amount of any such Payment (or portion thereof) as to which such a demand was made in same day funds, together with interest thereon (except to the extent waived in writing by the Administrative Agent) in respect of each day from and including the date such Payment (or portion thereof) was received by such Lender to the date such amount is repaid to the Administrative Agent at the greater of the NYFRB Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank compensation from time to time in effect.
(iii) The Borrower and each other Loan Party hereby agrees that (x) in the event an erroneous Payment (or portion thereof) are not recovered from any Lender that has received such Payment (or portion thereof) for any reason, the Administrative Agent shall be subrogated to all the rights of such Lender with respect to such amount and (y) an erroneous Payment shall not pay, prepay, repay, discharge or otherwise satisfy any Obligations owed by the Borrower or any other Loan Party.
(iv) Each party’s obligations under this Section 8.06(c) shall survive the resignation or replacement of the Administrative Agent or any transfer of rights or obligations by, or the replacement of, a Lender, the termination of the Commitments or the repayment, satisfaction or discharge of all Obligations under any Loan Document.
(d) The Lenders acknowledge that there may be a constant flow of information (including information which may be subject to confidentiality obligations in favor of the Loan Parties) between the Loan Parties and their Affiliates, on the one hand, and JPMorgan Chase Bank, N.A. and its Affiliates, on the other hand. Without limiting the foregoing, the Loan Parties or their Affiliates may provide information, including updates to previously provided information to JPMorgan and/or its Affiliates acting in different capacities, including as Lender, lead bank, arranger or potential securities investor, independent of such entity’s role as administrative agent hereunder. The Lenders acknowledge that neither JPMorgan nor its Affiliates shall be under any obligation to provide any of the foregoing information to them. Notwithstanding anything to the contrary set forth herein or in any other Loan Document, except for notices, reports and other documents expressly required to be furnished to the Lenders by the Administrative Agent herein, the Administrative Agent shall not have any duty or responsibility to provide, and shall not be liable for the failure to provide, any Lender with any credit or other information concerning the Loans, the Lenders, the business, prospects, operations, property, financial and other condition or creditworthiness of any of the Loan Parties or any of their respective Affiliates that is communicated to, obtained by, or in the possession of, the Administrative Agent or any of its Affiliates in any capacity, including any information obtained by the Administrative Agent in the course of communications among the Administrative Agent and any Loan Party, any Affiliate thereof or any other Person. Notwithstanding the foregoing, any such information may (but shall not be required to) be shared by the Administrative Agent with one or more Lenders, or any formal or informal committee or ad hoc group of such Lenders, including at the direction of a Loan Party.
SECTION 8.07 Collateral Matters.
(a) Except with respect to the exercise of setoff rights in accordance with Section 9.08 or with respect to a Secured Party’s right to file a proof of claim in an insolvency proceeding, no Secured Party shall have any right individually to realize upon any of the Collateral or to enforce any Guarantee of the Secured Obligations, it being understood and agreed that all powers, rights and remedies under the Loan Documents may be exercised solely by the Administrative Agent on behalf of the Secured Parties in accordance with the terms thereof. In its capacity, the Administrative Agent is a “representative” of the Secured Parties within the meaning of the term “secured party” as defined in the UCC. In the event that any Collateral is hereafter pledged by any Person as collateral security for the Secured Obligations, the Administrative Agent is hereby authorized, and hereby granted a power of attorney, to execute and deliver on behalf of the Secured Parties any Loan Documents necessary or appropriate to grant and perfect a Lien on such Collateral in favor of the Administrative Agent on behalf of the Secured Parties.
(b) In furtherance of the foregoing and not in limitation thereof, no arrangements in respect of Banking Services the obligations under which constitute Banking Services Obligations and no Swap Agreement the obligations under which constitute Swap Agreement Obligations, will create (or be deemed to create) in favor of any Secured Party that is a party thereto any rights in connection with the management or release of any Collateral or of the obligations of any Loan Party under any Loan Document. By accepting the benefits of the Collateral, each Secured Party that is a party to any such arrangement in respect of Banking Services or Swap Agreement, as applicable, shall be deemed to have appointed the Administrative Agent to serve as administrative agent and collateral agent under the Loan Documents and agreed to be bound by the Loan Documents as a Secured Party thereunder, subject to the limitations set forth in this paragraph.
(c) The Secured Parties irrevocably authorize the Administrative Agent, at its option and in its discretion, to subordinate any Lien on any property granted to or held by the Administrative Agent under any Loan Document to the holder of any Permitted Lien pursuant to clauses (b), (c), (d), (e), (f),(g), (h), (m), (r), (s) and (t) of the definition thereof so long as, in each case, such Permitted Lien does not secure Indebtedness for borrowed money. The Administrative Agent shall not be responsible for or have a duty to ascertain or inquire into any representation or warranty regarding the existence, value or collectability of the Collateral, the existence, priority or perfection of the Administrative Agent’s Lien thereon or any certificate prepared by any Loan Party in connection therewith, nor shall the Administrative Agent be responsible or liable to the Lenders or any other Secured Party for any failure to monitor or maintain any portion of the Collateral.
SECTION 8.08 Credit Bidding. The Secured Parties hereby irrevocably authorize the Administrative Agent, at the direction of the Required Lenders, to credit bid all or any portion of the Obligations (including by accepting some or all of the Collateral in satisfaction of some or all of the Obligations pursuant to a deed in lieu of foreclosure or otherwise) and in such manner purchase (either directly or through one or more acquisition vehicles) all or any portion of the Collateral (a) at any sale thereof conducted under the provisions of the Bankruptcy Code, including under Sections 363, 1123 or 1129 of the Bankruptcy Code, or any similar laws in any other jurisdictions to which a Loan Party is subject, or (b) at any other sale, foreclosure or acceptance of collateral in lieu of debt conducted by (or with the consent or at the direction of) the Administrative Agent (whether by judicial action or otherwise) in accordance with any applicable law. In connection with any such credit bid and purchase, the Obligations owed to the Secured Parties shall be entitled to be, and shall be, credit bid by the Administrative Agent at the direction of the Required Lenders on a ratable basis (with Obligations with respect to contingent or unliquidated claims receiving contingent interests in the acquired assets on a ratable basis that shall vest upon the liquidation of such claims in an amount proportional to the liquidated portion of the contingent claim amount used in allocating the contingent interests) for the asset or assets so purchased (or for the equity interests or debt instruments of the acquisition vehicle or vehicles that are issued in connection with such purchase). In connection with any such bid, (i) the Administrative Agent shall be authorized to form one or more acquisition vehicles and to assign any successful credit bid to such acquisition vehicle or vehicles, (ii) each of the Secured Parties’ ratable interests in the Obligations which were credit bid shall be deemed without any further action under this Agreement to be assigned to such vehicle or vehicles for the purpose of closing such sale, (iii) the Administrative Agent shall be authorized to adopt documents providing for the governance of the acquisition vehicle or vehicles (provided that any actions by the Administrative Agent with respect to such acquisition vehicle or vehicles, including any disposition of the assets or equity interests thereof, shall be governed, directly or indirectly, by, and the governing documents shall provide for, control by the vote of the Required Lenders or their permitted assignees under the terms of this Agreement or the governing documents of the applicable acquisition vehicle or vehicles, as the case may be, irrespective of the termination of this Agreement and without giving effect to the limitations on actions by the Required Lenders contained in Section 9.02 of this Agreement), (iv) the Administrative Agent on behalf of such acquisition vehicle or vehicles shall be authorized to issue to each of the Secured
Parties, ratably on account of the relevant Obligations which were credit bid, interests, whether as equity, partnership interests, limited partnership interests or membership interests, in any such acquisition vehicle and/or debt instruments issued by such acquisition vehicle, all without the need for any Secured Party or acquisition vehicle to take any further action, and (v) to the extent that Obligations that are assigned to an acquisition vehicle are not used to acquire Collateral for any reason (as a result of another bid being higher or better, because the amount of Obligations assigned to the acquisition vehicle exceeds the amount of Obligations credit bid by the acquisition vehicle or otherwise), such Obligations shall automatically be reassigned to the Secured Parties pro rata with their original interest in such Obligations and the equity interests and/or debt instruments issued by any acquisition vehicle on account of such Obligations shall automatically be cancelled, without the need for any Secured Party or any acquisition vehicle to take any further action. Notwithstanding that the ratable portion of the Obligations of each Secured Party are deemed assigned to the acquisition vehicle or vehicles as set forth in clause (ii) above, each Secured Party shall execute such documents and provide such information regarding the Secured Party (and/or any designee of the Secured Party which will receive interests in or debt instruments issued by such acquisition vehicle) as the Administrative Agent may reasonably request in connection with the formation of any acquisition vehicle, the formulation or submission of any credit bid or the consummation of the transactions contemplated by such credit bid.
SECTION 8.09 Certain ERISA Matters.
(a) Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent, and the Lead Arrangers and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that at least one of the following is and will be true:
(i) such Lender is not using “plan assets” (within the meaning of the Plan Asset Regulations) of one or more Benefit Plans in connection with the Loans, the Letters of Credit or the Commitments,
(ii) the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable with respect to, and the conditions for exemptive relief are satisfied in connection with, such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement,
(iii) (A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender to enter into, participate in, administer and perform the Loans, the Letters of Credit, the Commitments and this Agreement, (C) the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement satisfies the requirements of sub-sections (b) through (g) and (k) of Part I of PTE 84-14 and (D) to the best knowledge of such Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement, or
(iv) such other representation, warranty and covenant as may be agreed in writing between the Administrative Agent, in its sole discretion, and such Lender.
(b) In addition, unless sub-clause (i) in the immediately preceding clause (a) is true with respect to a Lender or such Lender has provided another representation, warranty and covenant as provided in sub-clause (iv) in the immediately preceding clause (a), such Lender further (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent, the Lead Arrangers and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that none of the Administrative Agent, or the Lead Arrangers or any of their respective Affiliates is a fiduciary with respect to the Collateral or the assets of such Lender (including in connection with the reservation or exercise of any rights by the Administrative Agent under this Agreement, any Loan Document or any documents related to hereto or thereto).
(c) The Administrative Agent and the Lead Arrangers hereby inform the Lenders that each such Person is not undertaking to provide investment advice or to give advice in a fiduciary capacity, in connection with the transactions contemplated hereby, and that such Person has a financial interest in the transactions contemplated hereby in that such Person or an Affiliate thereof (i) may receive interest or other payments with respect to the Loans, the Letters of Credit, the Commitments, this Agreement and any other Loan Documents (ii) may recognize a gain if it extended the Loans, the Letters of Credit or the Commitments for an amount less than the amount being paid for an interest in the Loans, the Letters of Credit or the Commitments by such Lender or (iii) may receive fees or other payments in connection with the transactions contemplated hereby, the Loan Documents or otherwise, including structuring fees, commitment fees, arrangement fees, facility fees, upfront fees, underwriting fees, ticking fees, agency fees, administrative agent or collateral agent fees, utilization fees, minimum usage fees, letter of credit fees, fronting fees, deal-away or alternate transaction fees, amendment fees, processing fees, term out premiums, banker’s acceptance fees, breakage or other early termination fees or fees similar to the foregoing.
SECTION 8.10 Subordination and Intercreditor Agreements. The Administrative Agent is authorized by the Lenders and each other Secured Party to, and shall, enter into the Effective Date Intercreditor Agreement and any other Acceptable Subordination or Intercreditor Agreement contemplated hereby with respect to any Indebtedness (i) that is (A) required or permitted hereunder to be subordinated in right of payment or with respect to security and/or (B) secured by any Lien and (ii) which contemplates an Acceptable Subordination or Intercreditor Agreement, and the Secured Parties party hereto acknowledge that the Effective Date Intercreditor Agreement and any other Acceptable Subordination or Intercreditor Agreement is binding upon them. Each Lender and each other Secured Party hereby (a) agrees that it will be bound by, and will not take any action contrary to, the provisions of the Effective Date Intercreditor Agreement or any other Acceptable Subordination or Intercreditor Agreement and (b) authorizes and instructs the Administrative Agent to enter into the Effective Date Intercreditor Agreement and/or any other Acceptable Subordination or Intercreditor Agreement and to subject the Liens on the Collateral securing the Secured Obligations to the provisions thereof, as applicable. The foregoing provisions are intended as an inducement to the Secured Parties to extend credit to the Borrower, and the Secured Parties are intended third-party beneficiaries of such provisions and the provisions of the Effective Date Intercreditor Agreement and/or any other Acceptable Subordination or Intercreditor Agreement.
SECTION 8.11 Borrower Communications.
(a) The Administrative Agent, the Lenders and the Issuing Banks agree that the Borrower may, but shall not be obligated to, make any Borrower Communications to the Administrative Agent through an
electronic platform chosen by the Administrative Agent to be its electronic transmission system (the “Approved Borrower Portal”).
(b) Although the Approved Borrower Portal and its primary web portal are secured with generally-applicable security procedures and policies implemented or modified by the Administrative Agent from time to time (including, as of the Effective Date, a user ID/password authorization system), each of the Lenders, each of the Issuing Banks and the Borrower acknowledges and agrees that the distribution of material through an electronic medium is not necessarily secure, that the Administrative Agent is not responsible for approving or vetting the representatives or contacts of the Borrower that are added to the Approved Borrower Portal, and that there may be confidentiality and other risks associated with such distribution. Each of the Lenders, each of the Issuing Banks and the Borrower hereby approves distribution of Borrower Communications through the Approved Borrower Portal and understands and assumes the risks of such distribution.
(c) THE APPROVED BORROWER PORTAL IS PROVIDED “AS IS” AND “AS AVAILABLE”. THE APPLICABLE PARTIES DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER COMMUNICATION, OR THE ADEQUACY OF THE APPROVED BORROWER PORTAL AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS OR OMISSIONS IN THE APPROVED BORROWER PORTAL AND THE BORROWER COMMUNICATIONS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE APPLICABLE PARTIES IN CONNECTION WITH THE BORROWER COMMUNICATIONS OR THE APPROVED BORROWER PORTAL. IN NO EVENT SHALL THE APPLICABLE PARTIES HAVE ANY LIABILITY TO ANY LOAN PARTY, ANY LENDER, ANY ISSUING BANK OR ANY OTHER PERSON OR ENTITY FOR DAMAGES OF ANY KIND, INCLUDING DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES (WHETHER IN TORT, CONTRACT OR OTHERWISE) ARISING OUT OF THE BORROWER’S TRANSMISSION OF BORROWER COMMUNICATIONS THROUGH THE INTERNET OR THE APPROVED BORROWER PORTAL.
“Borrower Communications” means, collectively, any Borrowing Request, Interest Election Request, notice of prepayment, notice requesting the issuance, amendment or extension of a Letter of Credit or other notice, demand, communication, information, document or other material provided by or on behalf of any Loan Party pursuant to any Loan Document or the transactions contemplated therein which is distributed by the Borrower to the Administrative Agent through an Approved Borrower Portal.
(d) Each of the Lenders, each of the Issuing Banks and the Borrower agrees that the Administrative Agent may, but (except as may be required by applicable law) shall not be obligated to, store the Borrower Communications on the Approved Borrower Portal in accordance with the Administrative Agent’s generally applicable document retention procedures and policies.
(e) Nothing herein shall prejudice the right of the Borrower to give any notice or other communication pursuant to any Loan Document in any other manner specified in such Loan Document.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01 Notices.
(a) Except in the case of notices and other communications expressly permitted to be given by telephone (and subject to paragraph (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by e-mail, as follows:
(i) if to any Loan Party, to it in care of the Borrower at:
Voyager Technologies, Inc.
Attention: Phil De Sousa and Meg Vernal
1225 17th Street, Suite 1100
Denver, CO 80202
Email: phil.desousa@voyagerspace.com, meg.vernal@voyagerspace.com
Telephone: 917.740.0353
with a copy to:
Morgan, Lewis & Bockius LLP
2222 Market Street
Philadelphia, PA 19103
Attention: Andrew T. Budreika
Email: andrew.budreika@morganlewis.com
(ii) if to the Administrative Agent from the Borrower, to the address or addresses separately provided to the Borrower;
(iii) if to the Administrative Agent from the Lenders, to JPMorgan Chase Bank, N.A., 383 Madison Ave, Floor 22, New York, NY, 10179-0001, United States;
(iv) if to an Issuing Bank or the Swingline Lender, to it at the address separately provided to the Borrower; and
(v) if to any other Lender, to it at its address set forth in its Administrative Questionnaire.
Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices delivered through Approved Electronic Platforms or Approved Borrower Portals, to the extent provided in paragraph (b) below, shall be effective as provided in said paragraph (b).
(b) Notices and other communications to the Borrower, any Loan Party, the Lenders, the Administrative Agent and the Issuing Banks hereunder may be delivered or furnished by using Approved Electronic Platforms or Approved Borrower Portals (as applicable), in each case, pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices pursuant to Article II or to compliance and no Default certificates delivered pursuant to Section 5.01(d) unless otherwise agreed by the Administrative Agent and the applicable Lender. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.
(c) Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an
acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient, at its e-mail address as described in the foregoing clause (i), of notification that such notice or communication is available and identifying the website address therefor; provided that, for both clauses (i) and (ii) above, if such notice, email or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient.
(d) Any party hereto may change its address for notices and other communications hereunder by notice to the other parties hereto.
SECTION 9.02 Waivers; Amendments.
(a) No failure or delay by the Administrative Agent, any Issuing Bank or any Lender in exercising any right or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Administrative Agent, the Issuing Banks and the Lenders hereunder and under any other Loan Document are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of any Loan Document or consent to any departure by any Loan Party therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section 9.02, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a waiver of any Default, regardless of whether the Administrative Agent, any Lender or any Issuing Bank may have had notice or knowledge of such Default at the time.
(b) Subject to Section 2.14(b), (c) and (e) and Section 9.02(e) below, neither this Agreement nor any other Loan Document nor any provision hereof or thereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Borrower and the Required Lenders or by the Borrower and the Administrative Agent with the consent of the Required Lenders; provided that no such agreement shall (i) increase the Commitment of any Lender without the written consent of such Lender (including any such Lender that is a Defaulting Lender) (it being understood that a waiver of any condition precedent or the waiver of any Default, Event of Default or mandatory prepayment shall not constitute an increase of any Commitment), (ii) reduce or forgive the principal amount of any Loan or LC Disbursement or reduce the rate of interest thereon, or reduce or forgive any interest or fees payable hereunder, without the written consent of each Lender directly and adversely affected thereby (including any such Lender that is a Defaulting Lender); provided, however, that only the consent of the Required Lenders shall be necessary to amend the provisions with respect to the application or amount of the default rate described in Section 2.13(c) or waive any obligation of the Borrower to pay interest or fees at such default rate and with respect to amendments to any financial covenant ratios or related definitions, the impact of which may reduce interest, (iii) postpone any scheduled date of payment of the principal amount of any Loan or LC Disbursement, or any date for payment of any interest thereon, or any fees or other Obligations payable hereunder (including extending the expiration of a Letter of Credit to a date after the Maturity Date), or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Commitment, without the written consent of each Lender directly and adversely affected thereby (including any such Lender that is a Defaulting Lender), (iv) change Section 2.09(c) or 2.18(b), (d) or (e) in a manner that would alter the ratable reduction of Commitments or the pro rata sharing of payments required thereby, without the written consent of each Lender, (v) change the payment waterfall provisions of Section 2.18(b) or 2.20(b) without the written consent of each Lender, (vi) release the
Borrower from its Obligations without the written consent of each Lender, (vii) change any of the provisions of this Section 9.02 or the definition of “Required Lenders” or, except as provided in the following clause (viii), any other provision of any Loan Document specifying the number or percentage of Lenders required to waive, amend or modify any rights thereunder or make any determination or grant any consent thereunder, without the written consent of each Lender, (viii) change Section 2.20, without the consent of each Lender (other than any Defaulting Lender), (ix) contractually subordinate any of the Obligations in right of payment to any other Indebtedness or subordinate any Liens on Collateral securing the Obligations to any Lien on such Collateral securing any other Indebtedness, in each case without the written consent of each Lender directly and adversely affected thereby, (x) amend or waive the conditions set forth in Sections 4.02 or 4.03 (including amendments to the component definitions thereof which have the effect of amending or waiving such conditions), in each case without the written consent of each Lender, (xi) release all or substantially all of the Guarantors from their obligations under the Loan Guaranty, without the written consent of each Lender (other than any Defaulting Lender) (except as otherwise expressly provided for in this Agreement as in effect on the Effective Date), or (xii) except as provided in paragraph (f)(i) of this Section 9.02, release all or substantially all of the Collateral (except as otherwise expressly provided for in this Agreement as in effect on the Effective Date), without the written consent of each Lender (other than any Defaulting Lender); provided further, that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent, the Swingline Lender or the Issuing Bank hereunder without the prior written consent of the Administrative Agent, the Swingline Lender or the Issuing Bank, as the case may be (it being understood that any change to Section 2.20 shall require the consent of the Administrative Agent, the Swingline Lender and the Issuing Bank); provided further, that no such agreement shall amend or modify the provisions of Section 2.06 or any letter of credit application and any bilateral agreement between the Borrower and the Issuing Bank regarding the Issuing Bank’s Issuing Bank Sublimit or the respective rights and obligations between the Borrower and the Issuing Bank in connection with the issuance of Letters of Credit without the prior written consent of the Borrower, the Administrative Agent and the Issuing Bank, respectively. The Administrative Agent may also amend Schedule 2.01 to reflect assignments entered into pursuant to Section 9.04.
(c) [Intentionally Omitted].
(d) If, in connection with any proposed amendment, waiver or consent requiring the consent of “each Lender” or “each Lender affected thereby,” the consent of the Required Lenders is obtained, but the consent of other necessary Lenders is not obtained (any such Lender whose consent is necessary but has not been obtained being referred to herein as a “Non-Consenting Lender”), then the Borrower may elect to replace a Non-Consenting Lender as a Lender party to this Agreement, provided that, concurrently with such replacement, (i) another bank or other entity which is reasonably satisfactory to the Borrower, the Administrative Agent, the Swingline Lender and the Issuing Bank shall agree, as of such date, (A) to purchase for cash the Loans and other Obligations due to the Non-Consenting Lender pursuant to an Assignment and Assumption and to become a Lender for all purposes under this Agreement, (B) to assume all obligations of the Non-Consenting Lender to be terminated as of such date, (C) to comply with the requirements of clause (b) of Section 9.04 and (D) to consent to the applicable amendment, waiver or consent, and (ii) the Borrower shall pay to such Non-Consenting Lender in same day funds on the day of such replacement (1) all interest, fees and other amounts then accrued but unpaid to such Non-Consenting Lender by the Borrower hereunder to and including the date of termination, including without limitation payments due to such Non-Consenting Lender under Sections 2.15 and 2.17, and (2) an amount, if any, equal to the payment which would have been due to such Lender on the day of such replacement under Section 2.16 had the Loans of such Non-Consenting Lender been prepaid on such date rather than sold to the replacement Lender. Each party hereto agrees that an assignment required pursuant to this paragraph may be effected pursuant to an Assignment and Assumption executed by the Borrower, the Administrative Agent and the assignee (or, to the extent applicable, an agreement incorporating an Assignment and Assumption by reference pursuant to an Approved Electronic Platform as to which the Administrative
Agent and such parties are participants), and the Lender required to make such assignment need not be a party thereto in order for such assignment to be effective and shall be deemed to have consented to an be bound by the terms thereof; provided that, following the effectiveness of any such assignment, the other parties to such assignment agree to execute and deliver such documents necessary to evidence such assignment as reasonably requested by the applicable Lender, provided that any such documents shall be without recourse to or warranty by the parties thereto.
(e) If the Administrative Agent and the Borrower acting together identify any ambiguity, omission, mistake, typographical error or other defect in any provision of this Agreement or any other Loan Document, then the Administrative Agent and the Borrower shall be permitted to amend, modify or supplement such provision to cure such ambiguity, omission, mistake, typographical error or other defect, and such amendment shall become effective without any further action or consent of any other party to this Agreement.
(f) The Lenders and the Issuing Bank hereby irrevocably authorize the Administrative Agent, at its option and in its sole discretion, to release any Liens granted to or held by the Administrative Agent upon any Collateral (i) upon the termination of all the Commitments, payment and satisfaction in full in cash of all Secured Obligations (other than (A) contingent obligations and (B) Swap Agreement Obligations and Banking Services Obligations as to which arrangements satisfactory to the applicable counterparty have been made), and the expiration with no pending drawings or termination of all Letters of Credit (other than Letters of Credit as to which other arrangements satisfactory to the Administrative Agent and the Issuing Bank have been made), (ii) constituting property being sold or disposed of to a Person other than a Loan Party if the sale or disposition is made in compliance with the terms of this Agreement, (iii) constituting property leased to the Borrower or any Subsidiary under a lease which has expired or been terminated in a transaction permitted under this Agreement, (iv) as required to effect any sale or other disposition of such Collateral in connection with any exercise of remedies of the Administrative Agent and the Lenders pursuant to Article VII, (v) as otherwise permitted by, but only in accordance with, the terms of any Loan Document, or (vi) if approved, authorized or ratified in writing by the Required Lenders, unless such release is required to be approved by all of the Lenders hereunder. At any time that a Loan Party desires that the Administrative Agent take any action to acknowledge or confirm any release of Collateral pursuant to clauses (ii), (iii), (iv) or (v) of the preceding sentence, such Loan Party shall, upon the Administrative Agent’s request, deliver to the Administrative Agent a certificate signed by a Responsible Officer of such Loan Party (or the Borrower on behalf of such Loan Party) certifying as to such matter relating to such release as the Administrative Agent may reasonably request (and the Lenders authorize the Administrative Agent to rely upon such certificate in performing its obligations hereunder). Upon request by the Administrative Agent at any time, the Lenders will confirm in writing the Administrative Agent’s authority to release particular types or items of Collateral pursuant hereto. Any such release shall not in any manner discharge, affect, or impair the Secured Obligations or any Liens (other than those expressly being released) upon (or obligations of the Loan Parties in respect of) all interests retained by the Loan Parties, including the proceeds of any sale, all of which shall continue to constitute part of the Collateral. Any execution and delivery by the Administrative Agent of documents in connection with any such release shall be without recourse to or warranty by the Administrative Agent.
SECTION 9.03 Expenses; Limitation of Liability; Indemnity; Damage Waiver.
(a) The Borrower shall pay (i) all reasonable out of pocket expenses incurred by the Administrative Agent, the Lead Arrangers and their respective Affiliates, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent and the Lead Arrangers, in connection with the syndication, distribution (including without limitation, via the internet or through an Approved Electronic Platform) of the credit facilities provided for herein, the preparation, execution, delivery and administration of this Agreement and the other Loan Documents or any amendments, modifications or
waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket expenses incurred by any Issuing Bank in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all out-of-pocket expenses incurred by the Administrative Agent, any Issuing Bank or any Lender, including the fees, charges and disbursements of any counsel for the Administrative Agent, any Issuing Bank or any Lender, in connection with the enforcement, collection or protection of its rights in connection with this Agreement and the other Loan Documents, including its rights under this Section, or in connection with the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during an Event of Default and during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit.
(b) To the extent permitted by applicable law (i) the Borrower and any Loan Party shall not assert, and the Borrower and each Loan Party hereby waives, any claim against the Administrative Agent, the Lead Arrangers, any Issuing Bank and any Lender, and any Related Party of any of the foregoing Persons (each such Person being called a “Lender-Related Person”) for any Liabilities arising from the use by others of information or other materials (including, without limitation, any personal data) obtained through telecommunications, electronic or other information transmission systems (including the Internet, any Approved Electronic Platform and any Approved Borrower Portal), and (ii) no party hereto shall assert, and each such party hereby waives, any Liabilities against any other party hereto, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document, or any agreement or instrument contemplated hereby or thereby, the Transactions, any Loan or Letter of Credit or the use of the proceeds thereof; provided that, nothing in this Section 9.03(b) shall relieve the Borrower and each Loan Party of any obligation it may have to indemnify an Indemnitee, as provided in Section 9.03(c), against any special, indirect, consequential or punitive damages asserted against such Indemnitee by a third party.
(c) Each of the Loan Parties, jointly and severally, shall indemnify the Administrative Agent, the Lead Arrangers, each Issuing Bank and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all Liabilities and related expenses, including the fees, charges and disbursements of any counsel for any Indemnitee, incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document, or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the Transactions or any other transactions contemplated hereby, (ii) any act or omission of the Administrative Agent in connection with the administration of the Loan Documents; (iii) any Loan or Letter of Credit or the use of the proceeds therefrom (including any refusal by an Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iv) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (v) any actual or prospective Proceeding relating to any of the foregoing, whether or not such Proceeding is brought by the Borrower or any other Loan Party or its or their respective equity holders, Affiliates, creditors or any other third Person and whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that (a) such Liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted primarily from the gross negligence or willful misconduct of such Indemnitee or material breach in bad faith of such Indemnitee’s obligations hereunder or under any other Loan Document or (b) any dispute solely among the indemnitee that does not involve an act or omission of the Borrower of any of its Subsidiaries (other than any claims against an Indemnitee in its capacity as an administrative agent or arranger or any similar role under the Loan Documents). This Section 9.03(c) shall
not apply with respect to Taxes other than any Taxes that represent losses, claims or damages arising from any non-Tax claim.
(d) Each Lender severally agrees to pay any amount required to be paid by any Loan Party under paragraphs (a), (b) or (c) of this Section 9.03 to the Administrative Agent, each Issuing Bank and each Swingline Lender, and each Related Party of any of the foregoing Persons (each, an “Agent-Related Person”) (to the extent not reimbursed by any Loan Party and without limiting the obligation of such Loan Party to do so), ratably according to their respective Applicable Percentage in effect on the date on which such payment is sought under this Section (or, if such payment is sought after the date upon which the Commitments shall have terminated and the Loans shall have been paid in full, ratably in accordance with such Applicable Percentage immediately prior to such date), and agrees to indemnify and hold each Agent-Related Person harmless from and against any and all Liabilities and related expenses, including the fees, charges and disbursements of any kind whatsoever that may at any time (whether before or after the payment of the Loans) be imposed on, incurred by or asserted against such Agent-Related Person in any way relating to or arising out of the Commitments, this Agreement, any of the other Loan Documents or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by such Agent-Related Person under or in connection with any of the foregoing; provided that the unreimbursed expense or Liability or related expense, as the case may be, was incurred by or asserted against such Agent-Related Person in its capacity as such; provided further that no Lender shall be liable for the payment of any portion of such Liabilities, costs, expenses or disbursements that are found by a final and nonappealable decision of a court of competent jurisdiction to have resulted primarily from such Agent-Related Person’s gross negligence or willful misconduct. The agreements in this Section shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.
(e) All amounts due under this Section 9.03 shall be payable promptly after written demand therefor.
SECTION 9.04 Successors and Assigns.
(a) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby (including any Affiliate of an Issuing Bank that issues any Letter of Credit), except that (i) the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights or obligations hereunder except in accordance with this Section 9.04. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby (including any Affiliate of an Issuing Bank that issues any Letter of Credit), Participants (to the extent provided in paragraph (c) of this Section 9.04) and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent, the Issuing Banks and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.
(b) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more Persons (other than an Ineligible Institution) all or a portion of its rights and obligations under the Loan Documents (including all or a portion of its Commitment, participations in Letters of Credit and the Loans at the time owing to it) with the prior written consent (such consent not to be unreasonably withheld, conditioned or delayed) of:
(1) the Borrower; provided that, the Borrower shall be deemed to have consented to an assignment of all or a portion of the Revolving Loans and Commitments unless it shall have objected thereto by written notice to the Administrative Agent within
ten (10) Business Days after having received notice thereof; provided that no consent of the Borrower shall be required for an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if an Event of Default has occurred and is continuing, any other assignee (other than any Ineligible Institution);
(2) the Administrative Agent; provided that no consent of the Administrative Agent shall be required for an assignment of any Commitment to an assignee that is a Lender (other than a Defaulting Lender) with a Commitment immediately prior to giving effect to such assignment;
(3) each Issuing Bank; provided that no consent of an Issuing Bank shall be required if (x) an Event of Default occurs with respect to the Borrower under Sections 7.01(h) or 7.01(i) and (y) such Issuing Bank has no outstanding Letters of Credit at that time; and
(4) each Swingline Lender; provided that no consent of a Swingline Lender shall be required if (x) an Event of Default occurs with respect to the Borrower under Sections 7.01(h) or 7.01(i) and (y) such Swingline Lender has no outstanding Swingline Loans at that time.
(ii) Assignments shall be subject to the following additional conditions:
(1) except in the case of an assignment to a Lender or an Affiliate of a Lender or an assignment of the entire remaining amount of the assigning Lender’s Commitment or Loans of any Class, the amount of the Commitment or Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be less than $5,000,000, unless each of the Borrower and the Administrative Agent otherwise consent; provided that no such consent of the Borrower shall be required if an Event of Default has occurred and is continuing;
(2) each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement; provided that this clause shall not be construed to prohibit the assignment of a proportionate part of all the assigning Lender’s rights and obligations in respect of one Class of Commitments or Loans;
(3) the parties to each assignment shall execute and deliver to the Administrative Agent (x) an Assignment and Assumption or (y) to the extent applicable, an agreement incorporating an Assignment and Assumption by reference pursuant to an Approved Electronic Platform as to which the Administrative Agent and the parties to the Assignment and Assumption are participants, together with a processing and recordation fee of $3,500; and
(4) the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire in which the assignee designates one or more credit contacts to whom all syndicate-level information (which may contain material non-public information about the Loan Parties and their Related Parties or their respective securities) will be made available and who may receive such information in accordance with the assignee’s compliance procedures and applicable laws, including Federal and state securities laws.
For the purposes of this Section 9.04(b), the term “Approved Fund” and “Ineligible Institution” have the following meanings:
“Approved Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.
“Ineligible Institution” means (a) a natural person, (b) a Defaulting Lender or its Lender Parent, (c) company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural person or relative(s) thereof; provided that, with respect to clause (c), such company, investment vehicle or trust shall not constitute an Ineligible Institution if it (x) has not been established for the primary purpose of acquiring any Loans or Commitments, (y) is managed by a professional advisor, who is not such natural person or a relative thereof, having significant experience in the business of making or purchasing commercial loans, and (z) has assets greater than $25,000,000 and a significant part of its activities consist of making or purchasing commercial loans and similar extensions of credit in the ordinary course of its business, (d) a Loan Party or a Subsidiary or other Affiliate of a Loan Party or (e) any Competitors or Competitor Controllers of the Borrower identified by the Borrower in writing to the Administrative Agent. The Borrower hereby consents to the Administrative Agent disclosing the Ineligible Institutions to the Lenders (upon their written request to the Administrative Agent).
(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) of this Section 9.04, from and after the effective date specified in each Assignment and Assumption the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 2.15, 2.16, 2.17 and 9.03). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 9.04 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (c) of this Section 9.04.
(iv) The Administrative Agent, acting for this purpose as a non-fiduciary agent of the Borrower, shall maintain at one of its offices a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and principal amount (and stated interest) of the Loans and LC Disbursements owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive, and the Borrower, the Administrative Agent, the Issuing Banks and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower, any Issuing Bank and any Lender, at any reasonable time and from time to time upon reasonable prior notice.
(v) Upon its receipt of (x) a duly completed Assignment and Assumption executed by an assigning Lender and an assignee or (y) to the extent applicable, an agreement incorporating an Assignment and Assumption by reference pursuant to an Approved Electronic Platform as to which the Administrative Agent and the parties to the Assignment and Assumption are participants, the assignee’s completed Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of this Section 9.04 and any written consent to such assignment required by paragraph (b) of this Section 9.04, the Administrative Agent shall accept such Assignment and Assumption and record the information contained therein in the Register; provided that if either the assigning Lender or the assignee shall have failed to make any payment required to be made by it pursuant to Section 2.05(d), 2.06(d) or (e), 2.07(b), 2.18(f) or 9.03(d), the Administrative Agent shall have no obligation to accept such Assignment and Assumption and record the information therein in the Register unless and until such payment shall have been made in full, together with all accrued interest thereon. No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this paragraph.
(c) Any Lender may, without the consent of, or notice to, the Borrower, the Administrative Agent, the Issuing Banks or the Swingline Lender, sell participations to one or more banks or other entities (a “Participant”), other than an Ineligible Institution, in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans owing to it); provided that (A) such Lender’s obligations under this Agreement shall remain unchanged; (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations; and (C) the Borrower, the Administrative Agent, the Issuing Banks and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 9.02(b) that affects such Participant. The Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.15, 2.16 and 2.17 (subject to the requirements and limitations therein, including the requirements under Section 2.17(f) (it being understood that the documentation required under Section 2.17(f) shall be delivered to the participating Lender)) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section 9.04; provided that such Participant (A) agrees to be subject to the provisions of Section 2.19 as if it were an assignee under paragraph (b) of this Section 9.04; and (B) shall not be entitled to receive any greater payment under Section 2.15 or 2.17, with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation.
(d) Each Lender that sells a participation agrees, at the Borrower’s request and expense, to use reasonable efforts to cooperate with the Borrower to effectuate the provisions of Section 2.19(b) with respect to any Participant. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 9.08 as though it were a Lender; provided that such Participant agrees to be subject to Section 2.18(c) as though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any Commitments, Loans, Letters of Credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such Commitment, Loan, Letter of Credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the
Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.
(e) Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section 9.04 shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.
SECTION 9.05 Survival. All covenants, agreements, representations and warranties made by the Borrower herein and in the Loan Documents and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Documents shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the making of any Loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent, any Issuing Bank or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid or any Letter of Credit is outstanding and so long as the Commitments have not expired or terminated. The provisions of Sections 2.15, 2.16, 2.17 and 9.03 and Article VIII shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Letters of Credit and the Commitments or the termination of this Agreement or any provision hereof.
SECTION 9.06 Counterparts; Integration; Effectiveness; Electronic Execution.
(a) This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement, the other Loan Documents and any separate letter agreements with respect to (i) fees payable to the Administrative Agent and (ii) the reductions of Issuing Bank Sublimit of any Issuing Bank constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
(b) Delivery of an executed counterpart of a signature page of (x) this Agreement, (y) any other Loan Document and/or (z) any document, amendment, approval, consent, information, notice (including, for the avoidance of doubt, any notice delivered pursuant to Section 9.01), certificate, request, statement, disclosure or authorization related to this Agreement, any other Loan Document and/or the transactions contemplated hereby and/or thereby (each an “Ancillary Document”) that is an Electronic Signature transmitted by emailed pdf. or any other electronic means that reproduces an image of an actual executed signature page shall be effective as delivery of a manually executed counterpart of this Agreement, such other Loan Document or such Ancillary Document, as applicable. The words “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to this Agreement, any other Loan Document and/or any Ancillary Document shall be deemed to include Electronic Signatures, deliveries or the keeping of records in any electronic form (including deliveries by emailed pdf. or any other electronic means that reproduces an image of an actual executed signature page), each of which shall be of the same legal effect,
validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be; provided that nothing herein shall require the Administrative Agent to accept Electronic Signatures in any form or format without its prior written consent and pursuant to procedures approved by it; provided, further, without limiting the foregoing, (i) to the extent the Administrative Agent has agreed to accept any Electronic Signature, the Administrative Agent and each of the Lenders shall be entitled to rely on such Electronic Signature purportedly given by or on behalf of the Borrower or any other Loan Party without further verification thereof and without any obligation to review the appearance or form of any such Electronic Signature and (ii) upon the request of the Administrative Agent or any Lender, any Electronic Signature shall be promptly followed by a manually executed counterpart. Without limiting the generality of the foregoing, the Borrower and each Loan Party hereby (A) agrees that, for all purposes, including without limitation, in connection with any workout, restructuring, enforcement of remedies, bankruptcy proceedings or litigation among the Administrative Agent, the Lenders, the Borrower and the Loan Parties, Electronic Signatures transmitted by emailed pdf. or any other electronic means that reproduces an image of an actual executed signature page and/or any electronic images of this Agreement, any other Loan Document and/or any Ancillary Document shall have the same legal effect, validity and enforceability as any paper original, (B) the Administrative Agent and each of the Lenders may, at its option, create one or more copies of this Agreement, any other Loan Document and/or any Ancillary Document in the form of an imaged electronic record in any format, which shall be deemed created in the ordinary course of such Person’s business, and destroy the original paper document (and all such electronic records shall be considered an original for all purposes and shall have the same legal effect, validity and enforceability as a paper record), (C) waives any argument, defense or right to contest the legal effect, validity or enforceability of this Agreement, any other Loan Document and/or any Ancillary Document based solely on the lack of paper original copies of this Agreement, such other Loan Document and/or such Ancillary Document, respectively, including with respect to any signature pages thereto and (D) waives any claim against any Lender-Related Person for any Liabilities arising solely from the Administrative Agent’s and/or any Lender’s reliance on or use of Electronic Signatures and/or transmissions by emailed pdf. or any other electronic means that reproduces an image of an actual executed signature page, including any Liabilities arising as a result of the failure of the Borrower and/or any Loan Party to use any available security measures in connection with the execution, delivery or transmission of any Electronic Signature.
SECTION 9.07 Severability. Any provision of any Loan Document held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.
SECTION 9.08 Right of Setoff. If an Event of Default shall have occurred and be continuing, each Lender, each Issuing Bank, and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to setoff and apply any and all deposits (general or special, time or demand, provisional or final) at any time held, and other obligations at any time owing, by such Lender, such Issuing Bank or any such Affiliate, to or for the credit or the account of any Loan Party against any and all of the obligations of any Loan Party now or hereafter existing under this Agreement or any other Loan Document to such Lender or such Issuing Bank or their respective Affiliates, irrespective of whether or not such Lender, Issuing Bank or Affiliate shall have made any demand under this Agreement or any other Loan Document and although such obligations of the Loan Parties may be contingent or unmatured or are owed to a branch office or Affiliate of such Lender or such Issuing Bank different from the branch office or Affiliate holding such deposit or obligated on such indebtedness; provided that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so setoff shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.20 and, pending such payment, shall be segregated by such Defaulting
Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent, the Issuing Banks, and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of each Lender, each Issuing Bank and their respective Affiliates under this Section 9.08 are in addition to other rights and remedies (including other rights of setoff) that such Lender, such Issuing Bank or their respective Affiliates may have. Each Lender and Issuing Bank agrees to notify the Borrower and the Administrative Agent promptly after any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application.
SECTION 9.09 Governing Law; Jurisdiction; Consent to Service of Process.
(a) This Agreement and the other Loan Documents shall be construed in accordance with and governed by the Law of the State of New York.
(b) Each of the Lenders and the Administrative Agent hereby irrevocably and unconditionally agrees that, notwithstanding the governing law provisions of any applicable Loan Document, any claims brought against the Administrative Agent, any Secured Party or any of their respective Related Parties relating to this Agreement, any other Loan Document, the Collateral or the consummation or administration of the transactions contemplated hereby or thereby shall be construed in accordance with and governed by the law of the State of New York.
(c) Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the United States District Court for the Southern District of New York sitting in the Borough of Manhattan (or if such court lacks subject matter jurisdiction, the Supreme Court of the State of New York sitting in the Borough of Manhattan), and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or any other Loan Document or the transactions relating hereto or thereto, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may (and any such claims, cross-claims or third party claims brought against the Administrative Agent or any of its Related Parties may only) be heard and determined in such Federal (to the extent permitted by law) or New York State court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement or in any other Loan Document shall (i) affect any right that the Administrative Agent, any Issuing Bank or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against the Borrower, any Loan Party or its properties in the courts of any jurisdiction, (ii) waive any statutory, regulatory, common law, or other rule, doctrine, legal restriction, provision or the like providing for the treatment of bank branches, bank agencies, or other bank offices as if they were separate juridical entities for certain purposes, including Uniform Commercial Code Sections 4-106, 4-A-105(1)(b), and 5-116(b), UCP 600 Article 3 and ISP98 Rule 2.02, and URDG 758 Article 3(a), or (iii) affect which courts have or do not have personal jurisdiction over the issuing bank or beneficiary of any Letter of Credit or any advising bank, nominated bank or assignee of proceeds thereunder or proper venue with respect to any litigation arising out of or relating to such Letter of Credit with, or affecting the rights of, any Person not a party to this Agreement, whether or not such Letter of Credit contains its own jurisdiction submission clause.
(d) Each of the parties hereto hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in paragraph (c) of this Section. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(e) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.01. Nothing in this Agreement or any other Loan Document will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
SECTION 9.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.10.
SECTION 9.11 Headings. Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.
SECTION 9.12 Confidentiality. Each of the Administrative Agent, the Issuing Banks and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and its and their respective directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any Governmental Authority (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any suit, action or proceeding relating to this Agreement or the enforcement of rights hereunder or under any other Loan Document, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any actual or prospective counterparty (or its advisors) to any swap, derivative or insurance transaction relating to the Loan Parties and their obligations, (g) on a confidential basis to (i) any rating agency in connection with rating the Borrower or its Subsidiaries or the credit facilities provided for herein or (ii) the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of identification numbers with respect to the credit facilities provided for herein, (h) with the consent of the Borrower, (i) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section, (ii) becomes available to the Administrative Agent, any Lender, any Issuing Bank or any of their respective branches or Affiliates on a nonconfidential basis from a source other than the Borrower that is not known to be subject to a confidentiality obligation to the Borrower or (iii) is independently discovered or developed by a party hereto without utilizing any Information received from the Borrower or violating the terms of this Section or (j) to the extent required by a potential or actual insurer or reinsurer in connection with providing insurance, reinsurance or credit risk mitigation coverage under which payments are to be made or may be made by reference to this Agreement. For the purposes of this Section, “Information” means all information received from the Loan Parties or from other Persons on their behalf relating to the Loan
Parties, their Subsidiaries or their business, other than any such information that is available to the Administrative Agent, any Issuing Bank or any Lender on a non-confidential basis prior to disclosure by the Borrower and other than information pertaining to this Agreement routinely provided by arrangers to data service providers, including league table providers, that serve the lending industry; provided that, in the case of information received from the Borrower after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.
For the avoidance of doubt, nothing in this Section 9.12 shall prohibit any Person from voluntarily disclosing or providing any Information within the scope of this confidentiality provision to any governmental, regulatory or self-regulatory organization (any such entity, a “Regulatory Authority”) to the extent that any such prohibition on disclosure set forth in this Section 9.12 shall be prohibited by the laws or regulations applicable to such Regulatory Authority.
SECTION 9.13 Several Obligations; Nonreliance; Violation of Law. The respective obligations of the Lenders hereunder are several and not joint and the failure of any Lender to make any Loan or perform any of its obligations hereunder shall not relieve any other Lender from any of its obligations hereunder. Each Lender hereby represents that it is not relying on or looking to any margin stock (as defined in Regulation U of the Board) for the repayment of the Borrowings provided for herein. Anything contained in this Agreement to the contrary notwithstanding, neither the Issuing Bank nor any Lender shall be obligated to extend credit to the Borrower in violation of any Requirement of Law.
SECTION 9.14 USA PATRIOT Act and Beneficial Ownership. Each Lender that is subject to the requirements of the USA PATRIOT Act of 2001 (the “USA Patriot Act”) and Beneficial Ownership Regulation hereby notifies the Borrower that pursuant to the requirements of the Patriot Act and Beneficial Ownership Regulation, it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender to identify the Borrower in accordance with the Patriot Act and Beneficial Ownership Regulation.
SECTION 9.15 Disclosure. Each Loan Party, each Lender and each Issuing Bank hereby acknowledges and agrees that the Administrative Agent and/or its Affiliates from time to time may hold investments in, make other loans to or have other relationships with, any of the Loan Parties and their respective Affiliates.
SECTION 9.16 Appointment for Perfection. Each Lender hereby appoints each other Lender as its agent for the purpose of perfecting Liens, for the benefit of the Administrative Agent and the Secured Parties, in assets which, in accordance with Article 9 of the UCC or any other applicable law can be perfected only by possession or control. Should any Lender (other than the Administrative Agent) obtain possession or control of any such Collateral, such Lender shall notify the Administrative Agent thereof, and, promptly upon the Administrative Agent’s request therefor shall deliver such Collateral to the Administrative Agent (if applicable) or otherwise deal with such Collateral in accordance with the Administrative Agent’s instructions.
SECTION 9.17 Interest Rate Limitation. Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which are treated as interest on such Loan under applicable law (collectively the “Charges”), shall exceed the maximum lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by the Lender holding such Loan in accordance with applicable law, the rate of interest payable in
respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section 9.17 shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the NYFRB Rate to the date of repayment, shall have been received by such Lender.
SECTION 9.18 No Fiduciary Duty, etc.
(a) The Borrower acknowledges and agrees, and acknowledges its Subsidiaries’ understanding, that no Credit Party will have any obligations except those obligations expressly set forth herein and in the other Loan Documents and each Credit Party is acting solely in the capacity of an arm’s length contractual counterparty to the Borrower with respect to the Loan Documents and the transactions contemplated herein and therein and not as a financial advisor or a fiduciary to, or an agent of, the Borrower or any other person. The Borrower agrees that it will not assert any claim against any Credit Party based on an alleged breach of fiduciary duty by such Credit Party in connection with this Agreement and the transactions contemplated hereby. Additionally, the Borrower acknowledges and agrees that no Credit Party is advising the Borrower as to any legal, tax, investment, accounting, regulatory or any other matters in any jurisdiction. The Borrower shall consult with its own advisors concerning such matters and shall be responsible for making its own independent investigation and appraisal of the transactions contemplated herein or in the other Loan Documents, and the Credit Parties shall have no responsibility or liability to the Borrower with respect thereto.
(b) The Borrower further acknowledges and agrees, and acknowledges its Subsidiaries’ understanding, that each Credit Party, together with its Affiliates, in addition to providing or participating in commercial lending facilities such as that provided hereunder, is a full service securities or banking firm engaged in securities trading and brokerage activities as well as providing investment banking and other financial services. In the ordinary course of business, any Credit Party may provide investment banking and other financial services to, and/or acquire, hold or sell, for its own accounts and the accounts of customers, equity, debt and other securities and financial instruments (including bank loans and other obligations) of, the Borrower and other companies with which the Borrower may have commercial or other relationships. With respect to any securities and/or financial instruments so held by any Credit Party or any of its customers, all rights in respect of such securities and financial instruments, including any voting rights, will be exercised by the holder of the rights, in its sole discretion.
(c) In addition, the Borrower acknowledges and agrees, and acknowledges its Subsidiaries’ understanding, that each Credit Party and its affiliates may be providing debt financing, equity capital or other services (including financial advisory services) to other companies in respect of which the Borrower may have conflicting interests regarding the transactions described herein and otherwise. No Credit Party will use confidential information obtained from the Borrower by virtue of the transactions contemplated by the Loan Documents or its other relationships with the Borrower in connection with the performance by such Credit Party of services for other companies, and no Credit Party will furnish any such information to other companies. The Borrower also acknowledges that no Credit Party has any obligation to use in connection with the transactions contemplated by the Loan Documents, or to furnish to the Borrower, confidential information obtained from other companies.
SECTION 9.19 [Intentionally Omitted].
SECTION 9.20 Acknowledgement and Consent to Bail-In of Affected Financial Institutions. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Affected
Financial Institution arising under any Loan Document may be subject to the Write-Down and Conversion Powers of the applicable Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:
(a) the application of any Write-Down and Conversion Powers by the applicable Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an Affected Financial Institution; and
(b) the effects of any Bail-In Action on any such liability, including, if applicable:
(i) a reduction in full or in part or cancellation of any such liability;
(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such Affected Financial Institution, its parent entity, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or
(iii) the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of the applicable Resolution Authority.
SECTION 9.21 Acknowledgement Regarding Any Supported QFCs.
(a) To the extent that the Loan Documents provide support, through a guarantee or otherwise, for Swap Agreements or any other agreement or instrument that is a QFC (such support “QFC Credit Support” and each such QFC a “Supported QFC”), the parties acknowledge and agree as follows with respect to the resolution power of the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act and Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes”) in respect of such Supported QFC and QFC Credit Support (with the provisions below applicable notwithstanding that the Loan Documents and any Supported QFC may in fact be stated to be governed by the laws of the State of New York and/or of the United States or any other state of the United States).
(b) In the event a Covered Entity that is party to a Supported QFC (each, a “Covered Party”) becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and any interest and obligation in or under such Supported QFC and such QFC Credit Support, and any rights in property securing such Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if the Supported QFC and such QFC Credit Support (and any such interest, obligation and rights in property) were governed by the laws of the United States or a state of the United States. In the event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under the Loan Documents that might otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised against such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Supported QFC and the Loan Documents were governed by the laws of the United States or a state of the United States. Without limitation of the foregoing, it is understood and agreed that rights and remedies of the parties with respect to a Defaulting Lender shall in no event affect the rights of any Covered Party with respect to a Supported QFC or any QFC Credit Support.
ARTICLE X
LOAN GUARANTY
SECTION 10.01 Guaranty. Each Guarantor (other than those that have delivered a separate Loan Guaranty) hereby agrees that it is jointly and severally liable for, and, as a primary obligor and not merely as surety, absolutely, unconditionally and irrevocably guarantees to the Secured Parties, the prompt payment when due, whether at stated maturity, upon acceleration or otherwise, and at all times thereafter, of the Secured Obligations and all costs and expenses to which the Secured Parties are entitled to reimbursement under Section 9.03, including, without limitation, all court costs and reasonable attorneys’ and paralegals’ fees and expenses paid or incurred by the Administrative Agent, the Issuing Banks and the Lenders in endeavoring to collect all or any part of the Secured Obligations from, or in prosecuting any action against, the Borrower, any Guarantor or any other guarantor of all or any part of the Secured Obligations to the extent reimbursable under Section 9.03 (such costs and expenses, together with the Secured Obligations, collectively the “Guaranteed Obligations”); provided, however, that the definition of “Guaranteed Obligations” shall not create any guarantee by any Guarantor of (or grant of security interest by any Guarantor to support, as applicable) any Excluded Swap Obligations of such Guarantor for purposes of determining any obligations of any Guarantor. Each Guarantor further agrees that the Guaranteed Obligations may be extended or renewed in whole or in part without notice to or further assent from it, and that it remains bound upon its guarantee notwithstanding any such extension or renewal. All terms of this Loan Guaranty apply to and may be enforced by or on behalf of any domestic or foreign branch or Affiliate of any Lender that extended any portion of the Guaranteed Obligations. This Loan Guaranty is a continuing guarantee and shall remain in effect until the Maturity Date. Each Guarantor hereby irrevocably waives any right to revoke this Loan Guaranty as to future transactions giving rise to any Guaranteed Obligations.
SECTION 10.02 Guaranty of Payment. This Loan Guaranty is a guaranty of payment and not of collection. Each Guarantor waives any right to require the Administrative Agent, the Issuing Bank or any Lender to sue the Borrower, any Guarantor, any other guarantor, or any other Person obligated for all or any part of the Guaranteed Obligations (each, an “Obligated Party”), or otherwise to enforce its payment against any collateral securing all or any part of the Guaranteed Obligations.
SECTION 10.03 No Discharge or Diminishment of Loan Guaranty.
(a) Except as otherwise provided for herein, the obligations of each Guarantor hereunder are unconditional and absolute and not subject to any reduction, limitation, impairment or termination for any reason (other than the Payment in Full of the Guaranteed Obligations), including: (i) any claim of waiver, release, extension, renewal, settlement, surrender, alteration, or compromise of any of the Guaranteed Obligations, by operation of law or otherwise; (ii) any change in the corporate existence, structure or ownership of the Borrower or any other Obligated Party liable for any of the Guaranteed Obligations; (iii) any insolvency, bankruptcy, reorganization or other similar proceeding affecting any Obligated Party, or their assets or any resulting release or discharge of any obligation of any Obligated Party; or (iv) the existence of any claim, setoff or other rights which any Guarantor may have at any time against any Obligated Party, the Administrative Agent, the Issuing Bank, any Lender, or any other Person, whether in connection herewith or in any unrelated transactions.
(b) The obligations of each Guarantor hereunder are not subject to any defense or setoff, counterclaim, recoupment, or termination whatsoever by reason of the invalidity, illegality, or unenforceability of any of the Guaranteed Obligations or otherwise, or any provision of applicable law or regulation purporting to prohibit payment by any Obligated Party, of the Guaranteed Obligations or any part thereof.
(c) Further, the obligations of any Guarantor hereunder are not discharged or impaired or otherwise affected by: (i) the failure of the Administrative Agent, the Issuing Bank or any Lender to assert any claim or demand or to enforce any remedy with respect to all or any part of the Guaranteed Obligations; (ii) any waiver or modification of or supplement to any provision of any agreement relating to the Guaranteed Obligations; (iii) any release, non-perfection, or invalidity of any indirect or direct security for the obligations of the Borrower for all or any part of the Guaranteed Obligations or any obligations of any other Obligated Party liable for any of the Guaranteed Obligations; (iv) any action or failure to act by the Administrative Agent, the Issuing Bank or any Lender with respect to any collateral securing any part of the Guaranteed Obligations; or (v) any default, failure or delay, willful or otherwise, in the payment or performance of any of the Guaranteed Obligations, or any other circumstance, act, omission or delay that might in any manner or to any extent vary the risk of such Guarantor or that would otherwise operate as a discharge of any Guarantor as a matter of law or equity (other than the Payment in Full of the Guaranteed Obligations).
SECTION 10.04 Defenses Waived. To the fullest extent permitted by applicable law, each Guarantor hereby waives any defense based on or arising out of any defense of the Borrower or any Guarantor or the unenforceability of all or any part of the Guaranteed Obligations from any cause, or the cessation from any cause of the liability of the Borrower, any Guarantor or any other Obligated Party, other than, in each case, the Payment in Full of the Guaranteed Obligations. Without limiting the generality of the foregoing, each Guarantor irrevocably waives acceptance hereof, presentment, demand, protest and, to the fullest extent permitted by law, any notice not provided for herein, as well as any requirement that at any time any action be taken by any Person against any Obligated Party, or any other Person. Each Guarantor confirms that it is not a surety under any state law and shall not raise any such law as a defense to its obligations hereunder. The Administrative Agent may, at its election, foreclose on any Collateral held by it by one or more judicial or nonjudicial sales, accept an assignment of any such Collateral in lieu of foreclosure or otherwise act or fail to act with respect to any collateral securing all or a part of the Guaranteed Obligations, compromise or adjust any part of the Guaranteed Obligations, make any other accommodation with any Obligated Party or exercise any other right or remedy available to it against any Obligated Party, without affecting or impairing in any way the liability of such Guarantor under this Loan Guaranty, except to the extent the Guaranteed Obligations have been Paid in Full. To the fullest extent permitted by applicable law, each Guarantor waives any defense arising out of any such election even though that election may operate, pursuant to applicable law, to impair or extinguish any right of reimbursement or subrogation or other right or remedy of any Guarantor against any Obligated Party or any security.
SECTION 10.05 Rights of Subrogation. No Guarantor will assert any right, claim or cause of action, including, without limitation, a claim of subrogation, contribution or indemnification that it has against any Obligated Party, or any collateral, until the Payment in Full of the Secured Obligations.
SECTION 10.06 Reinstatement; Stay of Acceleration. If at any time any payment of any portion of the Guaranteed Obligations (including a payment effected through exercise of a right of setoff) is rescinded, or must otherwise be restored or returned upon the insolvency, bankruptcy or reorganization of the Borrower or otherwise (including pursuant to any settlement entered into by a Secured Party in its discretion), each Guarantor’s obligations under this Loan Guaranty with respect to that payment shall be reinstated at such time as though the payment had not been made and whether or not the Administrative Agent, the Issuing Banks and the Lenders are in possession of this Loan Guaranty. If acceleration of the time for payment of any of the Guaranteed Obligations is stayed upon the insolvency, bankruptcy or reorganization of the Borrower, all such amounts otherwise subject to acceleration under the terms of any agreement relating to the Guaranteed Obligations shall nonetheless be payable by the Guarantors forthwith on demand by the Administrative Agent.
SECTION 10.07 Information. Each Guarantor assumes all responsibility for being and keeping itself informed of the Borrower’s financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations and the nature, scope and extent of the risks that each Guarantor assumes and incurs under this Loan Guaranty, and agrees that none of the Administrative Agent, the Issuing Bank or any Lender shall have any duty to advise any Guarantor of information known to it regarding those circumstances or risks.
SECTION 10.08 Termination. Each of the Lenders and the Issuing Bank may continue to make loans or extend credit to the Borrower based on this Loan Guaranty until five (5) days after it receives written notice of termination from any Guarantor. Notwithstanding receipt of any such notice, each Guarantor will continue to be liable to the Lenders for any Guaranteed Obligations created, assumed or committed to prior to the fifth (5th) day after receipt of the notice, and all subsequent renewals, extensions, modifications and amendments with respect to, or substitutions for, all or any part of such Guaranteed Obligations. Nothing in this Section 10.08 shall be deemed to constitute a waiver of, or eliminate, limit, reduce or otherwise impair any rights or remedies the Administrative Agent or any Lender may have in respect of, any Default or Event of Default that shall exist under Article VII hereof as a result of any such notice of termination.
SECTION 10.09 Taxes. Each payment of the Guaranteed Obligations will be made by each Guarantor without withholding for any Taxes, unless such withholding is required by law. If any Guarantor determines, in its sole discretion exercised in good faith, that it is so required to withhold Taxes, then such Guarantor may so withhold and shall timely pay the full amount of withheld Taxes to the relevant Governmental Authority in accordance with applicable law. If such Taxes are Indemnified Taxes, then the amount payable by such Guarantor shall be increased as necessary so that, net of such withholding (including such withholding applicable to additional amounts payable under this Section), the Administrative Agent, Lender or Issuing Bank (as the case may be) receives the amount it would have received had no such withholding been made.
SECTION 10.10 Maximum Liability. The provisions of this Loan Guaranty are severable, and in any action or proceeding involving any state corporate law, or any state, federal or foreign bankruptcy, insolvency, reorganization or other law affecting the rights of creditors generally, if the obligations of any Guarantor under this Loan Guaranty would otherwise be held or determined to be avoidable, invalid or unenforceable on account of the amount of such Guarantor’s liability under this Loan Guaranty, then, notwithstanding any other provision of this Loan Guaranty to the contrary, the amount of such liability shall, without any further action by the Guarantors or the Administrative Agent, the Issuing Bank or any Lender, be automatically limited and reduced to the highest amount that is valid and enforceable as determined in such action or proceeding (such highest amount determined hereunder being the relevant Guarantor’s “Maximum Liability”). This Section 10.10 with respect to the Maximum Liability of each Guarantor is intended solely to preserve the rights of the Administrative Agent, the Issuing Banks and the Lenders to the maximum extent not subject to avoidance under applicable law, and no Guarantor nor any other Person shall have any right or claim under this Section 10.10 with respect to such Maximum Liability, except to the extent necessary so that the obligations of any Guarantor hereunder shall not be rendered voidable under applicable law. Each Guarantor agrees that the Guaranteed Obligations may at any time and from time to time exceed the Maximum Liability of each Guarantor without impairing this Loan Guaranty or affecting the rights and remedies of the Administrative Agent, the Issuing Bank or the Lenders hereunder; provided that nothing in this sentence shall be construed to increase any Guarantor’s obligations hereunder beyond its Maximum Liability. Notwithstanding any other provision of this Loan Guaranty, the amount guaranteed by each Guarantor hereunder shall be limited to the extent, if any, required so that its obligations hereunder shall not be subject to avoidance under Section 548 of the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act, Uniform Voidable Transactions Act or similar statute or common law. In determining the limitations, if any, on the amount of
any Guarantor’s obligations hereunder pursuant to the preceding sentence, it is the intention of the parties hereto that any rights of subrogation, indemnification or contribution which such Guarantor may have under this Loan Guaranty, any other agreement or applicable law shall be taken into account.
SECTION 10.11 Contribution.
(a) To the extent that any Guarantor shall make a payment under this Loan Guaranty (a “Guarantor Payment”) which, taking into account all other Guarantor Payments then previously or concurrently made by any other Guarantor, exceeds the amount which otherwise would have been paid by or attributable to such Guarantor if each Guarantor had paid the aggregate Guaranteed Obligations satisfied by such Guarantor Payment in the same proportion as such Guarantor’s “Allocable Amount” (as defined below) (as determined immediately prior to such Guarantor Payment) bore to the aggregate Allocable Amounts of each of the Guarantors as determined immediately prior to the making of such Guarantor Payment, then, following payment in full in cash of the Guarantor Payment, the Payment in Full of the Guaranteed Obligations and the termination of this Agreement, such Guarantor shall be entitled to receive contribution and indemnification payments from, and be reimbursed by, each other Guarantor for the amount of such excess, pro rata based upon their respective Allocable Amounts in effect immediately prior to such Guarantor Payment.
(b) As of any date of determination, the “Allocable Amount” of any Guarantor shall be equal to the excess of the fair saleable value of the property of such Guarantor over the total liabilities of such Guarantor (including the maximum amount reasonably expected to become due in respect of contingent liabilities, calculated, without duplication, assuming each other Guarantor that is also liable for such contingent liability pays its ratable share thereof), giving effect to all payments made by other Guarantors as of such date in a manner to maximize the amount of such contributions.
(c) This Section 10.11 is intended only to define the relative rights of the Guarantors, and nothing set forth in this Section 10.11 is intended to or shall impair the obligations of the Guarantors, jointly and severally, to pay any amounts as and when the same shall become due and payable in accordance with the terms of this Loan Guaranty.
(d) The parties hereto acknowledge that the rights of contribution and indemnification hereunder shall constitute assets of the Guarantor or Guarantors to which such contribution and indemnification is owing.
(e) The rights of the indemnifying Guarantors against other Guarantors under this Section 10.11 shall be exercisable upon the Payment in Full of the Guaranteed Obligations and the termination of this Agreement.
SECTION 10.12 Liability Cumulative. The liability of each Loan Party as a Guarantor under this Article X is in addition to and shall be cumulative with all liabilities of each Loan Party to the Administrative Agent, the Issuing Banks and the Lenders under this Agreement and the other Loan Documents to which such Loan Party is a party or in respect of any obligations or liabilities of the other Loan Parties, without any limitation as to amount, unless the instrument or agreement evidencing or creating such other liability specifically provides to the contrary.
SECTION 10.13 Keepwell. Each Qualified ECP Guarantor hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Loan Party to honor all of its obligations under this Loan Guaranty in respect of a Swap Obligation (provided, however, that each Qualified ECP Guarantor shall only be liable under this Section 10.13 for the maximum amount of such liability that can be hereby incurred without
rendering its obligations under this Section 10.13 or otherwise under this Loan Guaranty voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). Except as otherwise provided herein, the obligations of each Qualified ECP Guarantor under this Section 10.13 shall remain in full force and effect until the termination of all Swap Obligations. Each Qualified ECP Guarantor intends that this Section 10.13 constitute, and this Section 10.13 shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Loan Party for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.
SECTION 10.14 Release of Guarantors.
(a) A Guarantor shall automatically be released from its obligations under the Loan Guaranty upon the consummation of any transaction permitted by this Agreement as a result of which such Guarantor ceases to be a Subsidiary. In connection with any release pursuant to this Section, the Administrative Agent shall (and is hereby irrevocably authorized by each Lender to) execute and deliver to any Loan Party, at such Loan Party’s sole expense, all documents that such Loan Party shall reasonably request to evidence such release. Any execution and delivery of documents pursuant to this Section shall be without recourse to or warranty by the Administrative Agent.
(b) Further, the Administrative Agent may (and is hereby irrevocably authorized by each Lender to), upon the request of the Borrower, release any Guarantor from its obligations under the Loan Guaranty if such Guarantor becomes an Excluded Subsidiary.
(c) At such time as the principal and interest on the Loans, all LC Disbursements, the fees, expenses and other amounts payable under the Loan Documents and the other Secured Obligations shall have been Paid in Full, all obligations (other than those expressly stated to survive such termination) of each Guarantor thereunder shall automatically terminate, all without delivery of any instrument or performance of any act by any Person.
(d) Upon the effectiveness of any written consent to the release of the security interest created under any Collateral Document in any Collateral pursuant to Section 9.02, the security interests in such Collateral created by the Collateral Documents shall be automatically released.
[remainder of page intentionally left blank; signature pages follow]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their respective authorized officers as of the day and year first above written.
| | | | | | | | | | | |
| VOYAGER TECHNOLOGIES, INC., as the Borrower |
| | | |
| By: | | |
| Name: | | |
| Title: | | |
[Signature Page - Credit Agreement]
| | | | | | | | | | | |
| [__________], as a Guarantor |
| | | |
| By: | | |
| Name: | | |
| Title: | | |
[Signature Page - Credit Agreement]
| | | | | | | | | | | |
| JPMORGAN CHASE BANK, N.A., individually, and as Administrative Agent, a Lender and Issuing bank |
| | | |
| By: | | |
| Name: | | |
| Title: | | |
[Signature Page - Credit Agreement]
| | | | | | | | | | | |
| [__________], as a Lender |
| | | |
| By: | | |
| Name: | | |
| Title: | | |
[Signature Page - Credit Agreement]
Voyager Space Holdings, Inc.
2020 Incentive Plan
Dated as of March 5, 2020
As Amended February 29, 2024 and November 13, 2024
1. Establishment and Effective Date. Voyager Space Holdings, Inc., a Delaware corporation (the “Company”) has established this Voyager Space Holdings, Inc. 2020 Incentive Plan (the “Plan”) as of the date first set forth above, which shall be the effective date of the Plan (the “Effective Date”). The Plan amends, restates and replaces in its entirety the Voyager Space Holdings, Inc. 2019 Incentive Plan.
2. Purpose. The purpose of this Plan is to aid the Company in attracting, retaining, motivating and rewarding employees, non-employee directors and key consultants to the Company or its subsidiaries, to provide for equitable and competitive compensation opportunities, to recognize individual contributions and reward achievement of Company goals, and promote the creation of long-term value for stockholders by closely aligning the interests of Participants with those of stockholders. The Plan authorizes equity-based and cash-based incentives for Participants.
3. Definitions. In addition to the terms defined above and elsewhere in the Plan, the following capitalized terms used in the Plan have the respective meanings set forth in this Section:
(a) “Award” means any Option, SAR, Restricted Stock, Phantom Stock, Sale Phantom Stock, Stock granted as a bonus, Performance Award, other Stock-Based Award or Annual Incentive Award, together with any related right or interest, granted to a Participant under the Plan.
(b) “Award Agreement” means a Stock Option Agreement, a Stock Appreciation Rights Agreement, a Phantom Stock Agreement, a Sale Phantom Stock Agreement, a Restricted Stock Agreement, an agreement related to another share-based agreement pursuant to Section 7(h) or an agreement related to a Performance Award pursuant to Section 7(g) and Section 8, as applicable.
(c) “Beneficiary” means the legal representatives of the Participant’s estate entitled by will or the laws of descent and distribution to receive the benefits under a Participant’s Award upon a Participant’s death, provided that, if and to the extent authorized by the Committee, a Participant may be permitted to designate a Beneficiary, in which case the “Beneficiary” instead will be the person, persons, trust or trusts (if any are then surviving) which have been designated by the Participant in his or her most recent written beneficiary designation filed with the Company to receive the benefits specified under the Participant’s Award upon such Participant’s death.
(d) “Board” means the Company’s Board of Directors.
(e) “Change in Control” and related terms have the meanings specified in Section 10(c).
(f) “Code” means the Internal Revenue Code of 1986, as amended, and proposed and final
Treasury Department regulations issued thereunder.
(g) “Consultant” means a person engaged to provide consulting or advisory services (other than as an Employee or a Director) to the Company, provided that the identity of such person, the nature of such services or the entity to which such services are provided would not preclude the Company from offering or selling securities to such person pursuant to the Plan in reliance on registration on Form S-8 under the Securities Act.
(h) “Committee” means the Compensation Committee of the Board, if one exists, or the Board if a Compensation Committee does not exist at any time.
(i) “Director” means a member of the Board.
(j) “Effective Date” has the meaning specified in Section 1.
(k) “Eligible Person” has the meaning specified in Section 6.
(l) “Employee” means any person treated as an employee (including an Officer or a Director who is also treated as an employee) in the records of the Company and, with respect to any Incentive Stock Option granted to such person, who is an employee for purposes of Section 422 of the Code; provided, however, that neither service as a Director nor payment of a Director’s fee shall be sufficient to constitute employment for purposes of the Plan. The Company shall determine in good faith and in the exercise of its discretion whether an individual has become or has ceased to be an Employee and the effective date of such individual’s employment or termination of employment, as the case may be. For purposes of an individual’s rights, if any, under the terms of the Plan as of the time of the Company’s determination of whether or not the individual is an Employee, all such determinations by the Company shall be final, binding and conclusive as to such rights, if any, notwithstanding that the Company or any court of law or governmental agency subsequently makes a contrary determination as to such individual’s status as an Employee.
(m) “Exchange Act” means the Securities Exchange Act of 1934, as amended.
(n) “Fair Market Value” means the fair market value per share of Stock as determined by the Committee under any method of determining fair market value as shall be permissible under the Code and the rules and regulations thereunder.
(o) “Incentive Stock Option” means an Option intended to be (as set forth in the Award Agreement) and which qualifies as an incentive stock option within the meaning of Section 422(b) of the Code.
(p) “ISO-Qualifying Corporation” has the meaning ascribed to such term in Section 6(b)(ii).
(q) “Non-qualified Stock Option” means an Award of an Option not intended to be (as set forth in the Award Agreement) or which does not qualify as an incentive stock option within the meaning of Section 422(b) of the Code.
(r) “Officer” means any person designated by the Board as an officer of the Company.
(s) “Option” means a right, granted to a Participant under Section 7(b), to purchase Stock at a specified price during specified time periods, including an Incentive Stock Option or a Non-qualified Stock Option.
(t) “Other Stock-Based Awards” means Awards granted to a Participant under Section 7(h).
(u) “Participant” means a person who has been granted an Award under the Plan which remains outstanding, including a person who is no longer an Eligible Person.
(v) “Performance Award” means a conditional right, granted to a Participant under Section 7(g) and Section 8, to receive cash, Stock or other Awards or payments, as determined by the Committee, based upon performance criteria specified by the Committee.
(w) “Phantom Stock” means a right granted to a Participant under Section 7(d).
(x) “Restricted Stock” means Stock granted to a Participant under Section 7(f) which is subject to certain restrictions and to a risk of forfeiture.
(y) “Sale Phantom Stock” means a right granted to a Participant under Section 7(e).
(z) “Securities Act” means the Securities Act of 1933, as amended.
(aa) “Service” means a Participant’s employment or service with the Company, whether as an Employee, a Director or a Consultant. Unless otherwise provided by the Committee, a Participant’s Service shall not be deemed to have terminated merely because of a change in the capacity in which the Participant renders Service or a change in the Company, provided that there is no interruption or termination of the Participant’s Service
(bb) “Stock” or “Common Stock” means the Company’s common stock, par value $0.0001 per share, and any other equity securities of the Company that may be substituted or resubstituted for Stock pursuant to Section 12(c).
(cc) “Stock Appreciation Rights” or “SAR” means a right granted to a Participant under Section 7(c).
(dd) “Ten Percent Owner” means a Participant who, at the time an Award of an Option is granted to the Participant, owns Stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company within the meaning of Section 422(b)(6) of the Code.
(ee) “Termination of Service” means (1) with respect to an Award granted to an Employee, the termination of the employment relationship between the Employee and the Company; (2) with respect to an Award granted to a Consultant, the termination of the consulting
or advisory arrangement between the Consultant and the Company; and (3) with respect to an Award granted to a non-employee Director, the cessation of the provision of services as a director of the Company. A Termination of Service shall not be deemed to have resulted by reason of a bona fide leave of absence approved by the Company. Notwithstanding the foregoing, if the Participant’s status changes from Employee, Consultant or non-employee Director to any other status eligible to receive an Award under the Plan, no Termination of Service shall occur for purposes of the Plan until the Participant’s new status with the Company terminates.
4. Administration.
(a) Authority of the Committee. The Plan shall be administered by the Committee, which shall have full and final authority, in each case subject to and consistent with the provisions of the Plan, to select Eligible Persons to become Participants; to grant Awards; to determine the type and number of Awards, the dates on which Awards may be exercised and on which the risk of forfeiture or deferral period relating to Awards shall lapse or terminate, the acceleration of any such dates, the expiration date of any Award, whether, to what extent, and under what circumstances an Award may be settled, or the exercise price of an Award may be paid, in cash, Stock, other Awards, or other property, and other terms and conditions of, and all other matters relating to Awards; to prescribe documents evidencing or setting terms of Awards (such Award documents need not be identical for each Participant), amendments thereto, and rules and regulations for the administration of the Plan and amendments thereto; to construe and interpret the Plan and Award documents and correct defects, supply omissions or reconcile inconsistencies therein; and to make all other decisions and determinations as the Committee may deem necessary or advisable for the administration of the Plan. Decisions of the Committee with respect to the administration and interpretation of the Plan shall be final, conclusive, and binding upon all persons interested in the Plan, including Participants, Beneficiaries, transferees under Section 12(b) and other persons claiming rights from or through a Participant, and stockholders.
(b) Limitation of Liability. The Committee and each member thereof, and any person acting pursuant to authority delegated by the Committee, shall be entitled, in good faith, to rely or act upon any report or other information furnished by any executive officer, other officer or employee of the Company or a subsidiary, the Company’s independent auditors, consultants, legal counsel or any other agents assisting in the administration of the Plan. Members of the Committee, any person acting pursuant to authority delegated by the Committee, and any officer or employee of the Company or a subsidiary acting at the direction or on behalf of the Committee or a delegee shall not be personally liable for any action or determination taken or made in good faith with respect to the Plan, and shall, to the extent permitted by law, be fully indemnified and protected by the Company with respect to any such action or determination.
5. Stock Subject to Plan.
(a) Overall Number of Shares Available for Delivery. Subject to adjustment as provided in Section 12(c), the total number of shares of Stock reserved and available for delivery in connection with Awards under the Plan (excluding, for the avoidance of doubt, any
Phantom Stock or Sale Phantom Stock) shall be equal to 4,375,1281 shares of Common Stock. Any shares of Stock delivered under the Plan shall consist of authorized and unissued shares or treasury shares.
(b) Share Counting Rules.
(i) The Committee may adopt reasonable counting procedures to ensure appropriate counting, avoid double counting (as, for example, in the case of tandem or substitute awards) and make adjustments if the number of shares of Stock actually delivered differs from the number of shares previously counted in connection with an Award.
(ii) Shares that are potentially deliverable under an Award under the Plan that are canceled, expired, forfeited, settled in cash or otherwise terminated without a delivery of such shares to the Participant will not be counted as delivered under the Plan and shall be available for Awards under this Plan. However, shares withheld in payment of the exercise price or taxes relating to an Award and shares equal to the number surrendered in payment of any exercise price or taxes relating to an Award shall be deemed to constitute shares delivered to the Participant and shall not be available for reissue as Awards under this Plan.
(iii) Because shares will count against the number reserved in Section 5(a) upon delivery, and subject to the share counting rules under this Section 5(b), the Committee may determine that Awards may be outstanding that relate to a greater number of shares than the aggregate remaining available under the Plan, so long as Awards will not result in delivery and vesting of shares in excess of the number then available under the Plan.
6. Eligibility, Participation and Award Limitations.
(a) General. Subject to the provision below regarding Incentive Stock Options, Awards may be granted under the Plan only to Eligible Persons. For purposes of the Plan, an “Eligible Person” means an Employee, Contractor or Director of the Company or any subsidiary, and any person who has been offered employment by the Company or a subsidiary, provided that such prospective employee may not receive any payment or exercise any right relating to an Award until such person has commenced employment with the Company or a subsidiary. The phrase “Eligible Person” shall be deemed to be tailored, if and as necessary, to conform to the restriction regarding the class of persons authorized hereunder and the Code to be awarded grants of Awards of Incentive Stock Options pursuant to Section 6(b)(ii).
(b) Incentive Stock Option Limitations.
(i) The maximum aggregate number of shares of Stock that may be issued under the Plan as Incentive Stock Options shall be a number of shares subject to the limitation of the number of all Awards determined in accordance with Section 5(a).
(ii) An Incentive Stock Option may be granted only to a person who, on the effective date of grant, is an Employee of the Company, or a subsidiary (each being an “ISO-
1 Note: Post- 2021 Split number.
Qualifying Corporation”). Any person who is not an Employee of an ISO-Qualifying Corporation on the effective date of the grant of an Option to such person may be granted only a Non-qualified Stock Option.
(iii) To the extent that Options designated as Incentive Stock Options (granted under all stock plans of the Company, including the Plan) become exercisable by a Participant for the first time during any calendar year for stock having a Fair Market Value greater than $100,000, the portion of such Options which exceeds such amount shall be treated as Non-qualified Stock Options. For purposes of this Section 6(b), Options designated as Incentive Stock Options shall be taken into account in the order in which they were granted, and the Fair Market Value of Stock shall be determined as of the time the Option with respect to such Stock is granted. If the Code is amended to provide for a limitation different from that set forth in this Section 6(b), such different limitation shall be deemed incorporated herein effective as of the date and with respect to such Options as required or permitted by such amendment to the Code. If an Option is treated as an Incentive Stock Option in part and as a Non-qualified Stock Option in part by reason of the limitation set forth in this Section 6(b), the Participant may designate which portion of such Option the Participant is exercising. In the absence of such designation, the Participant shall be deemed to have exercised the Incentive Stock Option portion of the Option first. Upon exercise of the Option, shares issued pursuant to each such portion shall be separately identified.
7. Specific Terms of Awards.
(a) General. Awards may be granted on the terms and conditions set forth in this Section 7. In addition, the Committee may impose on any Award or the exercise thereof, at the date of grant or thereafter (subject to Section 12(e)), such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine, including terms requiring forfeiture of Awards in the event of Termination of Service by the Participant, terms in the event of a Change in Control and terms permitting a Participant to make elections relating to his or her Award. The Committee shall retain full power and discretion with respect to any term or condition of an Award that is not mandatory under the Plan. The Committee shall require the payment of lawful consideration for an Award to the extent necessary to satisfy the requirements of the Delaware General Corporation Law, and may otherwise require payment of consideration for an Award except as limited by the Plan.
(b) Options. The Committee is authorized to grant Options to Participants on the following terms and conditions which options may be Incentive Stock Options or Non-qualified Stock Options for purposes of the Code, provided, however, that, notwithstanding anything herein to the contrary, the Committee shall not issue any Incentive Stock Options unless and until this Plan has been approved by the shareholders of the Company:
(i) The exercise price per share of Stock purchasable under an Option shall be determined by the Committee, provided that (A) as to a Non-qualified Stock Option, such exercise price shall be not less than the Fair Market Value of a share
of Stock on the date of grant of such Option; and (B) no Incentive Stock Option granted to a Ten Percent Owner shall have an exercise price per share less than one hundred ten percent (110%) of the Fair Market Value of a share of Stock on the effective date of grant of the Option. Notwithstanding the foregoing, an Option (whether an Incentive Stock Option or a Non-qualified Stock Option) may be granted with an exercise price less than the minimum exercise price set forth above if such Option is granted pursuant to an assumption or substitution for another option in a manner that would qualify under the provisions of Section 409A or Section 424(a) of the Code.
(ii) The Committee shall determine the term of each Option, provided that in no event shall the term of any Option or SAR issued in tandem therewith exceed ten years. The Committee shall determine the time or times at which or the circumstances under which an Option may be exercised in whole or in part (including based on achievement of performance goals and future service requirements), the methods by which such exercise price may be paid or deemed to be paid and the form of such payment (subject to Section 12(j)), including, without limitation, cash, Stock (including through withholding of Stock deliverable upon exercise, if such withholding will not result in the recognition of additional accounting expense to the Company), other Awards or awards granted under other plans of the Company or any subsidiary, or other property (including through “cashless exercise” arrangements, to the extent permitted by applicable law), and the methods by or forms in which Stock will be delivered or deemed to be delivered in satisfaction of Options to Participants.
(iii) Exercisability and Term of Options. Options shall be exercisable at such time or times, or upon such event or events, and subject to such terms, conditions, performance criteria and restrictions as shall be determined by the Committee and set forth in the Stock Option Agreement evidencing such Option; provided, however, that (a) no Option shall be exercisable after the expiration of ten (10) years after the effective date of grant of such Option, (b) no Incentive Stock Option granted to a Ten Percent Owner shall be exercisable after the expiration of five (5) years after the effective date of grant of such Option and (c) no Option granted to an Employee who is a non-exempt employee for purposes of the Fair Labor Standards Act of 1938, as amended, shall be first exercisable until at least six (6) months following the date of grant of such Option (except in the event of such Employee’s death, disability or retirement, upon a Change in Control, or as otherwise permitted by the Worker Economic Opportunity Act). Subject to the foregoing, unless otherwise specified by the Committee in the grant of an Option, each Option shall terminate ten (10) years after the effective date of grant of the Option, unless earlier terminated in accordance with its provisions.
(iv) Options shall be issued pursuant to a Stock Option Agreement, substantially in the form as attached hereto as Exhibit A, with such changes thereto as the Committee may deem necessary.
(c) Stock Appreciation Rights. The Committee is authorized to grant SARs to Participants on the following terms and conditions:
(i) An SAR shall confer on the Participant to whom it is granted a right to receive, upon vesting thereof, an amount equal to the excess of (A) the Fair Market Value of one share of Stock on the date of exercise (or, in the case of a “Limited SAR,” the Fair Market Value determined by reference to the Change in Control Price, as defined under Section 10(d)) over (B) the grant price of the SAR as determined by the Committee.
(ii) The Committee shall determine at the date of grant or thereafter, the time or times at which and the circumstances under which a SAR may be exercised in whole or in part (including based on achievement of performance goals and future service requirements), the method of exercise, method of settlement, form of consideration payable in settlement, method by or forms in which Stock will be delivered or deemed to be delivered to Participants, whether or not a SAR shall be free-standing or in tandem or combination with an Option, and the maximum term of a SAR, which in no event shall exceed a period of ten years from the date of grant. Limited SARs that may only be exercised in connection with a Change in Control or other event as specified by the Committee may be granted on such terms, not inconsistent with this Section 7(c), as the Committee may determine.
(iii) Stock Appreciation Rights shall be granted pursuant to a Stock Appreciation Rights Agreement, substantially in the form as attached hereto as Exhibit B, with such changes thereto as the Committee may deem necessary.
(d) Phantom Stock. The Committee is authorized to grant Phantom Stock to Participants on the following terms and conditions:
(i) A share of Phantom Stock shall confer on the Participant to whom it is granted a right to receive, upon vesting thereof, such payments or amounts as set forth in the Phantom Stock Agreement.
(ii) The Committee shall determine at the date of grant or thereafter, the time or times at which and the circumstances under which Phantom Stock shall vest in whole or in part, method of settlement, form of consideration payable in settlement.
(iii) Phantom Stock shall be issued pursuant to a Phantom Stock Agreement, substantially in the form as attached hereto as Exhibit C-1. Shares of Phantom Stock shall not be certificated.
(e) Sale Phantom Stock. The Committee is authorized to grant Sale Phantom Stock to Participants on the following terms and conditions:
(i) A share of Sale Phantom Stock shall confer on the Participant to whom it is granted a right to receive a proportionate share of such payments or amounts as set forth in the Sale Phantom Stock Agreement.
(ii) The Committee shall determine at the date of grant or thereafter, method of settlement, and form of consideration payable in settlement as to any Sale Phantom Stock.
(iii) Sale Phantom Stock shall be issued pursuant to a Sale Phantom Stock Agreement, substantially in the form as attached hereto as Exhibit C-2, with such changes thereto as the Committee may deem necessary. Shares of Sale Phantom Stock shall not be certificated.
(f) Restricted Stock. The Committee is authorized to grant Restricted Stock to Participants on the following terms and conditions:
(i) Restricted Stock shall be subject to such restrictions on transferability, risk of forfeiture and other restrictions, if any, as the Committee may impose, which restrictions may lapse separately or in combination at such times, under such circumstances (including based on achievement of performance goals and future service requirements), in such installments or otherwise and under such other circumstances as the Committee may determine at the date of grant or thereafter. Except to the extent restricted under the terms of the Plan and any Award document relating to the Restricted Stock, a Participant granted Restricted Stock shall have all of the rights of a stockholder, including the right to vote the Restricted Stock and the right to receive dividends thereon (subject to any mandatory reinvestment or other requirement imposed by the Committee).
(ii) Except as otherwise determined by the Committee, upon Termination of Service during the applicable restriction period, Restricted Stock that is at that time subject to restrictions shall be forfeited and reacquired by the Company; provided that the Committee may provide, by rule or regulation or in any Award document, or may determine in any individual case, that restrictions or forfeiture conditions relating to Restricted Stock will lapse in whole or in part, including in the event of terminations resulting from specified causes.
(iii) Restricted Stock granted under the Plan may be evidenced in such manner as the Committee shall determine. If certificates representing Restricted Stock are registered in the name of the Participant, the Committee may require that such certificates bear an appropriate legend referring to the terms, conditions and restrictions applicable to such Restricted Stock, that the Company retain physical possession of the certificates, and that the Participant deliver a stock power to the Company, endorsed in blank, relating to the Restricted Stock.
(iv) Restricted Stock shall be issued pursuant to a Restricted Stock Agreement, substantially in the form as attached hereto as Exhibit D, with such changes thereto as the Committee may deem necessary.
(g) Performance Awards. Performance Awards, denominated in cash or in Stock or other Awards, may be granted by the Committee in accordance with Section 8.
(h) Other Stock-Based Awards. The Committee is authorized, subject to limitations under applicable law, to grant to Participants such other Awards that may be denominated or payable in, valued in whole or in part by reference to, or otherwise based on, or related to, Stock or factors that may influence the value of Stock, including, without limitation, convertible or exchangeable debt securities, other rights convertible or exchangeable into
Stock, purchase rights for Stock, Awards with value and payment contingent upon performance of the Company or business units thereof or any other factors designated by the Committee, and Awards valued by reference to the book value of Stock or the value of securities of or the performance of specified subsidiaries or other business units. The Committee shall determine the terms and conditions of such Awards. Stock delivered pursuant to an Award in the nature of a purchase right granted under this Section 7(h) shall be purchased for such consideration, paid for at such times, by such methods, and in such forms, including, without limitation, cash, Stock, other Awards, notes, or other property, as the Committee shall determine. Cash awards, as an element of or supplement to any other Award under the Plan, may also be granted pursuant to this Section 7(h).
8. Performance Awards.
(a) Performance Awards Generally. The Committee is authorized to grant any of the awards described in Section 7(b), 7(c), 7(d), 7(e) and 7(f) as Performance Awards, the terms and conditions of which are described in this Section 8. Performance Awards may be denominated as a cash amount, number of shares of Stock, or specified number of other Awards (or a combination) which may be earned upon achievement or satisfaction of performance conditions specified by the Committee. In addition, the Committee may specify that any other Award shall constitute a Performance Award by conditioning the right of a Participant to exercise the Award or have it settled, and the timing thereof, upon achievement or satisfaction of such performance conditions as may be specified by the Committee. The Committee may use such business criteria and other measures of performance as it may deem appropriate in establishing any performance conditions, and may exercise its discretion to reduce or increase the amounts payable under any Award subject to performance conditions.
(b) Performance Goal Generally. The performance goal for such Performance Awards shall consist of one or more business criteria and a targeted level or levels of performance with respect to each of such criteria, as specified by the Committee consistent with this Section 8. The performance goal shall be objective, including the requirement that the level or levels of performance targeted by the Committee result in the achievement of performance goals being “substantially uncertain.” The Committee may determine that such Performance Awards shall be granted, exercised and settled upon achievement of any one performance goal or that two or more of the performance goals must be achieved as a condition to grant, exercise and settlement of such Performance Awards. Performance goals may differ for Performance Awards granted to any one Participant or to different Participants.
(i) One or more of the following business criteria for the Company, on a consolidated basis, shall be used by the Committee in establishing performance goals for such Performance Awards: (1) revenues; (2) earnings from operations, earnings before or after taxes, earnings before or after interest, depreciation, amortization, incentives, service fees or extraordinary or special items; (3) net income or net income per common share (basic or diluted); (4) return on assets, return on net assets, return on investment, return on capital, or return on equity; (5) cash flow, free cash flow, cash flow return on investment, or net cash provided by operations; (6) economic value created or added; (7) operating margin or profit margin;
(8) stock price, dividends or total stockholder return; and (9) strategic business criteria, consisting of one or more objectives based on meeting specified market penetration or value added, product development or introduction, geographic business expansion goals, cost targets, debt reduction, customer satisfaction, employee satisfaction, information technology, and goals relating to acquisitions or divestitures of subsidiaries, affiliates or joint ventures. The targeted level or levels of performance with respect to such business criteria may be established at such levels and in such terms as the Committee may determine, in its discretion, including in absolute terms, as a goal relative to performance in prior periods, or as a goal compared to the performance of one or more comparable companies or an index covering multiple companies.
(ii) Achievement of performance goals in respect of such Performance Awards shall be measured over a performance period as specified by the Committee.
(iii) The Committee may establish a Performance Award pool, which shall be an unfunded pool, for purposes of measuring performance of the Company in connection with Performance Awards. The amount of such Performance Award pool shall be based upon the achievement of a performance goal or goals based on one or more of the business criteria set forth in Section 8(b)(i) during the given performance period, as specified by the Committee in accordance with Section 8(b)(ii). The Committee may specify the amount of the Performance Award pool as a percentage of any of such business criteria, a percentage thereof in excess of a threshold amount, or as another amount which need not bear a strictly mathematical relationship to such business criteria.
(iv) Settlement of such Performance Awards shall be in cash, Stock, or other property, in the discretion of the Committee.
9. Certain Provisions Applicable to Awards.
(a) Stand-Alone, Additional, Tandem, and Substitute Awards. Options and SARs granted under the Plan may, in the discretion of the Committee, be granted either alone or in addition to or in tandem with the other, and any Award granted under the Plan may, in the discretion of the Committee, be granted in substitution or exchange for any other Award or any award granted under another plan of the Company, or any business entity to be acquired by the Company or a subsidiary, or any other right of a Participant to receive payment from the Company or any subsidiary, provided that such substitution or exchange does not cause the recipient to become subject to excise taxes under Code Section 409A. Options and SARs granted in addition to or in tandem with the other may be granted either as of the same time as or a different time from the grant of such other Award, except to the extent that grants at different times would cause the recipient of the Option or SAR to become subject to excise taxes under Code Section 409A.
(b) Term of Awards. The term of each Award shall be for such period as may be determined by the Committee, subject to the express limitations set forth in Section 7(b)(ii).
(c) Form and Timing of Payment under Awards; Deferrals. Subject to the terms of the Plan (including Section 12(j)) and any applicable Award document, payments to be made by the Company or a subsidiary upon the exercise of an Option or other Award or settlement of an Award may be made in such forms as the Committee shall determine, including, without limitation, cash, Stock, or other property. The settlement of any Award may be accelerated, and cash paid in lieu of Stock in connection with such settlement, in the discretion of the Committee or upon occurrence of one or more specified events (subject to Section 12(j)), provided such acceleration does not cause the recipient to become subject to excise taxes under Code Section 409A.
(d) Vesting Conditions. The Committee reserves the authority to establish such conditions under this Plan prior to the satisfaction of which an Award or shares subject to an Award remain subject to forfeiture or a repurchase option in favor of the Company exercisable for the Participant’s monetary purchase price, if any, for such shares upon the Participant’s termination of Service or failure of a performance condition to be satisfied. Awards may also be granted fully vested.
(e) Deferred Compensation Awards. Notwithstanding anything to the contrary contained herein, any Award which is subject to Code Section 409A shall, at a minimum, comply with all of the requirements set forth in Code Section 409A as are necessary to allow the deferral of federal income tax on the deferred compensation resulting from the Award and to avoid the constructive receipt of such deferred compensation.
10. Change in Control.
(a) Effect of “Change in Control” on Non-Performance Based Awards. In the event of a “Change in Control,” the following provisions shall apply to non-performance based Awards, including Awards as to which performance conditions previously have been satisfied or are deemed satisfied under Section 10(b), unless otherwise determined by the Committee at the time of the Change in Control or as otherwise provided in a current employment agreement between the Company and the Participant or as otherwise provided in the applicable Award Agreement:
(i) All deferral of settlement, forfeiture conditions and other restrictions applicable to Awards granted under the Plan shall lapse and such Awards shall be fully payable as of the time of the Change in Control without regard to deferral and vesting conditions, except to the extent of any waiver by the Participant or other express election to defer beyond the Change in Control and subject to applicable restrictions set forth in Section 12(a);
(ii) Any Award carrying a right to exercise that was not previously exercisable and vested shall become fully exercisable and vested as of the time of the Change in Control and shall remain exercisable and vested for the balance of the stated term of such Award without regard to any Termination of Service by the Participant other than a termination for “cause” (as defined in any employment or severance agreement between the Company or its subsidiary and the Participant then in effect or, if none, as defined by the Committee and in effect at the time of the Change in Control), subject only to applicable restrictions set forth in Section 12(a); and
(iii) The Committee may, in its discretion, determine to extend to any Participant who holds an Option the right to elect, during the 60-day period immediately following the Change in Control, in lieu of acquiring the shares of Stock covered by such Option, to receive in cash the excess of the Change in Control Price over the exercise price of such Option, multiplied by the number of shares of Stock covered by such Option, and to extend to any Participant who holds other types of Awards denominated in shares the right to elect, during the 60-day period immediately following the Change in Control, in lieu of receiving the shares of Stock covered by such Award, to receive in cash the Change in Control Price multiplied by the number of shares of Stock covered by such Award.
(b) Effect of “Change in Control” on Performance-Based Awards. In the event of a “Change in Control,” with respect to an outstanding Award subject to achievement of performance goals and conditions, such performance goals and conditions shall be deemed to be met or exceeded if and to the extent so provided by the Committee in the Award document governing such Award or other agreement with the Participant.
(c) Definition of “Change in Control.” A “Change in Control” shall be deemed to have occurred if, after the Effective Date, there shall have occurred any of the following:
(i) a complete dissolution or liquidation of the Company, or similar occurrence;
(ii) the consummation of a merger, consolidation, acquisition, separation, reorganization, or similar occurrence, where the Company is not the surviving entity in a single transaction or a series of related transactions;
(iii) a transfer of substantially all of the assets of the Company or more than 50% of the outstanding Common Stock, each in a single transaction or a series of related transactions;
(iv) the individuals who constitute the Board as of the Effective Date, or who have been recommended for election to the Board by two-thirds of the Board consisting of individuals who are either on the Board as of the Effective Date or such successors, cease for any reason to constitute at least a majority of such Board; or
(v) the initial public offering of the Company’s equity securities pursuant to an effective registration statement filed with the Securities and Exchange Commission in accordance with the Securities Act or a direct listing of the Company's equity securities in the United States on a national securities exchange (“IPO”).
Notwithstanding the foregoing, with respect to any deferred compensation Award which is subject to Code Section 409A and with respect to which Section 409A(a)(2)(A)(v) is applicable, a “Change in Control” shall not have been deemed to have occurred unless the requirements of Section 409A(a)(2)(A)(v) have been satisfied.
(d) Definition of “Change in Control Price.” “Change in Control Price” means an amount in cash equal to (i) the amount of cash and fair market value of property that is the highest price per share paid (including extraordinary dividends) in any transaction triggering the Change in Control or any liquidation of shares following a sale of substantially all assets of the Company or (ii) the price per share of common stock in an IPO.
11. Additional Award Forfeiture Provisions.
(a) Forfeiture of Options and Other Awards and Gains Realized Upon Prior Option
Exercises or Award Settlements. Unless otherwise determined by the Committee, each Award granted hereunder shall be subject to the following additional forfeiture conditions, to which the Participant, by accepting an Award hereunder, agrees. Unless as otherwise provided in a current employment agreement between the Company and the Participant or as otherwise provided in the applicable Award Agreement, if any of the events specified in Section 11(b)(i), Section 11(b)(ii), or Section 11(b)(iii) occurs or any provisions as may be set forth in any employment agreement or other agreement between the Participant and the Company occurs (in each case a “Forfeiture Event”), all of the following forfeitures will result, with such forfeitures becoming effective at the later of the occurrence of the Forfeiture Event or the Participant’s Termination of Service:
(i) The unexercised portion of the Option, whether or not vested, and any other Award not then settled (except for an Award that has not been settled solely due to an elective deferral by the Participant and otherwise is not forfeitable in the event of any Termination of Service of the Participant) will be immediately forfeited and canceled upon the occurrence of the Forfeiture Event; and
(ii) The Participant will be obligated to repay to the Company, in cash, within five business days after demand is made therefor by the Company, the total amount of Award Gain (as defined herein) realized by the Participant upon each exercise of an Option or settlement of an Award (regardless of any elective deferral) that occurred on or after (A) the date that is six months prior to the occurrence of the Forfeiture Event, if the Forfeiture Event occurred while the Participant was employed by the Company or a subsidiary, or (B) the date that is six months prior to the date the Participant’s employment by the Company or a subsidiary terminated, if the Forfeiture Event occurred after the Participant ceased to be so employed. For purposes of this Section 11(a), the term “Award Gain” shall mean (i) in respect of a given Option exercise, the product of (X) the Fair Market Value per share of Stock at the date of such exercise (without regard to any subsequent change in the market price of shares) minus the exercise price times (Y) the number of shares as to which the Option was exercised at that date, and (ii) in respect of any other settlement of an Award granted to the Participant, the Fair Market Value of the cash or Stock paid or payable to Participant (regardless of any elective deferral) less any cash or the Fair Market Value of any Stock or property (other than an Award or award which would have itself then been forfeitable hereunder and excluding any payment of tax withholding) paid by the Participant to the Company as a condition of or in connection with such settlement.
(b) Events Triggering Forfeiture. Unless otherwise provided in a current employment agreement between the Company and the Participant or as otherwise provided in the applicable Award Agreement, the forfeitures specified in Section 11(a) will be triggered upon the occurrence of any one of the following Forfeiture Events occurs (or, for the avoidance of doubt, upon any event set forth in any provisions as may be set forth in any employment agreement or other agreement between the Participant and the Company occurring) at any time during the Participant’s employment by the Company or a subsidiary or during the one-year period following termination of such employment:
(i) The Participant, acting alone or with others, directly or indirectly, prior to a Change
in Control, (A) engages, either as employee, employer, consultant, advisor, or director, or as an owner, investor, partner, or stockholder unless the Participant’s interest is insubstantial, in any business in an area or region in which the Company conducts business at the date the event occurs, which is directly in competition with a business then conducted by the Company or a subsidiary; (B) induces any customer, supplier, licensee or licensor of the Company or a subsidiary, or other company with which the Company or a subsidiary has a business relationship, to curtail, cancel, not renew, or not continue his or her or its business with the Company or any subsidiary; or (C) induces, or attempts to influence, any employee of or service provider (including, but not limited to, licensees and licensors) to the Company or a subsidiary to terminate such employment or service. The Committee shall, in its discretion, determine which lines of business the Company conducts on any particular date and which third parties may reasonably be deemed to be in competition with the Company. For purposes of this Section 11(b)(i), a Participant’s interest as a stockholder is insubstantial if it represents beneficial ownership of less than five percent of the outstanding class of stock, and a Participant’s interest as an owner, investor, or partner is insubstantial if it represents ownership, as determined by the Committee in its discretion, of less than five percent of the outstanding equity of the entity;
(ii) The Participant discloses, uses, sells, or otherwise transfers, except in the course of employment with or other service to the Company or any subsidiary, any confidential or proprietary information of the Company or any subsidiary, including but not limited to information regarding the Company’s current and potential customers, organization, employees, finances, and methods of operations and investments, so long as such information has not otherwise been disclosed to the public or is not otherwise in the public domain, except as required by law or pursuant to legal process, or the Participant makes statements or representations, or otherwise communicates, directly or indirectly, in writing, orally, or otherwise, or takes any other action which may, directly or indirectly, disparage or be damaging to the Company or any of its subsidiaries or their respective officers, directors, employees, advisors, businesses or reputations, except as required by law or pursuant to legal process; or
(iii) The Participant fails to cooperate with the Company or any subsidiary or by making himself or herself available to testify on behalf of the Company or such subsidiary in any action, suit, or proceeding, whether civil, criminal, administrative, or investigative, or otherwise fails to assist the Company or any subsidiary in any such action, suit, or proceeding by providing information and meeting and consulting with members of management of, other representatives of, or counsel to, the Company or such subsidiary, as reasonably requested.
(c) Agreement Does Not Prohibit Competition or Other Participant Activities. Although the conditions set forth in this Section 11 shall be deemed to be incorporated into an Award, a Participant is not thereby prohibited from engaging in any activity, including but not limited to competition with the Company and its subsidiaries. Rather, the non-occurrence of the Forfeiture Events set forth in Section 11(b) is a condition to the Participant’s right to realize and retain value from his or her
compensatory Options and Awards, and the consequence under the Plan if the Participant engages in an activity giving rise to any such Forfeiture Event are the forfeitures specified herein. The Company and the Participant shall not be precluded by this provision or otherwise from entering into other agreements concerning the subject matter of Section 11(a) and Section 11(b).
(d) Committee Discretion. The Committee may, in its discretion, waive in whole or in part the Company’s right to forfeiture under this Section 11, but no such waiver shall be effective unless evidenced by a writing signed by a duly authorized officer of the Company. In addition, the Committee may impose additional conditions on Awards, by inclusion of appropriate provisions in the document evidencing or governing any such Award.
12. General Provisions.
(a) Compliance with Legal and Other Requirements. The Company may, to the extent deemed necessary or advisable by the Committee, postpone the issuance or delivery of Stock or payment of other benefits under any Award until completion of such registration or qualification of such Stock or other required action under any federal or state law, rule or regulation, listing or other required action with respect to any stock exchange or automated quotation system upon which the Stock or other securities of the Company are listed or quoted, or compliance with any other obligation of the Company, as the Committee may consider appropriate, and may require any Participant to make such representations, furnish such information and comply with or be subject to such other conditions as it may consider appropriate in connection with the issuance or delivery of Stock or payment of other benefits in compliance with applicable laws, rules, and regulations, listing requirements, or other obligations.
(b) Limits on Transferability; Beneficiaries. No Award or other right or interest of a Participant under the Plan shall be pledged, hypothecated or otherwise encumbered or subject to any lien, obligation or liability of such Participant to any party (other than the Company or a subsidiary thereof), or assigned or transferred by such Participant otherwise than by will or the laws of descent and distribution or to a Beneficiary upon the death of a Participant, and such Awards or rights that may be exercisable shall be exercised during the lifetime of the Participant only by the Participant or his or her guardian or legal representative, except that Awards and other rights may be transferred to one or more transferees during the lifetime of the Participant, and may be exercised by such transferees in accordance with the terms of such Award, but only if and to the extent such transfers are permitted by the Committee, subject to any terms and conditions which the Committee may impose thereon (including limitations the Committee may deem appropriate in order that offers and sales under the Plan will meet applicable requirements of registration forms under the Securities Act of 1933 specified by the Securities and Exchange Commission). A Beneficiary, transferee, or other person claiming any rights under the Plan from or through any Participant shall be subject to all terms and conditions of the Plan and any Award document applicable to such Participant, except as otherwise determined by the Committee, and to any additional terms and conditions deemed necessary or appropriate by the Committee.
(c) Adjustments. In the event of any large, special and non-recurring dividend or other distribution (whether in the form of cash or property other than Stock), recapitalization, forward or reverse split, Stock dividend, reorganization, merger, consolidation, spin-off, combination, repurchase, share exchange, liquidation, dissolution or other similar corporate transaction or event affects the Stock, the Committee shall adjust any or all of (i) the number and kind of shares of Stock which may be delivered in connection with Awards granted thereafter, (ii) the number and kind of shares of Stock by which annual per-person Award limitations are measured under Section 8, (iii) the number and kind of shares of Stock subject to or deliverable in respect of outstanding Awards and (iv) the exercise price, grant price or purchase price relating to any Award or, if deemed appropriate, the Committee may make provision for a payment of cash or property to the holder of an outstanding Option (subject to Section 12(j)). In addition, the Committee is authorized to make adjustments in the terms and conditions of, and the criteria included in, Awards (including Performance Awards and performance goals and any hypothetical funding pool relating thereto) in recognition of unusual or nonrecurring events (including, without limitation, events described in the preceding sentence, as well as acquisitions and dispositions of businesses and assets) affecting the Company, any subsidiary or other business unit, or the financial statements of the Company or any subsidiary, or in response to changes in applicable laws, regulations, accounting principles, tax rates and regulations or business conditions or in view of the Committee’s assessment of the business strategy of the Company, any subsidiary or business unit thereof, performance of comparable organizations, economic and business conditions, personal performance of a Participant, and any other circumstances deemed relevant.
(d) Tax Provisions.
(i) The Company and any subsidiary is authorized to withhold from any Award granted, any payment relating to an Award under the Plan, including from a distribution of Stock, or any payroll or other payment to a Participant, amounts of withholding and other taxes due or potentially payable in connection with any transaction involving an Award, and to take such other action as the Committee may deem advisable to enable the Company and Participants to satisfy obligations for the payment of withholding taxes and other tax obligations relating to any Award. This authority shall include authority to withhold or receive Stock or other property and to make cash payments in respect thereof in satisfaction of a Participant’s withholding obligations, either on a mandatory or elective basis in the discretion of the Committee. Other provisions of the Plan notwithstanding, only the minimum amount of Stock deliverable in connection with an Award necessary to satisfy statutory withholding requirements will be withheld, except a greater amount of Stock may be withheld if such withholding would not result in the recognition of additional accounting expense to the Company.
(ii) No election under Code Section 83(b) (to include in gross income in the year of transfer the amounts specified in Code Section 83(b)) or under a similar provision of the laws of a jurisdiction outside the United States may be made unless expressly permitted by the terms of the Award document or by action of the Committee in writing prior to the making of such election, which election right shall not be unreasonably withheld if the Participant requests to make such an election in
writing to the Committee. In any case in which a Participant is permitted to make such an election in connection with an Award, the Participant shall notify the Company of such election within ten days of filing notice of the election with the Internal Revenue Service or other governmental authority, in addition to any filing and notification required pursuant to regulations issued under Code Section 83(b) or other applicable provision.
(e) Changes to the Plan. The Board may amend, suspend or terminate the Plan or the Committee’s authority to grant Awards under the Plan without the consent of stockholders or Participants; provided, however, that any amendment to the Plan shall be submitted to the Company’s stockholders for approval not later than the earliest annual meeting for which the record date is after the date of such Board action if such stockholder approval is required by any federal or state law or regulation or the rules of any stock exchange or automated quotation system on which the Stock may then be listed or quoted, and the Board may otherwise, in its discretion, determine to submit other amendments to the Plan to stockholders for approval and provided further, that, without the consent of an affected Participant, no such Board action may materially and adversely affect the rights of such Participant under any outstanding Award. Except in connection with a corporate transaction involving the Company (including, without limitation, any stock dividend, stock split, extraordinary cash dividend, recapitalization, reorganization, merger, consolidation, split-up, spin-off, combination, or exchange of shares), the terms of outstanding awards may not be amended to reduce the exercise price of outstanding Options or SARs or cancel outstanding Options or SARS in exchange for cash, other awards or Options or SARs with an exercise price that is less than the exercise price of the original Options or SARs without stockholder approval.
(f) Right of Setoff. The Company or any subsidiary may, to the extent permitted by applicable law, deduct from and set off against any amounts the Company or its subsidiary may owe to the Participant from time to time, including amounts payable in connection with any Award, owed as wages, fringe benefits, or other compensation owed to the Participant, any such amounts as may be owed by the Participant to the Company, including but not limited to amounts owed under Section 11(a), although the Participant shall remain liable for any part of the Participant’s payment obligation not satisfied through such deduction and setoff. By accepting any Award granted hereunder, the Participant agrees to any deduction or setoff under this Section 12(f).
(g) Unfunded Status of Awards; Creation of Trusts. The Plan is intended to constitute an “unfunded” plan for incentive and deferred compensation. With respect to any payments not yet made to a Participant or obligation to deliver Stock pursuant to an Award, nothing contained in the Plan or any Award shall give any such Participant any rights that are greater than those of a general creditor of the Company; provided that the Committee may authorize the creation of trusts and deposit therein cash, Stock, other Awards or other property, or make other arrangements to meet the Company’s obligations under the Plan. Such trusts or other arrangements shall be consistent with the “unfunded” status of the Plan unless the Committee otherwise determines with the consent of each affected Participant.
(h) Nonexclusivity of the Plan. Neither the adoption of the Plan by the Board nor its
submission to the stockholders of the Company for approval shall be construed as creating any limitations on the power of the Board or a committee thereof to adopt such other incentive arrangements, apart from the Plan, as it may deem desirable.
(i) Payments in the Event of Forfeitures; Fractional Shares. Unless otherwise determined by the Committee, in the event of a forfeiture of an Award with respect to which a Participant paid cash consideration, the Participant shall be repaid the amount of such cash consideration. No fractional shares of Stock shall be issued or delivered pursuant to the Plan or any Award. The Committee shall determine whether cash, other Awards or other property shall be issued or paid in lieu of such fractional shares or whether such fractional shares or any rights thereto shall be forfeited or otherwise eliminated.
(j) Certain Limitations Relating to Accounting Treatment of Awards. At any time that the Company is accounting for stock-denominated Awards under the Statement of Financial Accounting Standards No. 123R (“FAS 123R”), the Company intends that, with respect to such Awards, the compensation measurement date for accounting purposes shall occur at the date of grant or such other date that applies to Awards that are treated as equity awards under FAS 123R, unless the Committee specifically determines otherwise. Therefore, other provisions of the Plan notwithstanding, in order to preserve this fundamental objective of the Plan, if any authority granted to the Committee hereunder or any provision of the Plan or an Award agreement would result, under FAS 123R, in “liability” accounting, if the Committee was not specifically aware of such accounting consequence at the time such Award was granted or provision otherwise became effective, such authority shall be limited and such provision shall be automatically modified and reformed to the extent necessary to preserve the accounting treatment of the award intended by the Committee. This provision shall cease to be effective if and at such time as the Company no longer accounts for equity compensation under FAS 123R.
(k) Governing Law; Jurisdiction. The validity, construction, and effect of the Plan, any rules and regulations relating to the Plan and any Award document shall be determined in accordance with the laws of the State of Delaware, without giving effect to principles of conflicts of laws, and applicable provisions of federal law. With respect to any suit, action or proceeding (a “Proceeding”) arising out of or relating to the Plan each of the Company, each Eligible Person and each Participant hereby irrevocably submits to the exclusive jurisdiction of the courts of the state of Colorado and the United States of America, in each case located in Denver County, Colorado (the “Selected Courts”), and waives any objection to venue being laid in the Selected Courts whether based on the grounds of venue, forum non conveniens or otherwise. EACH OF THE FORGOING PARTIES WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THE PLAN OR ANY AWARD THEREUNDER.
(l) Awards to Participants Outside the United States. The Committee may modify the terms of any Award under the Plan made to or held by a Participant who is then resident or primarily employed outside of the United States in any manner deemed by the
Committee to be necessary or appropriate in order that such Award shall conform to laws, regulations, and customs of the country in which the Participant is then resident or primarily employed, or so that the value and other benefits of the Award to the Participant, as affected by foreign tax laws and other restrictions applicable as a result of the Participant’s residence or employment abroad shall be comparable to the value of such an Award to a Participant who is resident or primarily employed in the United States. An Award may be modified under this Section 12(l) in a manner that is inconsistent with the express terms of the Plan, so long as such modifications will not contravene any applicable law or regulation.
(m) Limitation on Rights Conferred under Plan. Neither the Plan nor any action taken hereunder shall be construed as (i) giving any Eligible Person or Participant the right to continue as an Eligible Person or Participant or in the employ or service of the Company or a subsidiary, (ii) interfering in any way with the right of the Company or a subsidiary to terminate any Eligible Person’s or Participant’s employment or service at any time, (iii) giving an Eligible Person or Participant any claim to be granted any Award under the Plan or to be treated uniformly with other Participants and employees, or (iv) conferring on a Participant any of the rights of a stockholder of the Company unless and until the Participant is duly issued or transferred shares of Stock in accordance with the terms of an Award or an Option is duly exercised. Except as expressly provided in the Plan and an Award document, neither the Plan nor any Award document shall confer on any person other than the Company and the Participant any rights or remedies thereunder.
(n) Severability; Entire Agreement. If any of the provisions of this Plan or any Award document is finally held to be invalid, illegal or unenforceable (whether in whole or in part), such provision shall be deemed modified to the extent, but only to the extent, of such invalidity, illegality or unenforceability, and the remaining provisions shall not be affected thereby; provided, that, if any of such provisions is finally held to be invalid, illegal, or unenforceable because it exceeds the maximum scope determined to be acceptable to permit such provision to be enforceable, such provision shall be deemed to be modified to the minimum extent necessary to modify such scope in order to make such provision enforceable hereunder. The Plan and any Award documents contain the entire agreement of the parties with respect to the subject matter thereof and supersede all prior agreements (unless an employment agreement entered into between the Company and the Participant specifically provides contradictory terms, in which case the terms of the employment agreement shall govern), promises, covenants, arrangements, communications, representations and warranties between them, whether written or oral with respect to the subject matter thereof. In the event of any conflict between the terms of this Plan and the terms in an Award Agreement, the terms of the Award Agreement shall control.
(o) Termination. The Plan is effective as of the Effective Date. Unless earlier terminated by action of the Board of Directors, the Plan will remain in effect until such time as no Stock remains available for delivery under the Plan and the Company has no further rights or obligations under the Plan with respect to outstanding Awards under the Plan.
***
Exhibit A
FORM OF STOCK OPTION AGREEMENT
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| GRANTEE | | NUMBER OF OPTIONS | | OPTION | | GRANT | | EXPIRATION |
| | | | | | | | |
NAME | | GRANTED | | PRICE | | DATE | | DATE |
STOCK OPTION VESTING SCHEDULE
| | | | | | | | | | | | | | |
| PERCENTAGE OF OPTION SHARES EXERCISABLE | | DATE EXERCISABLE | |
Voyager Space Holdings, Inc., a Delaware corporation (the “Company”), hereby grants to [_________] (the “Grantee”, also referred to as “you”) an option to purchase (the “Option”) shares of the Common Stock of the Company at an option price as set forth above, pursuant to the terms of the attached Stock Option Agreement and the Voyager Space Holdings, Inc. 2020 Incentive Plan (the “Plan”).
By signing this cover sheet, you hereby accept the Options and agree to all of the terms and conditions described in the attached Stock Option Agreement and the Plan.
| | | | | | | | |
| The Company: | |
| | |
| By: | | |
| | |
| Name: | | |
| | |
| Title: | | |
This is not a stock certificate or a negotiable instrument. This grant of Option is a
voluntary, revocable grant from the Company and Grantee hereby acknowledges that the
Company has no obligation to make additional grants in the future.
UPON RECEIPT OF YOUR SIGNED AGREEMENT, A BOOKKEEPING ENTRY
WILL BE ENTERED INTO THE COMPANY’S BOOKS AND RECORDS
TO EVIDENCE THE OPTIONS GRANTED TO YOU.
Voyager Space Holdings, Inc.
STOCK OPTION AGREEMENT
1. Nontransferability. This Stock Option Agreement (this “Agreement”) evidences the grant to you evidences the grant to you on the Grant Date set forth on the cover page of an option under the Voyager Space Holdings, Inc. 2020 Incentive Plan (the “Plan”) to purchase shares of the Common Stock of the Company (the “Option”). Under applicable provisions of the Internal Revenue Code of 1986, as amended, the Option is treated as a [an incentive option][a non-qualified option]. Capitalized terms that are not defined on the cover page or in the Option Agreement are defined in the Plan. Your Option Agreement may not be transferred, assigned, pledged or hypothecated, whether by operation of law or otherwise, nor may the Option be made subject to execution, attachment or similar process.
2. The Plan. The Option is issued in accordance with and is subject to and conditioned upon all of the terms and conditions of this Agreement and the Plan as amended from time to time; provided, however, that no future amendment or termination of the Plan shall, without your consent, alter or impair any of your rights or obligations under the Plan, all of which are incorporated by reference in this Agreement as if fully set forth herein.
3. Termination. The Option shall terminate immediately if you voluntarily incur a Termination of Service without the written consent of the Company or if you incur a Termination of Service by action of the Company due to your willful refusal to perform your duties or for “cause” (as such term is defined in your employment or severance agreement (if any) or, if none, as defined by the Committee and in effect at the time of your termination). Notwithstanding the previous sentence, if your Termination of Service is voluntary and with the written consent of the Company (which written consent expressly sets forth a statement to the effect that, to the extent exercisable on the date of such termination the Option shall remain exercisable), or if your Termination of Service is by action of the Company for reasons other than cause, you may exercise the Option to the extent exercisable at the time of such termination, at any time prior to the expiration of three months after such termination, or for any longer period of time after such termination as shall be determined by the Committee, but not later than the Expiration Date. Should you die during your employment or service or following your Termination of Service, the Option shall immediately terminate, except that, to the extent exercisable by you at the time of your death, the Option may be exercised within one year after the date of your death but not later than the Expiration Date, solely in accordance with all of the terms and conditions of the Plan by your personal representatives or by the person or persons to whom your rights under the Option shall pass by will or by the applicable laws of descent and distribution.
4. Sale. In the event that you elect to sell or transfer any interest in the shares of Common Stock of the Company acquired pursuant to the Option, the Company has a right to purchase such shares at the then-market value of such shares. As a precondition to any sale or transfer of such shares, you agree to provide the Company notice of such sale or transfer, together with such additional information as the Company may request, and you may not sell or transfer such shares unless and until the Company has waived its repurchase right in writing, which the Company shall do within thirty (30) days of receipt of your notice.
5. Additional Forfeiture. The Committee may cancel, suspend, withhold or otherwise limit or
restrict the Option at any time if you (i) are not in compliance with all applicable provisions of this Agreement or the Plan or (ii) engage in any activity inimical, contrary or harmful to the interests of the Company, including, but not limited to: (A) conduct related to your service or employment for which either criminal or civil penalties against you may be sought (B) violation of any policies of the Company, including, without limitation, insider trading or anti-harassment policies or (C) participating in a hostile takeover attempt against the Company.
6. Employment Not Affected. Neither the grant of the Option, nor any other action taken with respect to the Option, shall confer upon the Grantee any right to continue in the employ of the Company or shall interfere in any way with the right of the Company to terminate Grantee’s employment at any time. Except as may be otherwise limited by another written agreement, the right of the Company to terminate at will the Grantee’s employment with it at any time (whether by dismissal, discharge, retirement or otherwise) is specifically reserved.
7. No Stockholder Rights. Neither the Grantee, nor any person entitled to exercise the Grantee’s rights in the event of the Grantee’s death, shall have any of the rights and privileges of a holder of the Company’s Common Stock subject to this Agreement.
8. Securities Laws. The Company shall not be obligated to issue any Common Stock pursuant to this Agreement if, in the opinion of counsel to the Company, the shares to be so issued are required to be registered or otherwise qualified under the United States Securities Act of 1933, as amended, or under any other applicable statute, regulation or ordinance affecting the sale of securities, unless and until such shares have been so registered or otherwise qualified.
9. Severability. Should a court of competent jurisdiction deem any of the provisions in this Agreement to be unenforceable in any respect, it is the intention of the parties to this Agreement that this Agreement be deemed, without further action on the part of the parties hereto, modified, amended and limited to the extent necessary to render the same valid and enforceable. It is further the parties’ intent that all provisions not deemed to be overbroad shall be given their full force and effect. You acknowledge that you are freely, knowingly and voluntarily entering into this Agreement after having an opportunity for consultation with your own independent counsel.
10. Choice of Law; Jurisdiction. This Agreement shall be governed by and construed and interpreted in accordance with the substantive laws of the State of Delaware, without giving effect to any conflicts of law rule or principle that might require the application of the laws of another jurisdiction. ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT SHALL BE INSTITUTED SOLELY IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA OR THE COURTS OF THE STATE OF COLORADO LOCATED IN DENVER COUNTY, COLORADO AND EACH PARTY IRREVOCABLY SUBMITS TO THE PERSONAL JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING.
11. Income Taxes. You agree to comply with the appropriate procedures established by the Company, from time to time, to provide for payment or withholding of such income or other taxes as may be required by law to be paid or withheld in connection with the Option or the shares of Common Stock issuable in connection therewith.
12. Expiration. This Option, to the extent not previously exercised, shall expire on the Expiration Date set forth above.
13. Exercise. This Option is to be exercised by delivering to the Company a written notice of exercise in the form attached hereto as Exhibit A together with payment as provided in the Plan.
EXHIBIT A
STOCK OPTION EXERCISE NOTICE
Dated: _______________________
To: Voyager Space Holdings, Inc.
Attn: [_______________]
Sir/Madam:
Notice is hereby given of my election to purchase ___ shares of Common Stock of Voyager Space Holdings, Inc. (the “Company”) at a price of $_____________ per share under the provisions of the stock option (“Option”) granted to me on ____________________under the terms of the Voyager Space Holdings, Inc. 2020 Incentive Plan.
I hereby certify that I am in compliance with the covenants and forfeiture provisions of the Option Agreement dated as of _______________________ between the Company and me (the “Option Agreement”). I acknowledge that a violation of these provisions will result in the forfeiture of any remaining options that I have.
Cash Method or Cashless Method:
Cash: Enclosed is my check made payable to the Company in the amount of $ ________________ in payment of the exercise price of the Option and my check in the amount of $ ________________ made payable to ____________________________ in payment of the tax due on exercise of the Option.
Cashless: I will contact my broker from _______________________ who will be verifying my options and arranging to exercise and sell my option shares.
The following information is supplied for use in issuing and registering the shares purchased:
| | | | | | | | | | | | | | |
| Number of Shares: | | | | |
| Full Name: | | | | |
| Address: | | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| Signature: | | | | |
Exhibit B
FORM OF STOCK APPRECIATION RIGHTS AGREEMENT
| | | | | | | | | | | | | | | | | | | | |
GRANTEE
NAME | | NUMBER OF
SARs | | GRANT
DATE | | VESTING
SCHEDULE |
Voyager Space Holdings, Inc., a Delaware corporation (the “Company”), hereby grants to [_________] (the “Grantee”, also referred to as “you”) Stock Appreciation Rights (the “SAR”), pursuant to the terms of the attached Stock Appreciation Rights Agreement and the Voyager Space Holdings, Inc. 2020 Incentive Plan (the “Plan”).
By signing this cover sheet, you agree to all of the terms and conditions described in the attached Stock Appreciation Rights Agreement and the Plan.
| | | | | | | | |
| The Company: | |
| | |
| By: | | |
| | |
| Name: | | |
| | |
| Title: | | |
This is not a stock certificate or a negotiable instrument. This grant of SAR is a
voluntary, revocable grant from the Company and Grantee hereby acknowledges that the
Company has no obligation to make additional grants in the future.
UPON RECEIPT OF YOUR SIGNED AGREEMENT, A BOOKKEEPING ENTRY
WILL BE ENTERED INTO THE COMPANY’S BOOKS AND RECORDS
TO EVIDENCE THE SAR GRANTED TO YOU.
Voyager Space Holdings, Inc.
STOCK APPRECIATION RIGHTS AGREEMENT
1. SAR/Nontransferability. This Stock Appreciation Rights Agreement (this “Agreement”) evidences the grant to you on the Grant Date set forth on the cover page of Stock Appreciation Rights (the “SAR”) under the Voyager Space Holdings, Inc. 2020 Incentive Plan (the “Plan”). These SARs represent the right to receive, upon vesting thereof, an amount in cash equal to the excess of (A) the Fair Market Value of one share of Stock on the date of exercise (or, in the case of a “Limited SAR,” the Fair Market Value determined by reference to the Change in Control Price, as defined under Section 10(d) of the Plan) over (B) the grant price of the SAR as determined by the Committee. This SAR will NOT be credited with dividends to the extent dividends are paid on the Common Stock of the Company. Your SAR may not be transferred, assigned, pledged or hypothecated, whether by operation of law or otherwise, nor may the SAR be made subject to execution, attachment or similar process. Any capitalized, but undefined, term used in this Agreement shall have the meaning ascribed to it in the Plan.
2. The Plan. The SAR is issued in accordance with and is subject to and conditioned upon all of the terms and conditions of this Agreement and the Plan as amended from time to time; provided, however, that no future amendment or termination of the Plan shall, without your consent, alter or impair any of your rights or obligations under the Plan, all of which are incorporated by reference in this Agreement as if fully set forth herein.
3. Cash Value Determination upon Vesting and Time of Payment. Subject to the terms and conditions set forth in this Agreement, the SARs covered by this grant shall vest on the vesting date set forth on the cover page of this Phantom Stock Agreement, provided the Grantee is employed by the Company on the date of vesting. The payment of the value of the SARs shall be made no later than ten (10) days thereafter. The payment of amounts with respect to the SARs is subject to the provisions of the Plan and to interpretations, regulations and determinations concerning the Plan as established from time to time by the Committee in accordance with the provisions of the Plan, including, but not limited to, provisions relating to (i) rights and obligations with respect to withholding taxes, (ii) capital or other changes of the Company and (iii) other requirements of applicable law.
4. Accelerated Vesting. Notwithstanding Paragraph 3, your right to the SARs under this Agreement shall immediately vest as to 100% of the total number of shares covered by this grant upon the occurrence of either (i) your Termination of Service on account of your death or permanent and total disability, or by action of the Company other than by reason of your willful refusal to perform your duties and other than for “cause” (as such term is defined in your employment or severance agreement (if any) or, if none, as defined by the Committee and in effect at the time of your termination); or (ii) a “Change in Control” as provided for in Section 10 of the Plan.
5. Termination. Your right to the SARs under this Agreement, to the extent the restrictions have not lapsed, shall terminate immediately upon your voluntary Termination of Service or if Termination of Service occurs by action of the Company by reason of your willful refusal to
perform your duties or for “cause” (as such term is defined in your employment or severance agreement (if any) or, if none, as defined by the Committee and in effect at the time of your termination).
6. Additional Forfeiture. The Committee may cancel, suspend, withhold or otherwise limit or restrict your right to any of the payments under this Agreement at any time if you (i) are not in compliance with all applicable provisions of this Agreement or the Plan or (ii) engage in any activity inimical, contrary or harmful to the interests of the Company, including, but not limited to: (A) conduct related to your service or employment for which either criminal or civil penalties against you may be sought (B) violation of any policies of the Company, including, without limitation, insider trading or anti-harassment policies or (C) participating in a hostile takeover attempt against the Company.
7. Employment Not Affected. Neither the grant of any SARs, nor any other action taken with respect to the SARs, shall confer upon the Grantee any right to continue in the employ of the Company or shall interfere in any way with the right of the Company to terminate Grantee’s employment at any time. Except as may be otherwise limited by another written agreement, the right of the Company to terminate at will the Grantee’s employment with it at any time (whether by dismissal, discharge, retirement or otherwise) is specifically reserved.
8. No Stockholder Rights. SARs are not shares of the Company’s Common Stock. Neither the Grantee, nor any person entitled to exercise the Grantee’s rights in the event of the Grantee’s death, shall have any of the rights and privileges of a holder of the Company’s Common Stock.
9. Severability. Should a court of competent jurisdiction deem any of the provisions in this Agreement to be unenforceable in any respect, it is the intention of the parties to this Agreement that this Agreement be deemed, without further action on the part of the parties hereto, modified, amended and limited to the extent necessary to render the same valid and enforceable. It is further the parties’ intent that all provisions not deemed to be overbroad shall be given their full force and effect. You acknowledge that you are freely, knowingly and voluntarily entering into this Agreement after having an opportunity for consultation with your own independent counsel.
10. Choice of Law; Jurisdiction. This Agreement shall be governed by and construed and interpreted in accordance with the substantive laws of the State of Delaware, without giving effect to any conflicts of law rule or principle that might require the application of the laws of another jurisdiction. ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT SHALL BE INSTITUTED SOLELY IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA OR THE COURTS OF THE STATE OF COLORADO LOCATED IN DENVER COUNTY, COLORADO AND EACH PARTY IRREVOCABLY SUBMITS TO THE PERSONAL JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING.
11. Income Taxes. You agree to comply with the appropriate procedures established by the Company, from time to time, to provide for payment or withholding of such income or other taxes as may be required by law to be paid or withheld in connection with the SARs.
Exhibit C-1
FORM OF PHANTOM STOCK AGREEMENT
| | | | | | | | | | | | | | | | | | | | |
GRANTEE
NAME | | NUMBER OF
PHANTOM
SHARES | | GRANT
DATE | | VESTING
SCHEDULE |
Voyager Space Holdings, Inc., a Delaware corporation (the “Company”), hereby grants to [_________] (the “Grantee”, also referred to as “you”) shares of its phantom stock (the “Phantom Stock”), pursuant to the terms of the attached Phantom Stock Agreement and the Voyager Space Holdings, Inc. 2020 Incentive Plan (the “Plan”).
By signing this cover sheet, you agree to all of the terms and conditions described in the attached Phantom Stock Agreement and the Plan.
| | | | | | | | |
| The Company: | |
| | |
| By: | | |
| | |
| Name: | | |
| | |
| Title: | | |
This is not a stock certificate or a negotiable instrument. This grant of Phantom Stock is a
voluntary, revocable grant from the Company and Grantee hereby acknowledges that the
Company has no obligation to make additional grants in the future.
UPON RECEIPT OF YOUR SIGNED AGREEMENT, A BOOKKEEPING ENTRY
WILL BE ENTERED INTO THE COMPANY’S BOOKS AND RECORDS
TO EVIDENCE THE PHANTOM STOCK GRANTED TO YOU.
Voyager Space Holdings, Inc.
PHANTOM STOCK AGREEMENT
1. Phantom Stock/Nontransferability. This Phantom Stock Agreement (this “Agreement”) evidences the grant to you on the Grant Date set forth on the cover page of Phantom Stock (the “Phantom Stock”) under the Voyager Space Holdings, Inc. 2020 Incentive Plan (the “Plan”). These shares of Phantom Stock represent the right to receive, upon vesting thereof, an amount in cash equal to [the Fair Market Value of one share of Stock on the date of vesting – or other measure of performance]. This Phantom Stock will NOT be credited with dividends to the extent dividends are paid on the Common Stock of the Company. Your Phantom Stock may not be transferred, assigned, pledged or hypothecated, whether by operation of law or otherwise, nor may the Phantom Stock be made subject to execution, attachment or similar process. Any capitalized, but undefined, term used in this Agreement shall have the meaning ascribed to it in the Plan.
2. The Plan. The Phantom Stock is issued in accordance with and is subject to and conditioned upon all of the terms and conditions of this Agreement and the Plan as amended from time to time; provided, however, that no future amendment or termination of the Plan shall, without your consent, alter or impair any of your rights or obligations under the Plan, all of which are incorporated by reference in this Agreement as if fully set forth herein.
3. Cash Value Determination upon Vesting and Time of Payment. Subject to the terms and conditions set forth in this Agreement, the shares of Phantom Stock covered by this grant shall vest on the vesting date set forth on the cover page of this Agreement, provided the Grantee is employed by the Company on the date of vesting. The payment of the value of the shares of Phantom Stock shall be made no later than ten (10) days thereafter. The payment of amounts with respect to the Phantom Stock is subject to the provisions of the Plan and to interpretations, regulations and determinations concerning the Plan as established from time to time by the Committee in accordance with the provisions of the Plan, including, but not limited to, provisions relating to (i) rights and obligations with respect to withholding taxes, (ii) capital or other changes of the Company and (iii) other requirements of applicable law.
4. Accelerated Vesting. Notwithstanding Paragraph 3, your right to the Phantom Stock under this Agreement shall immediately vest as to 100% of the total number of shares covered by this grant upon the occurrence of either (i) your Termination of Service on account of your death or permanent and total disability, or by action of the Company other than by reason of your willful refusal to perform your duties and other than for “cause” (as such term is defined in your employment or severance agreement (if any) or, if none, as defined by the Committee and in effect at the time of your termination); or (ii) a “Change in Control” as provided for in Section 10 of the Plan.
5. Termination. Your right to the Phantom Stock under this Agreement, to the extent the restrictions have not lapsed, shall terminate immediately upon your voluntary Termination of Service or if Termination of Service occurs by action of the Company by reason of your willful refusal to perform your duties or for “cause” (as such term is defined in your employment or
severance agreement (if any) or, if none, as defined by the Committee and in effect at the time of your termination).
6. Additional Forfeiture. The Committee may cancel, suspend, withhold or otherwise limit or restrict your right to any of the payments under this Agreement at any time if you (i) are not in compliance with all applicable provisions of this Agreement or the Plan or (ii) engage in any activity inimical, contrary or harmful to the interests of the Company, including, but not limited to: (A) conduct related to your service or employment for which either criminal or civil penalties against you may be sought (B) violation of any policies of the Company, including, without limitation, insider trading or anti-harassment policies or (C) participating in a hostile takeover attempt against the Company.
7. Employment Not Affected. Neither the grant of any Phantom Stock, nor any other action taken with respect to the Phantom Stock, shall confer upon the Grantee any right to continue in the employ of the Company or shall interfere in any way with the right of the Company to terminate Grantee’s employment at any time. Except as may be otherwise limited by another written agreement, the right of the Company to terminate at will the Grantee’s employment with it at any time (whether by dismissal, discharge, retirement or otherwise) is specifically reserved.
8. No Stockholder Rights. Shares of Phantom Stock are not shares of the Company’s Common Stock. Neither the Grantee, nor any person entitled to exercise the Grantee’s rights in the event of the Grantee’s death, shall have any of the rights and privileges of a holder of the Company’s Common Stock.
9. Severability. Should a court of competent jurisdiction deem any of the provisions in this Agreement to be unenforceable in any respect, it is the intention of the parties to this Agreement that this Agreement be deemed, without further action on the part of the parties hereto, modified, amended and limited to the extent necessary to render the same valid and enforceable. It is further the parties’ intent that all provisions not deemed to be overbroad shall be given their full force and effect. You acknowledge that you are freely, knowingly and voluntarily entering into this Agreement after having an opportunity for consultation with your own independent counsel.
10. Choice of Law; Jurisdiction. This Agreement shall be governed by and construed and interpreted in accordance with the substantive laws of the State of Delaware, without giving effect to any conflicts of law rule or principle that might require the application of the laws of another jurisdiction. ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT SHALL BE INSTITUTED SOLELY IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA OR THE COURTS OF THE STATE OF COLORADO LOCATED IN DENVER COUNTY, COLORADO AND EACH PARTY IRREVOCABLY SUBMITS TO THE PERSONAL JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING.
11. Income Taxes. You agree to comply with the appropriate procedures established by the Company, from time to time, to provide for payment or withholding of such income or other taxes as may be required by law to be paid or withheld in connection with the Phantom Stock.
Exhibit C-2
FORM OF SALE PHANTOM STOCK AGREEMENT
| | | | | | | | | | | | | | | | | | | | |
GRANTEE
NAME | | NUMBER OF
PHANTOM
SHARES | | GRANT
DATE | | VESTING
SCHEDULE |
| | | | | | |
| | [1] | | | | All shares of
Sale Phantom
Stock shall be
deemed
vested on the
date hereof. |
Voyager Space Holdings, Inc., a Delaware corporation (the “Company”), hereby grants to [_________] (the “Grantee”, also referred to as “you”) shares of its Sale Phantom Stock related to the sale of the Company (the “Sale Phantom Stock”), pursuant to the terms of the attached Sale Phantom Stock Agreement and the Voyager Space Holdings, Inc. 2020 Incentive Plan (the “Plan”).
By signing this cover sheet, you agree to all of the terms and conditions described in the attached Sale Phantom Stock Agreement and the Plan.
| | | | | | | | |
| The Company: | |
| | |
| By: | | |
| | |
| Name: | | |
| | |
| Title: | | |
This is not a stock certificate or a negotiable instrument. This grant of Sale Phantom Stock is
a voluntary, revocable grant from the Company and Grantee hereby acknowledges that the
Company has no obligation to make additional grants in the future.
UPON RECEIPT OF YOUR SIGNED AGREEMENT, A BOOKKEEPING ENTRY
WILL BE ENTERED INTO THE COMPANY’S BOOKS AND RECORDS
TO EVIDENCE THE SALE PHANTOM STOCK GRANTED TO YOU.
Voyager Space Holdings, Inc.
SALE PHANTOM STOCK AGREEMENT
1. Sale Phantom Stock/Nontransferability. This Sale Phantom Stock Agreement (this “Agreement”) evidences the grant to you on the Grant Date set forth on the cover page of Sale Phantom Stock (the “Sale Phantom Stock”) under the Voyager Space Holdings, Inc. 2020 Incentive Plan (the “Plan”).
a. These shares of Sale Phantom Stock represent the right to receive, subject to the terms and conditions herein:
i. In the event of a sale of all or substantially all of the assets of the Company to a third party which (i) does not control the Company; (ii) is not controlled by the Company or its shareholders; and (iii) is not under common control with the Company or its shareholders (a party meeting such requirements, a “Non-Affiliate”), an amount in cash equal to fifteen percent (15%) of the total value received by the Company or the shareholders of the Company for such sale of assets to such Non-Affiliate, with such value to be determined, in the event that it is not in cash, by the Board of Directors of the Company in its sole discretion; or
ii. In the event of a Change in Control defined in any of Section 10(c)(ii) or Section 10(c)(iii) of the Plan (subject to the last sentence of such Section 10(c) of the Plan), an amount in cash equal to fifteen percent (15%) of the total value received by the shareholders of the Company as a whole related to such event, with such value to be determined, in the event that it is not in cash, by the Board of Directors of the Company in its sole discretion.
b. Any amounts to be paid pursuant to Section 1.a shall be apportioned pro rata between and amongst all shares of Sale Phantom Stock outstanding as of the completion of the sale pursuant to Section 1.a.i or the completion of the Change in Control pursuant to Section 1.a.ii. By way of example and not limitation, in the event that there are three (3) shares of Sale Phantom Stock outstanding as of such time, each share of Sale Phantom Stock shall receive one third (1/3) of the total payments to be made to all Sale Phantom Shares outstanding of such time. Grantee acknowledges and agrees that the Company may have awarded shares of Sale Phantom Stock prior to the date hereof, and has the right to award additional shares of Sale Phantom Stock following the date hereof, and that such awards shall reduce the amount that would otherwise be payable to Grantee hereunder.
c. Any payments accruing hereunder shall be paid no later than ten (10) days following the event pursuant to which the payment arises.
d. Shares of Sale Phantom Stock will NOT be credited with dividends to the extent dividends are paid on the Common Stock of the Company. Your Sale Phantom
Stock may not be transferred, assigned, pledged or hypothecated, whether by operation of law or otherwise, nor may the Sale Phantom Stock be made subject to execution, attachment or similar process. Any capitalized, but undefined, term used in this Agreement shall have the meaning ascribed to it in the Plan.
2. The Plan. The Sale Phantom Stock is issued in accordance with and is subject to and conditioned upon all of the terms and conditions of this Agreement and the Plan as amended from time to time; provided, however, that no future amendment or termination of the Plan shall, without your consent, alter or impair any of your rights or obligations under the Plan, all of which are incorporated by reference in this Agreement as if fully set forth herein.
3. Vesting and Time of Payment. The share(s) of Sale Phantom Stock granted hereunder shall be vested immediately upon execution of this Agreement. The payment of amounts with respect to the Sale Phantom Stock is subject to the provisions of the Plan and to interpretations, regulations and determinations concerning the Plan as established from time to time by the Committee in accordance with the provisions of the Plan, including, but not limited to, provisions relating to (i) rights and obligations with respect to withholding taxes, (ii) capital or other changes of the Company and (iii) other requirements of applicable law.
4. Termination. Notwithstanding the forgoing, the shares of Sale Phantom Stock shall be immediately forfeited upon any Termination of Service with the Company for any reason prior to the date that such payments accrue pursuant to Section 1, and, following such forfeiture, Grantee shall have no right to receive any payments hereunder.
5. Additional Forfeiture. The Committee may cancel, suspend, withhold or otherwise limit or restrict your right to any of the payments under this Agreement at any time if you (i) are not in compliance with all applicable provisions of this Agreement or the Plan or (ii) engage in any activity inimical, contrary or harmful to the interests of the Company, including, but not limited to: (A) conduct related to your service or employment for which either criminal or civil penalties against you may be sought (B) violation of any policies of the Company, including, without limitation, insider trading or anti-harassment policies or (C) participating in a hostile takeover attempt against the Company.
6. Employment Not Affected. Neither the grant of any Sale Phantom Stock, nor any other action taken with respect to the Sale Phantom Stock, shall confer upon the Grantee any right to continue in the employ of the Company or shall interfere in any way with the right of the Company to terminate Grantee’s employment at any time. Except as may be otherwise limited by another written agreement, the right of the Company to terminate at will the Grantee’s employment with it at any time (whether by dismissal, discharge, retirement or otherwise) is specifically reserved.
7. No Stockholder Rights. Shares of Sale Phantom Stock are not shares of the Company’s Common Stock. Neither the Grantee, nor any person entitled to exercise the Grantee’s rights in the event of the Grantee’s death, shall have any of the rights and privileges of a holder of the Company’s Common Stock.
8. Severability. Should a court of competent jurisdiction deem any of the provisions in this
Agreement to be unenforceable in any respect, it is the intention of the parties to this Agreement that this Agreement be deemed, without further action on the part of the parties hereto, modified, amended and limited to the extent necessary to render the same valid and enforceable. It is further the parties’ intent that all provisions not deemed to be overbroad shall be given their full force and effect. You acknowledge that you are freely, knowingly and voluntarily entering into this Agreement after having an opportunity for consultation with your own independent counsel.
9. Choice of Law; Jurisdiction. This Agreement shall be governed by and construed and interpreted in accordance with the substantive laws of the State of Delaware, without giving effect to any conflicts of law rule or principle that might require the application of the laws of another jurisdiction. ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT SHALL BE INSTITUTED SOLELY IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA OR THE COURTS OF THE STATE OF COLORADO LOCATED IN DENVER COUNTY, COLORADO AND EACH PARTY IRREVOCABLY SUBMITS TO THE PERSONAL JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING.
10. Income Taxes. You agree to comply with the appropriate procedures established by the Company, from time to time, to provide for payment or withholding of such income or other taxes as may be required by law to be paid or withheld in connection with the Sale Phantom Stock.
Exhibit D
FORM OF RESTRICTED STOCK AGREEMENT
| | | | | | | | | | | | | | | | | | | | |
GRANTEE
NAME | | NUMBER OF
SHARES | | GRANT
DATE | | VESTING
SCHEDULE |
| | | | | | |
| | | | | | As set forth below. |
Vesting Schedule:
| | | | | |
| |
| Vesting Date | Number of Shares Vesting |
| |
Voyager Space Holdings, Inc., a Delaware corporation (the “Company”), hereby grants to [_________] (the “Grantee”, also referred to as “you”) shares of Restricted Stock (the “Shares”), pursuant to the terms of the attached Restricted Stock Agreement and the Voyager Space Holdings, Inc. 2020 Incentive Plan (the “Plan”).
By signing this cover sheet, you agree to all of the terms and conditions described in the attached Restricted Stock Agreement and the Plan.
| | | | | | | | |
| The Company: | |
| | |
| By: | | |
| | |
| Name: | | |
| | |
| Title: | | |
This is not a stock certificate or a negotiable instrument. This grant of Shares is a
voluntary, revocable grant from the Company and Grantee hereby acknowledges that the
Company has no obligation to make additional grants in the future.
UPON RECEIPT OF YOUR SIGNED AGREEMENT, A BOOKKEEPING ENTRY
WILL BE ENTERED INTO THE COMPANY’S BOOKS AND RECORDS
TO EVIDENCE THE SHARES GRANTED TO YOU.
Voyager Space Holdings, Inc.
RESTRICTED STOCK AGREEMENT
1. Shares/Nontransferability. This Restricted Stock Agreement (this “Agreement”) evidences the grant to you on the Grant Date set forth on the cover page of Restricted Stock (the “Shares”) under the Voyager Space Holdings, Inc. 2020 Incentive Plan (the “Plan”). Your Shares may not be transferred, assigned, pledged or hypothecated, whether by operation of law or otherwise, nor may the Shares be made subject to execution, attachment or similar process. Except as may be required by federal income tax withholding provisions or by the tax laws of any state, your interests (and the interests of your beneficiaries, if any) under this Agreement are not subject to the claims of your creditors and may not be voluntarily or involuntarily sold, transferred, alienated, assigned, pledged, anticipated, or encumbered. Any attempt to sell, transfer, alienate, assign, pledge, anticipate, encumber, charge or otherwise dispose of any right to benefits payable hereunder shall be void. Your rights to your Shares are no greater than that of other general, unsecured creditors of the Company. Any capitalized, but undefined, term used in this Agreement shall have the meaning ascribed to it in the Plan.
2. The Plan. The Shares are issued in accordance with and are subject to and conditioned upon all of the terms and conditions of this Agreement and the Plan as amended from time to time; provided, however, that no future amendment or termination of the Plan shall, without your consent, alter or impair any of your rights or obligations under the Plan, all of which are incorporated by reference in this Agreement as if fully set forth herein.
3. Vesting. Subject to the terms and conditions set forth in this Agreement, the Shares covered by this grant shall vest on the vesting date set forth on the cover page of this Agreement, provided the Grantee is employed by the Company on the date of vesting. Promptly after your Shares vest, the Company will cause to be issued to you (or your beneficiary(ies) or personal representative, if you are deceased) in book-entry in the records of the Company’s transfer agent, shares of Common Stock of the Company equal to the number of vested Shares granted herein.
4. Accelerated Vesting. Notwithstanding Paragraph 3, your right to the Shares under this Agreement shall immediately vest as to 100% of the total number of shares covered by this grant upon the occurrence of either (i) your Termination of Service on account of your death or permanent and total disability, or by action of the Company other than by reason of your willful refusal to perform your duties and other than for “cause” (as such term is defined in your employment or severance agreement (if any) or, if none, as defined by the Committee and in effect at the time of your termination); or (ii) a “Change in Control” as provided for in Section 10 of the Plan.
5. Termination. Your right to the Shares under this Agreement, to the extent the restrictions have not lapsed, shall terminate immediately upon your voluntary Termination of Service or if Termination of Service occurs by action of the Company by reason of your willful refusal to perform your duties or for “cause” (as such term is defined in your employment or severance agreement (if any) or, if none, as defined by the Committee and in effect at the time of your
termination).
6. Additional Forfeiture. The Committee may cancel, suspend, withhold or otherwise limit or restrict your right to any of the payments under this Agreement at any time if you (i) are not in compliance with all applicable provisions of this Agreement or the Plan or (ii) engage in any activity inimical, contrary or harmful to the interests of the Company, including, but not limited to: (A) conduct related to your service or employment for which either criminal or civil penalties against you may be sought (B) violation of any policies of the Company, including, without limitation, insider trading or anti-harassment policies or (C) participating in a hostile takeover attempt against the Company.
7. Employment Not Affected. Neither the grant of any Shares, nor any other action taken with respect to the Shares, shall confer upon the Grantee any right to continue in the employ of the Company or shall interfere in any way with the right of the Company to terminate Grantee’s employment at any time. Except as may be otherwise limited by another written agreement, the right of the Company to terminate at will the Grantee’s employment with it at any time (whether by dismissal, discharge, retirement or otherwise) is specifically reserved.
8. No Stockholder Rights. You will not have any stockholder rights with respect to the Shares unless and until such Shares vest in accordance with the terms herein.
9. Securities Laws. The Company shall not be obligated to issue any Common Stock pursuant to this Agreement if, in the opinion of counsel to the Company, the shares to be so issued are required to be registered or otherwise qualified under the United States Securities Act of 1933, as amended, or under any other applicable statute, regulation or ordinance affecting the sale of securities, unless and until such shares have been so registered or otherwise qualified.
10. Severability. Should a court of competent jurisdiction deem any of the provisions in this Agreement to be unenforceable in any respect, it is the intention of the parties to this Agreement that this Agreement be deemed, without further action on the part of the parties hereto, modified, amended and limited to the extent necessary to render the same valid and enforceable. It is further the parties’ intent that all provisions not deemed to be overbroad shall be given their full force and effect. You acknowledge that you are freely, knowingly and voluntarily entering into this Agreement after having an opportunity for consultation with your own independent counsel.
11. Choice of Law; Jurisdiction. This Agreement shall be governed by and construed and interpreted in accordance with the substantive laws of the State of Delaware, without giving effect to any conflicts of law rule or principle that might require the application of the laws of another jurisdiction. ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT SHALL BE INSTITUTED SOLELY IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA OR THE COURTS OF THE STATE OF COLORADO LOCATED IN DENVER COUNTY, COLORADO AND EACH PARTY IRREVOCABLY SUBMITS TO THE PERSONAL JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING.
12. Income Taxes. You agree to comply with the appropriate procedures established by the
Company, from time to time, to provide for payment or withholding of such income or other taxes as may be required by law to be paid or withheld in connection with the vesting of the Shares.
STOCK OPTION AGREEMENT
| | | | | | | | | | | | | | |
| | | | |
GRANTEE NAME | NUMBER OF OPTIONS GRANTED | OPTION PRICE | GRANT DATE | EXPIRATION DATE |
| | | | |
STOCK OPTION VESTING SCHEDULE
| | | | | |
| VESTING DATE | NUMBER OF SHARES TO VEST |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| TOTAL | |
Voyager Space Holdings, Inc., a Delaware corporation (the “Company”), hereby grants to [ ò ] (the “Grantee”, also referred to as “you”) an option to purchase (the “Option”) shares of the
Common Stock of the Company at an option price as set forth above, pursuant to the terms of the attached Stock Option Agreement and the Voyager Space Holdings, Inc. 2020 Incentive Plan (the “Plan”).
By signing this cover sheet, you hereby accept the Options and agree to all of the terms and conditions described in the attached Stock Option Agreement and the Plan.
| | | | | | | | | | | |
| The Company: | |
| | | |
| By: | | |
| | | |
| Name: | | |
| | | |
| Title: | | |
This is not a stock certificate or a negotiable instrument. This grant of Option is a voluntary, revocable grant from the Company and Grantee hereby acknowledges that the Company has no obligation to make additional grants in the future.
UPON RECEIPT OF YOUR SIGNED AGREEMENT, A BOOKKEEPING ENTRY WILL BE ENTERED INTO THE COMPANY’S BOOKS AND RECORDS TO EVIDENCE THE OPTIONS GRANTED TO YOU.
Voyager Space Holdings, Inc.
STOCK OPTION AGREEMENT
1.Nontransferability. This Stock Option Agreement (this “Agreement”) evidences the grant to you evidences the grant to you on the Grant Date set forth on the cover page of an option under the Voyager Space Holdings, Inc. 2020 Incentive Plan (the “Plan”) to purchase shares of the Common Stock of the Company (the “Option”). Under applicable provisions of the Internal Revenue Code of 1986, as amended, the Option is treated as an incentive option. Capitalized terms that are not defined on the cover page or in the Option Agreement are defined in the Plan. Your Option Agreement may not be transferred, assigned, pledged or hypothecated, whether by operation of law or otherwise, normay the Option be made subject to execution, attachment or similar process.
2.The Plan. The Option is issued in accordance with and is subject to and conditioned upon all of the terms and conditions of this Agreement and the Plan as amended from time to time; provided, however, that no future amendment or termination of the Plan shall, without your consent, alter or impair any of your rights or obligations under the Plan, all of which are incorporated by reference in this Agreement as if fully set forth herein.
3.Vesting. This Option shall vest in accordance with time-vesting schedule set forth on Page 1 above. Notwithstanding Section 10 of the Plan, this Option shall not become fully exercisable and vested upon the initial public offering of the Company’s equity securities pursuant to an effective registration statement filed with the Securities and Exchange Commission in accordance with the Securities Act or a direct listing of the Company’s equity securities in the United States on a national securities exchange (“IPO”); provided, however, that, if an IPO occurs after the Grant Date and your employment is subsequently terminated by action of the Company for reasons other than cause (as such term is defined in your employment or severance agreement (if any) or, if none, as defined by the Committee and in effect at the time of your termination) then this Option shall become fully vested and exercisable as of the date of your termination. For the avoidance of doubt, the vesting provisions set forth in Section 10 of the Plan shall apply to a Change in Control that is not an IPO.
4.Termination. The Option shall terminate immediately if you voluntarily incur a Termination of Service without the written consent of the Company or if you incur a Termination of Service by action of the Company due to your willful refusal to perform your duties or for “cause” (as such term is defined in your employment or severance agreement (if any) or, if none, as defined by the Committee and in effect at the time of your termination). Notwithstanding the previous sentence, if your Termination of Service is voluntary and with the written consent of the Company (which written consent expressly sets forth a statement to the effect that, to the extent exercisable on the date of such termination the Option shall remain exercisable), or if your Termination of Service is by action of the Company for reasons other than cause, you may exercise the Option to the extent exercisable at the time of such termination, at any time prior to the expiration of three months after such termination, or for any longer period of time after such
termination as shall be determined by the Committee, but not later than the Expiration Date. Should you die during your employment or service or following your Termination of Service, the Option shall immediately terminate, except that, to the extent exercisable by you at the time of your death, the Option may be exercised within one year after the date of your death but not later than the Expiration Date, solely in accordance with all of the terms and conditions of the Plan by your personal representatives or by the person or persons to whom your rights under the Option shall pass by will or by the applicable laws of descent and distribution.
5.Sale. In the event that you elect to sell or transfer any interest in the shares of Common Stock of the Company acquired pursuant to the Option, the Company has a right to purchase such shares at the then-market value of such shares. As a precondition to any sale or transfer of such shares, you agree to provide the Company notice of such sale or transfer, together with such additional information as the Company may request, and you may not sell or transfer such shares unless and until the Company has waived its repurchase right in writing, which the Company shall do within thirty (30) days of receipt of your notice.
6.Additional Forfeiture. The Committee may cancel, suspend, withhold or otherwise limit or restrict the Option at any time if you (i) are not in compliance with all applicable provisions of this Agreement or the Plan or (ii) engage in any activity inimical, contrary or harmful to the interests of the Company, including, but not limited to: (A) conduct related to your service or employment for which either criminal or civil penalties against you may be sought (B) violation of any policies of the Company, including, without limitation, insider trading or anti-harassment policies or (C) participating in a hostile takeover attempt against the Company.
7.Employment Not Affected. Neither the grant of the Option, nor any other action taken with respect to the Option, shall confer upon the Grantee any right to continue in the employ of the Company or shall interfere in any way with the right of the Company to terminate Grantee’s employment at any time. Except as may be otherwise limited by another written agreement, the right of the Company to terminate at will the Grantee’s employment with it at any time (whether by dismissal, discharge, retirement or otherwise) is specifically reserved.
8.No Stockholder Rights. Neither the Grantee, nor any person entitled to exercise the Grantee’s rights in the event of the Grantee’s death, shall have any of the rights and privileges of a holder of the Company’s Common Stock subject to this Agreement.
9.Securities Laws. The Company shall not be obligated to issue any Common Stock pursuant to this Agreement if, in the opinion of counsel to the Company, the shares to be so issued are required to be registered or otherwise qualified under the United States Securities Act of 1933, as amended, or under any other applicable statute, regulation or ordinance affecting the sale of securities, unless and until such shares have been so registered or otherwise qualified.
10.Severability. Should a court of competent jurisdiction deem any of the provisions in this Agreement to be unenforceable in any respect, it is the intention of the parties to this Agreement that this Agreement be deemed, without further action on the part of the parties hereto, modified, amended and limited to the extent necessary to render the same valid and enforceable. It is further the parties’ intent that all provisions not deemed to be overbroad shall be given their full force and effect. You acknowledge that you are freely, knowingly and voluntarily entering into this Agreement after having an opportunity for consultation with your own independent counsel.
11.Choice of Law; Jurisdiction. This Agreement shall be governed by and construed and interpreted in accordance with the substantive laws of the State of Delaware, without giving effect to any conflicts of law rule or principle that might require the application of the laws of another jurisdiction. ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT SHALL BE INSTITUTED SOLELY IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA OR THE COURTS OF THE STATE OF COLORADO LOCATED IN DENVER COUNTY, COLORADO AND EACH PARTY IRREVOCABLY SUBMITS TO THE PERSONAL JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING.
12.Income Taxes. You agree to comply with the appropriate procedures established by the Company, from time to time, to provide for payment or withholding of such income or other taxes as may be required by law to be paid or withheld in connection with the Option or the shares of Common Stock issuable in connection therewith.
13.Expiration. This Option, to the extent not previously exercised, shall expire on the Expiration Date set forth above.
14.Exercise. This Option is to be exercised by delivering to the Company a written notice of exercise in the form attached hereto as Exhibit A together with payment as provided in the Plan.
EXHIBIT A
STOCK OPTION EXERCISE NOTICE
Dated: [ ò ]
To: Voyager Space Holdings, Inc.
Attn: [ ò ]
Sir/Madam:
Notice is hereby given of my election to purchase [ ò ] shares of Common Stock of Voyager Space Holdings, Inc. (the “Company”) at a price of $[ ò ] per share under the provisions of the stock option (“Option”) granted to me on [ ò ] under the terms of the Voyager Space Holdings, Inc. 2020 Incentive Plan.
I hereby certify that I am in compliance with the covenants and forfeiture provisions of the Option Agreement dated as of [ ò ] between the Company and me (the “Option Agreement”). I acknowledge that a violation of these provisions will result in the forfeiture of any remaining options that I have.
Cash Method or Cashless Method:
Cash: Enclosed is my check made payable to the Company in the amount of $ [ ò ] in payment of the exercise price of the Option and my check in the amount of $ [ ò ] made payable to [ ò ] in payment of the tax due on exercise of the Option.
Cashless: I will contact my broker from [ ò ] who will be verifying my options and arranging to exercise and sell my option shares.
The following information is supplied for use in issuing and registering the shares purchased:
| | | | | | | | | | | |
| Number of Shares: |
| |
| Full Name: |
| |
| Address: |
| |
| | | |
| | | |
| | | |
| Signature: | | |
| | |
|
VOYAGER TECHNOLOGIES, INC. 2025 INCENTIVE AWARD PLAN |
|
ARTICLE I.
PURPOSE
The Plan’s purpose is to enhance the Company’s ability to attract, retain and motivate persons who make (or are expected to make) important contributions to the Company by providing these individuals with equity ownership opportunities and/or equity-linked compensatory opportunities. Capitalized terms used in the Plan are defined in Article XI.
ARTICLE II.
ELIGIBILITY
Service Providers are eligible to be granted Awards under the Plan, subject to the limitations described herein.
ARTICLE III.
ADMINISTRATION AND DELEGATION
3.1 Administration. The Plan is administered by the Administrator. The Administrator has authority to determine which Service Providers receive Awards, grant Awards and set Award terms and conditions, subject to the conditions and limitations in the Plan. The Administrator also has the authority to take all actions and make all determinations under the Plan, to interpret the Plan and Award Agreements and to adopt, amend and repeal Plan administrative rules, guidelines and practices as it deems advisable. The Administrator may correct defects and ambiguities, supply omissions and reconcile inconsistencies in the Plan or any Award Agreement as it deems necessary or appropriate to administer the Plan and any Awards. The Administrator’s determinations under the Plan are in its sole discretion and will be final and binding on all persons having or claiming any interest in the Plan or any Award.
3.2 Appointment of Committees. To the extent Applicable Laws permit, the Board or the Administrator may delegate any or all of its powers under the Plan to one or more Committees or one or more committees of directors or officers of the Company or any of its Subsidiaries; provided, however, that in no event shall an officer of the Company be delegated the authority to grant Awards to, or amend Awards held by, the following individuals: (a) individuals who are subject to Section 16 of the Exchange Act, or (b) officers of the Company (or Directors) to whom authority to grant or amend Awards has been delegated hereunder. The Board or the Administrator, as applicable, may rescind any such delegation, abolish any such Committee or committee and/or re-vest in itself any previously delegated authority at any time.
ARTICLE IV.
STOCK AVAILABLE FOR AWARDS
4.1 Number of Shares. Subject to adjustment under Article VIII and the terms of this Article IV, the maximum number of Shares that may be issued pursuant to Awards under the Plan shall be equal to the Overall Share Limit. Shares issued under the Plan may consist of authorized but unissued Shares, Shares purchased on the open market or treasury Shares. As of the Effective Date, the Company
will cease granting awards under the Prior Plan; however, Prior Plan Awards will remain subject to the terms of the applicable Prior Plan.
4.2 Share Recycling. If all or any part of an Award or Prior Plan Award expires, lapses or is terminated, exchanged for or settled in cash, surrendered, repurchased, canceled without having been fully exercised or forfeited, in any case, in a manner that results in the Company acquiring Shares covered by the Award or Prior Plan Award at a price not greater than the price (as adjusted to reflect any Equity Restructuring) paid by the Participant for such Shares or not issuing any Shares covered by the Award or Prior Plan Award, the unused Shares covered by the Award or Prior Plan Award will, as applicable, become or again be available for Award grants under the Plan. In addition, Shares delivered (either by actual delivery or attestation) to the Company by a Participant to satisfy the applicable exercise or purchase price of an Award or Prior Plan Award and/or to satisfy any applicable tax withholding obligation with respect to an Award or Prior Plan Award (including Shares retained by the Company from the Award or Prior Plan Award being exercised or purchased and/or creating the tax obligation) as well as Shares purchased on the open market by the Company with the cash proceeds from the exercise of Options, will, as applicable, become or again be available for Award grants under the Plan. The payment of Dividend Equivalents in cash in conjunction with any outstanding Awards shall not count against the Overall Share Limit. Notwithstanding anything to the contrary contained herein, the following Shares shall not be added to the Shares authorized for grant under Section 4.1 and shall not be available for future grants of Awards: (i) Shares subject to a Stock Appreciation Right that are not issued in connection with the stock settlement of the Stock Appreciation Right on exercise thereof.
4.3 Incentive Stock Option Limitations. Notwithstanding anything to the contrary herein, no more than 44,035,330 Shares may be issued pursuant to the exercise of Incentive Stock Options.
4.4 Substitute Awards. In connection with an entity’s merger or consolidation with the Company or the Company’s acquisition of an entity’s property or stock, the Administrator may grant Awards in substitution for any options or other stock or stock-based awards granted before such merger or consolidation by such entity or its affiliate. Substitute Awards may be granted on such terms as the Administrator deems appropriate, notwithstanding limitations on Awards in the Plan. Substitute Awards will not count against the Overall Share Limit (nor shall Shares subject to a Substitute Award be added to the Shares available for Awards under the Plan as provided above), except that Shares acquired by exercise of substitute Incentive Stock Options will count against the maximum number of Shares that may be issued pursuant to the exercise of Incentive Stock Options under the Plan. Additionally, in the event that a company acquired by the Company or any Subsidiary or with which the Company or any Subsidiary combines has shares available under a pre-existing plan approved by stockholders and not adopted in contemplation of such acquisition or combination, the shares available for grant pursuant to the terms of such pre-existing plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio or formula used in such acquisition or combination to determine the consideration payable to the holders of shares of the entities party to such acquisition or combination) may be used for Awards under the Plan and shall not reduce the Shares authorized for grant under the Plan (and Shares subject to such Awards shall not be added to the Shares available for Awards under the Plan as provided above); provided that Awards using such available shares shall not be made after the date awards or grants could have been made under the terms of the pre-existing plan, absent the acquisition or combination, and shall only be made to individuals who were not Employees, Consultants or Directors prior to such acquisition or combination.
4.5 Non-Employee Director Compensation. Notwithstanding any provision to the contrary in the Plan, the Administrator may establish compensation for non-employee Directors from time to time,
subject to the limitations in the Plan and the requirements of Applicable Law and/or pursuant to a written nondiscretionary formula established by the Administrator (the “Non-Employee Director Compensation Policy”). The sum of any cash compensation, or other compensation, and the value (determined as of the grant date in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, or any successor thereto) of Awards granted to a non-employee Director as compensation for services as a non-employee Director during any fiscal year of the Company may not exceed $750,000, increased to $1,000,000 in the fiscal year of a non-employee Director’s initial service as a non-employee Director (the “Director Limit”). The Administrator may make exceptions to the Director Limit in extraordinary circumstances, as the Administrator may determine in its discretion, provided that the non-employee Director receiving such additional compensation may not participate in the decision to award such compensation or in other contemporaneous compensation decisions involving non-employee Directors.
ARTICLE V.
STOCK OPTIONS AND STOCK APPRECIATION RIGHTS
5.1 General. The Administrator may grant Options or Stock Appreciation Rights to Service Providers subject to the limitations in the Plan, including any limitations in the Plan that apply to Incentive Stock Options. A Stock Appreciation Right will entitle the Participant (or other person entitled to exercise the Stock Appreciation Right) to receive from the Company upon exercise of the exercisable portion of the Stock Appreciation Right an amount determined by multiplying the excess, if any, of the Fair Market Value of one share on the date of exercise over the exercise price per share of the Stock Appreciation Right by the number of Shares with respect to which the Stock Appreciation Right is exercised, subject to any limitations of the Plan or that the Administrator may impose and payable in cash, Shares valued at Fair Market Value or a combination of the two as the Administrator may determine or provide in the Award Agreement.
5.2 Exercise Price. The Administrator will establish each Option’s and Stock Appreciation Right’s exercise price and specify the exercise price in the Award Agreement. The exercise price will not be less than 100% of the Fair Market Value on the grant date of the Option (subject to Section 5.6) or Stock Appreciation Right. Notwithstanding the foregoing, in the case of an Option or a Stock Appreciation Right that is a Substitute Award, the exercise price per share of the Shares subject to such Option or Stock Appreciation Right, as applicable, may be less than the Fair Market Value per share on the date of grant; provided that the exercise price of any Substitute Award shall be determined in accordance with the applicable requirements of Sections 424 and 409A of the Code.
5.3 Duration. Each Option or Stock Appreciation Right will be exercisable at such times and as specified in the Award Agreement, provided that, subject to Section 5.6, the term of an Option or Stock Appreciation Right will not exceed ten years. Notwithstanding the foregoing and unless determined otherwise by the Company, in the event that on the last business day of the term of an Option or Stock Appreciation Right (other than an Incentive Stock Option) (i) the exercise of the Option or Stock Appreciation Right is prohibited by Applicable Law, as determined by the Company, or (ii) Shares may not be purchased or sold by the applicable Participant due to any Company insider trading policy (including blackout periods) or a “lock-up” agreement undertaken in connection with an issuance of securities by the Company, the term of the Option or Stock Appreciation Right shall be extended until the date that is 30 days after the end of the legal prohibition, black-out period or lock-up agreement, as determined by the Company; provided, however, in no event shall the extension last beyond the ten year term of the applicable Option or Stock Appreciation Right. Unless otherwise determined by the Administrator in the Award Agreement or by action of the Administrator following the grant of the
Option or Stock Appreciation Right, (i) no portion of an Option or Stock Appreciation Right which is unexercisable at a Participant’s Termination of Service shall thereafter become exercisable and (ii) the portion of an Option or Stock Appreciation Right that is unexercisable at a Participant’s Termination of Service shall automatically expire sixty (60) days following such Termination of Service. Notwithstanding the foregoing, to the extent permitted under Applicable Laws, if the Participant, prior to the end of the term of an Option or Stock Appreciation Right, violates the non-competition, non-solicitation, confidentiality or other similar restrictive covenant provisions of any employment contract, confidentiality and nondisclosure agreement or other agreement between the Participant and the Company or any of its Subsidiaries, the right of the Participant and the Participant’s transferees to exercise any Option or Stock Appreciation Right issued to the Participant shall terminate immediately upon such violation, unless the Company otherwise determines.
5.4 Exercise. Options and Stock Appreciation Rights may be exercised by delivering to the Company a written notice of exercise, in a form the Administrator approves (which may be electronic), signed by the person authorized to exercise the Option or Stock Appreciation Right, together with, as applicable, payment in full (i) as specified in Section 5.5 for the number of Shares for which the Award is exercised and (ii) as specified in Section 9.5 for any applicable taxes. Unless the Administrator otherwise determines, an Option or Stock Appreciation Right may not be exercised for a fraction of a Share.
5.5 Payment Upon Exercise. Subject to Section 10.8, any Company insider trading policy (including blackout periods) and Applicable Laws, the exercise price of an Option must be paid by:
(a) cash, wire transfer of immediately available funds or by check payable to the order of the Company, provided that the Company may limit the use of one of the foregoing payment forms if one or more of the payment forms below is permitted;
(b) if there is a public market for Shares at the time of exercise, unless the Company otherwise determines, (A) delivery (including electronically or telephonically to the extent permitted by the Company) of an irrevocable and unconditional undertaking by a broker acceptable to the Company to deliver promptly to the Company sufficient funds to pay the exercise price, or (B) the Participant’s delivery to the Company of a copy of irrevocable and unconditional instructions to a broker acceptable to the Company to deliver promptly to the Company cash or a check sufficient to pay the exercise price; provided that such amount is paid to the Company at such time as may be required by the Administrator;
(c) to the extent permitted by the Administrator, delivery (either by actual delivery or attestation) of Shares owned by the Participant valued at their Fair Market Value;
(d) to the extent permitted by the Administrator, surrendering Shares then issuable upon the Option’s exercise valued at their Fair Market Value on the exercise date;
(e) to the extent permitted by the Administrator, delivery of a promissory note or any other property that the Administrator determines is good and valuable consideration; or
(f) to the extent permitted by the Company, any combination of the above payment forms approved by the Administrator.
5.6 Additional Terms of Incentive Stock Options. The Administrator may grant Incentive Stock Options only to employees of the Company, any of its present or future parent or subsidiary corporations, as defined in Sections 424(e) or (f) of the Code, respectively, and any other entities the employees of which are eligible to receive Incentive Stock Options under the Code. If an Incentive Stock
Option is granted to a Greater Than 10% Stockholder, the exercise price will not be less than 110% of the Fair Market Value on the Option’s grant date, and the term of the Option will not exceed five years. All Incentive Stock Options will be subject to and construed consistently with Section 422 of the Code. By accepting an Incentive Stock Option, the Participant agrees to give prompt notice to the Company of dispositions or other transfers (other than in connection with a Change in Control) of Shares acquired under the Option made within (i) two years from the grant date of the Option or (ii) one year after the transfer of such Shares to the Participant, specifying the date of the disposition or other transfer and the amount the Participant realized, in cash, other property, assumption of indebtedness or other consideration, in such disposition or other transfer. Neither the Company nor the Administrator will be liable to a Participant, or any other party, if an Incentive Stock Option fails or ceases to qualify as an “incentive stock option” under Section 422 of the Code. Any Incentive Stock Option or portion thereof that fails to qualify as an “incentive stock option” under Section 422 of the Code for any reason, including becoming exercisable with respect to Shares having a Fair Market Value exceeding the $100,000 limitation under Treasury Regulation Section 1.422-4, will be a Non-Qualified Option.
ARTICLE VI.
RESTRICTED STOCK; RESTRICTED STOCK UNITS
6.1 General. The Administrator may grant Restricted Stock, or the right to purchase Restricted Stock, to any Service Provider, subject to the Company’s right to repurchase all or part of such Shares at their issue price or other stated or formula price from the Participant (or to require forfeiture of such Shares) if conditions the Administrator specifies in the Award Agreement are not satisfied before the end of the applicable restriction period or periods that the Administrator establishes for such Award. In addition, the Administrator may grant to Service Providers Restricted Stock Units, which may be subject to vesting and forfeiture conditions during the applicable restriction period or periods, as set forth in an Award Agreement.
6.2 Restricted Stock.
(a) Rights as Stockholders. Subject to the Company’s right of repurchase as described above, upon issuance of Restricted Stock, the Participant shall have, unless otherwise provided by the Administrator, all of the rights of a stockholder with respect to said Shares, subject to the restrictions in the Plan.
(b) Dividends. Participants holding Restricted Stock will be entitled to all ordinary cash dividends paid with respect to such Shares, unless the Administrator provides otherwise in the Award Agreement. In addition, unless the Administrator provides otherwise, if any dividends or distributions are paid in Shares, or consist of a dividend or distribution to holders of Shares of property other than an ordinary cash dividend, the Shares or other property will be subject to the same restrictions on transferability and forfeitability as the Restricted Stock with respect to which they were paid. Notwithstanding anything to the contrary herein, with respect to any award of Restricted Stock, dividends which are paid to holders of Shares prior to vesting shall only be paid out to the Participant holding such Restricted Stock to the extent that the vesting conditions are subsequently satisfied. All such dividend payments will be made no later than March 15 of the calendar year following the calendar year in which the right to the dividend payment becomes nonforfeitable.
(c) Stock Certificates. The Company may require that the Participant deposit in escrow with the Company (or its designee) any stock certificates issued in respect of Restricted Stock, together with a stock power endorsed in blank.
6.3 Restricted Stock Units.
(a) Settlement. The Administrator may provide that settlement of Restricted Stock Units will occur upon or as soon as reasonably practicable after the Restricted Stock Units vest or will instead be deferred, on a mandatory basis or at the Participant’s election, in a manner intended to comply with Section 409A.
(b) Stockholder Rights. A Participant will have no rights of a stockholder with respect to Shares subject to any Restricted Stock Unit unless and until the Shares are delivered in settlement of the Restricted Stock Unit.
ARTICLE VII.
OTHER STOCK OR CASH BASED AWARDS; DIVIDEND EQUIVALENTS
7.1 Other Stock or Cash Based Awards. Other Stock or Cash Based Awards may be granted to Participants, including Awards entitling Participants to receive Shares to be delivered in the future and including annual or other periodic or long-term cash bonus awards (whether based on specified Performance Criteria or otherwise), in each case subject to any conditions and limitations in the Plan. Such Other Stock or Cash Based Awards will also be available as a payment form in the settlement of other Awards, as standalone payments and as payment in lieu of compensation to which a Participant is otherwise entitled. Other Stock or Cash Based Awards may be paid in Shares, cash or other property, as the Administrator determines.
7.2 Dividend Equivalents. A grant of Restricted Stock Units or Other Stock or Cash Based Award may provide a Participant with the right to receive Dividend Equivalents, and no Dividend Equivalents shall be payable with respect to Options or Stock Appreciation Rights. Dividend Equivalents may be paid currently or credited to an account for the Participant, settled in cash or Stocks and subject to the same restrictions on transferability and forfeitability as the Award with which the Dividend Equivalents are paid and subject to other terms and conditions as set forth in the Award Agreement. Notwithstanding anything to the contrary herein, Dividend Equivalents with respect to an Award shall only be paid out to the Participant to the extent that the vesting conditions applicable to the underlying Award are satisfied. All such Dividend Equivalent payments will be made no later than March 15 of the calendar year following the calendar year in which the right to the Dividend Equivalent payment becomes nonforfeitable in accordance with the foregoing, unless otherwise determined by the Administrator.
ARTICLE VIII.
ADJUSTMENTS FOR CHANGES IN COMMON STOCK
AND CERTAIN OTHER EVENTS
8.1 Equity Restructuring. In connection with any Equity Restructuring, notwithstanding anything to the contrary in this Article VIII, the Administrator will equitably adjust each outstanding Award as it deems appropriate to reflect the Equity Restructuring, which may include adjusting the number and type of securities subject to each outstanding Award and/or the Award’s exercise price or grant price (if applicable), granting new Awards to Participants, and making a cash payment to Participants. The adjustments provided under this Section 8.1 will be nondiscretionary and final and binding on the affected Participant and the Company; provided that the Administrator will determine whether an adjustment is equitable.
8.2 Corporate Transactions. In the event of any dividend or other distribution (whether in the form of cash, Common Stock, other securities, or other property), reorganization, merger, consolidation,
combination, amalgamation, repurchase, recapitalization, liquidation, dissolution, or sale, transfer, exchange or other disposition of all or substantially all of the assets of the Company, or sale or exchange of Common Stock or other securities of the Company, Change in Control, issuance of warrants or other rights to purchase Common Stock or other securities of the Company, other similar corporate transaction or event, other unusual or nonrecurring transaction or event affecting the Company or its financial statements or any change in any Applicable Laws or accounting principles, the Administrator, on such terms and conditions as it deems appropriate, either by the terms of the Award or by action taken prior to the occurrence of such transaction or event (except that action to give effect to a change in Applicable Law or accounting principles may be made within a reasonable period of time after such change) and either automatically or upon the Participant’s request, is hereby authorized to take any one or more of the following actions whenever the Administrator determines that such action is appropriate in order to (x) prevent dilution or enlargement of the benefits or potential benefits intended by the Company to be made available under the Plan or with respect to any Award granted or issued under the Plan, (y) facilitate such transaction or event or (z) give effect to such changes in Applicable Laws or accounting principles:
(a) To provide for the cancellation of any such Award in exchange for either an amount of cash or other property with a value equal to the amount that could have been obtained upon the exercise or settlement of the vested portion of such Award or realization of the Participant’s rights under the vested portion of such Award, as applicable; provided that, if the amount that could have been obtained upon the exercise or settlement of the vested portion of such Award or realization of the Participant’s rights, in any case, is equal to or less than zero, then the Award may be terminated without payment;
(b) To provide that such Award shall vest and, to the extent applicable, be exercisable as to all Shares covered thereby, notwithstanding anything to the contrary in the Plan or the provisions of such Award;
(c) To provide that such Award be assumed by the successor or survivor corporation, or a parent or subsidiary thereof, or shall be substituted for by awards covering the shares of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and/or applicable exercise or purchase price, in all cases, as determined by the Administrator;
(d) To make adjustments in the number and type of Shares (or other securities or property) subject to outstanding Awards and/or with respect to which Awards may be granted under the Plan (including, but not limited to, adjustments of the limitations in Article IV on the maximum number and kind of shares which may be issued, including pursuant to any Non-Employee Director Compensation Policy) and/or in the terms and conditions of (including the grant or exercise price or applicable performance goals), and the criteria included in, outstanding Awards;
(e) To replace such Award with other rights or property selected by the Administrator; and/or
(f) To provide that the Award will terminate and cannot vest, be exercised or become payable after the applicable event.
8.3 Administrative Stand Still. In the event of any pending stock dividend, stock split, combination or exchange of shares, merger, consolidation or other distribution (other than normal cash dividends) of Company assets to stockholders, or any other extraordinary transaction or change affecting
the Shares or the share price of Common Stock, including any Equity Restructuring or any securities offering or other similar transaction, for administrative convenience, the Administrator may refuse to permit the exercise of any Award for up to 60 days before or after such transaction.
8.4 General. Except as expressly provided in the Plan or the Administrator’s action under the Plan, no Participant will have any rights due to any subdivision or consolidation of Shares of any class, dividend payment, increase or decrease in the number of Shares of any class or dissolution, liquidation, merger, or consolidation of the Company or other corporation. Except as expressly provided with respect to an Equity Restructuring under Section 8.1 or the Administrator’s action under the Plan, no issuance by the Company of Shares of any class, or securities convertible into Shares of any class, will affect, and no adjustment will be made regarding, the number of Shares subject to an Award or the Award’s grant or exercise price. The existence of the Plan, any Award Agreements and the Awards granted hereunder will not affect or restrict in any way the Company’s right or power to make or authorize (i) any adjustment, recapitalization, reorganization or other change in the Company’s capital structure or its business, (ii) any merger, consolidation dissolution or liquidation of the Company or sale of Company assets or (iii) any sale or issuance of securities, including securities with rights superior to those of the Shares or securities convertible into or exchangeable for Shares. The Administrator may treat Participants and Awards (or portions thereof) differently under this Article VIII.
ARTICLE IX.
GENERAL PROVISIONS APPLICABLE TO AWARDS
9.1 Transferability. Except as the Administrator may determine or provide in an Award Agreement or otherwise for Awards other than Incentive Stock Options, Awards may not be sold, assigned, transferred, pledged or otherwise encumbered, either voluntarily or by operation of law, except for certain beneficiary designations, by will or the laws of descent and distribution, or, subject to the Administrator’s consent, pursuant to a domestic relations order, and, during the life of the Participant, will be exercisable only by the Participant. Any permitted transfer of an Award hereunder shall be without consideration, except as required by Applicable Law, and such Award transferred to a permitted transferee shall continue to be subject to all the terms and conditions of the Award as applicable to the original Participant and the Participant or transferor and the receiving permitted transferee shall execute any and all documents requested by the Administrator. References to a Participant, to the extent relevant in the context, will include references to a Participant’s authorized transferee that the Administrator specifically approves.
9.2 Documentation. Each Award will be evidenced in an Award Agreement, which may be written or electronic, as the Administrator determines. The Award Agreement will contain the terms and conditions applicable to an Award. Each Award may contain terms and conditions in addition to those set forth in the Plan.
9.3 Discretion. Except as the Plan otherwise provides, each Award may be made alone or in addition or in relation to any other Award. The terms of each Award to a Participant need not be identical, and the Administrator need not treat Participants or Awards (or portions thereof) uniformly.
9.4 Termination of Status. The Administrator will determine how the disability, death, retirement, an authorized leave of absence or any other change or purported change in a Participant’s Service Provider status affects an Award and the extent to which, and the period during which the Participant, the Participant’s legal representative, conservator, guardian or Designated Beneficiary may exercise rights under the Award, if applicable.
9.5 Withholding. Each Participant must pay the Company, or make provision satisfactory to the Administrator for payment of, any taxes required by Applicable Law to be withheld in connection with such Participant’s Awards by the date of the event creating the tax liability. The Company may deduct an amount sufficient to satisfy such tax obligations based on the applicable statutory withholding rates (or such other rate as may be determined by the Company after considering any accounting consequences or costs) from any payment of any kind otherwise due to a Participant. In the absence of a contrary determination by the Company (or, with respect to withholding pursuant to clause (ii) below with respect to Awards held by individuals subject to Section 16 of the Exchange Act, a contrary determination by the Administrator), all tax withholding obligations will be calculated based on the maximum applicable statutory withholding rates. Subject to Section 10.8 and any Company insider trading policy (including blackout periods), Participants may satisfy such tax obligations (i) in cash, by wire transfer of immediately available funds, by check made payable to the order of the Company, provided that the Company may limit the use of the foregoing payment forms if one or more of the payment forms below is permitted, (ii) to the extent permitted by the Administrator, in whole or in part by delivery of Shares, including Shares delivered by attestation and Shares retained from the Award creating the tax obligation, valued at their Fair Market Value on the date of delivery, (iii) if there is a public market for Shares at the time the tax obligations are satisfied, unless the Company otherwise determines, (A) delivery (including electronically or telephonically to the extent permitted by the Company) of an irrevocable and unconditional undertaking by a broker acceptable to the Company to deliver promptly to the Company sufficient funds to satisfy the tax obligations, or (B) delivery by the Participant to the Company of a copy of irrevocable and unconditional instructions to a broker acceptable to the Company to deliver promptly to the Company cash or a check sufficient to satisfy the tax withholding; provided that such amount is paid to the Company at such time as may be required by the Administrator, or (iv) to the extent permitted by the Company, any combination of the foregoing payment forms approved by the Administrator. Notwithstanding any other provision of the Plan, the number of Shares which may be so delivered or retained pursuant to clause (ii) of the immediately preceding sentence shall be limited to the number of Shares which have a Fair Market Value on the date of delivery or retention no greater than the aggregate amount of such liabilities based on the maximum individual statutory tax rate in the applicable jurisdiction at the time of such withholding (or such other rate as may be required to avoid the liability classification of the applicable award under generally accepted accounting principles in the United States of America); provided, however, to the extent such Shares were acquired by Participant from the Company as compensation, the Shares must have been held for the minimum period required by applicable accounting rules to avoid a charge to the Company’s earnings for financial reporting purposes; provided, further, that, any such Shares delivered or retained shall be rounded up to the nearest whole Share to the extent rounding up to the nearest whole Share does not result in the liability classification of the applicable Award under generally accepted accounting principles in the United States of America. If any tax withholding obligation will be satisfied under clause (ii) above by the Company’s retention of Shares from the Award creating the tax obligation and there is a public market for Shares at the time the tax obligation is satisfied, the Company may elect to instruct any brokerage firm determined acceptable to the Company for such purpose to sell on the applicable Participant’s behalf some or all of the Shares retained and to remit the proceeds of the sale to the Company or its designee, and each Participant’s acceptance of an Award under the Plan will constitute the Participant’s authorization to the Company and instruction and authorization to such brokerage firm to complete the transactions described in this sentence.
9.6 Amendment of Award; Repricing. The Administrator may amend, modify or terminate any outstanding Award, including by substituting another Award of the same or a different type, changing the exercise or settlement date, and converting an Incentive Stock Option to a Non-Qualified Option. The Participant’s consent to such action will be required unless (i) the action, taking into account any related action, does not materially and adversely affect the Participant’s rights under the Award, or (ii) the change
is permitted under Article VIII or pursuant to Section 10.6. Notwithstanding the foregoing or anything in the Plan to the contrary, the Administrator may not, without the approval of the stockholders of the Company, (i) reduce the exercise price per share of outstanding Options or Stock Appreciation Rights or (ii) cancel outstanding Options or Stock Appreciation Rights in exchange for cash, other Awards or Options or Stock Appreciation Rights with an exercise price per share that is less than the exercise price per share of the original Options or Stock Appreciation Rights.
9.7 Conditions on Delivery of Shares. The Company will not be obligated to deliver any Shares under the Plan or remove restrictions from Shares previously delivered under the Plan until (i) all Award conditions have been met or removed to the Company’s satisfaction, (ii) as determined by the Company, all other legal matters regarding the issuance and delivery of such Shares have been satisfied, including any applicable securities laws and stock exchange or stock market rules and regulations, and (iii) the Participant has executed and delivered to the Company such representations or agreements as the Administrator deems necessary or appropriate to satisfy any Applicable Laws. The Company’s inability to obtain authority from any regulatory body having jurisdiction, which the Administrator determines is necessary to the lawful issuance and sale of any securities, will relieve the Company of any liability for failing to issue or sell such Shares as to which such requisite authority has not been obtained.
9.8 Acceleration. The Administrator may at any time provide that any Award will become immediately vested and fully or partially exercisable, free of some or all restrictions or conditions, or otherwise fully or partially realizable.
9.9 Cash Settlement. Without limiting the generality of any other provision of the Plan, the Administrator may provide, in an Award Agreement or subsequent to the grant of an Award, in its discretion, that any Award may be settled in cash, Shares or a combination thereof.
9.10 Broker-Assisted Sales. In the event of a broker-assisted sale of Shares in connection with the payment of amounts owed by a Participant under or with respect to the Plan or Awards, including amounts to be paid under the final sentence of Section 9.5: (i) any Shares to be sold through the broker-assisted sale will be sold on the day the payment first becomes due, or as soon thereafter as practicable; (ii) such Shares may be sold as part of a block trade with other Participants in the Plan in which all participants receive an average price; (iii) the applicable Participant will be responsible for all broker’s fees and other costs of sale, and by accepting an Award, each Participant agrees to indemnify and hold the Company harmless from any losses, costs, damages, or expenses relating to any such sale; (iv) to the extent the Company or its designee receives proceeds of such sale that exceed the amount owed, the Company will pay such excess in cash to the applicable Participant as soon as reasonably practicable; (v) the Company and its designees are under no obligation to arrange for such sale at any particular price; and (vi) in the event the proceeds of such sale are insufficient to satisfy the Participant’s applicable obligation, the Participant may be required to pay immediately upon demand to the Company or its designee an amount in cash sufficient to satisfy any remaining portion of the Participant’s obligation.
ARTICLE X.
MISCELLANEOUS
10.1 No Right to Employment or Other Status. No person will have any claim or right to be granted an Award, and the grant of an Award will not be construed as giving a Participant the right to continued employment or any other relationship with the Company or any of its Subsidiaries. The Company and its Subsidiaries expressly reserves the right at any time to dismiss or otherwise terminate its
relationship with a Participant free from any liability or claim under the Plan or any Award, except as expressly provided in an Award Agreement or in the Plan.
10.2 No Rights as Stockholder; Certificates. Subject to the Award Agreement, no Participant or Designated Beneficiary will have any rights as a stockholder with respect to any Shares to be distributed under an Award until becoming the record holder of such Shares. Notwithstanding any other provision of the Plan, unless the Administrator otherwise determines or Applicable Laws require, the Company will not be required to deliver to any Participant certificates evidencing Shares issued in connection with any Award and instead such Shares may be recorded in the books of the Company (or, as applicable, its transfer agent or stock plan administrator). The Company may place legends on stock certificates issued under the Plan that the Administrator deems necessary or appropriate to comply with Applicable Laws.
10.3 Effective Date and Term of Plan. Unless earlier terminated by the Board, the Plan will become effective on the day prior to the Public Trading Date (the “Effective Date”) and will remain in effect until the tenth anniversary of the earlier of (i) the date the Board adopted the Plan or (ii) the date the Company’s stockholders approved the Plan, but Awards previously granted may extend beyond that date in accordance with the Plan. Notwithstanding anything to the contrary in the Plan, an Incentive Stock Option may not be granted under the Plan after 10 years from the earlier of (i) the date the Board adopted the Plan or (ii) the date the Company’s stockholders approved the Plan, but Awards previously granted may extend beyond that date in accordance with the Plan. If the Plan is not approved by the Company’s stockholders, the Plan will not become effective, no Awards will be granted under the Plan and the Prior Plan will continue in full force and effect in accordance with its terms.
10.4 Amendment of Plan. The Board may amend, suspend or terminate the Plan at any time; provided that no amendment, other than an increase to the Overall Share Limit, may materially and adversely affect any Award outstanding at the time of such amendment without the affected Participant’s consent. No Awards may be granted under the Plan during any suspension period or after the Plan’s termination. Awards outstanding at the time of any Plan suspension or termination will continue to be governed by the Plan and the Award Agreement, as in effect before such suspension or termination. The Board will obtain stockholder approval of any Plan amendment to the extent necessary to comply with Applicable Laws.
10.5 Provisions for Foreign Participants. The Administrator may modify Awards granted to Participants who are foreign nationals or employed outside the United States or establish subplans or procedures under the Plan to address requirements of Applicable Laws and differences in laws, rules, regulations or customs of such foreign jurisdictions with respect to tax, securities, currency, employee benefit or other matters; provided, however, that no such subplans and/or modifications shall increase the Overall Share Limit or the Director Limit.
10.6 Section 409A.
(a) General. The Company intends that all Awards be structured to comply with, or be exempt from, Section 409A, such that no adverse tax consequences, interest, or penalties under Section 409A apply. Notwithstanding anything in the Plan or any Award Agreement to the contrary, the Administrator may, without a Participant’s consent, amend this Plan or Awards, adopt policies and procedures, or take any other actions (including amendments, policies, procedures and retroactive actions) as are necessary or appropriate to preserve the intended tax treatment of Awards, including any such actions intended to (A) exempt this Plan or any Award from Section 409A, or (B) comply with
Section 409A, including regulations, guidance, compliance programs and other interpretative authority that may be issued after an Award’s grant date. The Company makes no representations or warranties as to an Award’s tax treatment under Section 409A or otherwise. The Company will have no obligation under this Section 10.6 or otherwise to avoid the taxes, penalties or interest under Section 409A with respect to any Award and will have no liability to any Participant or any other person if any Award, compensation or other benefits under the Plan are determined to constitute noncompliant “nonqualified deferred compensation” subject to taxes, penalties or interest under Section 409A.
(b) Separation from Service. If an Award constitutes “nonqualified deferred compensation” under Section 409A, any payment or settlement of such Award upon a termination of a Participant’s Service Provider relationship will, to the extent necessary to avoid taxes under Section 409A, be made only upon the Participant’s “separation from service” (within the meaning of Section 409A), whether such “separation from service” occurs upon or after the termination of the Participant’s Service Provider relationship. For purposes of this Plan or any Award Agreement relating to any such payments or benefits, references to a “termination,” “termination of employment” or like terms means a “separation from service.”
10.7 Limitations on Liability. To the extent permitted under Applicable Law and the Organizational Documents, each member of the Administrator shall be indemnified and held harmless by the Company from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by such member in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action or failure to act pursuant to the Plan and against and from any and all amounts paid by him or her in satisfaction of judgment in such action, suit, or proceeding against him or her; provided he or she gives the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled pursuant to the Organizational Documents, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless.
10.8 Lock-Up Period. The Company may, at the request of any underwriter representative or otherwise, in connection with registering the offering of any Company securities under the Securities Act, prohibit Participants from, directly or indirectly, selling or otherwise transferring any Shares or other Company securities during a period of up to 180 days following the effective date of a Company registration statement filed under the Securities Act, or such longer period as determined by the underwriter.
10.9 Data Privacy. As a condition for receiving any Award, each Participant explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of personal data as described in this section by and among the Company and its Subsidiaries and affiliates exclusively for implementing, administering and managing the Participant’s participation in the Plan. The Company and its Subsidiaries and affiliates may hold certain personal information about a Participant, including the Participant’s name, address and telephone number; birthdate; social security, insurance number or other identification number; salary; nationality; job title(s); any Shares held in the Company or its Subsidiaries and affiliates; and Award details, to implement, manage and administer the Plan and Awards (the “Data”). The Company and its Subsidiaries and affiliates may transfer the Data amongst themselves as necessary to implement, administer and manage a Participant’s participation in the Plan, and the Company and its Subsidiaries and affiliates may transfer the Data to third parties assisting the Company with Plan implementation, administration and management. These recipients may be located in the
Participant’s country, or elsewhere, and the Participant’s country may have different data privacy laws and protections than the recipients’ country. By accepting an Award, each Participant authorizes such recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, to implement, administer and manage the Participant’s participation in the Plan, including any required Data transfer to a broker or other third party with whom the Company or the Participant may elect to deposit any Shares. The Data related to a Participant will be held only as long as necessary to implement, administer, and manage the Participant’s participation in the Plan. A Participant may, at any time, view the Data that the Company holds regarding such Participant, request additional information about the storage and processing of the Data regarding such Participant, recommend any necessary corrections to the Data regarding the Participant or refuse or withdraw the consents in this Section 10.9 in writing, without cost, by contacting the local human resources representative. If the Participant refuses or withdraws the consents in this Section 10.9, the Company may cancel Participant’s ability to participate in the Plan and, in the Administrator’s discretion, the Participant may forfeit any outstanding Awards. For more information on the consequences of refusing or withdrawing consent, Participants may contact their local human resources representative.
10.10 Severability. If any portion of the Plan or any action taken under it is held illegal or invalid for any reason, the illegality or invalidity will not affect the remaining parts of the Plan, and the Plan will be construed and enforced as if the illegal or invalid provisions had been excluded, and the illegal or invalid action will be null and void.
(a) Payments to Specified Employees. Notwithstanding any contrary provision in the Plan or any Award Agreement, any payment(s) of “nonqualified deferred compensation” required to be made under an Award to a “specified employee” (as defined under Section 409A and as the Administrator determines) due to his or her “separation from service” will, to the extent necessary to avoid taxes under Section 409A(a)(2)(B)(i) of the Code, be delayed for the six-month period immediately following such “separation from service” (or, if earlier, until the specified employee’s death) and will instead be paid (as set forth in the Award Agreement) on the day immediately following such six-month period or as soon as administratively practicable thereafter (without interest). Any payments of “nonqualified deferred compensation” under such Award payable more than six months following the Participant’s “separation from service” will be paid at the time or times the payments are otherwise scheduled to be made.
10.11 Governing Documents. If any contradiction occurs between the Plan and any Award Agreement or other written agreement between a Participant and the Company (or any Subsidiary) that the Administrator has approved, the Plan will govern, unless it is expressly specified in such Award Agreement or other written document that a specific provision of the Plan will not apply.
10.12 Governing Law. The Plan and all Awards will be governed by and interpreted in accordance with the laws of Delaware, without giving effect to principles of conflicts of laws.
10.13 Claw-back Provisions. All Awards (including, without limitation, any proceeds, gains or other economic benefit actually or constructively received by Participant upon any receipt or exercise of any Award or upon the receipt or resale of any Shares underlying the Award) shall be subject to the provisions of any claw-back policy implemented by the Company, including, without limitation, any claw-back policy adopted to comply with Applicable Laws (including the Dodd-Frank Wall Street Reform and Consumer Protection Act and any rules or regulations promulgated thereunder) as and to the extent set forth in such claw-back policy or the Award Agreement.
10.14 Titles and Headings. The titles and headings in the Plan are for convenience of reference only and, if any conflict, the Plan’s text, rather than such titles or headings, will control.
10.15 Conformity to Securities Laws. Participant acknowledges that the Plan is intended to conform to the extent necessary with Applicable Laws. Notwithstanding anything herein to the contrary, the Plan and all Awards will be administered only in conformance with Applicable Laws. To the extent Applicable Laws permit, the Plan and all Award Agreements will be deemed amended as necessary to conform to Applicable Laws.
10.16 Relationship to Other Benefits. No payment under the Plan will be taken into account in determining any benefits under any pension, retirement, savings, profit sharing, group insurance, welfare or other benefit plan of the Company or any Subsidiary except as expressly provided in writing in such other plan or an agreement thereunder.
ARTICLE XI.
DEFINITIONS
As used in the Plan, the following words and phrases will have the following meanings:
11.1 “Administrator” means the Board or a Committee to the extent that the Board’s powers or authority under the Plan have been delegated to such Committee. Notwithstanding the foregoing, the full Board, acting by a majority of its members in office, shall conduct the general administration of the Plan with respect to Awards granted to Directors and, with respect to such Awards, the term “Administrator” as used in the Plan shall be deemed to refer to the Board.
11.2 “Applicable Laws” means the requirements relating to the administration of equity incentive plans under U.S. federal and state securities, tax and other applicable laws, rules and regulations, the applicable rules of any stock exchange or quotation system on which the Shares are listed or quoted and the applicable laws and rules of any foreign country or other jurisdiction where Awards are granted.
11.3 “Award” means, individually or collectively, a grant under the Plan of Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Dividend Equivalents, or Other Stock or Cash Based Awards.
11.4 “Award Agreement” means a written agreement evidencing an Award, which may be electronic, that contains such terms and conditions as the Administrator determines, consistent with and subject to the terms and conditions of the Plan.
11.5 “Board” means the Board of Directors of the Company.
11.6 “Cause” with respect to a Participant, “Cause” (or any term of similar effect) as defined in such Participant’s employment or service agreement with the Company or an affiliate thereof if such an agreement exists and contains a definition of Cause (or term of similar effect), or, if no such agreement exists or such agreement does not contain a definition of Cause (or term of similar effect), then “Cause” shall mean one or more of the following: (A) repeated and gross failure to perform Participant’s material duties, after written notice of such performance has been given to Participant with 30 days to cure such nonperformance; (B) use of illegal drugs by Participant; (C) commission of a felony, a crime of moral turpitude or a misdemeanor involving fraud or dishonesty (for avoidance of doubt, a single driving while intoxicated (or other similar charge) shall not be considered a felony or crime of moral turpitude); (D) the
perpetration of any act of fraud or material dishonesty against or affecting the Company, any of its affiliates, or any customer, agent or employee thereof; (E) material breach of fiduciary duty or material breach of this Agreement, after written notice of such breach has been given to Participant and, to the event such breach is curable, within 30 days to cure such breach; (F) repeated insolent or abusive conduct in the workplace, including but not limited to, harassment of others of a racial or sexual nature after notice of such behavior; (G) taking any action which is intended to harm or disparage the Company, holdings, their affiliates, or their reputations, or which would reasonably be expected to lead to unwanted or unfavorable publicity to the Company, holdings or their affiliates; or (H) engaging in any act of material self-dealing without prior notice to and consent by the Board.
11.7 “Change in Control” means and includes each of the following:
(a) A transaction or series of transactions (other than an offering of Shares to the general public through a registration statement filed with the Securities and Exchange Commission or a transaction or series of transactions that meets the requirements of clauses (i) and (ii) of subsection (c) below) whereby any “person” or related “group” of “persons” (as such terms are used in Sections 13(d) and 14(d)(2) of the Exchange Act) (other than the Company, any of its Subsidiaries, an employee benefit plan maintained by the Company or any of its Subsidiaries or a “person” that, prior to such transaction, directly or indirectly controls, is controlled by, or is under common control with, the Company) directly or indirectly acquires beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of securities of the Company possessing more than 50% of the total combined voting power of the Company’s securities outstanding immediately after such acquisition; or
(b) During any period of twenty-four consecutive months, individuals who, at the beginning of such period, constitute the Board together with any new Director(s) (other than a Director designated by a person who shall have entered into an agreement with the Company to effect a transaction described in subsections (a) or (c)) whose election by the Board or nomination for election by the Company’s shareholders was approved by a vote of at least a majority of the Directors then still in office who either were Directors at the beginning of the twenty-four month period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof; or
(c) The consummation by the Company (whether directly involving the Company or indirectly involving the Company through one or more intermediaries) of (x) a merger, consolidation, reorganization, or business combination or (y) a sale or other disposition of all or substantially all of the Company’s assets in any single transaction or series of related transactions or (z) the acquisition of assets or shares of another entity, in each case other than a transaction:
(i) which results in the Company’s voting securities outstanding immediately before the transaction continuing to represent (either by remaining outstanding or by being converted into voting securities of the Company or the person that, as a result of the transaction, controls, directly or indirectly, the Company or owns, directly or indirectly, all or substantially all of the Company’s assets or otherwise succeeds to the business of the Company (the Company or such person, the “Successor Entity”)) directly or indirectly, at least a majority of the combined voting power of the Successor Entity’s outstanding voting securities immediately after the transaction, and
(ii) after which no person or group beneficially owns voting securities representing 50% or more of the combined voting power of the Successor Entity; provided, however, that no person or group shall be treated for purposes of this clause (ii) as beneficially owning 50% or more of
the combined voting power of the Successor Entity solely as a result of the voting power held in the Company prior to the consummation of the transaction.
Notwithstanding the foregoing, if a Change in Control constitutes a payment event with respect to any Award (or portion of any Award) that provides for the deferral of compensation that is subject to Section 409A, to the extent required to avoid the imposition of additional taxes under Section 409A, the transaction or event described in subsection (a), (b) or (c) with respect to such Award (or portion thereof) shall only constitute a Change in Control for purposes of the payment timing of such Award if such transaction also constitutes a “change in control event,” as defined in Treasury Regulation Section 1.409A-3(i)(5).
The Administrator shall have full and final authority, which shall be exercised in its discretion, to determine conclusively whether a Change in Control has occurred pursuant to the above definition, the date of the occurrence of such Change in Control and any incidental matters relating thereto; provided that any exercise of authority in conjunction with a determination of whether a Change in Control is a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5) shall be consistent with such regulation.
11.8 “Code” means the Internal Revenue Code of 1986, as amended, and the regulations issued thereunder.
11.9 “Committee” means one or more committees or subcommittees of the Board, which may include one or more Company directors or executive officers, to the extent Applicable Laws permit. To the extent required to comply with the provisions of Rule 16b-3, it is intended that each member of the Committee will be, at the time the Committee takes any action with respect to an Award that is subject to Rule 16b-3, a “non-employee director” within the meaning of Rule 16b-3; however, a Committee member’s failure to qualify as a “non-employee director” within the meaning of Rule 16b-3 will not invalidate any Award granted by the Committee that is otherwise validly granted under the Plan.
11.10 “Common Stock” means the Class A common stock of the Company (or, if determined by the Administrator, the Class B common stock of the Company), par value $0.0001.
11.11 “Company” means Voyager Technologies, Inc., a Delaware incorporated company, or any successor.
11.12 “Consultant” means any person, including any adviser, engaged by the Company or any of its Subsidiaries to render services to such entity if the consultant or adviser: (a) renders bona fide services to the Company; (b) renders services not in connection with the offer or sale of securities in a capital-raising transaction and does not directly or indirectly promote or maintain a market for the Company’s securities; and (c) is a natural person.
11.13 “Designated Beneficiary” means the beneficiary or beneficiaries the Participant designates, in a manner the Administrator determines, to receive amounts due or exercise the Participant’s rights if the Participant dies or becomes incapacitated. Without a Participant’s effective designation, “Designated Beneficiary” will mean the Participant’s estate.
11.14 “Director” means a Board member.
11.15 “Disability” means that the Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve months.
11.16 “Dividend Equivalents” means a right granted to a Participant under the Plan to receive the equivalent value (in cash or Shares) of dividends paid on Shares.
11.17 “Employee” means any employee of the Company or its Subsidiaries.
11.18 “Equity Restructuring” means, as determined by the Administrator, a non-reciprocal transaction between the Company and its stockholders, such as a stock dividend, stock split, spin-off or recapitalization through a large, nonrecurring cash dividend, or other large, nonrecurring cash dividend, that affects the Shares (or other securities of the Company) or the share price of Shares (or other securities of the Company) and causes a change in the per share value of the Shares underlying outstanding Awards.
11.19 “Exchange Act” means the Securities Exchange Act of 1934, as amended.
11.20 “Fair Market Value” means, as of any date, the value of a Share determined as follows: (a) if the Shares are listed on any established stock exchange, its Fair Market Value will be the closing sales price for such Shares as quoted on such exchange for such date, or if no sale occurred on such date, the last day preceding such date during which a sale occurred, as reported in The Wall Street Journal or another source the Administrator deems reliable; (b) if the Shares are not traded on a stock exchange but is quoted on a national market or other quotation system, the closing sales price on such date, or if no sales occurred on such date, then on the last date preceding such date during which a sale occurred, as reported in The Wall Street Journal or another source the Administrator deems reliable; or (c) without an established market for the Shares, the Administrator will determine the Fair Market Value in its discretion.
Notwithstanding the foregoing, with respect to any Award granted on the pricing date of the Company’s initial public offering, the Fair Market Value shall mean the initial public offering price of a Share as set forth in the Company’s final prospectus relating to its initial public offering filed with the Securities and Exchange Commission.
11.21 “Greater Than 10% Stockholder” means an individual then owning (within the meaning of Section 424(d) of the Code) more than 10% of the total combined voting power of all classes of shares of the Company or its parent or subsidiary corporation, as defined in Section 424(e) and (f) of the Code, respectively.
11.22 “Incentive Stock Option” means an Option intended to qualify as an “incentive stock option” as defined in Section 422 of the Code.
11.23 “Non-Qualified Option” means an Option, or portion thereof, not intended or not qualifying as an Incentive Stock Option.
11.24 “Option” means an option to purchase Shares, which will either be an Incentive Stock Option or a Non-Qualified Option.
11.25 “Organizational Documents” shall mean, collectively, (a) the Company’s articles of incorporation, certificate of incorporation, bylaws or other similar organizational documents relating to
the creation and governance of the Company, and (b) the Committee’s charter or other similar organizational documentation relating to the creation and governance of the Committee.
11.26 “Other Stock or Cash Based Awards” means cash awards, awards of Shares, and other awards valued wholly or partially by referring to, or are otherwise based on, Shares or other property awarded to a Participant under Article VII.
11.27 “Overall Share Limit” means the sum of (a) 4,403,533 Shares; (b) any Shares which remain available for issuance under the Prior Plan as of the Effective Date; and (c) any Shares which are subject to Prior Plan Awards as of the Effective Date which, following the Effective Date, become available for issuance under the Plan pursuant to Article IV; and (d) an annual increase on the first day of each calendar year beginning January 1, 2026 and ending on and including January 1, 2035, equal to the lesser of (i) 5% of the aggregate number of shares of Class A Common Stock and Class B Common Stock outstanding (on an as-converted basis) as of the last day of the immediately preceding fiscal year and (ii) such smaller number of Shares as is determined by the Board.
11.28 “Participant” means a Service Provider who has been granted an Award.
11.29 “Performance Criteria” means the criteria (and adjustments) that the Administrator may select for an Award to establish performance goals for a performance period, which may include (but is not limited to) the following: net earnings or losses (either before or after one or more of interest, taxes, depreciation, amortization, and non-cash equity-based compensation expense); gross or net sales or revenue or sales or revenue growth; net income (either before or after taxes) or adjusted net income; profits (including but not limited to gross profits, net profits, profit growth, net operation profit or economic profit), profit return ratios or operating margin; budget or operating earnings (either before or after taxes or before or after allocation of corporate overhead and bonus); cash flow (including operating cash flow and free cash flow or cash flow return on capital); return on assets; return on capital or invested capital; cost of capital; return on stockholders’ equity; total stockholder return; return on sales; costs, reductions in costs and cost control measures; expenses; working capital; earnings or loss per share; adjusted earnings or loss per share; price per share or dividends per share (or appreciation in or maintenance of such price or dividends); regulatory achievements or compliance; implementation, completion or attainment of objectives relating to research, development, regulatory, commercial, or strategic milestones or developments; market share; economic value or economic value added models; division, group or corporate financial goals; customer satisfaction/growth; customer service; employee satisfaction; recruitment and maintenance of personnel; human resources management; supervision of litigation and other legal matters; strategic partnerships and transactions; financial ratios (including those measuring liquidity, activity, profitability or leverage); debt levels or reductions; sales-related goals; financing and other capital raising transactions; cash on hand; acquisition activity; investment sourcing activity; and marketing initiatives, any of which may be measured in absolute terms or as compared to any incremental increase or decrease. Such performance goals also may be based solely by reference to the Company’s performance or the performance of a Subsidiary, division, business segment or business unit of the Company or a Subsidiary, or based upon performance relative to performance of other companies or upon comparisons of any of the indicators of performance relative to performance of other companies.
11.30 “Plan” means this 2025 Incentive Award Plan.
11.31 “Prior Plan” means the Voyager Space Holdings, Inc. 2020 Incentive Award Plan, as amended.
11.32 “Prior Plan Award” means an award outstanding under the Prior Plan as of the Effective Date.
11.33 “Public Trading Date” means the first date upon which the Shares are listed (or approved for listing) upon notice of issuance on any securities exchange or designated (or approved for designation) upon notice of issuance as a national market security on an interdealer quotation system.
11.34 “Restricted Stock” means Shares awarded to a Participant under Article VI subject to certain vesting conditions and other restrictions.
11.35 “Restricted Stock Unit” means an unfunded, unsecured right to receive, on the applicable settlement date, one Share or an amount in cash or other consideration determined by the Administrator to be of equal value as of such settlement date awarded to a Participant under Article VI subject to certain vesting conditions and other restrictions.
11.36 “Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act.
11.37 “Section 409A” means Section 409A of the Code and all regulations, guidance, compliance programs and other interpretative authority thereunder.
11.38 “Securities Act” means the Securities Act of 1933, as amended.
11.39 “Service Provider” means an Employee, Consultant or Director.
11.40 “Shares” means shares of Common Stock.
11.41 “Stock Appreciation Right” means a stock appreciation right granted under Article V.
11.42 “Subsidiary” means any entity (other than the Company), whether domestic or foreign, in an unbroken chain of entities beginning with the Company if each of the entities other than the last entity in the unbroken chain beneficially owns, at the time of the determination, securities or interests representing at least 50% of the total combined voting power of all classes of securities or interests in one of the other entities in such chain.
11.43 “Substitute Awards” means Awards granted or Shares issued by the Company in assumption of, or in substitution or exchange for, awards previously granted, or the right or obligation to make future awards, in each case by a company acquired by the Company or any Subsidiary or with which the Company or any Subsidiary combines.
11.44 “Termination of Service” means the date the Participant ceases to be a Service Provider.
* * * * *
| | |
VOYAGER TECHNOLOGIES, INC. 2025 INCENTIVE AWARD PLAN |
RESTRICTED STOCK UNIT GRANT NOTICE
Capitalized terms not specifically defined in this Restricted Stock Unit Grant Notice (the “Grant Notice”) have the meanings given to them in the 2025 Incentive Award Plan (as amended from time to time, the “Plan”) of Voyager Technologies, Inc. (the “Company”).
The Company hereby grants to the participant listed below (“Participant”) the Restricted Stock Units described in this Grant Notice (the “RSUs”), subject to the terms and conditions of the Plan and the Restricted Stock Unit Agreement attached hereto as Exhibit A (the “Agreement”), both of which are incorporated into this Grant Notice by reference. Each vested RSU represents the right to receive, in accordance with the Agreement, one share of Common Stock (“Share”). [Each RSU is hereby granted in tandem with a corresponding dividend equivalent to the extent a portion of such RSU is vested, as further described in Article II of the Agreement (the “Dividend Equivalents”).]1
| | | | | | | | |
| Participant: | [Insert Participant Name] |
| | |
| Grant Date: | [Insert Grant Date] |
| | |
| Number of RSUs: | [Insert Number of RSUs] with respect to [Class A common stock][Class B common stock] of the Company |
| | |
| Vesting Commencement Date: | [Insert Vesting Commencement Date] |
| | |
| Vesting Schedule: | [To be specified in individual agreements] |
If the Company uses an electronic capitalization table system (such as Shareworks, Carta or Equity Edge) and the fields in this Grant Notice are blank or the information is otherwise provided in a different format electronically, the blank fields and other information will be deemed to come from the electronic capitalization system and is considered part of this Grant Notice. In addition, the Company’s signature below shall be deemed to have occurred by the Company’s input of the RSUs in such electronic capitalization table system and Participant’s signature below shall be deemed to have occurred by Participant’s online acceptance of the RSUs through such electronic capitalization table system.
By accepting this Award electronically through the Plan service provider’s online grant acceptance procedure, Participant agrees to be bound by the terms and conditions of the Plan, the Agreement and the Grant Notice. Participant has reviewed the Agreement, the Plan and the Grant Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing the Grant Notice and fully understands all provisions of the Grant Notice, the Agreement and the Plan. Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan, the Grant Notice and the Agreement.
1 NTD: To include if dividend equivalents will be granted in tandem.
| | | | | | | | | | | | | | | | | | | | |
| VOYAGER TECHNOLOGIES, INC. | | PARTICIPANT | |
| | | | | | |
| | | | | | |
| | | | | | |
| By: | | | By: | | |
| | | | | | |
| Print Name: | | | Print Name: | | |
| | | | | | |
| Title: | | | | | |
EXHIBIT A
TO RESTRICTED STOCK UNIT GRANT NOTICE
RESTRICTED STOCK UNIT AWARD AGREEMENT
Pursuant to the Grant Notice to which this Agreement is attached, the Company has granted to Participant the number of RSUs set forth in the Grant Notice.
ARTICLE I.
GENERAL
Section 1.1 Defined Terms. Capitalized terms not specifically defined herein shall have the meanings specified in the Plan or the Grant Notice. For purposes of this Agreement,
(a) “Cessation Date” shall mean the date of Participant’s Termination of Service (regardless of the reason for such termination).
(b) “Participating Company” shall mean the Company or any of its parents or Subsidiaries.
Section 1.2 Incorporation of Terms of Plan. The RSUs and the shares of Common Stock issued to Participant hereunder (“Shares”) are subject to the terms and conditions set forth in this Agreement and the Plan (including, without limitation, Section 10.6 thereof), which is incorporated herein by reference. In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan shall control.
ARTICLE II.
AWARD OF RESTRICTED STOCK UNITS
Section 2.1 Award of RSUs [and Dividend Equivalents]
(a) In consideration of Participant’s past and/or continued employment with or service to a Participating Company and for other good and valuable consideration, effective as of the grant date set forth in the Grant Notice (the “Grant Date”), the Company has granted to Participant the number of RSUs set forth in the Grant Notice, upon the terms and conditions set forth in the Grant Notice, the Plan and this Agreement, subject to adjustment as provided in Article VIII of the Plan. Each RSU represents the right to receive one Share at the times and subject to the conditions set forth herein. However, unless and until the RSUs have vested, Participant will have no right to the payment of any Shares subject thereto. Prior to the actual delivery of any Shares, the RSUs will represent an unsecured obligation of the Company, payable only from the general assets of the Company.
(b) [The Company hereby grants to Participant an Award of Dividend Equivalents with respect to each RSU granted pursuant to the Grant Notice for all ordinary cash dividends that are paid to all or substantially all holders of the outstanding Shares between the Grant Date and the date when the applicable RSU is distributed or paid to Participant or is forfeited or expires. The Dividend Equivalents for each RSU shall be equal to the amount of cash that is paid as a dividend on one Share. All such Dividend Equivalents shall be credited to Participant and be deemed to be reinvested in additional RSUs as of the date of payment of any such dividend based on the Fair Market Value of a
Share on such date. Each additional RSU that results from such deemed reinvestment of Dividend Equivalents granted hereunder shall be subject to the same vesting, distribution or payment, adjustment and other provisions that apply to the underlying RSU to which such additional RSU relates.]2
Section 2.2 Vesting of RSUs [and Dividend Equivalents].
(a) Subject to Participant’s continued employment with or service to a Participating Company on each applicable vesting date and subject to the terms of this Agreement, the RSUs shall vest in such amounts and at such times as are set forth in the Grant Notice. [Each additional RSU that results from deemed reinvestments of Dividend Equivalents pursuant to Section 2.1(b) shall vest whenever the underlying RSU to which such additional RSU relates vests.]
(b) In the event Participant incurs a Termination of Service, except as may be otherwise provided by the Administrator or as set forth in a written agreement between Participant and the Company, Participant shall immediately forfeit any and all RSUs [and Dividend Equivalents] granted under this Agreement that have not vested or do not vest on or prior to the date on which such Termination of Service occurs, and Participant’s rights in any such RSUs [and Dividend Equivalents] that are not so vested shall lapse and expire.3
Section 2.3 Distribution or Payment of RSUs.
(a) Participant’s RSUs shall be distributed in Shares (either in book-entry form or otherwise) as soon as administratively practicable following the vesting of any RSUs pursuant to Section 2.2 hereof, but in no event later than March 15 of the year after the year of vesting. Notwithstanding the foregoing, the Company may delay a distribution or payment in settlement of RSUs if it reasonably determines that such payment or distribution will violate federal securities laws or any other Applicable Law, provided that such distribution or payment shall be made at the earliest date at which the Company reasonably determines that the making of such distribution or payment will not cause such violation, as required by Treasury Regulation Section 1.409A-2(b)(7)(ii), and provided further that no payment or distribution shall be delayed under this Section 2.3(a) if such delay will result in a violation of Section 409A.
(b) All distributions shall be made by the Company in the form of whole Shares.
Section 2.4 Conditions to Issuance of Certificates. The Company shall not be required to issue or deliver any certificate or certificates for any Shares or to cause any Shares to be held in book-entry form prior to the fulfillment of all of the following conditions: (a) the admission of the Shares to listing on all stock exchanges on which such Shares are then listed, (b) the completion of any registration or other qualification of the Shares under any state or federal law or under rulings or regulations of the Securities and Exchange Commission or other governmental regulatory body, which the Administrator shall, in its absolute discretion, deem necessary or advisable, (c) the obtaining of any approval or other clearance from any state or federal governmental agency that the Administrator shall, in its absolute discretion, determine to be necessary or advisable, and (d) the receipt of full payment of any applicable withholding tax in accordance with Section 2.5 by the Participating Company with respect to which the applicable withholding obligation arises.
2 NTD: Insert for dividend equivalents.
3 Note to Company: Please confirm if any good leaver termination protections should be included.
Section 2.5 Tax Withholding. Notwithstanding any other provision of this Agreement:
(a) The Participating Companies have the authority to deduct or withhold, or require Participant to remit to the applicable Participating Company, an amount sufficient to satisfy any applicable federal, state, local and foreign taxes (including the employee portion of any FICA obligation) required by Applicable Law to be withheld with respect to any taxable event arising pursuant to this Agreement. The Participating Companies may withhold or Participant may make such payment in one or more of the forms specified below:
(i)by cash or check made payable to the Participating Company with respect to which the withholding obligation arises;
(ii)by the deduction of such amount from other compensation payable to Participant;
(iii)with respect to any withholding taxes arising in connection with the vesting or settlement of the RSUs, with the consent of the Administrator, by requesting that the Company withhold a net number of vested shares of Common Stock otherwise issuable pursuant to the RSUs having a then current Fair Market Value not exceeding the amount necessary to satisfy the withholding obligation of the Participating Companies based on the maximum statutory withholding rates in Participant’s applicable jurisdictions for federal, state, local and foreign income tax and payroll tax purposes that are applicable to such taxable income;
(iv)with respect to any withholding taxes arising in connection with the vesting or settlement of the RSUs, with the consent of the Administrator, by tendering to the Company vested shares of Common Stock having a then current Fair Market Value not exceeding the amount necessary to satisfy the withholding obligation of the Participating Companies based on the maximum statutory withholding rates in Participant’s applicable jurisdictions for federal, state, local and foreign income tax and payroll tax purposes that are applicable to such taxable income;
(v)with respect to any withholding taxes arising in connection with the vesting or settlement of the RSUs, through the delivery of a notice that Participant has placed a market sell order with a broker acceptable to the Company with respect to shares of Common Stock then issuable to Participant pursuant to the RSUs, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to the Participating Company with respect to which the withholding obligation arises in satisfaction of such withholding taxes; provided that payment of such proceeds is then made to the applicable Participating Company at such time as may be required by the Administrator, but in any event not later than the settlement of such sale; or
(vi)in any combination of the foregoing.
(b) With respect to any withholding taxes arising in connection with the RSUs, in the event Participant fails to provide timely payment of all sums required pursuant to Section 2.5(a), the Company shall have the right and option, but not the obligation, to treat such failure as an election by Participant to satisfy all or any portion of Participant’s required payment obligation pursuant to Section 2.5(a)(ii) or Section 2.5(a)(iii) above, or any combination of the foregoing as the Company may determine to be appropriate. The Company shall not be obligated to deliver any certificate representing shares of Common Stock issuable with respect to the RSUs to Participant or his or her legal representative
unless and until Participant or his or her legal representative shall have paid or otherwise satisfied in full the amount of all federal, state, local and foreign taxes applicable with respect to the taxable income of Participant resulting from the vesting or settlement of the RSUs or any other taxable event related to the RSUs.
(c) In the event any tax withholding obligation arising in connection with the RSUs will be satisfied under Section 2.5(a)(iii), then the Company may elect to instruct any brokerage firm determined acceptable to the Company for such purpose to sell on Participant’s behalf a whole number of shares from those shares of Common Stock then issuable to Participant pursuant to the RSUs as the Company determines to be appropriate to generate cash proceeds sufficient to satisfy the tax withholding obligation and to remit the proceeds of such sale to the Participating Company with respect to which the withholding obligation arises. Participant’s acceptance of this Award constitutes Participant’s instruction and authorization to the Company and such brokerage firm to complete the transactions described in this Section 2.5(c), including the transactions described in the previous sentence, as applicable. The Company may refuse to issue any shares of Common Stock in settlement of the RSUs to Participant until the foregoing tax withholding obligations are satisfied, provided that no payment shall be delayed under this Section 2.5(c) if such delay will result in a violation of Section 409A of the Code.
(d) Participant is ultimately liable and responsible for all taxes owed in connection with the RSUs, regardless of any action any Participating Company takes with respect to any tax withholding obligations that arise in connection with the RSUs. No Participating Company makes any representation or undertaking regarding the treatment of any tax withholding in connection with the awarding, vesting or payment of the RSUs or the subsequent sale of Shares. The Participating Companies do not commit and are under no obligation to structure the RSUs to reduce or eliminate Participant’s tax liability.
Section 2.6 Rights as Stockholder. Neither Participant nor any Person claiming under or through Participant will have any of the rights or privileges of a stockholder of the Company in respect of any Shares deliverable hereunder unless and until certificates representing such Shares (which may be in book-entry form) will have been issued and recorded on the records of the Company or its transfer agents or registrars and delivered to Participant (including through electronic delivery to a brokerage account). Except as otherwise provided herein, after such issuance, recordation and delivery, Participant will have all the rights of a stockholder of the Company with respect to such Shares, including, without limitation, the right to receipt of dividends and distributions on such Shares.
ARTICLE III.
OTHER PROVISIONS
Section 3.1 Administration. The Administrator shall have the power to interpret the Plan, the Grant Notice and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan, the Grant Notice and this Agreement as are consistent therewith and to interpret, amend or revoke any such rules. All actions taken and all interpretations and determinations made by the Administrator will be final and binding upon Participant, the Company and all other interested Persons. To the extent allowable pursuant to Applicable Laws, no member of the Committee or the Board will be personally liable for any action, determination or interpretation made with respect to the Plan, the Grant Notice or this Agreement.
Section 3.2 RSUs Not Transferable. The RSUs may not be sold, pledged, assigned or transferred in any manner other than by will or the laws of descent and distribution, unless and until the Shares underlying the RSUs have been issued, and all restrictions applicable to such Shares have lapsed. No RSUs or any interest or right therein or part thereof shall be liable for the debts, contracts or engagements of Participant or his or her successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect, except to the extent that such disposition is permitted by the preceding sentence.
Section 3.3 Adjustments. The Administrator may accelerate the vesting of all or a portion of the RSUs in such circumstances as it, in its sole discretion, may determine. Participant acknowledges that the RSUs and the Shares subject to the RSUs are subject to adjustment, modification and termination in certain events as provided in this Agreement and the Plan, including Article VIII of the Plan.
Section 3.4 Notices. Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of the Secretary4 of the Company at the Company’s principal office, and any notice to be given to Participant shall be addressed to Participant at Participant’s last email or physical address reflected on the Company’s records. By a notice given pursuant to this Section 3.4, either party may hereafter designate a different address for notices to be given to that party. Any notice shall be deemed duly given when sent via email or when sent by certified mail (return receipt requested) and deposited (with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service.
Section 3.5 Titles. Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.
Section 3.6 Governing Law. The laws of the State of Delaware shall govern the interpretation, validity, administration, enforcement and performance of the terms of this Agreement regardless of the law that might be applied under principles of conflicts of laws.
Section 3.7 Conformity to Securities Laws. Participant acknowledges that the Plan, the Grant Notice and this Agreement are intended to conform to the extent necessary with all Applicable Laws, including, without limitation, the provisions of the Securities Act and the Exchange Act, and any and all regulations and rules promulgated thereunder by the Securities and Exchange Commission, and state securities laws and regulations. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the RSUs are granted, only in such a manner as to conform to Applicable Laws. To the extent permitted by Applicable Laws, the Plan, the Grant Notice and this Agreement shall be deemed amended to the extent necessary to conform to Applicable Laws.
Section 3.8 Amendment, Suspension and Termination. To the extent permitted by the Plan, this Agreement may be wholly or partially amended or otherwise modified, suspended or terminated at any time or from time to time by the Administrator or the Board, provided that, except as may otherwise be provided by the Plan, no amendment, modification, suspension or termination of this Agreement shall adversely affect the RSUs in any material way without the prior written consent of Participant, unless
4Note to Company: Please confirm whether the Secretary or another officer of the company should receive participant notices.
such action is necessary to ensure or facilitate compliance with Applicable Law, as determined by the Administrator.
Section 3.9 Successors and Assigns. The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement shall inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth in Section 3.2 and the Plan, this Agreement shall be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the parties hereto.
Section 3.10 Limitations Applicable to Section 16 Persons. Notwithstanding any other provision of the Plan or this Agreement, if Participant is subject to Section 16 of the Exchange Act, the Plan, the RSUs [(including RSUs that result from the deemed reinvestment of Dividend Equivalents), the Dividend Equivalents], the Grant Notice and this Agreement shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent permitted by Applicable Laws, this Agreement shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.
Section 3.11 Not a Contract of Service Relationship. Nothing in this Agreement or in the Plan shall confer upon Participant any right to continue to serve as an employee or other service provider of any Participating Company or shall interfere with or restrict in any way the rights of any Participating Company, which rights are hereby expressly reserved, to discharge or terminate the services of Participant at any time for any reason whatsoever, with or without cause, except to the extent (a) expressly provided otherwise in a written agreement between a Participating Company and Participant or (b) where such provisions are not consistent with applicable foreign or local laws, in which case such applicable foreign or local laws shall control.
Section 3.12 Entire Agreement. The Plan, the Grant Notice and this Agreement (including any exhibit hereto) constitute the entire agreement of the parties and supersede in their entirety all prior undertakings and agreements of the Company and Participant with respect to the subject matter hereof.
Section 3.13 Section 409A. This Award is not intended to constitute “nonqualified deferred compensation” within the meaning of Section 409A and shall be interpreted consistent with such intent. However, notwithstanding any other provision of the Plan, the Grant Notice or this Agreement, if at any time the Administrator determines that this Award (or any portion thereof) may be subject to Section 409A, the Administrator shall have the right in its sole discretion (without any obligation to do so or to indemnify Participant or any other Person for failure to do so) to adopt such amendments to the Plan, the Grant Notice or this Agreement, or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, as the Administrator determines are necessary or appropriate for this Award either to be exempt from the application of Section 409A or to comply with the requirements of Section 409A.
Section 3.14 Agreement Severable. In the event that any provision of the Grant Notice or this Agreement is held invalid or unenforceable, such provision will be severable from, and such invalidity or unenforceability will not be construed to have any effect on, the remaining provisions of the Grant Notice or this Agreement.
Section 3.15 Limitation on Participant’s Rights. Participation in the Plan confers no rights or interests other than as herein provided. This Agreement creates only a contractual obligation on the part
of the Company as to amounts payable and shall not be construed as creating a trust. Neither the Plan nor any underlying program, in and of itself, has any assets. Participant shall have only the rights of a general unsecured creditor of the Company with respect to amounts credited and benefits payable, if any, with respect to the RSUs [and Dividend Equivalents].
Section 3.16 Clawback. The RSUs (including any proceeds, gains or other economic benefit the Participant actually or constructively receives upon receipt or settlement of the RSUs or the receipt or resale of any Shares underlying the RSUs) will be subject to any Company claw-back policy as in effect from time to time, including any claw-back policy adopted to comply with Applicable Laws (including the Dodd-Frank Wall Street Reform and Consumer Protection Act and any rules or regulations promulgated thereunder).
Section 3.17 Counterparts. The Grant Notice may be executed in one or more counterparts, including by way of any electronic signature, subject to Applicable Law, each of which shall be deemed an original and all of which together shall constitute one instrument.
* * * * *
| | |
VOYAGER TECHNOLOGIES, INC. 2025 INCENTIVE AWARD PLAN |
STOCK OPTION GRANT NOTICE
Capitalized terms not specifically defined in this Stock Option Grant Notice (the “Grant Notice”) have the meanings given to them in the 2025 Incentive Award Plan (as amended from time to time, the “Plan”) of Voyager Technologies, Inc. (the “Company”). The Company hereby grants to the participant listed below (“Participant”) the stock option described in this Grant Notice (the “Option”), subject to the terms and conditions of the Plan and the Stock Option Agreement attached hereto as Exhibit A (the “Agreement”), both of which are incorporated into this Grant Notice by reference.
| | | | | | | | |
| Participant: | [Insert name of Participant] |
| | |
| Grant Date: | [Insert Grant Date] |
| | |
| Exercise Price per Share: | [Insert Exercise Price per Share] |
| | |
| Shares Subject to the Option: | [____] shares of [Class A common stock][Class B common stock] of the Company |
| | |
| Final Expiration Date: | [Insert Final Expiration Date] |
| | |
| Vesting Commencement Date: | [Insert Vesting Commencement Date] |
| | |
| Vesting Schedule: | [To be specified in individual agreements] |
| | |
| Type of Option | Incentive Stock Option Non-Qualified Stock Option |
If the Company uses an electronic capitalization table system (such as Shareworks, Carta or Equity Edge) and the fields in this Grant Notice are blank or the information is otherwise provided in a different format electronically, the blank fields and other information will be deemed to come from the electronic capitalization system and is considered part of this Grant Notice. In addition, the Company’s signature below shall be deemed to have occurred by the Company’s input of the Options in such electronic capitalization table system and Participant’s signature below shall be deemed to have occurred by Participant’s online acceptance of the Options through such electronic capitalization table system.
By accepting this Award electronically through the Plan service provider’s online grant acceptance procedure, Participant agrees to be bound by the terms and conditions of the Plan, the Agreement and the Grant Notice. Participant has reviewed the Agreement, the Plan and the Grant Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing the Grant Notice and fully understands all provisions of the Grant Notice, the Agreement and the Plan. Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan, the Grant Notice and the Agreement.
| | | | | | | | | | | | | | | | | |
| VOYAGER TECHNOLOGIES, INC. | | PARTICIPANT |
| | | | | |
| | | | | |
| By: |
| | By: |
|
| | | | | |
| Print Name: |
| | Print Name: |
|
| | | | | |
| Title: |
| | | |
EXHIBIT A
STOCK OPTION AGREEMENT
ARTICLE I.
GENERAL
1.1 Incorporation of Terms of Plan. The Option is subject to the terms and conditions set forth in this Agreement and the Plan, which is incorporated herein by reference. In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan will control.
1.2 Defined Terms. Capitalized terms not specifically defined herein shall have the meanings specified in the Plan or the Grant Notice. For purposes of this Agreement,
(a) “Cessation Date” shall mean the date of Participant’s Termination of Service (regardless of the reason for such termination).
(b) “Participating Company” shall mean the Company or any of its parents or Subsidiaries.
ARTICLE II.
GRANT OF OPTION
2.1 Grant of Option. In consideration of Participant’s past and/or continued employment with or service to a Participating Company and for other good and valuable consideration, effective as of the grant date set forth in the Grant Notice (the “Grant Date”), the Company has granted to the Participant the Option to purchase any part or all of an aggregate number of Shares set forth in the Grant Notice, upon the terms and conditions set forth in the Grant Notice, the Plan and this Agreement, subject to adjustment as provided in Article VIII of the Plan.
2.2 Exercise Price. The exercise price per Share of the Shares subject to the Option (the “Exercise Price”) shall be as set forth in the Grant Notice.
2.3 Consideration to the Company. In consideration of the grant of the Option by the Company, Participant agrees to render faithful and efficient services to any Participating Company.
ARTICLE III.
PERIOD OF EXERCISABILITY
3.1 Commencement of Exercisability.
(a) Subject to Participant’s continued employment with or service to a Participating Company on each applicable vesting date and subject to Sections 3.2, 3.3, 5.9 and 5.14 hereof, the Option shall become vested and exercisable in such amounts and at such times as are set forth in the Grant Notice.
(b) Unless otherwise determined by the Administrator or as set forth in a written agreement between Participant and the Company, any portion of the Option that has not become vested and exercisable on or prior to the Cessation Date (including, without limitation, pursuant to any employment or similar agreement by and between Participant and the Company) shall be forfeited on the Cessation Date and shall not thereafter become vested or exercisable.
3.2 Duration of Exercisability. The installments provided for in the vesting schedule set forth in the Grant Notice are cumulative. Each such installment that becomes vested and exercisable pursuant to the vesting schedule set forth in the Grant Notice shall remain vested and exercisable until it becomes unexercisable under Section 3.3 hereof. Once the Option becomes unexercisable, it shall be forfeited immediately.
3.3 Expiration of Option. The Option may not be exercised to any extent by anyone after the first to occur of the following events:
(a) The expiration date set forth in the Grant Notice; provided that such expiration date shall not be later than the tenth (10th) anniversary of the Grant Date;
(b) Except as the Administrator may otherwise approve, the ninetieth (90th) day following the Cessation Date by reason of Participant’s Termination of Service for any reason other than due to death, Disability or by a Participating Company for Cause;
(c) Except as the Administrator may otherwise approve, immediately upon the Cessation Date by reason of Participant’s Termination of Service by a Participating Company for Cause; and
(d) The expiration of twelve (12) months from the Cessation Date by reason of Participant’s Termination of Service due to death or Disability.
3.4 Tax Withholding. Notwithstanding any other provision of this Agreement:
(a) The Participating Companies have the authority to deduct or withhold, or require Participant to remit to the applicable Participating Company, an amount sufficient to satisfy any applicable federal, state, local and foreign taxes (including the employee portion of any FICA obligation) required by Applicable Law to be withheld with respect to any taxable event arising pursuant to this Agreement. The Participating Companies may withhold or Participant may make such payment in one or more of the forms specified below:
(i) by cash or check made payable to the Participating Company with respect to which the withholding obligation arises;
(ii) by the deduction of such amount from other compensation payable to Participant;
(iii) with respect to any withholding taxes arising in connection with the exercise of the Option, with the consent of the Administrator, by requesting that the Participating Companies withhold a net number of vested Shares otherwise issuable upon the exercise of the Option having a then current Fair Market Value not exceeding the amount necessary to satisfy the withholding obligation of the Participating Companies based on the maximum statutory withholding rates in Participant’s applicable jurisdictions for federal, state, local and foreign income tax and payroll tax purposes that are applicable to such taxable income;
(iv) with respect to any withholding taxes arising in connection with the exercise of the Option, with the consent of the Administrator, by tendering to the Company vested Shares held for such period of time as may be required by the Administrator in order to avoid adverse accounting consequences and having a then current Fair Market Value not exceeding the amount necessary to satisfy the withholding obligation of the Participating Companies based on the maximum statutory withholding rates in Participant’s applicable jurisdictions for federal, state, local and foreign income tax and payroll tax purposes that are applicable to such taxable income;
(v) with respect to any withholding taxes arising in connection with the exercise of the Option, through the delivery of a notice that Participant has placed a market sell order with a broker acceptable to the Company with respect to Shares then issuable to Participant pursuant to the Option, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to the Participating Company with respect to which the withholding obligation arises in satisfaction of such withholding taxes; provided that payment of such proceeds is then made to the applicable Participating Company at such time as may be required by the Administrator, but in any event not later than the settlement of such sale; or
(vi) in any combination of the foregoing.
(b) With respect to any withholding taxes arising in connection with the Option, in the event Participant fails to provide timely payment of all sums required pursuant to Section 3.4(a), the Company shall have the right and option, but not the obligation, to treat such failure as an election by Participant to satisfy all or any portion of Participant’s required payment obligation pursuant to Section 3.4(a)(ii) or Section 3.4(a)(iii) above, or any combination of the foregoing as the Company may determine to be appropriate. The Company shall not be obligated to deliver any certificate representing Shares issuable with respect to the exercise of the Option to, or to cause any such Shares to be held in book-entry form by, Participant or his or her legal representative unless and until Participant or his or her legal representative shall have paid or otherwise satisfied in full the amount of all federal, state, local and foreign taxes applicable with respect to the taxable income of Participant resulting from the exercise of the Option or any other taxable event related to the Option.
(c) In the event any tax withholding obligation arising in connection with the Option will be satisfied under Section 3.4(a)(iii), then the Company may elect to instruct any brokerage firm determined acceptable to the Company for such purpose to sell on Participant’s behalf a whole number of Shares from those Shares then issuable upon the exercise of the Option as the Company determines to be
appropriate to generate cash proceeds sufficient to satisfy the tax withholding obligation and to remit the proceeds of such sale to the Participating Company with respect to which the withholding obligation arises. Participant’s acceptance of this Option constitutes Participant’s instruction and authorization to the Company and such brokerage firm to complete the transactions described in this Section 3.4(c), including the transactions described in the previous sentence, as applicable. The Company may refuse to issue any Shares to Participant until the foregoing tax withholding obligations are satisfied, provided that no payment shall be delayed under this Section 3.4(c) if such delay will result in a violation of Section 409A.
(d) Participant is ultimately liable and responsible for all taxes owed in connection with the Option, regardless of any action any Participating Company takes with respect to any tax withholding obligations that arise in connection with the Option. No Participating Company makes any representation or undertaking regarding the treatment of any tax withholding in connection with the awarding, vesting or exercise of the Option or the subsequent sale of Shares. The Participating Companies do not commit and are under no obligation to structure the Option to reduce or eliminate Participant’s tax liability.
ARTICLE IV.
EXERCISE OF OPTION
4.1 Person Eligible to Exercise. During the lifetime of Participant, only Participant may exercise the Option or any portion thereof. After the death of Participant, any exercisable portion of the Option may, prior to the time when the Option becomes unexercisable under Section 3.3 hereof, be exercised by Participant’s personal representative or by any Person empowered to do so under the deceased Participant’s will or under the then Applicable Laws of descent and distribution.
4.2 Partial Exercise. Subject to Section 5.2, any exercisable portion of the Option or the entire Option, if then wholly exercisable, may be exercised in whole or in part at any time prior to the time when the Option or portion thereof becomes unexercisable under Section 3.3 hereof.
4.3 Manner of Exercise. The Option, or any exercisable portion thereof, may be exercised solely by delivery to the Secretary of the Company (or any third party administrator or other Person designated by the Company), during regular business hours, of all of the following prior to the time when the Option or such portion thereof becomes unexercisable under Section 3.3 hereof.
(a) An exercise notice in a form specified by the Administrator, stating that the Option or portion thereof is thereby exercised, such notice complying with all applicable rules established by the Administrator;
(b) The receipt by the Company of full payment for the Shares with respect to which the Option or portion thereof is exercised, in such form of consideration permitted under Section 4.4 that is acceptable to the Administrator;
(c) The payment of any applicable withholding tax in accordance with Section 3.4;
(d) Any other written representations or documents as may be required in the Administrator’s sole discretion to effect compliance with Applicable Law; and
(e) In the event the Option or portion thereof shall be exercised pursuant to Section 4.1 by any Person or Persons other than Participant, appropriate proof of the right of such Person or Persons to exercise the Option.
Notwithstanding any of the foregoing, the Administrator shall have the right to specify all conditions of the manner of exercise, which conditions may vary by country and which may be subject to change from time to time.
4.4 Method of Payment. Payment of the Exercise Price shall be by any of the following, or a combination thereof, at the election of Participant:
(a) Cash or check;
(b) With the consent of the Administrator, surrender of vested Shares (including, without limitation, Shares otherwise issuable upon exercise of the Option) held for such period of time as may be required by the Administrator in order to avoid adverse accounting consequences and having a Fair Market Value on the date of delivery equal to the aggregate Exercise Price of the Option or exercised portion thereof;
(c) Through the delivery of a notice that Participant has placed a market sell order with a broker acceptable to the Company with respect to Shares then issuable upon exercise of the Option, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to the Company in satisfaction of the Exercise Price; provided that payment of such proceeds is then made to the Company at such time as may be required by the Administrator, but in any event not later than the settlement of such sale; or
(d) Any other form of legal consideration acceptable to the Administrator.
4.5 Conditions to Issuance of Shares. The Company shall not be required to issue or deliver any certificate or certificates for any Shares or to cause any Shares to be held in book-entry form prior to the fulfillment of all of the following conditions: (a) the admission of the Shares to listing on all stock exchanges on which such Shares are then listed, (b) the completion of any registration or other qualification of the Shares under any state or federal law or under rulings or regulations of the Securities and Exchange Commission or other governmental regulatory body, which the Administrator shall, in its absolute discretion, deem necessary or advisable, (c) the obtaining of any approval or other clearance from any state or federal governmental agency that the Administrator shall, in its absolute discretion, determine to be necessary or advisable, (d) the receipt by the Company of full payment for such Shares, which may be in one or more of the forms of consideration permitted under Section 4.4, and (e) the receipt of full payment of any applicable withholding tax in accordance with Section 3.4 by the Participating Company with respect to which the applicable withholding obligation arises.
4.6 Rights as Stockholder. Neither Participant nor any Person claiming under or through Participant will have any of the rights or privileges of a stockholder of the Company in respect of any Shares purchasable upon the exercise of any part of the Option unless and until certificates representing such Shares (which may be in book-entry form) will have been issued and recorded on the records of the Company or its transfer agents or registrars and delivered to Participant (including through electronic delivery to a brokerage account). No adjustment will be made for a dividend or other right for which the record date is prior to the date of such issuance, recordation and delivery, except as provided in Article VIII of the Plan. Except as otherwise provided herein, after such issuance, recordation and delivery, Participant will have all the rights of a stockholder of the Company with respect to such Shares, including, without limitation, the right to receipt of dividends and distributions on such Shares.
ARTICLE V.
OTHER PROVISIONS
5.1 Administration. The Administrator shall have the power to interpret the Plan, the Grant Notice and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan, the Grant Notice and this Agreement as are consistent therewith and to interpret, amend or revoke any such rules. All actions taken and all interpretations and determinations made by the Administrator will be final and binding upon Participant, the Company and all other interested Persons. To the extent allowable pursuant to Applicable Law, no member of the Committee or the Board will be personally liable for any action, determination or interpretation made with respect to the Plan, the Grant Notice or this Agreement.
5.2 Whole Shares. The Option may only be exercised for whole Shares.
5.3 Option Not Transferable. The Option shall be subject to the restrictions on transferability set forth in Section 9.1 of the Plan.
5.4 Adjustments. The Administrator may accelerate the vesting of all or a portion of the Option in such circumstances as it, in its sole discretion, may determine. Participant acknowledges that the Option is subject to adjustment, modification and termination in certain events as provided in this Agreement and the Plan, including Article VIII of the Plan.
5.5 Notices. Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of the Secretary of the Company at the Company’s principal office, and any notice to be given to Participant shall be addressed to Participant at Participant’s last email or physical address reflected on the Company’s records. By a notice given pursuant to this Section 5.5, either party may hereafter designate a different address for notices to be given to that party. Any notice shall be deemed duly given when sent via email (to Participant only) or when sent by certified mail (return receipt requested) and deposited (with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service.
5.6 Titles. Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.
5.7 Governing Law. The laws of the State of Delaware shall govern the interpretation, validity, administration, enforcement and performance of the terms of this Agreement regardless of the law that might be applied under principles of conflicts of laws.
5.8 Conformity to Securities Laws. Participant acknowledges that the Plan, the Grant Notice and this Agreement are intended to conform to the extent necessary with all Applicable Laws, including, without limitation, the provisions of the Securities Act and the Exchange Act, and any and all regulations and rules promulgated thereunder by the Securities and Exchange Commission and state securities laws and regulations. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Option is granted and may be exercised, only in such a manner as to conform to Applicable Laws. To the extent permitted by Applicable Laws, the Plan, the Grant Notice and this Agreement shall be deemed amended to the extent necessary to conform to Applicable Laws.
5.9 Amendment, Suspension and Termination. To the extent permitted by the Plan, this Agreement may be wholly or partially amended or otherwise modified, suspended or terminated at any time or from time to time by the Administrator or the Board, provided that, except as may otherwise be provided by the Plan, no amendment, modification, suspension or termination of this Agreement shall adversely affect the Option in any material respect without the prior written consent of Participant.
5.10 Successors and Assigns. The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement shall inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth in Section 5.3 and the Plan, this Agreement shall be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the parties hereto.
5.11 Limitations Applicable to Section 16 Persons. Notwithstanding any other provision of the Plan or this Agreement, if Participant is subject to Section 16 of the Exchange Act, the Plan, the Option, the Grant Notice and this Agreement shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent permitted by Applicable Laws, this Agreement shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.
5.12 Not a Contract of Service Relationship. Nothing in this Agreement or in the Plan shall confer upon Participant any right to continue to serve as an employee or other service provider of any Participating Company or shall interfere with or restrict in any way the rights of any Participating Company, which rights are hereby expressly reserved, to discharge or terminate the services of Participant at any time for any reason whatsoever, with or without cause, except to the extent (i) expressly provided otherwise in a written agreement between a Participating Company and Participant or (ii) where such provisions are not consistent with applicable foreign or local laws, in which case such applicable foreign or local laws shall control.
5.13 Entire Agreement. The Plan, the Grant Notice and this Agreement (including any exhibit hereto) constitute the entire agreement of the parties and supersede in their entirety all prior
undertakings and agreements of the Company and Participant with respect to the subject matter hereof, provided that the Option shall be subject to any accelerated vesting provisions in any written agreement between Participant and the Company (or any Participating Company) or a Company plan pursuant to which Participant participates, in each case, in accordance with the terms therein.
5.14 Section 409A. This Option is not intended to constitute “nonqualified deferred compensation” within the meaning of Section 409A. However, notwithstanding any other provision of the Plan, the Grant Notice or this Agreement, if at any time the Administrator determines that this Option (or any portion thereof) may be subject to Section 409A, the Administrator shall have the right in its sole discretion (without any obligation to do so or to indemnify Participant or any other Person for failure to do so) to adopt such amendments to the Plan, the Grant Notice or this Agreement, or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, as the Administrator determines are necessary or appropriate for this Option either to be exempt from the application of Section 409A or to comply with the requirements of Section 409A.
5.15 Agreement Severable. In the event that any provision of the Grant Notice or this Agreement is held invalid or unenforceable, such provision will be severable from, and such invalidity or unenforceability will not be construed to have any effect on, the remaining provisions of the Grant Notice or this Agreement.
5.16 Limitation on Participant’s Rights. Participation in the Plan confers no rights or interests other than as herein provided. This Agreement creates only a contractual obligation on the part of the Company as to amounts payable and shall not be construed as creating a trust. Neither the Plan nor any underlying program, in and of itself, has any assets. Participant shall have only the right to receive Shares as a general unsecured creditor with respect to the Option, as and when exercised pursuant to the terms hereof.
5.17 Counterparts. The Grant Notice may be executed in one or more counterparts, including by way of any electronic signature, subject to Applicable Law, each of which shall be deemed an original and all of which together shall constitute one instrument.
5.18 Broker-Assisted Sales. In the event of any broker-assisted sale of Shares in connection with the payment of withholding taxes as provided in Section 3.4(c) or the payment of the Exercise Price as provided in Section 4.4(c): (a) any Shares to be sold through a broker-assisted sale will be sold on the day the tax withholding obligation or exercise of the Option, as applicable, occurs or arises, or as soon thereafter as practicable; (b) such Shares may be sold as part of a block trade with other participants in the Plan in which all participants receive an average price; (c) Participant will be responsible for all broker’s fees and other costs of sale, and Participant agrees to indemnify and hold the Company harmless from any losses, costs, damages, or expenses relating to any such sale; (d) to the extent the proceeds of such sale exceed the applicable tax withholding obligation or Exercise Price, the Company agrees to pay such excess in cash to Participant as soon as reasonably practicable; (e) Participant acknowledges that the Company or its designee is under no obligation to arrange for such sale at any particular price, and that the proceeds of any such sale may not be sufficient to satisfy the applicable tax withholding obligation or
Exercise Price; and (f) in the event the proceeds of such sale are insufficient to satisfy the applicable tax withholding obligation, Participant agrees to pay immediately upon demand to the Participating Company with respect to which the withholding obligation arises an amount in cash sufficient to satisfy any remaining portion of the applicable Participating Company’s withholding obligation.
5.19 Clawback. The Option (including any proceeds, gains or other economic benefit actually or constructively received by the Participant upon any receipt or exercise of the Option or upon the receipt or resale of any Shares underlying the Option) will be subject to any Company claw-back policy as in effect from time to time, including any claw-back policy adopted to comply with Applicable Laws (including the Dodd-Frank Wall Street Reform and Consumer Protection Act and any rules or regulations promulgated thereunder).
5.20 Incentive Stock Options. Participant acknowledges that to the extent the aggregate Fair Market Value of Shares (determined as of the time the option with respect to the Shares is granted) with respect to which Incentive Stock Options, including this Option (if applicable), are exercisable for the first time by Participant during any calendar year exceeds $100,000 or if for any other reason such Incentive Stock Options do not qualify or cease to qualify for treatment as “incentive stock options” under Section 422 of the Code, such Incentive Stock Options shall be treated as Non-Qualified Options. Participant further acknowledges that the rule set forth in the preceding sentence shall be applied by taking the Option and other stock options into account in the order in which they were granted, as determined under Section 422(d) of the Code and the Treasury Regulations thereunder. Participant also acknowledges that an Incentive Stock Option exercised more than three (3) months after Participant’s Termination of Service, other than by reason of death or disability, will be taxed as a Non-Qualified Option.
5.21 Notification of Disposition. If this Option is designated as an Incentive Stock Option, Participant shall give prompt written notice to the Company of any disposition or other transfer of any Shares acquired under this Agreement if such disposition or transfer is made (a) within two (2) years from the Grant Date or (b) within one (1) year after the transfer of such Shares to Participant. Such notice shall specify the date of such disposition or other transfer and the amount realized, in cash, other property, assumption of indebtedness or other consideration, by Participant in such disposition or other transfer.
* * * * *
| | |
VOYAGER TECHNOLOGIES, INC. 2025 INCENTIVE AWARD PLAN |
RESTRICTED STOCK GRANT NOTICE
Capitalized terms not specifically defined in this Restricted Stock Grant Notice (the “Grant Notice”) have the meanings given to them in the 2025 Incentive Award Plan (as amended from time to time, the “Plan”) of Voyager Technologies, Inc. (the “Company”).
The Company has granted to the participant listed below (“Participant”) the shares of Restricted Stock described in this Grant Notice (the “Restricted Shares”), subject to the terms and conditions of the Plan and the Restricted Stock Agreement attached as Exhibit A (the “Agreement”), both of which are incorporated into this Grant Notice by reference.
| | | | | | | | |
| Participant: | [Insert Participant Name] |
| | |
| Grant Date: | [Insert Grant Date] |
| | |
| Number of Restricted Shares: | [____] shares of [Class A common stock][Class B common stock] of the Company |
| | |
| Vesting Commencement Date: | [Insert Vesting Commencement Date] |
| | |
| Vesting Schedule: | [To be specified in individual agreements] |
If the Company uses an electronic capitalization table system (such as Shareworks, Carta or Equity Edge) and the fields in this Grant Notice are blank or the information is otherwise provided in a different format electronically, the blank fields and other information will be deemed to come from the electronic capitalization system and is considered part of this Grant Notice. In addition, the Company’s signature below shall be deemed to have occurred by the Company’s input of the Restricted Shares in such electronic capitalization table system and Participant’s signature below shall be deemed to have occurred by Participant’s online acceptance of the Restricted Shares through such electronic capitalization table system.
By accepting this Award electronically through the Plan service provider’s online grant acceptance procedure, Participant agrees to be bound by the terms and conditions of the Plan, the Agreement and the Grant Notice. Participant has reviewed the Agreement, the Plan and the Grant Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing the Grant Notice and fully understands all provisions of the Grant Notice, the Agreement and the Plan. Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan, the Grant Notice and the Agreement.
| | | | | | | | | | | | | | |
| VOYAGER TECHNOLOGIES, INC. | | PARTICIPANT |
| | | | |
| | | | |
| | | | |
| By: | | | |
| | | | |
| Name: | | | |
| | | | |
| Title: | | | |
RESTRICTED STOCK AGREEMENT
Capitalized terms not specifically defined in this Agreement have the meanings specified in the Grant Notice or, if not defined in the Grant Notice, in the Plan.
ARTICLE I.
GENERAL
1.1 Issuance of Restricted Shares. In consideration of Participant’s past and/or continued employment with or service to the Company or any of its parents or Subsidiaries (each, a “Participating Company”) and for other good and valuable consideration, the Company will issue the Restricted Shares to the Participant effective as of the Grant Date set forth in the Grant Notice and will cause (a) a stock certificate or certificates representing the Restricted Shares to be registered in Participant’s name or (b) the Restricted Shares to be held in book-entry form. If a stock certificate is issued, the certificate will be delivered to, and held in accordance with this Agreement by, the Company or its authorized representatives and will bear the restrictive legends required by this Agreement. If the Restricted Shares are held in book-entry form, then the book-entry will indicate that the Restricted Shares are subject to the restrictions of this Agreement.
1.2 Incorporation of Terms of Plan. The Restricted Shares are subject to the terms and conditions set forth in this Agreement and the Plan, which is incorporated herein by reference. In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan will control.
ARTICLE II.
VESTING, FORFEITURE AND ESCROW
2.1 Vesting. The Restricted Shares will become vested Shares (the “Vested Shares”) according to the vesting schedule in the Grant Notice except that any fraction of a Share that would otherwise become a Vested Share will be accumulated and will become a Vested Share only when a whole Vested Share has accumulated.
2.2 Forfeiture.
(a) In the event of Participant’s Termination of Service for any reason, Participant will immediately and automatically forfeit to the Company any Restricted Shares that are not Vested Shares (the “Unvested Shares”) at the time of Participant’s Termination of Service, except as otherwise determined by the Administrator or provided in a binding written agreement between Participant and the Company. Upon forfeiture of Unvested Shares, the Company will become the legal and beneficial owner of the Unvested Shares and all related interests and Participant will have no further rights with respect to the Unvested Shares.
2.3 Escrow.
(a) Unvested Shares will be held by the Company or its authorized representatives until (i) they are forfeited, (ii) they become Vested Shares or (iii) this Agreement is no longer in effect. By accepting this Award, Participant appoints the Company and its authorized representatives as Participant’s attorney(s)-in-fact to take all actions necessary to effect any transfer of forfeited Unvested Shares (and Retained Distributions (as defined below), if any, paid on such forfeited Unvested Shares) to the Company as may be required pursuant to the Plan or this Agreement and to execute such representations or other documents or assurances as the Company or such representatives deem necessary
or advisable in connection with any such transfer. The Company, or its authorized representative, will not be liable for any good faith act or omission with respect to the holding in escrow or transfer of the Restricted Shares.
(b) All cash dividends and other distributions made or declared with respect to Unvested Shares (“Retained Distributions”) will be held by the Company until the time (if ever) when the Unvested Shares to which such Retained Distributions relate become Vested Shares. The Company will establish a separate Retained Distribution bookkeeping account (“Retained Distribution Account”) for each Unvested Share with respect to which Retained Distributions have been made or declared in cash and credit the Retained Distribution Account (without interest) on the date of payment with the amount of such cash made or declared with respect to the Unvested Share. Retained Distributions (including any Retained Distribution Account balance) will immediately and automatically be forfeited upon forfeiture of the Unvested Share with respect to which the Retained Distributions were paid or declared.
(c) As soon as reasonably practicable following the date on which an Unvested Share becomes a Vested Share, the Company will (i) cause the certificate (or a new certificate without the legend required by this Agreement, if Participant so requests) representing the Share to be delivered to Participant or, if the Share is held in book-entry form, cause the notations indicating the Share is subject to the restrictions of this Agreement to be removed and (ii) pay to Participant the Retained Distributions relating to the Share.
2.4 Rights as Stockholder. Except as otherwise provided in this Agreement or the Plan, upon issuance of the Restricted Shares by the Company, Participant will have all the rights of a stockholder with respect to the Restricted Shares, including the right to vote the Restricted Shares and to receive dividends or other distributions paid or made with respect to the Restricted Shares.
ARTICLE III.
TAXATION AND TAX WITHHOLDING
3.1 Representation. Participant represents to the Company that Participant has reviewed with Participant’s own tax advisors the tax consequences of the Restricted Shares and the transactions contemplated by the Grant Notice and this Agreement. Participant is relying solely on such advisors and not on any statements or representations of the Company or any of its agents.
3.2 Section 83(b) Election. If Participant makes an election under Section 83(b) of the Code with respect to the Restricted Shares, Participant will deliver a copy of the election to the Company promptly after filing the election with the Internal Revenue Service.
3.3 Tax Withholding.
(a) The Participant shall satisfy all applicable federal, state and local taxes required by law to be withheld with respect to any taxable event arising in connection with the Restricted Shares through the surrender of Shares, as set forth in Section 9.5 of the Plan.
(b) Participant acknowledges that Participant is ultimately liable and responsible for all taxes owed in connection with the Restricted Shares, regardless of any action the Company or any Subsidiary takes with respect to any tax withholding obligations that arise in connection with the Restricted Shares. Neither the Company nor any Subsidiary makes any representation or undertaking regarding the treatment of any tax withholding in connection with the awarding, vesting or payment of the Restricted Shares or the subsequent sale of the Restricted Shares. The Company and the Subsidiaries do
not commit and are under no obligation to structure this Award to reduce or eliminate Participant’s tax liability.
ARTICLE IV.
RESTRICTIVE LEGENDS AND TRANSFERABILITY
4.1 Legends. Any certificate representing a Restricted Share will bear the following legend until the Restricted Share becomes a Vested Share:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO FORFEITURE IN FAVOR OF THE COMPANY AND MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF A RESTRICTED STOCK AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.
4.2 Transferability. The Restricted Shares and any Retained Distributions are subject to the restrictions on transfer in the Plan and may not be sold, assigned or transferred in any manner unless and until they become Vested Shares. Any attempted transfer or disposition of Unvested Shares or related Retained Distributions prior to the time the Unvested Shares become Vested Shares will be null and void. The Company will not be required to (a) transfer on its books any Restricted Share that has been sold or otherwise transferred in violation of this Agreement or (b) treat as owner of such Restricted Share or accord the right to vote or pay dividends to any purchaser or other transferee to whom such Restricted Share has been so transferred. The Company may issue appropriate “stop transfer” instructions to its transfer agent, if any, or make appropriate notations to the same effect in its records.
ARTICLE V.
OTHER PROVISIONS
5.1 Administration. The Administrator shall have the power to interpret the Plan, the Grant Notice and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan, the Grant Notice and this Agreement as are consistent therewith and to interpret, amend or revoke any such rules. All actions taken and all interpretations and determinations made by the Administrator will be final and binding upon Participant, the Company and all other interested persons. To the extent allowable pursuant to Applicable Laws, no member of the Committee or the Board will be personally liable for any action, determination or interpretation made with respect to the Plan, the Grant Notice or this Agreement.
5.2 Adjustments. The Administrator may accelerate the vesting of all or a portion of the Restricted Shares in such circumstances as it, in its sole discretion, may determine. Participant acknowledges that the Restricted Shares are subject to adjustment, modification and termination in certain events as provided in this Agreement and the Plan, including Article VIII of the Plan.
5.3 Notices. Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of the Secretary at the Company’s principal office, and any notice to be given to Participant shall be addressed to Participant at Participant’s last email or physical address reflected on the Company’s records. By a notice given pursuant to this Section 5.3, either party may hereafter designate a different address for notices to be given to that party. Any notice shall be deemed duly given when sent via email or when sent by certified mail (return receipt requested) and deposited
(with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service.
5.4 Titles. Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.
5.5 Governing Law. The laws of the State of Delaware shall govern the interpretation, validity, administration, enforcement and performance of the terms of this Agreement regardless of the law that might be applied under principles of conflicts of laws.
5.6 Conformity to Securities Laws. Participant acknowledges that the Plan, the Grant Notice and this Agreement are intended to conform to the extent necessary with all Applicable Laws, including, without limitation, the provisions of the Securities Act and the Exchange Act, and any and all regulations and rules promulgated thereunder by the Securities and Exchange Commission, and state securities laws and regulations. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Restricted Shares are granted, only in such a manner as to conform to Applicable Laws. To the extent permitted by Applicable Laws, the Plan, the Grant Notice and this Agreement shall be deemed amended to the extent necessary to conform to Applicable Laws.
5.7 Amendment, Suspension and Termination. To the extent permitted by the Plan, this Agreement may be wholly or partially amended or otherwise modified, suspended or terminated at any time or from time to time by the Administrator or the Board, provided that, except as may otherwise be provided by the Plan, no amendment, modification, suspension or termination of this Agreement shall adversely affect the Restricted Shares in any material way without the prior written consent of Participant, unless such action is necessary to ensure or facilitate compliance with Applicable Law, as determined by the Administrator.
5.8 Successors and Assigns. The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement will inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth in Section 4.2 and the Plan, this Agreement shall be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the parties hereto.
5.9 Limitations Applicable to Section 16 Persons. Notwithstanding any other provision of the Plan or this Agreement, if Participant is subject to Section 16 of the Exchange Act, the Plan, the Restricted Shares, Grant Notice and this Agreement shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent permitted by Applicable Laws, this Agreement shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.
5.10 Not a Contract of Service Relationship. Nothing in this Agreement or in the Plan shall confer upon Participant any right to continue to serve as an employee or other service provider of the Company or any of its parents or Subsidiaries or shall interfere with or restrict in any way the rights of the Company or any of its parents or Subsidiaries, which rights are hereby expressly reserved, to discharge or terminate the services of Participant at any time for any reason whatsoever, with or without cause, except to the extent (a) expressly provided otherwise in a written agreement between the Company or any of its parents or Subsidiaries and Participant or (b) where such provisions are not consistent with applicable foreign or local laws, in which case such applicable foreign or local laws shall control.
5.11 Entire Agreement. The Plan, the Grant Notice and this Agreement (including any exhibit hereto) constitute the entire agreement of the parties and supersede in their entirety all prior undertakings and agreements of the Company and Participant with respect to the subject matter hereof.
5.12 Section 409A. This Award is not intended to constitute “nonqualified deferred compensation” within the meaning of Section 409A and shall be interpreted consistent with such intent. However, notwithstanding any other provision of the Plan, the Grant Notice or this Agreement, if at any time the Administrator determines that this Award (or any portion thereof) may be subject to Section 409A, the Administrator shall have the right in its sole discretion (without any obligation to do so or to indemnify Participant or any other Person for failure to do so) to adopt such amendments to the Plan, the Grant Notice or this Agreement, or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, as the Administrator determines are necessary or appropriate for this Award either to be exempt from the application of Section 409A or to comply with the requirements of Section 409A.
5.13 Agreement Severable. In the event that any provision of the Grant Notice or this Agreement is held invalid or unenforceable, such provision will be severable from, and such invalidity or unenforceability will not be construed to have any effect on, the remaining provisions of the Grant Notice or this Agreement.
5.14 Limitation on Participant’s Rights. Participation in the Plan confers no rights or interests other than as herein provided. This Agreement creates only a contractual obligation on the part of the Company as to amounts payable and shall not be construed as creating a trust. Neither the Plan nor any underlying program, in and of itself, has any assets. Participant shall have only the rights of a general unsecured creditor of the Company with respect to amounts credited and benefits payable, if any, with respect to the Restricted Shares.
5.15 Clawback. The Restricted Shares (including any proceeds, gains or other economic benefit the Participant actually or constructively receives upon receipt or settlement of the Restricted Shares) will be subject to any Company claw-back policy as in effect from time to time, including any claw-back policy adopted to comply with Applicable Laws (including the Dodd-Frank Wall Street Reform and Consumer Protection Act and any rules or regulations promulgated thereunder).
5.16 Counterparts. The Grant Notice may be executed in one or more counterparts, including by way of any electronic signature, subject to Applicable Law, each of which shall be deemed an original and all of which together shall constitute one instrument.
* * * * *
| | |
VOYAGER TECHNOLOGIES, INC. 2025 EMPLOYEE STOCK PURCHASE PLAN |
ARTICLE I.
PURPOSE
The purpose of this Plan is to assist Eligible Employees of the Company and its Designated Subsidiaries in acquiring a stock ownership interest in the Company.
The Plan consists of two components: (i) the Section 423 Component and (ii) the Non-Section 423 Component. The Section 423 Component is intended to qualify as an “employee stock purchase plan” under Section 423 of the Code and shall be administered, interpreted and construed in a manner consistent with the requirements of Section 423 of the Code. The Non-Section 423 Component authorizes the grant of rights which need not qualify as rights granted pursuant to an “employee stock purchase plan” under Section 423 of the Code. Rights granted under the Non-Section 423 Component shall be granted pursuant to separate Offerings containing such sub-plans, appendices, rules or procedures as may be adopted by the Administrator and designed to achieve tax, securities laws or other objectives for Eligible Employees and Designated Subsidiaries but shall not be intended to qualify as an “employee stock purchase plan” under Section 423 of the Code. Except as otherwise determined by the Administrator or provided herein, the Non-Section 423 Component will operate and be administered in the same manner as the Section 423 Component. Offerings intended to be made under the Non-Section 423 Component will be designated as such by the Administrator at or prior to the time of such Offering.
For purposes of this Plan, the Administrator may designate separate Offerings under the Plan in which Eligible Employees will participate. The terms of these Offerings need not be identical, even if the dates of the applicable Offering Period(s) in each such Offering are identical, provided that the terms of participation are the same within each separate Offering under the Section 423 Component (as determined under Section 423 of the Code). Solely by way of example and without limiting the foregoing, the Company could, but shall not be required to, provide for simultaneous Offerings under the Section 423 Component and the Non-Section 423 Component of the Plan.
ARTICLE II.
DEFINITIONS AND CONSTRUCTION
Wherever the following terms are used in the Plan they shall have the meanings specified below, unless the context clearly indicates otherwise.
2.1 “Administrator” means the entity that conducts the general administration of the Plan as provided in Article XI.
2.2 “Agent” means the brokerage firm, bank or other financial institution, entity or person(s), if any, engaged, retained, appointed or authorized to act as the agent of the Company or an Employee with regard to the Plan.
2.3 “Applicable Law” means the requirements relating to the administration of equity incentive plans under U.S. federal and state securities, tax and other applicable laws, rules and regulations, the applicable rules of any stock exchange or quotation system on which Shares are listed or quoted and the applicable laws and rules of any foreign country or other jurisdiction where rights under this Plan are granted.
2.4 “Board” means the Board of Directors of the Company.
2.5 “Code” means the U.S. Internal Revenue Code of 1986, as amended, and the regulations issued thereunder.
2.6 “Common Stock” means the Class A common stock of the Company and such other securities of the Company that may be substituted therefore.
2.7 “Company” means Voyager Technologies, Inc., a Delaware corporation, or any successor.
2.8 “Compensation” of an Eligible Employee means, unless otherwise determined by the Administrator, the gross base compensation received by such Eligible Employee as compensation for services to the Company or any Designated Subsidiary, including prior week adjustment and overtime payments but excluding vacation pay, holiday pay, jury duty pay, funeral leave pay, military leave pay, commissions, incentive compensation, one-time bonuses (e.g., retention or sign on bonuses), education or tuition reimbursements, travel expenses, business and moving reimbursements, income received in connection with any stock options, stock appreciation rights, restricted stock, restricted stock units or other compensatory equity awards, fringe benefits, other special payments and all contributions made by the Company or any Designated Subsidiary for the Employee’s benefit under any employee benefit plan now or hereafter established.
2.9 “Designated Subsidiary” means any Subsidiary designated by the Administrator in accordance with Section 11.2(b), such designation to specify whether such participation is in the Section 423 Component or Non-Section 423 Component. A Designated Subsidiary may participate in either the Section 423 Component or Non-Section 423 Component, but not both; provided that a Subsidiary that, for U.S. tax purposes, is disregarded from the Company or any Subsidiary that participates in the Section 423 Component shall automatically constitute a Designated Subsidiary that participates in the Section 423 Component.
2.10 “Effective Date” means the day prior to the Public Trading Date.
2.11 “Eligible Employee” means:
(a) an Employee who does not, immediately after any rights under this Plan are granted, own (directly or through attribution) stock possessing five percent (5%) or more of the total combined voting power or value of all classes of Common Stock (including Class B Common Stock) and other securities of the Company, a Parent or a Subsidiary (as determined under Section 423(b)(3) of the Code). For purposes of the foregoing, the rules of Section 424(d) of the Code with regard to the attribution of stock ownership shall apply in determining the stock ownership of an individual, and stock that an Employee may purchase under outstanding options shall be treated as stock owned by the Employee.
(b) Notwithstanding the foregoing, the Administrator may provide in an Offering Document that an Employee shall not be eligible to participate in an Offering Period under the Section 423 Component if: (i) such Employee is a highly compensated employee within the meaning of Section 423(b)(4)(D) of the Code; (ii) such Employee has not met a service requirement designated by the Administrator pursuant to Section 423(b)(4)(A) of the Code (which service requirement may not exceed two (2) years); (iii) such Employee’s customary employment is for twenty (20) hours per week or less; (iv) such Employee’s customary employment is for less than five (5) months in any calendar year; and/or
(v) such Employee is a citizen or resident of a foreign jurisdiction and the grant of a right to purchase Shares under the Plan to such Employee would be prohibited under the laws of such foreign jurisdiction or the grant of a right to purchase Shares under the Plan to such Employee in compliance with the laws of such foreign jurisdiction would cause the Plan to violate the requirements of Section 423 of the Code, as determined by the Administrator in its sole discretion; provided, further, that any exclusion in clauses (i), (ii), (iii), (iv) or (v) shall be applied in an identical manner under each Offering Period to all Employees, in accordance with Treasury Regulation Section 1.423-2(e).
(c) Further notwithstanding the foregoing, with respect to the Non-Section 423 Component, the first sentence in this definition shall apply in determining who is an “Eligible Employee,” except (i) the Administrator may limit eligibility further within the Company or a Designated Subsidiary so as to only designate some Employees of the Company or a Designated Subsidiary as Eligible Employees, and (ii) to the extent the restrictions in the first sentence in this definition are not consistent with applicable local laws, the applicable local laws shall control.
2.12 “Employee” means any individual who renders services to the Company or any Designated Subsidiary in the status of an employee, and, with respect to the Section 423 Component, a person who is an employee within the meaning of Section 3401(c) of the Code. For purposes of an individual’s participation in, or other rights under the Plan, all determinations by the Company shall be final, binding and conclusive, notwithstanding that any court of law or governmental agency subsequently makes a contrary determination. For purposes of the Plan, the employment relationship shall be treated as continuing intact while the individual is on sick leave or other leave of absence approved by the Company or Designated Subsidiary and meeting the requirements of Treasury Regulation Section 1.421-1(h)(2). Where the period of leave exceeds three (3) months and the individual’s right to reemployment is not guaranteed either by statute or by contract, the employment relationship shall be deemed to have terminated on the first day immediately following such three (3)-month period.
2.13 “Enrollment Date” means the first Trading Day of each Offering Period.
2.14 “Fair Market Value” means, as of any date, the value of Shares determined as follows: (i) if the Shares are listed on any established stock exchange, its Fair Market Value will be the closing sales price for such Shares as quoted on such exchange for such date, or if no sale occurred on such date, the last day preceding such date during which a sale occurred, as reported in The Wall Street Journal or another source the Administrator deems reliable; (ii) if the Shares are not traded on a stock exchange but are quoted on a national market or other quotation system, the closing sales price on such date, or if no sales occurred on such date, then on the last date preceding such date during which a sale occurred, as reported in The Wall Street Journal or another source the Administrator deems reliable; or (iii) without an established market for the Shares, the Administrator will determine the Fair Market Value in its discretion.
2.15 “Non-Section 423 Component” means those Offerings under the Plan, together with the sub-plans, appendices, rules or procedures, if any, adopted by the Administrator as a part of this Plan, in each case, pursuant to which rights to purchase Shares during an Offering Period may be granted to Eligible Employees that need not satisfy the requirements for rights to purchase Shares granted pursuant to an “employee stock purchase plan” that are set forth under Section 423 of the Code.
2.16 “Offering” means an offer under the Plan of a right to purchase Shares that may be exercised during an Offering Period as further described in Article IV hereof. Unless otherwise specified by the Administrator, each Offering to the Eligible Employees of the Company or a Designated
Subsidiary shall be deemed a separate Offering, even if the dates and other terms of the applicable Offering Periods of each such Offering are identical, and the provisions of the Plan will separately apply to each Offering. To the extent permitted by Treas. Reg. § 1.423-2(a)(1), the terms of each separate Offering under the Section 423 Component need not be identical, provided that the terms of the Section 423 Component and an Offering thereunder together satisfy Treas. Reg. § 1.423-2(a)(2) and (a)(3).
2.17 “Offering Document” has the meaning given to such term in Section 4.1.
2.18 “Offering Period” has the meaning given to such term in Section 4.1.
2.19 “Parent” means any corporation, other than the Company, in an unbroken chain of corporations ending with the Company if, at the time of the determination, each of the corporations other than the Company owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.
2.20 “Participant” means any Eligible Employee who has executed a subscription agreement and been granted rights to purchase Shares pursuant to the Plan.
2.21 “Payday” means the regular and recurring established day for payment of Compensation to an Employee of the Company or any Designated Subsidiary.
2.22 “Plan” means this 2025 Employee Stock Purchase Plan, including both the Section 423 Component and Non-Section 423 Component and any other sub-plans or appendices hereto, as amended from time to time.
2.23 “Public Trading Date” means the first date upon which the Common Stock is listed (or approved for listing) upon notice of issuance on any securities exchange or designated (or approved for designation) upon notice of issuance as a national market security on an interdealer quotation system.
2.24 “Purchase Date” means the last Trading Day of each Purchase Period or such other date as determined by the Administrator and set forth in the Offering Document.
2.25 “Purchase Period” means one or more periods within an Offering Period, as designated in the applicable Offering Document; provided, however, that, in the event no Purchase Period is designated by the Administrator in the applicable Offering Document, the Purchase Period for each Offering Period covered by such Offering Document shall be the same as the applicable Offering Period.
2.26 “Purchase Price” means the purchase price designated by the Administrator in the applicable Offering Document (which purchase price, for purposes of the Section 423 Component, shall not be less than 85% of the Fair Market Value of a Share on the Enrollment Date or on the Purchase Date, whichever is lower); provided, however, that, in the event no purchase price is designated by the Administrator in the applicable Offering Document, the purchase price for the Offering Periods covered by such Offering Document shall be 85% of the Fair Market Value of a Share on the Enrollment Date or on the Purchase Date, whichever is lower; provided, further, that the Purchase Price may be adjusted by the Administrator pursuant to Article VIII and shall not be less than the par value of a Share.
2.27 “Section 423 Component” means those Offerings under the Plan, together with the sub-plans, appendices, rules or procedures, if any, adopted by the Administrator as a part of this Plan, in each case, pursuant to which rights to purchase Shares during an Offering Period may be granted to Eligible
Employees that are intended to satisfy the requirements for rights to purchase Shares granted pursuant to an “employee stock purchase plan” that are set forth under Section 423 of the Code.
2.28 “Securities Act” means the U.S. Securities Act of 1933, as amended.
2.29 “Share” means a share of Common Stock.
2.30 “Subsidiary” means any corporation, other than the Company, in an unbroken chain of corporations beginning with the Company if, at the time of the determination, each of the corporations other than the last corporation in an unbroken chain owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain; provided, however, that a limited liability company or partnership may be treated as a Subsidiary to the extent either (a) such entity is treated as a disregarded entity under Treasury Regulation Section 301.7701-3(a) by reason of the Company or any other Subsidiary that is a corporation being the sole owner of such entity, or (b) such entity elects to be classified as a corporation under Treasury Regulation Section 301.7701-3(a) and such entity would otherwise qualify as a Subsidiary. In addition, with respect to the Non-Section 423 Component, Subsidiary shall include any corporate or non-corporate entity in which the Company has a direct or indirect equity interest or significant business relationship.
2.31 “Trading Day” means a day on which national stock exchanges in the United States are open for trading.
2.32 “Treas. Reg.” means U.S. Department of the Treasury regulations.
ARTICLE III.
SHARES SUBJECT TO THE PLAN
3.1 Number of Shares. Subject to Article VIII, the aggregate number of Shares that may be issued pursuant to rights granted under the Plan shall be 1,100,883 Shares. In addition to the foregoing, subject to Article VIII, on the first day of each calendar year beginning on January 1, 2026 and ending on and including January 1, 2035, the number of Shares available for issuance under the Plan shall be increased by that number of Shares equal to the lesser of (a) one percent (1%) of the aggregate number of shares of Class A Common Stock and Class B Common Stock of the Company outstanding (on an as-converted basis) on the final day of the immediately preceding calendar year and (b) such smaller number of shares as determined by the Board. If any right granted under the Plan shall for any reason terminate without having been exercised, the Shares not purchased under such right shall again become available for issuance under the Plan. Notwithstanding anything in this Section 3.1 to the contrary, the number of Shares that may be issued or transferred pursuant to the rights granted under the Section 423 Component of the Plan shall not exceed an aggregate of 11,008,830 Shares, subject to Article VIII.
3.2 Shares Distributed. Any Shares distributed pursuant to the Plan may consist, in whole or in part, of authorized and unissued Shares, treasury shares or Shares purchased on the open market.
ARTICLE IV.
OFFERING PERIODS; OFFERING DOCUMENTS; PURCHASE DATES
4.1 Offering Periods. The Administrator may from time to time grant or provide for the grant of rights to purchase Shares under the Plan to Eligible Employees during one or more periods (each, an “Offering Period”) selected by the Administrator. The terms and conditions applicable to each Offering Period shall be set forth in an “Offering Document” adopted by the Administrator, which Offering
Document shall be in such form and shall contain such terms and conditions as the Administrator shall deem appropriate and shall be incorporated by reference into and made part of the Plan and shall be attached hereto as part of the Plan. The Administrator shall establish in each Offering Document one or more Purchase Periods during such Offering Period during which rights granted under the Plan shall be exercised and purchases of Shares carried out during such Offering Period in accordance with such Offering Document and the Plan. The provisions of separate Offering Periods under the Plan need not be identical.
4.2 Offering Documents. Each Offering Document with respect to an Offering Period shall specify (through incorporation of the provisions of this Plan by reference or otherwise):
(a) the length of the Offering Period, which period shall not exceed twenty-seven (27) months;
(b) the length of the Purchase Period(s) within the Offering Period;
(c) in connection with each Offering Period that contains only one (1) Purchase Period the maximum number of Shares that may be purchased by any Eligible Employee during such Offering Period, which, in the absence of a contrary designation by the Administrator, shall be two thousand five hundred (2,500) Shares;
(d) in connection with each Offering Period that contains more than one (1) Purchase Period, the maximum aggregate number of Shares which may be purchased by any Eligible Employee during each Purchase Period, which, in the absence of a contrary designation by the Administrator, shall be two thousand five hundred (2,500) Shares; and
(e) such other provisions as the Administrator determines are appropriate, subject to the Plan.
ARTICLE V.
ELIGIBILITY AND PARTICIPATION
5.1 Eligibility. Any Eligible Employee who shall be employed by the Company or a Designated Subsidiary on a given Enrollment Date for an Offering Period shall be eligible to participate in the Plan during such Offering Period, subject to the requirements of this Article V and, for the Section 423 Component, the limitations imposed by Section 423(b) of the Code.
5.2 Enrollment in Plan.
(a) Except as otherwise set forth in an Offering Document or determined by the Administrator, an Eligible Employee may become a Participant in the Plan for an Offering Period by delivering a subscription agreement to the Company by such time prior to the Enrollment Date for such Offering Period (or such other date specified in the Offering Document) designated by the Administrator and in such form as the Company provides.
(b) Each subscription agreement shall designate a whole percentage of such Eligible Employee’s Compensation to be withheld by the Company or the Designated Subsidiary employing such Eligible Employee on each Payday during the Offering Period as payroll deductions under the Plan. The percentage of Compensation designated by an Eligible Employee may not be less than one percent (1%) and may not be more than the maximum percentage specified by the Administrator in the applicable
Offering Document (which percentage shall be twenty (20%) in the absence of any such designation) as payroll deductions. The payroll deductions made for each Participant shall be credited to an account for such Participant under the Plan and shall be deposited with the general funds of the Company.
(c) A Participant may increase or decrease the percentage of Compensation designated in his or her subscription agreement, subject to the limits of this Section 5.2, or may suspend his or her payroll deductions, at any time during an Offering Period; provided, however, that the Administrator may limit the number of changes a Participant may make to his or her payroll deduction elections during each Offering Period in the applicable Offering Document (and in the absence of any specific designation by the Administrator, a Participant shall be allowed to decrease and/or suspend (but not increase) his or her payroll deduction elections one time during each Offering Period). Any such change or suspension of payroll deductions shall be effective with the first (1st) full payroll period following five (5) business days after the Company’s receipt of the new subscription agreement (or such shorter or longer period as may be specified by the Administrator in the applicable Offering Document). In the event a Participant suspends his or her payroll deductions, such Participant’s cumulative payroll deductions prior to the suspension shall remain in his or her account and shall be applied to the purchase of Shares on the next occurring Purchase Date and shall not be paid to such Participant unless he or she withdraws from participation in the Plan pursuant to Article VII.
(d) Except as otherwise set forth in an Offering Document or determined by the Administrator, a Participant may participate in the Plan only by means of payroll deduction and may not make contributions by lump sum payment for any Offering Period.
5.3 Payroll Deductions. Except as otherwise provided in the applicable Offering Document, payroll deductions for a Participant shall commence on the first Payday following the Enrollment Date and shall end on the last Payday in the Offering Period to which the Participant’s authorization is applicable, unless sooner terminated by the Participant as provided in Article VII or suspended by the Participant or the Administrator as provided in Section 5.2 and Section 5.6, respectively. Notwithstanding any other provisions of the Plan to the contrary, in non-U.S. jurisdictions where participation in the Plan through payroll deductions is prohibited, the Administrator may provide that an Eligible Employee may elect to participate through contributions to the Participant’s account under the Plan in a form acceptable to the Administrator in lieu of or in addition to payroll deductions; provided, however, that, for any Offering under the Section 423 Component, the Administrator shall take into consideration any limitations under Section 423 of the Code when applying an alternative method of contribution.
5.4 Effect of Enrollment. A Participant’s completion of a subscription agreement will enroll such Participant in the Plan for each subsequent Offering Period on the terms contained therein until the Participant either submits a new subscription agreement, withdraws from participation under the Plan as provided in Article VII or otherwise becomes ineligible to participate in the Plan.
5.5 Limitation on Purchase of Shares. An Eligible Employee may be granted rights under the Section 423 Component only if such rights, together with any other rights granted to such Eligible Employee under “employee stock purchase plans” of the Company, any Parent or any Subsidiary, as specified by Section 423(b)(8) of the Code, do not permit such employee’s rights to purchase stock of the Company or any Parent or Subsidiary to accrue at a rate that exceeds twenty-five thousand dollars ($25,000) of the fair market value of such stock (determined as of the first (1st) day of the Offering Period during which such rights are granted) for each calendar year in which such rights are outstanding at any time. This limitation shall be applied in accordance with Section 423(b)(8) of the Code.
5.6 Suspension of Payroll Deductions. Notwithstanding the foregoing, to the extent necessary to comply with Section 423(b)(8) of the Code and Section 5.5 (with respect to the Section 423 Component) or the other limitations set forth in this Plan, a Participant’s payroll deductions may be suspended by the Administrator at any time during an Offering Period. The balance of the amount credited to the account of each Participant that has not been applied to the purchase of Shares by reason of Section 423(b)(8) of the Code, Section 5.5 or the other limitations set forth in this Plan shall be paid to such Participant in one lump sum in cash as soon as reasonably practicable after the Purchase Date.
5.7 Foreign Employees. In order to facilitate participation in the Plan, the Administrator may provide for such special terms applicable to Participants who are citizens or residents of a foreign jurisdiction, or who are employed by a Designated Subsidiary outside of the United States, as the Administrator may consider necessary or appropriate to accommodate differences in local law, tax policy or custom. Except as permitted by Section 423 of the Code, with respect to the Section 423 Component, such special terms may not be more favorable than the terms of rights granted under the Section 423 Component to Eligible Employees who are residents of the United States. Such special terms may be set forth in an addendum to the Plan in the form of an appendix or sub-plan (which appendix or sub-plan may be designed to govern Offerings under the Section 423 Component or the Non-Section 423 Component, as determined by the Administrator). To the extent that the terms and conditions set forth in an appendix or sub-plan conflict with any provisions of the Plan, the provisions of the appendix or sub-plan shall govern. The adoption of any such appendix or sub-plan shall be pursuant to Section 11.2(g). Without limiting the foregoing, the Administrator is specifically authorized to adopt rules and procedures, with respect to Participants who are foreign nationals or employed in non-U.S. jurisdictions, regarding the exclusion of particular Subsidiaries from participation in the Plan, eligibility to participate, the definition of Compensation, handling of payroll deductions or other contributions by Participants, payment of interest, conversion of local currency, data privacy security, payroll tax, withholding procedures, establishment of bank or trust accounts to hold payroll deductions or contributions.
5.8 Leave of Absence. During leaves of absence approved by the Company meeting the requirements of Treasury Regulation Section 1.421-1(h)(2) under the Code, a Participant may continue participation in the Plan by making cash payments to the Company on his or her normal Payday equal to the Participant’s authorized payroll deduction.
ARTICLE VI.
GRANT AND EXERCISE OF RIGHTS
6.1 Grant of Rights. On the Enrollment Date of each Offering Period, each Eligible Employee participating in such Offering Period shall be granted a right to purchase the maximum number of Shares specified under Section 4.2, subject to the limits in Section 5.5, and shall have the right to buy, on each Purchase Date during such Offering Period (at the applicable Purchase Price), such number of whole Shares as is determined by dividing (a) such Participant’s payroll deductions accumulated prior to such Purchase Date and retained in the Participant’s account as of the Purchase Date, by (b) the applicable Purchase Price (rounded down to the nearest Share). The right shall expire on the earliest of: (x) the last Purchase Date of the Offering Period, (y) the last day of the Offering Period, and (z) the date on which the Participant withdraws in accordance with Section 7.1 or Section 7.3.
6.2 Exercise of Rights. On each Purchase Date, each Participant’s accumulated payroll deductions and any other additional payments specifically provided for in the applicable Offering Document will be applied to the purchase of whole Shares, up to the maximum number of Shares permitted pursuant to the terms of the Plan and the applicable Offering Document, at the Purchase Price.
No fractional Shares shall be issued upon the exercise of rights granted under the Plan, unless the Offering Document specifically provides otherwise. Any cash in lieu of fractional Shares remaining after the purchase of whole Shares upon exercise of a purchase right will be credited to a Participant’s account and carried forward and applied toward the purchase of whole Shares for the next following Offering Period. Shares issued pursuant to the Plan may be evidenced in such manner as the Administrator may determine and may be issued in certificated form or issued pursuant to book-entry procedures.
6.3 Pro Rata Allocation of Shares. If the Administrator determines that, on a given Purchase Date, the number of Shares with respect to which rights are to be exercised may exceed (a) the number of Shares that were available for issuance under the Plan on the Enrollment Date of the applicable Offering Period, or (b) the number of Shares available for issuance under the Plan on such Purchase Date, the Administrator may in its sole discretion provide that the Company shall make a pro rata allocation of the Shares available for purchase on such Enrollment Date or Purchase Date, as applicable, in as uniform a manner as shall be practicable and as it shall determine in its sole discretion to be equitable among all Participants for whom rights to purchase Shares are to be exercised pursuant to this Article VI on such Purchase Date, and shall either (i) continue all Offering Periods then in effect, or (ii) terminate any or all Offering Periods then in effect pursuant to Article IX. The Company may make pro rata allocation of the Shares available on the Enrollment Date of any applicable Offering Period pursuant to the preceding sentence, notwithstanding any authorization of additional Shares for issuance under the Plan by the Company’s stockholders subsequent to such Enrollment Date. The balance of the amount credited to the account of each Participant that has not been applied to the purchase of Shares shall be paid to such Participant in one lump sum in cash as soon as reasonably practicable after the Purchase Date or such earlier date as determined by the Administrator.
6.4 Withholding. At the time a Participant’s rights under the Plan are exercised, in whole or in part, or at the time some or all of the Shares issued under the Plan are disposed of, the Participant must make adequate provision for the Company’s federal, state, or other tax withholding obligations, if any, that arise upon the exercise of the right or the disposition of the Shares. At any time, the Company may, but shall not be obligated to, withhold from the Participant’s compensation or Shares received pursuant to the Plan the amount necessary for the Company to meet applicable withholding obligations, including any withholding required to make available to the Company any tax deductions or benefits attributable to sale or early disposition of Shares by the Participant.
6.5 Conditions to Issuance of Shares. The Company shall not be required to issue or deliver any certificate or certificates for, or make any book entries evidencing, Shares purchased upon the exercise of rights under the Plan prior to fulfillment of all of the following conditions: (a) the admission of such Shares to listing on all stock exchanges, if any, on which the Shares are then listed; (b) the completion of any registration or other qualification of such Shares under any state or federal law or under the rulings or regulations of the Securities and Exchange Commission or any other governmental regulatory body, that the Administrator shall, in its absolute discretion, deem necessary or advisable; (c) the obtaining of any approval or other clearance from any state or federal governmental agency that the Administrator shall, in its absolute discretion, determine to be necessary or advisable; (d) the payment to the Company of all amounts that it is required to withhold under federal, state or local law upon exercise of the rights, if any; and (e) the lapse of such reasonable period of time following the exercise of the rights as the Administrator may from time to time establish for reasons of administrative convenience.
ARTICLE VII.
WITHDRAWAL; CESSATION OF ELIGIBILITY
7.1 Withdrawal. A Participant may withdraw all but not less than all of the payroll deductions credited to his or her account and not yet used to exercise his or her rights under the Plan at any time by giving written notice to the Company in a form acceptable to the Company no later than one (1) week prior to the end of the Offering Period or, if earlier, the end of the Purchase Period (or such shorter or longer period as may be specified by the Administrator in the applicable Offering Document). All of the Participant’s payroll deductions credited to his or her account during an Offering Period shall be paid to such Participant as soon as reasonably practicable after receipt of notice of withdrawal without any interest thereon (except as may be required by applicable local laws) and such Participant’s rights for the Offering Period shall be automatically terminated, and no further payroll deductions for the purchase of Shares shall be made for such Offering Period. If a Participant withdraws from an Offering Period, payroll deductions shall not resume at the beginning of the next Offering Period unless the Participant timely delivers to the Company a new subscription agreement.
7.2 Future Participation. A Participant’s withdrawal from an Offering Period shall not have any effect upon his or her eligibility to participate in any similar plan that may hereafter be adopted by the Company or a Designated Subsidiary or in subsequent Offering Periods that commence after the termination of the Offering Period from which the Participant withdraws.
7.3 Cessation of Eligibility. Upon a Participant’s ceasing to be an Eligible Employee for any reason, he or she shall be deemed to have elected to withdraw from the Plan pursuant to this Article VII and the payroll deductions credited to such Participant’s account during the Offering Period shall be paid to such Participant or, in the case of his or her death, to the person or persons entitled thereto under Section 12.4, as soon as reasonably practicable without any interest thereon (except as may be required by applicable local laws), and such Participant’s rights for the Offering Period shall be automatically terminated. If a Participant transfers employment from the Company or any Designated Subsidiary participating in the Section 423 Component to any Designated Subsidiary participating in the Non-Section 423 Component, such transfer shall not be treated as a termination of employment, but the Participant shall immediately cease to participate in the Section 423 Component; however, any contributions made for the Offering Period in which such transfer occurs shall be transferred to the Non-Section 423 Component, and such Participant shall immediately join the then-current Offering under the Non-Section 423 Component upon the same terms and conditions in effect for the Participant’s participation in the Section 423 Component, except for such modifications otherwise applicable for Participants in such Offering. A Participant who transfers employment from any Designated Subsidiary participating in the Non-Section 423 Component to the Company or any Designated Subsidiary participating in the Section 423 Component shall not be treated as terminating the Participant’s employment and shall remain a Participant in the Non-Section 423 Component until the earlier of (i) the end of the current Offering Period under the Non-Section 423 Component or (ii) the Enrollment Date of the first (1st) Offering Period in which the Participant is eligible to participate following such transfer. Notwithstanding the foregoing, the Administrator may establish different rules to govern transfers of employment between entities participating in the Section 423 Component and the Non-Section 423 Component, consistent with the applicable requirements of Section 423 of the Code.
ARTICLE VIII.
ADJUSTMENTS UPON CHANGES IN SHARES
8.1 Changes in Capitalization. Subject to Section 8.3, in the event that the Administrator determines that any dividend or other distribution (whether in the form of cash, Shares, other securities, or other property), change in control, reorganization, merger, amalgamation, consolidation, combination, repurchase, redemption, recapitalization, liquidation, dissolution, or sale, transfer, exchange or other disposition of all or substantially all of the assets of the Company, or sale or exchange of Shares or other securities of the Company, issuance of warrants or other rights to purchase Shares or other securities of the Company, or other similar corporate transaction or event, as determined by the Administrator, affects the Shares such that an adjustment is determined by the Administrator to be appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended by the Company to be made available under the Plan or with respect to any outstanding purchase rights under the Plan, the Administrator shall make equitable adjustments, if any, to reflect such change with respect to (a) the aggregate number and type of Shares (or other securities or property) that may be issued under the Plan (including, but not limited to, adjustments of the limitations in Section 3.1 and the limitations established in each Offering Document pursuant to Section 4.2 on the maximum number of Shares that may be purchased); (b) the class(es) and number of Shares and price per Share subject to outstanding rights; and (c) the Purchase Price with respect to any outstanding rights.
8.2 Other Adjustments. Subject to Section 8.3, in the event of any transaction or event described in Section 8.1 or any unusual or nonrecurring transactions or events affecting the Company, any affiliate of the Company, or the financial statements of the Company or any affiliate, or of changes in Applicable Law or accounting principles, the Administrator, in its discretion, and on such terms and conditions as it deems appropriate, is hereby authorized to take any one or more of the following actions whenever the Administrator determines that such action is appropriate in order to prevent the dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or with respect to any right under the Plan, to facilitate such transactions or events or to give effect to such changes in laws, regulations or principles:
(a) To provide for either (i) termination of any outstanding right in exchange for an amount of cash, if any, equal to the amount that would have been obtained upon the exercise of such right had such right been currently exercisable or (ii) the replacement of such outstanding right with other rights or property selected by the Administrator in its sole discretion;
(b) To provide that the outstanding rights under the Plan shall be assumed by the successor or survivor corporation, or a parent or subsidiary thereof, or shall be substituted for by similar rights covering the stock of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices;
(c) To make adjustments in the number and type of Shares (or other securities or property) subject to outstanding rights under the Plan and/or in the terms and conditions of outstanding rights and rights that may be granted in the future;
(d) To provide that Participants’ accumulated payroll deductions may be used to purchase Shares prior to the next occurring Purchase Date on such date as the Administrator determines in its sole discretion and the Participants’ rights under the ongoing Offering Period(s) shall be terminated; and
(e) To provide that all outstanding rights shall terminate without being exercised.
8.3 No Adjustment Under Certain Circumstances. Unless determined otherwise by the Administrator, no adjustment or action described in this Article VIII or in any other provision of the Plan shall be authorized to the extent that such adjustment or action would cause the Section 423 Component of the Plan to fail to satisfy the requirements of Section 423 of the Code.
8.4 No Other Rights. Except as expressly provided in the Plan, no Participant shall have any rights by reason of any subdivision or consolidation of shares of stock of any class, the payment of any dividend, any increase or decrease in the number of shares of stock of any class or any dissolution, liquidation, merger, or consolidation of the Company or any other corporation. Except as expressly provided in the Plan or pursuant to action of the Administrator under the Plan, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number of Shares subject to outstanding rights under the Plan or the Purchase Price with respect to any outstanding rights.
ARTICLE IX.
AMENDMENT, MODIFICATION AND TERMINATION
9.1 Amendment, Modification and Termination. The Administrator may amend, suspend or terminate the Plan at any time and from time to time; provided, however, that approval of the Company’s stockholders shall be required to amend the Plan to: (a) increase the aggregate number, or change the type, of shares that may be sold pursuant to rights under the Plan under Section 3.1 (other than an adjustment as provided by Article VIII) or (b) change the corporations or classes of corporations whose employees may be granted rights under the Plan.
9.2 Certain Changes to Plan. Without stockholder consent and without regard to whether any Participant rights may be considered to have been adversely affected (and, with respect to the Section 423 Component of the Plan, after taking into account Section 423 of the Code), the Administrator shall be entitled to change or terminate the Offering Periods, limit the frequency and/or number of changes in the amount withheld from Compensation during an Offering Period, establish the exchange ratio applicable to amounts withheld in a currency other than U.S. dollars, permit payroll withholding in excess of the amount designated by a Participant in order to adjust for delays or mistakes in the Company’s processing of payroll withholding elections, establish reasonable waiting and adjustment periods and/or accounting and crediting procedures to ensure that amounts applied toward the purchase of Shares for each Participant properly correspond with amounts withheld from the Participant’s Compensation, and establish such other limitations or procedures as the Administrator determines in its sole discretion to be advisable that are consistent with the Plan.
9.3 Actions In the Event of Unfavorable Financial Accounting Consequences. In the event the Administrator determines that the ongoing operation of the Plan may result in unfavorable financial accounting consequences, the Administrator may, in its discretion and, to the extent necessary or desirable, modify or amend the Plan to reduce or eliminate such accounting consequences including, but not limited to:
(a) altering the Purchase Price for any Offering Period including an Offering Period underway at the time of the change in Purchase Price;
(b) shortening any Offering Period so that the Offering Period ends on a new Purchase Date, including an Offering Period underway at the time of the Administrator action; and
(c) allocating Shares.
Such modifications or amendments shall not require stockholder approval or the consent of any Participant.
9.4 Payments Upon Termination of Plan. Upon termination of the Plan, the balance in each Participant’s Plan account shall be refunded as soon as practicable after such termination, without any interest thereon, or the Offering Period may be shortened so that the purchase of Shares occurs prior to the termination of the Plan.
ARTICLE X.
TERM OF PLAN
The Plan shall become effective on the Effective Date. The effectiveness of the Section 423 Component of the Plan shall be subject to approval of the Plan by the Company’s stockholders within twelve (12) months following the date the Plan is first approved by the Board. No right may be granted under the Section 423 Component of the Plan prior to such stockholder approval. The Plan shall remain in effect until terminated under Section 9.1. No rights may be granted under the Plan during any period of suspension of the Plan or after termination of the Plan.
ARTICLE XI.
ADMINISTRATION
11.1 Administrator. Unless otherwise determined by the Board, the Administrator of the Plan shall be the Compensation Committee of the Board (or another committee or a subcommittee of the Board to which the Board delegates administration of the Plan). The Board may at any time vest in the Board any authority or duties for administration of the Plan. The Administrator may delegate administrative tasks under the Plan to the services of an Agent or Employees to assist in the administration of the Plan, including establishing and maintaining an individual securities account under the Plan for each Participant.
11.2 Authority of Administrator. The Administrator shall have the power, subject to, and within the limitations of, the express provisions of the Plan:
(a) To determine when and how rights to purchase Shares shall be granted and the provisions of each offering of such rights (which need not be identical).
(b) To designate from time to time which Subsidiaries of the Company shall be Designated Subsidiaries, which designation may be made without the approval of the stockholders of the Company.
(c) To impose a mandatory holding period pursuant to which Employees may not dispose of or transfer Shares purchased under the Plan for a period of time determined by the Administrator in its discretion.
(d) To construe and interpret the Plan and rights granted under it, and to establish, amend and revoke rules and regulations for its administration. The Administrator, in the exercise of this power, may correct any defect, omission or inconsistency in the Plan, in a manner and to the extent it shall deem necessary or expedient to make the Plan fully effective.
(e) To amend, suspend or terminate the Plan as provided in Article IX.
(f) Generally, to exercise such powers and to perform such acts as the Administrator deems necessary or expedient to promote the best interests of the Company and its Subsidiaries and to carry out the intent that the Plan be treated as an “employee stock purchase plan” within the meaning of Section 423 of the Code for the Section 423 Component.
(g) The Administrator may adopt sub-plans applicable to particular Designated Subsidiaries or locations, which sub-plans may be designed to be outside the scope of Section 423 of the Code. The rules of such sub-plans may take precedence over other provisions of this Plan, with the exception of Section 3.1 hereof, but unless otherwise superseded by the terms of such sub-plan, the provisions of this Plan shall govern the operation of such sub-plan.
11.3 Decisions Binding. The Administrator’s interpretation of the Plan, any rights granted pursuant to the Plan, any subscription agreement and all decisions and determinations by the Administrator with respect to the Plan are final, binding, and conclusive on all parties.
ARTICLE XII.
MISCELLANEOUS
12.1 Restriction upon Assignment. A right granted under the Plan shall not be transferable other than by will or the applicable laws of descent and distribution, and is exercisable during the Participant’s lifetime only by the Participant. Except as provided in Section 12.4 hereof, a right under the Plan may not be exercised to any extent except by the Participant. The Company shall not recognize and shall be under no duty to recognize any assignment or alienation of the Participant’s interest in the Plan, the Participant’s rights under the Plan or any rights thereunder.
12.2 Rights as a Stockholder. With respect to Shares subject to a right granted under the Plan, a Participant shall not be deemed to be a stockholder of the Company, and the Participant shall not have any of the rights or privileges of a stockholder, until such Shares have been issued to the Participant or his or her nominee following exercise of the Participant’s rights under the Plan. No adjustments shall be made for dividends (ordinary or extraordinary, whether in cash securities, or other property) or distribution or other rights for which the record date occurs prior to the date of such issuance, except as otherwise expressly provided herein or as determined by the Administrator.
12.3 Interest. No interest shall accrue on the payroll deductions or contributions of a Participant under the Plan.
12.4 Designation of Beneficiary.
(a) A Participant may, in the manner determined by the Administrator, file a written designation of a beneficiary who is to receive any Shares and/or cash, if any, from the Participant’s account under the Plan in the event of such Participant’s death subsequent to a Purchase Date on which the Participant’s rights are exercised but prior to delivery to such Participant of such Shares and cash. In addition, a Participant may file a written designation of a beneficiary who is to receive any cash from the Participant’s account under the Plan in the event of such Participant’s death prior to exercise of the Participant’s rights under the Plan. If the Participant is married and resides in a community property state, a designation of a person other than the Participant’s spouse as his or her beneficiary shall not be effective without the prior written consent of the Participant’s spouse.
(b) Such designation of beneficiary may be changed by the Participant at any time by written notice to the Company. In the event of the death of a Participant and in the absence of a beneficiary validly designated under the Plan who is living at the time of such Participant’s death, the Company shall deliver such Shares and/or cash to the executor or administrator of the estate of the Participant, or if no such executor or administrator has been appointed (to the knowledge of the Company), the Company, in its discretion, may deliver such Shares and/or cash to the spouse or to any one or more dependents or relatives of the Participant, or if no spouse, dependent or relative is known to the Company, then to such other person as the Company may designate.
12.5 Notices. All notices or other communications by a Participant to the Company under or in connection with the Plan shall be deemed to have been duly given when received in the form specified by the Company at the location, or by the person, designated by the Company for the receipt thereof.
12.6 Equal Rights and Privileges. Subject to Section 5.7, all Eligible Employees will have equal rights and privileges under the Section 423 Component so that the Section 423 Component of this Plan qualifies as an “employee stock purchase plan” within the meaning of Section 423 of the Code. Subject to Section 5.7, any provision of the Section 423 Component that is inconsistent with Section 423 of the Code will, without further act or amendment by the Company, the Board or the Administrator, be reformed to comply with the equal rights and privileges requirement of Section 423 of the Code. Eligible Employees participating in the Non-Section 423 Component need not have the same rights and privileges as other Eligible Employees participating in the Non-Section 423 Component or as Eligible Employees participating in the Section 423 Component.
12.7 Use of Funds. All payroll deductions received or held by the Company under the Plan may be used by the Company for any corporate purpose, and the Company shall not be obligated to segregate such payroll deductions.
12.8 Reports. Statements of account shall be given to Participants at least annually, which statements shall set forth the amounts of payroll deductions, the Purchase Price, the number of Shares purchased and the remaining cash balance, if any.
12.9 No Employment Rights. Nothing in the Plan shall be construed to give any person (including any Eligible Employee or Participant) the right to remain in the employ of the Company or any Parent or Subsidiary or affect the right of the Company or any Parent or Subsidiary to terminate the employment of any person (including any Eligible Employee or Participant) at any time, with or without cause.
12.10 Notice of Disposition of Shares. Each Participant shall give prompt notice to the Company of any disposition or other transfer of any Shares purchased upon exercise of a right under the Section 423 Component of the Plan if such disposition or transfer is made: (a) within two (2) years from the Enrollment Date of the Offering Period in which the Shares were purchased or (b) within one (1) year after the Purchase Date on which such Shares were purchased. Such notice shall specify the date of such disposition or other transfer and the amount realized, in cash, other property, assumption of indebtedness or other consideration, by the Participant in such disposition or other transfer.
12.11 Governing Law. The Plan and any agreements hereunder shall be administered, interpreted and enforced in accordance with the laws of the State of Delaware, disregarding any state’s choice of law principles requiring the application of a jurisdiction’s laws other than the State of Delaware.
12.12 Electronic Forms. To the extent permitted by Applicable Law and in the discretion of the Administrator, an Eligible Employee may submit any form or notice as set forth herein by means of an electronic form approved by the Administrator. Before the commencement of an Offering Period, the Administrator shall prescribe the time limits within which any such electronic form shall be submitted to the Administrator with respect to such Offering Period in order to be a valid election.
* * * * *
VOYAGER TECHNOLOGIES, INC.
NON-EMPLOYEE DIRECTOR COMPENSATION POLICY
Non-employee members of the board of directors (the “Board”) of Voyager Technologies, Inc. (the “Company”) shall be eligible to receive cash and equity compensation as set forth in this Non-Employee Director Compensation Policy (this “Policy”). The cash and equity compensation described in this Policy shall be paid or be made, as applicable, automatically and without further action of the Board, to each member of the Board who is not an employee of the Company or any parent or subsidiary of the Company (each, a “Non-Employee Director”) who may be eligible to receive such cash or equity compensation, unless such Non-Employee Director declines the receipt of such cash or equity compensation by written notice to the Company. This Policy shall become effective after the effectiveness of the Company’s initial public offering (the “IPO”) and shall remain in effect until it is revised or rescinded by further action of the Board. This Policy may be amended, modified or terminated by the Board at any time in its sole discretion and if such IPO does not occur on or prior to December 31, 2025, this Policy shall be void ab initio. The terms and conditions of this Policy shall supersede any prior cash and/or equity compensation arrangements for service as a member of the Board between the Company and any of its Non-Employee Directors and between any subsidiary of the Company and any of its Non-Employee Directors.
1. Cash Compensation.
(a)Annual Retainers. Each Non-Employee Director shall receive an annual retainer of $100,000 for service on the Board.
(b)Additional Annual Retainers. In addition, a Non-Employee Director shall receive the following annual retainers:
(i)Lead Independent Director. A Non-Employee Director serving as Lead Independent Director of the Board shall receive an additional annual retainer of $25,000 for such service.
(ii)Audit Committee. A Non-Employee Director serving as Chairperson of the Audit Committee shall receive an additional annual retainer of $25,000 for such service. A Non-Employee Director serving as a member of the Audit Committee (other than the Chairperson) shall receive an additional annual retainer of $10,000 for such service.
(iii)Compensation Committee. A Non-Employee Director serving as Chairperson of the Compensation Committee shall receive an additional annual retainer of $15,000 for such service. A Non-Employee Director serving as a member of the Compensation Committee (other than the Chairperson) shall receive an additional annual retainer of $10,000 for such service.
(iv)Nominating and Corporate Governance Committee. A Non-Employee Director serving as Chairperson of the Nominating and Corporate Governance Committee shall receive an additional annual retainer of $15,000 for such service. A Non-
Employee Director serving as a member of the Nominating and Corporate Governance Committee (other than the Chairperson) shall receive an additional annual retainer of $10,000 for such service.
(c)Payment of Retainers. The annual retainers described in Sections 1(a) and 1(b) shall be earned on a quarterly basis based on a calendar quarter and shall be paid by the Company in arrears not later than the fifteenth day following the end of each calendar quarter. In the event a Non-Employee Director does not serve as a Non-Employee Director, or in the applicable positions described in Section 1(b), for an entire calendar quarter, such Non-Employee Director shall receive a prorated portion of the retainer(s) otherwise payable to such Non-Employee Director for such calendar quarter pursuant to Sections 1(a) and 1(b), with such prorated portion determined by multiplying such otherwise payable retainer(s) by a fraction, the numerator of which is the number of days during which the Non-Employee Director serves as a Non-Employee Director or in the applicable positions described in Section 1(b) during the applicable calendar quarter and the denominator of which is the number of days in the applicable calendar quarter.
2. Equity Compensation. Non-Employee Directors shall be granted the equity awards described below. The awards described below shall be granted under and shall be subject to the terms and provisions of the Company’s 2025 Incentive Award Plan or any other applicable Company equity incentive plan then-maintained by the Company (such plan, as may be amended from time to time, the “Equity Plan”) and shall be granted subject to the execution and delivery of award agreements, including attached exhibits, in substantially the forms previously approved by the Board. All applicable terms of the Equity Plan apply to this Policy as if fully set forth herein, and all equity grants hereunder are subject in all respects to the terms of the Equity Plan.
(a)IPO Awards. Each Non-Employee Director who (i) serves on the Board as of the date the IPO price of the shares of the Company’s common stock is established in connection with the Company’s IPO (the “Pricing Date”) and (ii) will continue to serve as a Non-Employee Director immediately following the Pricing Date shall be automatically granted, effective immediately following the effectiveness of the applicable Form S-8 registration statement, an award of 7,500 shares of restricted stock with respect to the Company’s Class A common stock (that is subject to adjustment as provided in the Equity Plan in each case).
(b)Annual Awards. Each Non-Employee Director who (i) serves on the Board as of the date of any annual meeting of the Company’s stockholders (an “Annual Meeting”) after the Pricing Date and (ii) will continue to serve as a Non-Employee Director immediately following such Annual Meeting shall be automatically granted, on the date of such Annual Meeting, an award of restricted stock units with respect to the Company’s Class A common stock that has an aggregate fair value on the date of such Annual Meeting of $155,000 (as determined in accordance with FASB Accounting Codification Topic 718 (“ASC 718”) and with the number of shares of common stock underlying such award subject to adjustment as provided in the Equity Plan). The awards described in this Section 2(b) shall be referred to as the “Annual Awards.” For the avoidance of doubt, a Non-Employee Director elected for the first time to the Board at an Annual Meeting shall receive only an Annual Award in connection with
such election, and shall not receive any Initial Award on the date of such Annual Meeting as well.
(c)Initial Awards. Except as otherwise determined by the Board, each Non-Employee Director who is initially elected or appointed to the Board after the Pricing Date on any date other than the date of an Annual Meeting shall be automatically granted, on the date of such Non-Employee Director’s initial election or appointment (such Non-Employee Director’s “Start Date”), an award of restricted stock units with respect to the Company’s Class A common stock that has an aggregate fair value on such Non-Employee Director’s Start Date equal to the product of (i) $155,000 (as determined in accordance with ASC 718) and (ii) a fraction, the numerator of which is (x) 365 minus (y) the number of days in the period beginning on the date of the Annual Meeting immediately preceding such Non-Employee Director’s Start Date (or, if no such Annual Meeting has occurred, the effective date of the Company’s IPO) and ending on such Non-Employee Director’s Start Date and the denominator of which is 365 (with the number of shares of common stock underlying each such award subject to adjustment as provided in the Equity Plan). The awards described in this Section 2(c) shall be referred to as “Initial Awards.” For the avoidance of doubt, no Non-Employee Director shall be granted more than one Initial Award.
(d)Termination of Employment of Employee Directors. Members of the Board who are employees of the Company or any parent or subsidiary of the Company who subsequently terminate their employment with the Company and any parent or subsidiary of the Company and remain on the Board will not receive an Initial Award pursuant to Section 2(c) above, but to the extent that they are otherwise eligible will be eligible to receive, after termination from employment with the Company and any parent or subsidiary of the Company, Annual Awards as described in Section 2(b) above.
(e)Vesting of Awards Granted to Non-Employee Directors. Each IPO Award shall vest and become exercisable in three equal installments on each of the third, fourth and fifth anniversaries of the date of grant, subject to the Non-Employee Director continuing in service on the Board through the applicable vesting date, and each Annual Award and Initial Award shall vest and become exercisable on the earlier of (i) the day immediately preceding the date of the first Annual Meeting following the date of grant and (ii) the first anniversary of the date of grant, subject to the Non-Employee Director continuing in service on the Board through the applicable vesting date. No portion of an IPO Award, Annual Award or Initial Award that is unvested or unexercisable at the time of a Non-Employee Director’s termination of service on the Board shall become vested and exercisable thereafter. All of a Non-Employee Director’s IPO Awards, Annual Awards and Initial Awards shall vest in full immediately prior to the occurrence of a Change in Control (as defined in the Equity Plan), to the extent outstanding at such time.
* * * * *
INDEMNIFICATION AND ADVANCEMENT AGREEMENT
This Indemnification and Advancement Agreement (“Agreement”) is made as of June [Date], 2025 by and between Voyager Technologies, Inc., a Delaware corporation (the “Company”), and [Board Member/Officer], a member of the Board of Directors or an officer of the Company (“Indemnitee”). This Agreement supersedes and replaces any and all previous agreements between the Company and Indemnitee covering indemnification and advancement of expenses.
RECITALS
WHEREAS, the Board of Directors of the Company (the “Board”) believes that highly competent persons have become more reluctant to serve publicly-held corporations as directors, officers, or in other capacities unless they are provided with adequate protection through insurance or adequate indemnification and advancement of expenses against inordinate risks of claims and actions against them arising out of their service to and activities on behalf of the corporation;
WHEREAS, the Board has determined that, in order to attract and retain qualified individuals, the Company will attempt to maintain on an ongoing basis, at its sole expense, liability insurance to protect persons serving the Company and its subsidiaries from certain liabilities. Although the furnishing of such insurance has been a customary and widespread practice among United States-based corporations and other business enterprises, the Company believes that, given current market conditions and trends, such insurance may be available to it in the future only at higher premiums and with more exclusions. At the same time, directors, officers, and other persons in service to corporations or business enterprises are being increasingly subjected to expensive and time-consuming litigation relating to, among other things, matters that traditionally would have been brought only against the Company or business enterprise itself. The Company’s Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”) and Amended and Restated Bylaws (the “Bylaws”) require indemnification of the officers and directors of the Company. Indemnitee may also be entitled to indemnification pursuant to the General Corporation Law of the State of Delaware (the “DGCL”). The Bylaws, the Certificate of Incorporation, and the DGCL expressly provide that the indemnification provisions set forth therein are not exclusive, and thereby contemplate that contracts may be entered into between the Company and its directors, officers, and other persons with respect to indemnification and advancement of expenses;
WHEREAS, the uncertainties relating to such insurance, to indemnification, and to advancement of expenses may increase the difficulty of attracting and retaining such persons;
WHEREAS, the Board has determined that the increased difficulty in attracting and retaining such persons is detrimental to the best interests of the Company and its stockholders and that the Company should act to assure such persons that there will be increased certainty of such protection in the future;
WHEREAS, it is reasonable, prudent and necessary for the Company contractually to obligate itself to indemnify, and to advance expenses on behalf of, such persons to the fullest extent
permitted by applicable law so that they will serve or continue to serve the Company free from undue concern that they will not be so indemnified;
WHEREAS, this Agreement is a supplement to, and in furtherance of, the Bylaws, the Certificate of Incorporation and any resolutions adopted pursuant thereto, as well as any rights of Indemnitee under any directors’ and officers’ liability insurance policy, and is not a substitute therefor, and does not diminish or abrogate any rights of Indemnitee thereunder; and
WHEREAS, Indemnitee does not regard the protection available under the Bylaws, the Certificate of Incorporation, and available insurance as adequate in the present circumstances, and may not be willing to serve or continue to serve as a/an officer/director without adequate additional protection, and the Company desires Indemnitee to serve or continue to serve in such capacity. Indemnitee is willing to serve, continue to serve and to take on additional service for or on behalf of the Company on the condition that Indemnitee be so indemnified and be advanced expenses.
NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as follows:
Section 1. Services to the Company. Indemnitee agrees to [serve/continue to serve] as a/an director/officer of the Company. Indemnitee may at any time and for any reason resign from such position (subject to any other contractual obligation or any obligation imposed by operation of law). This Agreement does not create any obligation on the Company to continue Indemnitee in such position and is not an employment contract between the Company (or any of its subsidiaries or any Enterprise (as defined below)) and Indemnitee.
Section 2. Definitions. As used in this Agreement:
(a) “Agent” means any person who is authorized by the Company or an Enterprise to act for or represent the interests of the Company or an Enterprise, respectively.
(b) “Beneficial Owner” has the meaning given to such term in Rule 13d-3 under the Exchange Act; provided, however, that Beneficial Owner excludes any Person otherwise becoming a Beneficial Owner by reason of the stockholders of the Company approving a merger of the Company with another entity.
(c) “Change in Control” means the occurrence after the date of this Agreement of any of the following events:
i. Acquisition of Stock by Third Party. Any Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company representing fifteen percent (15%) or more of the combined voting power of the Company’s then outstanding securities unless the change in relative beneficial ownership of the Company’s securities by any Person results solely from a reduction in the aggregate number of outstanding shares of securities entitled to vote generally in the election of directors;
ii. Change in Board of Directors. During any period of two (2) consecutive years (not including any period prior to the execution of this Agreement), individuals
who at the beginning of such period constitute the Board, and any new director (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in Sections 2(c)(i), 2(c)(iii) or 2(c)(iv) of this Agreement) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute at least a majority of the members of the Board;
iii. Corporate Transactions. The effective date of a merger or consolidation of the Company with any other entity, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than fifty percent (50%) of the combined voting power of the voting securities of the surviving entity outstanding immediately after such merger or consolidation and with the power to elect at least a majority of the board of directors or other governing body of such surviving entity;
iv. Liquidation. The approval by the stockholders of the Company of a complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets; and
v. Other Events. There occurs any other event of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or a response to any similar item on any similar schedule or form) promulgated under the Exchange Act (as defined below), whether or not the Company is then subject to such reporting requirement.
(d) “Corporate Status” describes the status of a person who is or was acting as a director, officer, employee, or Agent of the Company or an Enterprise.
(e) “Disinterested Director” means a director of the Company who is not and was not a party to the Proceeding in respect of which indemnification is sought by Indemnitee.
(f) “Enterprise” means any other corporation, limited liability company, partnership, joint venture, trust, employee benefit plan or other entity for which Indemnitee is or was serving at the request of the Company as a director, officer, employee, or Agent.
(g) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.
(h) “Expenses” includes all reasonable attorneys’ fees, retainers, court costs, transcript costs, fees and other costs of experts and other professionals, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, any federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement, excise taxes and penalties under the Employee Retirement Income Security Act of 1974, as amended, and all other disbursements, obligations, or expenses of the types customarily incurred in connection with preparing for or participating in a Proceeding. Expenses also include (i) Expenses incurred in connection with any
appeal resulting from any Proceeding, including without limitation the premium, security for, and other costs relating to any cost bond, supersedeas bond, or other appeal bond or its equivalent, and (ii) for purposes of Section 14(d) of this Agreement only, Expenses incurred by Indemnitee in connection with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement, by litigation or otherwise. The parties agree that for the purposes of any advancement of Expenses for which Indemnitee has made written demand to the Company in accordance with this Agreement, all Expenses included in such demand that are certified by affidavit of Indemnitee’s counsel as being reasonable in the good faith judgment of such counsel will be presumed conclusively to be reasonable. Expenses, however, do not include amounts paid in settlement by Indemnitee or the amount of judgments or fines against Indemnitee.
(i) “Independent Counsel” means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither presently is, nor in the five years prior to its selection or appointment has been, retained to represent: (i) the Company or Indemnitee in any matter material to either such party (other than with respect to matters concerning the Indemnitee under this Agreement, or of other indemnitees under similar indemnification agreements) or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term “Independent Counsel” does not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement. The Company agrees to pay the reasonable fees and expenses of the Independent Counsel.
(j) “Person” has the meaning as set forth in Sections 13(d) and 14(d) of the Exchange Act; provided, however, that Person excludes (i) the Company, (ii) any trustee or other fiduciary holding securities under an employee benefit plan of the Company, and (iii) any entity owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company.
(k) “Potential Change in Control” means the occurrence of any of the following events: (i) the Company enters into any written or oral agreement, undertaking or arrangement, the consummation of which would result in the occurrence of a Change in Control; (ii) any Person or the Company publicly announces an intention to take or consider taking actions which if consummated would constitute a Change in Control; (iii) any Person who becomes the Beneficial Owner, directly or indirectly, of securities of the Company representing 5% or more of the combined voting power of the Company’s then outstanding securities entitled to vote generally in the election of directors increases his beneficial ownership of such securities by 5% or more over the percentage so owned by such Person on the date hereof; or (iv) the Board adopts a resolution to the effect that, for purposes of this Agreement, a Potential Change in Control has occurred.
(l) “Proceeding” includes any threatened, pending or completed action, suit, claim, counterclaim, cross claim, arbitration, mediation, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing, or any other actual, threatened or completed proceeding, whether brought in the right of the Company or otherwise and whether of a civil, criminal, administrative, legislative, regulatory, or investigative (formal or informal) nature, including any appeal therefrom, in which Indemnitee was, is, or will be involved as a party,
potential party, non-party witness, or otherwise by reason of Indemnitee’s Corporate Status or by reason of any action taken by Indemnitee (or a failure to take action by Indemnitee) or of any action (or failure to act) on Indemnitee’s part while acting pursuant to Indemnitee’s Corporate Status, in each case whether or not serving in such capacity at the time any liability or Expense is incurred for which indemnification, reimbursement, or advancement of Expenses can be provided under this Agreement. A Proceeding also includes a situation the Indemnitee believes in good faith may lead to, or culminate in, the institution of a Proceeding.
Section 3. Indemnity in Third-Party Proceedings. Subject to Section 9 and Section 12 of this Agreement, the Company will indemnify Indemnitee in accordance with the provisions of this Section 3 if Indemnitee is, or is threatened to be made, a party to or a participant in any Proceeding, other than a Proceeding by or in the right of the Company to procure a judgment in its favor. Pursuant to this Section 3, the Company will indemnify Indemnitee to the fullest extent permitted by applicable law against all Expenses, judgments, fines and amounts paid in settlement (including all interest, assessments and other charges paid or payable in connection with, or in respect of, such Expenses, judgments, fines and amounts paid in settlement) actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with such Proceeding or any claim, issue, or matter therein, if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company and, in the case of a criminal Proceeding, had no reasonable cause to believe that Indemnitee’s conduct was unlawful.
Section 4. Indemnity in Proceedings by or in the Right of the Company. Subject to Section 9 and Section 12 of this Agreement, the Company will indemnify Indemnitee in accordance with the provisions of this Section 4 if Indemnitee is, or is threatened to be made, a party to or a participant in any Proceeding by or in the right of the Company to procure a judgment in its favor. Pursuant to this Section 4, the Company will indemnify Indemnitee to the fullest extent permitted by applicable law against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in, or not opposed to, the best interests of the Company. The Company will not indemnify Indemnitee for Expenses under this Section 4 related to any claim, issue, or matter in a Proceeding for which Indemnitee has been finally adjudged by a court to be liable to the Company, unless, and only to the extent that, the Court of Chancery of the State of Delaware (the “Delaware Court”) or any court in which the Proceeding was brought determines upon application by Indemnitee that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnification.
Section 5. Indemnification for Expenses of a Party Who is Wholly or Partly Successful. Notwithstanding any other provisions of this Agreement, to the fullest extent permitted by applicable law, the Company will indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee in connection with any Proceeding to the extent that Indemnitee is successful, on the merits or otherwise. If Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues, or matters in such Proceeding, the Company will indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection
with or related to each successfully resolved claim, issue or matter to the fullest extent permitted by law. For purposes of this Section 5 and without limitation, the termination of any claim, issue, or matter in such a Proceeding by dismissal, with or without prejudice, will be deemed to be a successful result as to such claim, issue, or matter.
Section 6. Indemnification for Expenses of a Witness. Notwithstanding any other provisions of this Agreement, to the fullest extent permitted by applicable law, the Company will indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with any Proceeding to which Indemnitee is not a party but to which Indemnitee is a witness, deponent, interviewee, or otherwise asked to participate or provide information.
Section 7. Partial Indemnification. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of Expenses, but not, however, for the total amount thereof, the Company will indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.
Section 8. Additional Indemnification. Notwithstanding any limitation in Sections 3, 4, or 5 of this Agreement, the Company will indemnify Indemnitee to the fullest extent permitted by applicable law (including but not limited to, the DGCL and any amendments to or replacements of the DGCL adopted after the date of this Agreement that expand the Company’s ability to indemnify its officers, directors, employees or Agents) if Indemnitee is a party to, or threatened to be made a party to, any Proceeding (including a Proceeding by or in the right of the Company to procure a judgment in its favor).
Section 9. Exclusions. Notwithstanding any provision in this Agreement, the Company is not obligated under this Agreement to indemnify Indemnitee for:
(a) any amount actually paid to or on behalf of Indemnitee under any insurance policy or other indemnity provision, except to the extent provided in Section 15(b) of this Agreement and except with respect to any excess beyond the amount paid under any insurance policy or other indemnity provision;
(b) an accounting of profits made from the purchase and sale (or sale and purchase) by Indemnitee of securities of the Company within the meaning of Section 16(b) of the Exchange Act or similar provisions of state statutory law or common law;
(c) reimbursement of the Company by the Indemnitee of any bonus or other incentive-based or equity-based compensation or of any profits realized by the Indemnitee from the sale of securities of the Company, as required in each case under the Exchange Act (including any such reimbursements that arise from an accounting restatement of the Company pursuant to Section 304 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), or the payment to the Company of profits arising from the purchase and sale by Indemnitee of securities in violation of Section 306 of the Sarbanes-Oxley Act);
(d) reimbursement of the Company by Indemnitee of any compensation pursuant to any compensation recoupment or clawback policy adopted by the Board or the
compensation committee of the Board, including but not limited to any such policy adopted to comply with stock exchange listing requirements implementing Section 10D of the Exchange Act; or
(e) any Proceeding initiated by Indemnitee, including any Proceeding (or any part of any Proceeding) initiated by Indemnitee against the Company or its directors, officers, employees or other indemnitees, unless (i) the Proceeding or part of any Proceeding is to enforce Indemnitee’s rights to indemnification or advancement, of Expenses under this Agreement, including a Proceeding (or any part of any Proceeding) initiated pursuant to Section 14 of this Agreement, (ii) the Board authorized the Proceeding (or any part of any Proceeding) prior to its initiation or (iii) the Company provides the indemnification, in its sole discretion, pursuant to the powers vested in the Company under applicable law.
Section 10. Advances of Expenses.
(a) The Company will advance, to the extent not prohibited by law, the Expenses incurred by Indemnitee in connection with:
i. any Proceeding (or any part of any Proceeding) not initiated by Indemnitee; or
ii. any Proceeding (or any part of any Proceeding) initiated by Indemnitee if
1 the Proceeding or part of any Proceeding is to enforce Indemnitee’s rights to obtain indemnification or advancement of Expenses under this Agreement, including a proceeding initiated pursuant to Section 14 of this Agreement, or
2 the Board authorized the Proceeding (or any part of any Proceeding) prior to its initiation.
(b) The Company will advance the Expenses within thirty (30) days after the receipt by the Company of a statement or statements requesting such advances from time to time, whether prior to or after final disposition of any Proceeding eligible for advancement of expenses.
(c) Advances will be unsecured and interest free. Indemnitee hereby undertakes to repay any amounts so advanced (without interest) to the extent that it is ultimately determined that Indemnitee is not entitled to be indemnified by the Company, thus Indemnitee qualifies for advances upon the execution of this Agreement and delivery to the Company. No other form of undertaking is required other than the execution of this Agreement. The Company will make advances without regard to Indemnitee’s ability to repay the Expenses and without regard to Indemnitee’s ultimate entitlement to indemnification under the other provisions of this Agreement.
Section 11. Procedure for Notification of Claim for Indemnification or Advancement.
(a) Indemnitee will notify the Company in writing of any Proceeding with respect to which Indemnitee intends to seek indemnification or advancement of Expenses hereunder as soon as reasonably practicable following the receipt by Indemnitee of written notice thereof. Indemnitee will include in the written notification to the Company a description of the nature of the Proceeding and the facts underlying the Proceeding and provide such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification following the final disposition of such Proceeding. Indemnitee’s failure to notify the Company will not relieve the Company from any obligation it may have to Indemnitee under this Agreement, and any delay in so notifying the Company will not constitute a waiver by Indemnitee of any rights under this Agreement. The Secretary of the Company will, promptly upon receipt of such a request for indemnification or advancement, advise the Board in writing that Indemnitee has requested indemnification or advancement.
(b) The Company will be entitled to participate in the Proceeding at its own expense.
Section 12. Procedure Upon Application for Indemnification.
(a) Unless a Change in Control has occurred, the determination of Indemnitee’s entitlement to indemnification will be made:
i. by a majority vote of the Disinterested Directors, even though less than a quorum of the Board;
ii. by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum of the Board;
iii. if there are no such Disinterested Directors or, if such Disinterested Directors so direct, by written opinion provided by Independent Counsel selected by the Board; or
iv. if so directed by the Board, by the stockholders of the Company.
(b) If a Change in Control has occurred, the determination of Indemnitee’s entitlement to indemnification will be made by written opinion provided by Independent Counsel selected by Indemnitee (unless Indemnitee requests such selection be made by the Board).
(c) The party selecting Independent Counsel pursuant to subsection (a)(iii) or (b) of this Section 12 will provide written notice of the selection to the other party. The notified party may, within ten (10) days after receiving written notice of the selection of Independent Counsel, deliver to the selecting party a written objection to such selection; provided, however, that such objection may be asserted only on the ground that the Independent Counsel so selected does not meet the requirements of “Independent Counsel” as defined in Section 2 of this Agreement, and the objection will set forth with particularity the factual basis of such assertion. Absent a proper and timely objection, the person so selected will act as Independent Counsel. If such written objection is so made and substantiated, the Independent Counsel so selected may not serve as Independent Counsel unless and until such objection is withdrawn or the Delaware Court
has determined that such objection is without merit. If, within thirty (30) days after the later of submission by Indemnitee of a written request for indemnification pursuant to Section 11(a) of this Agreement and the final disposition of the Proceeding, Independent Counsel has not been selected or, if selected, any objection to such selection has not been resolved, either the Company or Indemnitee may petition the Delaware Court for resolution of any objection made by the Company or Indemnitee to the other’s selection of Independent Counsel and/or for the appointment as Independent Counsel of a person selected by such court or by such other person as such court designates. Upon the due commencement of any judicial proceeding pursuant to Section 14(a) of this Agreement, Independent Counsel will be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing).
(d) Indemnitee will cooperate with the person, persons or entity making the determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons, or entity upon reasonable advance request any documentation or information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and reasonably necessary to such determination. The Company will advance and pay any Expenses incurred by Indemnitee in so cooperating with the person, persons or entity making the indemnification determination irrespective of the determination as to Indemnitee’s entitlement to indemnification and the Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom. The Company promptly will advise Indemnitee in writing of the determination that Indemnitee is or is not entitled to indemnification, including a description of any reason or basis for which indemnification has been denied and providing a copy of any written opinion provided to the Board by Independent Counsel.
(e) If it is determined that Indemnitee is entitled to indemnification, the Company will make payment to Indemnitee within thirty (30) days after such determination.
Section 13. Presumptions and Effect of Certain Proceedings.
(a) In making a determination with respect to entitlement to indemnification under this Agreement, the person, persons, or entity making such determination will, to the fullest extent not prohibited by law, presume Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 11(a) of this Agreement, and the Company will, to the fullest extent not prohibited by law, have the burden of proof to overcome that presumption. Neither the failure of the Company (including by its directors or Independent Counsel) to have made a determination prior to the commencement of any action pursuant to this Agreement that indemnification is proper under the circumstances because Indemnitee has met the applicable standard of conduct, nor an actual determination by the Company (including by its directors or Independent Counsel) that Indemnitee has not met such applicable standard of conduct, will be a defense to the action or create a presumption that Indemnitee has not met the applicable standard of conduct.
(b) If the determination of the Indemnitee’s entitlement to indemnification has not been made pursuant to Section 12 of this Agreement within sixty (60) days after the later of (i) receipt by the Company of Indemnitee’s request for indemnification pursuant to Section 11(a) of this Agreement and (ii) the final disposition of the Proceeding for which Indemnitee requested
Indemnification (the “Determination Period”), the requisite determination of entitlement to indemnification will, to the fullest extent not prohibited by law, be deemed to have been made and Indemnitee will be entitled to such indemnification absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification or (ii) a prohibition of such indemnification under applicable law. The Determination Period may be extended for a reasonable time, not to exceed an additional thirty (30) days, if the person, persons or entity making the determination with respect to entitlement to indemnification in good faith requires such additional time for the obtaining or evaluating of documentation and/or information relating thereto; and provided, further, the Determination Period will not apply (i) if the determination of entitlement to indemnification is to be made by the stockholders pursuant to Section 12(a)(iv) of this Agreement and if (A) within fifteen (15) days after receipt by the Company of the request for such determination the Board has resolved to submit such determination to the stockholders for their consideration at an annual meeting thereof to be held within seventy-five (75) days after such receipt and such determination is made thereat, or (B) a special meeting of stockholders is called within fifteen (15) days after such receipt for the purpose of making such determination, such meeting is held for such purpose within sixty (60) days after having been so called and such determination is made thereat, or (ii) if the determination of entitlement to indemnification is to be made by Independent Counsel.
(c) The termination of any Proceeding or of any claim, issue, or matter therein by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, will not (except as otherwise expressly provided in this Agreement) of itself adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in or not opposed to the best interests of the Company or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to believe that Indemnitee’s conduct was unlawful.
(d) For purposes of any determination of good faith, Indemnitee will be deemed to have acted in good faith if Indemnitee acted based on (i) the records or books of account of the Company, its subsidiaries, or an Enterprise, including financial statements, (ii) information supplied to Indemnitee by the directors or officers of the Company, its subsidiaries, or an Enterprise in the course of their duties, (iii) the advice of legal counsel for the Company, its subsidiaries, or an Enterprise or (iv) information or records given or reports made to the Company or an Enterprise by an independent certified public accountant or by an appraiser, financial advisor or other expert selected with reasonable care by or on behalf of the Company, its subsidiaries, or an Enterprise. Further, Indemnitee will be deemed to have acted in a manner “not opposed to the best interests of the Company,” as referred to in this Agreement if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the best interests of the participants and beneficiaries of an employee benefit plan. The provisions of this Section 13(d) are not exclusive and do not limit in any way the other circumstances in which the Indemnitee may be deemed to have met the applicable standard of conduct set forth in this Agreement.
(e) The knowledge and/or actions, or failure to act, of any other person affiliated with the Company or an Enterprise (including, but not limited to, a director, officer,
trustee, partner, managing member, Agent or employee) may not be imputed to Indemnitee for purposes of determining Indemnitee’s right to indemnification under this Agreement.
Section 14. Remedies of Indemnitee.
(a) Indemnitee may commence litigation against the Company in the Delaware Court to obtain indemnification or advancement of Expenses provided by this Agreement in the event that (i) a determination is made pursuant to Section 12 of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) the Company does not advance Expenses pursuant to Section 10 of this Agreement, (iii) the determination of entitlement to indemnification is not made pursuant to Section 12 of this Agreement within the Determination Period, (iv) the Company does not indemnify Indemnitee pursuant to Section 5 or 6 or the second to last sentence of Section 12(d) of this Agreement within thirty (30) days after receipt by the Company of a written request therefor, (v) the Company does not indemnify Indemnitee pursuant to Section 3, 4, 7, or 8 of this Agreement within thirty (30) days after a determination has been made that Indemnitee is entitled to indemnification, or (vi) in the event that the Company or any other person takes or threatens to take any action to declare this Agreement void or unenforceable, or institutes any litigation or other action or Proceeding designed to deny, or to recover from, the Indemnitee the benefits provided or intended to be provided to the Indemnitee hereunder. Indemnitee must commence such Proceeding seeking an adjudication within one hundred and eighty (180) days following the date on which Indemnitee first has the right to commence such Proceeding pursuant to this Section 14(a); provided, however, that the foregoing clause does not apply in respect of a Proceeding brought by Indemnitee to enforce Indemnitee’s rights under Section 5 of this Agreement. The Company will not oppose Indemnitee’s right to seek any such adjudication.
(b) If a determination is made pursuant to Section 12 of this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding commenced pursuant to this Section 14 will be conducted in all respects as a de novo trial on the merits and Indemnitee may not be prejudiced by reason of that adverse determination. In any judicial proceeding commenced pursuant to this Section 14, the Company will have the burden of proving Indemnitee is not entitled to indemnification or advancement of Expenses, as the case may be, and will not introduce evidence of the determination made pursuant to Section 12 of this Agreement.
(c) If a determination is made pursuant to Section 12 of this Agreement that Indemnitee is entitled to indemnification, the Company will be bound by such determination in any judicial proceeding commenced pursuant to this Section 14 unless (i) Indemnitee made a misstatement of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with Indemnitee’s request for indemnification, or (ii) the Company is prohibited from indemnifying Indemnitee under applicable law.
(d) The Company is, to the fullest extent not prohibited by law, precluded from asserting in any judicial proceeding commenced pursuant to this Section 14 that the procedures and presumptions of this Agreement are not valid, binding, or enforceable and will stipulate in any such court that the Company is bound by all the provisions of this Agreement.
(e) It is the intent of the Company that, to the fullest extent permitted by law, the Indemnitee not be required to incur legal fees or other Expenses associated with the interpretation, enforcement, or defense of Indemnitee’s rights under this Agreement, by litigation or otherwise, because the cost and expense thereof would substantially detract from the benefits intended to be extended to the Indemnitee under this Agreement. The Company, to the fullest extent permitted by law, will (within thirty (30) days after receipt by the Company of a written request therefor) advance to Indemnitee such Expenses which are incurred by Indemnitee in connection with a Proceeding concerning this Agreement, Indemnitee’s other rights to indemnification or advancement of Expenses from the Company, or concerning any directors’ and officers’ liability insurance policies maintained by the Company, and will indemnify Indemnitee against any and all such Expenses unless the court determines that Indemnitee’s claims in such action were made in bad faith or frivolous, or that the Company is prohibited by law from indemnifying Indemnitee for such Expenses.
Section 15. Non-exclusivity; Survival of Rights; Insurance; Subrogation.
(a) The indemnification and advancement of Expenses provided by this Agreement are not exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Certificate of Incorporation, the Bylaws, any agreement, a vote of stockholders, a resolution of the Board, or otherwise. The indemnification and advancement of Expenses provided by this Agreement may not be limited or restricted by any amendment, alteration or repeal of this Agreement in any way with respect to any action taken or omitted by Indemnitee in Indemnitee’s Corporate Status occurring prior to any amendment, alteration or repeal of this Agreement. To the extent that a change in Delaware law, whether by statute or judicial decision, permits greater indemnification or advancement of Expenses than would be afforded currently under the Bylaws, the Certificate of Incorporation, or this Agreement, it is the intent of the parties hereto that Indemnitee enjoy by this Agreement the greater benefits so afforded by such change. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy is 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, will not prevent the concurrent assertion or employment of any other right or remedy.
(b) The Company hereby acknowledges that Indemnitee may have certain rights to indemnification, advancement of Expenses and/or insurance provided by one or more other Persons with whom or which Indemnitee may be associated. The relationship between the Company and such other Persons, other than an Enterprise, with respect to Indemnitee’s rights to indemnification, advancement of Expenses, and insurance is described by this subsection, subject to the provisions of subsection (d) of this Section 15 with respect to a Proceeding concerning Indemnitee’s Corporate Status with an Enterprise.
i. The Company hereby acknowledges and agrees:
1) the Company’s obligations to Indemnitee are primary and any obligation of any other Persons, other than an Enterprise, are secondary (i.e., the Company is the indemnitor of first resort) with respect to any request for indemnification or advancement of Expenses made pursuant to this Agreement concerning any Proceeding;
2) the Company is primarily liable for all indemnification or advancement of Expenses obligations for any Proceeding, whether created by law, the Bylaws, the Certificate of Incorporation, contract (including this Agreement) or otherwise;
3) any obligation of any other Persons with whom or which Indemnitee may be associated to indemnify Indemnitee and/or advance Expenses to Indemnitee in respect of any proceeding are secondary to the Company’s obligations; and
4) the Company will indemnify Indemnitee and advance Expenses to Indemnitee hereunder to the fullest extent provided herein without regard to any rights Indemnitee may have against any other Person with whom or which Indemnitee may be associated or an insurer of any such Person.
ii. the Company irrevocably waives, relinquishes and releases (A) any other Person with whom or which Indemnitee may be associated from any claim of contribution, subrogation, reimbursement, exoneration or indemnification, or any other recovery of any kind in respect of amounts paid by the Company to Indemnitee pursuant to this Agreement and (B) any right to participate in any claim or remedy of Indemnitee against any Person whether or not such claim, remedy or right arises in equity or under contract, statute or common law, including, without limitation, the right to take or receive from any Person, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim, remedy or right.
iii. In the event any other Person with whom or which Indemnitee may be associated or their insurers advances or extinguishes any liability or loss for Indemnitee, the payor has a right of subrogation against the Company or its insurers for all amounts so paid which would otherwise be payable by the Company or its insurers under this Agreement. In no event will payment by any other Person with whom or which Indemnitee may be associated or their insurers affect the obligations of the Company hereunder or shift primary liability for the Company’s obligation to indemnify or advance Expenses to any other Person with whom or which Indemnitee may be associated.
iv. Any indemnification or advancement of Expenses provided by any other Person with whom or which Indemnitee may be associated is specifically in excess over the Company’s obligation to indemnify and advance Expenses or any valid and collectible insurance (including but not limited to any malpractice insurance or professional errors and omissions insurance) provided by the Company.
(c) To the extent that the Company maintains an insurance policy or policies providing liability insurance for directors, officers, employees, or Agents of the Company, the
Company will obtain a policy or policies covering Indemnitee to the maximum extent of the coverage available for any such director, officer, employee or Agent under such policy or policies, including coverage in the event the Company does not or cannot, for any reason, indemnify or advance Expenses to Indemnitee as required by this Agreement. If, at the time of the receipt of a notice of a claim pursuant to this Agreement, the Company has director and officer liability insurance in effect, the Company will give prompt notice of such claim or of the commencement of a Proceeding, as the case may be, to the insurers in accordance with the procedures set forth in the respective policies. The Company will thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such Proceeding in accordance with the terms of such policies. Indemnitee agrees to assist the Company’s efforts to cause the insurers to pay such amounts and will comply with the terms of such policies, including selection of approved panel counsel, if required.
(d) The Company’s obligation to indemnify or advance Expenses hereunder to Indemnitee for any Proceeding concerning Indemnitee’s Corporate Status with an Enterprise will be reduced by any amount Indemnitee has actually received as indemnification or advancement of Expenses from such Enterprise. The Company and Indemnitee intend that any such Enterprise (and its insurers) be the indemnitor of first resort with respect to indemnification and advancement of Expenses for any Proceeding related to or arising from Indemnitee’s Corporate Status with such Enterprise. The Company’s obligation to indemnify and advance Expenses to Indemnitee is secondary to the obligations the Enterprise or its insurers owe to Indemnitee. Indemnitee agrees to take all reasonably necessary and desirable action to obtain from an Enterprise indemnification and advancement of Expenses for any Proceeding related to, or arising from, Indemnitee’s Corporate Status with such Enterprise.
(e) In the event of any payment made by the Company under this Agreement, the Company will be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee from any Enterprise or its insurance carrier. Indemnitee will execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.
Section 16. Duration of Agreement. The indemnification and advancement of Expenses rights provided by or granted pursuant to this Agreement (i) are binding upon and enforceable by the parties hereto and their respective successors and assigns (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business or assets of the Company), (ii) continue as to an Indemnitee who has ceased to be a director, officer, employee or Agent of the Company or of any other Enterprise, and (iii) inure to the benefit of Indemnitee and Indemnitee’s spouse, assigns, heirs, devisees, executors and administrators and other legal representatives.
Section 17. Severability. If any provision or provisions of this Agreement is held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) will not in any way be affected or impaired thereby and will remain enforceable to the fullest extent permitted by law; (b) such
provision or provisions will be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) will be construed so as to give effect to the intent manifested thereby.
Section 18. Interpretation. Any ambiguity in the terms of this Agreement will be resolved in favor of Indemnitee and in a manner to provide the maximum indemnification and advancement of Expenses permitted by law. The Company and Indemnitee intend that this Agreement provide to the fullest extent permitted by law for indemnification and advancement of Expenses in excess of that expressly provided, without limitation, by the Certificate of Incorporation, the Bylaws, vote of the Company’s stockholders or disinterested directors, or applicable law.
Section 19. Enforcement.
(a) The Company expressly confirms and agrees that it has entered into this Agreement and assumed the obligations imposed on it hereby in order to induce Indemnitee to serve as a director, officer, employee, or Agent of the Company, and the Company acknowledges that Indemnitee is relying upon this Agreement in serving or continuing to serve as director, officer, employee, or Agent of the Company.
(b) This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof; provided, however, that this Agreement is a supplement to and in furtherance of the Certificate of Incorporation, the Bylaws, any directors’ and officers’ insurance maintained by the Company, and applicable law, is not a substitute therefor, and does not diminish or abrogate any rights of Indemnitee thereunder.
Section 20. Modification and Waiver. No supplement, modification or amendment of this Agreement is binding unless executed in writing by the parties hereto. No waiver of any of the provisions of this Agreement will be valid unless executed in writing by the party entitled to enforce the provision to be waived and any such waiver will not be deemed to or constitute a waiver of any other provisions of this Agreement nor will any waiver constitute a continuing waiver.
Section 21. Notice by Indemnitee. Indemnitee agrees to promptly notify the Company in writing upon being served with any summons, citation, subpoena, complaint, indictment, information or other document relating to any Proceeding or matter which may be subject to indemnification or advancement of Expenses covered hereunder. The failure of Indemnitee to so notify the Company does not relieve the Company of any obligation which it may have to the Indemnitee under this Agreement or otherwise.
Section 22. Notices. All notices, requests, demands and other communications under this Agreement will be in writing and will be deemed to have been duly given if (a) delivered by hand to the other party, (b) sent by reputable overnight courier to the other party or (c) sent by electronic mail, with receipt of oral confirmation that such communication has been received:
(a) If to Indemnitee, at the address indicated on the signature page of this Agreement, or such other address as Indemnitee provides to the Company.
(b) If to the Company to:
Voyager Technologies, Inc.
1225 17th Street, Suite 1100
Denver, CO 80202
Attention: Meg Vernal
Email: meg.vernal@voyagertechnologies.com
or to any other address as may have been furnished to Indemnitee by the Company.
Section 23. Contribution. To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, will contribute to the amount incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or for Expenses, in connection with any claim relating to an indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (a) the relative benefits received by the Company and Indemnitee as a result of the event(s) and/or transaction(s) giving cause to such Proceeding; and/or (b) the relative fault of the Company (and its directors, officers, employees and Agents) and Indemnitee in connection with such event(s) and/or transaction(s).
Section 24. Applicable Law and Consent to Jurisdiction. This Agreement and the legal relations among the parties are governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflict of laws rules. The Company and Indemnitee hereby irrevocably and unconditionally (a) agree that any action, claim, or proceeding between the parties arising out of or in connection with this Agreement may be brought only in the Delaware Court and not in any other state or federal court in the United States of America or any court in any other country, (b) consent to submit to the exclusive jurisdiction of the Delaware Court for purposes of any action, claim, or proceeding arising out of or in connection with this Agreement, (c) waive any objection to the laying of venue of any such action, claim, or proceeding in the Delaware Court, and (d) waive, and agree not to plead or to make, any claim that any such action, claim, or proceeding brought in the Delaware Court has been brought in an improper or inconvenient forum.
Section 25. Identical Counterparts. This Agreement may be executed in one or more counterparts, each of which will for all purposes be deemed to be an original but all of which together constitute one and the same Agreement. Counterparts may be delivered via electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of
2000, Uniform Electronic Transactions Act, the Electronic Signatures and Records Act or other applicable law, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes. Only one such counterpart signed by the party against whom enforceability is sought needs to be produced to evidence the existence of this Agreement.
Section 26. Headings. The headings of this Agreement are inserted for convenience only and do not constitute part of this Agreement or affect the construction thereof.
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the day and year first above written.
| | | | | | | | | | | | | | | | | | | | | | | |
| VOYAGER TECHNOLOGIES, INC. | INDEMNITEE |
| | | | | | | |
| | | | | | | |
| By: | | | | |
| Name: | | Name: | |
| Office: | | Address: | |
| | | | | | | |
| | | | | | | |
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement (“Agreement”) is made by and between Voyager Space Holdings, Inc., a Delaware corporation (the “Company”), and Dylan Taylor, a Colorado resident (the “Executive”), effective as of January 1, 2022 (the “Effective Date”).
WHEREAS, the Company, following the recommendation of the Compensation Committee (the “Compensation Committee”) of the Board of Directors of the Company (the “Board”) and unanimous approval by the Board, desires to employ Executive upon the terms and conditions set forth herein, and Executive desires to accept continued employment with the Company upon such terms and conditions
NOW, THEREFORE, for and in consideration of the above recitals and the mutual promises contained herein, and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the Company and Executive agree as follows:
1. EMPLOYMENT AND DUTIES.
1.1 Position. Executive shall be employed by the Company as its Chief Executive Officer, shall be subject to direction by the Board, and shall report solely and directly to the Board. Executive agrees to observe and comply with all written company policies and rules of the Company, as adopted by the Company from time to time. At the Company’s request, Executive shall serve the Company and/or its subsidiaries and affiliates in such other capacities in addition to the foregoing as the Company shall designate, provided that such additional capacities are consistent with the Executive’s position.
1.2 Employment At-Will. Executive’s employment with the Company is “at-will” and is not for a specified period of time. Subject to the Company’s obligations under Section 4 hereof, either Executive or the Company may terminate Executive’s employment at any time and for any reason whatsoever (or for no reason). This at-will employment relationship cannot be changed except in a writing signed by Executive and an authorized representative of the Company.
1.3 Full Attention. Executive shall devote his full business time exclusively to the affairs of the Company and the discharge of his duties and responsibilities hereunder. Executive shall not, without the prior written consent of the Company, engage in any other business activity or serve in any industry, trade, professional, or academic position during the term of this Agreement. Notwithstanding any other provision of this Agreement to the contrary, Executive may continue to serve as the Chief Executive Officer of Space for Humanity, and nothing in this Agreement shall limit Executive’s ability to participate in reasonable levels of charitable, civic, trade organization, and similar activities and passive personal investment activities, provided that such activities do not, as determined by the Company in its sole and exclusive discretion, create an actual or apparent conflict of interest, violate any provision of this Agreement or any other contract between Executive and the Company, or otherwise materially interfere with the performance of Executive’s duties under this Agreement.
2. COMPENSATION. During the Executive’s employment hereunder, as compensation for all services performed by the Executive for the Company and its affiliates, the Company will provide the Executive the following compensation and benefits:
2.1 Base Salary. Executive shall receive an annualized base salary of $395,000. Executive’s base salary may be increased from time to time at the sole discretion of the Compensation Committee. Executive’s base salary shall be paid in accordance with the Company’s standard payroll practices as they may exist from time-to-time.
2.2 Bonus. Commencing with calendar year 2022, for each calendar year during Executive’s employment with the Company, Executive will be eligible to earn a cash performance bonus (an “Annual Bonus”) with a target amount equal to $1,595,000. The actual amount of any Annual Bonus shall be determined by the Compensation Committee, based on such performance goals as may be determined by the Compensation Committee in its sole discretion. The payment of any Annual Bonus, to the extent any Annual Bonus becomes payable, will be made on the date on which annual bonuses are paid generally to the Company’s senior executives, but in no event later than March 15th of the calendar year following the calendar year in which such Annual Bonus was earned, subject to the Executive’s continued employment through the payment date.
2.3 Equity-Based Awards. During Executive’s employment with the Company, Executive shall be eligible to participate in the Company’s equity-based incentive plan (currently the Company’s 2020 Incentive Plan) and the Company’s annual equity incentive program applicable to its senior executive officers. The type and amount of any award granted to Executive thereunder, and the terms and conditions of any such awards shall be determined by the Committee in its discretion. The terms and conditions of such award(s) will be set forth in separate award agreements in forms prescribed by the Company, to be entered into by the Company and the Executive.
2.4 Benefits. During Executive’s employment with the Company, Executive shall be eligible to participate in the employee benefit plans and programs maintained by the Company from time to time for its senior executive officers, subject to the terms and conditions of such plans and programs. Such benefit plans and programs may be adopted, modified or terminated by the Company from time to time in its sole discretion and may include, without limitation, medical, health and dental care, life insurance, disability protection,401(k) and retirement plans. Nothing contained in this Agreement shall create or be deemed to create any obligation on the part of the Company to adopt or maintain any health, welfare, retirement or other benefit plan or program at any time or to create any limitation on the Company’s ability to modify or terminate any such plan or program.
2.5 Expense Reimbursement. The Company shall reimburse Executive for out-of-pocket expenses reasonably incurred by Executive in the performance of his or her duties under this Agreement in accordance with the Company’s policies as in effect from time to time. Expense reimbursement shall remain subject to the Company’s policies regarding expense reimbursement as they may exist from time to time.
3. TERMINATION OF EMPLOYMENT. The Executive’s employment under this Agreement will continue until terminated pursuant to this Section 3.
3.1 In General. The Executive’s employment may be terminated by the Company or by the Executive at any time upon sixty (60) days’ prior written notice to the other party; provided, however, that the Company may elect to waive such notice period or any portion thereof, in
which case the Company will continue to pay to the Executive his base salary for that portion of the notice period so waived.
3.2 Termination by the Company for Cause. Notwithstanding the provisions of Section 3.1, the Company may terminate the Executive’s employment immediately for Cause upon written notice to the Executive setting forth in reasonable detail the nature of the Cause. For purposes of this Agreement, “Cause” means the occurrence of any of the following, as determined by the Board in its reasonable judgment: (i) the Executive’s material failure to perform (other than by reason of disability), or substantial misconduct in the performance of, the Executive’s duties and responsibilities for the Company or any of its affiliates which causes material harm to the Company; (ii) the Executive’s material and demonstrable breach of any provision of Section 5 or of any other confidentiality, invention assignment or other restrictive covenant obligation set forth in any written agreement by and between the Executive and the Company or any of its affiliates; (iii) the Executive’s material and demonstrable breach of any other provision of this Agreement or any other written agreement by and between the Executive and the Company or any of its affiliates; (iv) the Executive’s material violation of any applicable policy or code of conduct of the Company or any of its affiliates, which violation causes material reputational or financial harm to the Company; or (v) the Executive’s indictment for, or plea of nolo contendere to, any felony or any crime involving moral turpitude. Notwithstanding anything to the contrary in the foregoing, a circumstance otherwise giving rise to Cause pursuant to the foregoing clause (i), (ii), (iii) or (iv), if capable of cure, will not constitute Cause if cured by the Executive within ten (10) days following the Company’s notice to the Executive thereof; provided, however, that the Company will not be required to provide any such notice or opportunity to cure with respect to any subsequent substantially similar or related conduct.
3.3 Resignation by the Executive for Good Reason. Notwithstanding the provisions of Section 3.1, the Executive may terminate the Executive’s employment for Good Reason upon written notice to the Company. For purposes of this Agreement, Good Reason; means the occurrence of any of the following without the Executive’s consent: (i) a material reduction in Base Salary, other than an across-the-board reduction applicable to similarly situated executives of the Company; or (ii) a material diminution of Executive’s duties, authorities or responsibilities; provided, however, that no resignation for Good Reason shall be effective unless and until (A) Executive has first provided the Company with written notice specifically identifying the acts or omissions constituting the grounds for “Good Reason” within thirty days after the initial existence of the facts or circumstances constituting Good Reason, (2) the Company has not cured such acts or omissions within thirty days of its actual receipt of such notice, and (3) the effective date of Executive’s termination for Good Reason occurs no later than ninety days after the initial existence of the facts or circumstances constituting Good Reason.
3.4 Death or Disability. The Executive’s employment shall terminate automatically upon the Executive’s death. Either the Company or the Executive may terminate the Executive’s employment in the event of the Executive’s disability during his employment with the Company.
4. OTHER MATTERS RELATED TO TERMINATION
4.1 Final Compensation. In the event of termination of the Executive’s employment with the Company, howsoever occurring, the Company will pay the Executive (i) any earned but unpaid Base Salary through the date on which Executive’s employment terminates (the “Termination Date”); and (ii) reimbursement, in accordance with Section 2.5 hereof, for business expenses
incurred by the Executive but not yet paid to the Executive as of the Termination Date, provided that the Executive submits all expenses and supporting documentation required within sixty (60) days of the Termination Date and that such expenses are reimbursable under Company policies then in effect (all of the foregoing, the “Final Compensation”). The amounts set forth in the foregoing clause (i) will be paid to the Executive immediately upon termination of employment.
4.2 Severance Payments. In the event the Executive’s employment is terminated by the Company without Cause or by the Executive for Good Reason, subject to the provisions of Section 4.4 and Executive’s continued compliance with the covenants set forth in Section 5, the Company will pay the Executive, in addition to the Final Compensation, severance payments as provided in this Section 4.2. The Severance Payments will include payment in an amount equal to eighteen (18) months’ Base Salary, payable in the form of salary continuation in accordance with the ordinary payroll practices of the Company over the eighteen (18) months following the Termination Date (the “Severance Payments”).
4.3 Equity. In the event the Executive’s employment is terminated by the Company without Cause or by the Executive for Good Reason, subject to the provisions of Section 4.4 and Executive’s continued compliance with the covenants set forth in Section 5, any outstanding and unvested Company equity-based awards held by the Executive on the Termination Date that vest based solely on the passage of time shall thereupon vest and, to the extent applicable, become exercisable, to the extent such equity awards would have vested had the Executive remained in continuous employment with the Company until the 12 month anniversary of the Termination Date.
4.4 Conditions to and Timing of the Severance Payments. Any obligation of the Company to provide the Severance Payments is conditioned on the Executive signing and returning to the Company, within 21 days following the Termination Date, and not revoking within 7 days thereafter, a timely and effective separation agreement containing a general release of claims and other customary terms in the form provided by the Company to the Executive at the time the Executive’s employment terminates (the “Separation Agreement”), which will contain no additional restrictive covenants beyond those set forth in this Agreement.
4.5 Resignation and Return of Company Documents and Property. In the event of termination of the Executive’s employment with the Company, howsoever occurring, unless otherwise specified in a written agreement between the Executive and the Company, the Executive shall be deemed to have resigned from all offices, directorships, and other employment positions if any, then held with the Company and its subsidiaries, and shall take all actions reasonably requested by the Company to effectuate the foregoing. In addition, upon the termination of the Executive’s employment for any reason, the Executive will return to the Company all information and property that Executive received from the Company, or that Executive received on behalf of the Company, or that Executive created while working for the Company, which relates to the Company’s business (other than documents regarding Executive’s individual compensation, such as pay stubs and benefit plan information) or contains any proprietary or confidential information of the Company or an affiliate of the Company and all copies thereof. This requirement pertains to all information that is in Executive’s possession, custody, or control,and includes both paper documents and electronically stored information, which must be returned in all forms in which it exists, without alteration or deletion. By way of example only, the information Executive must return includes code, data, programs, databases, printed
materials, customer lists, customer information, mailing lists, account information, samples, prototypes, price lists, pricing information, correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents or any other documents concerning the customers, business plans, marketing strategies, products and/or processes of the Company or any of its affiliates and any information received from the Company or any of its affiliates regarding third parties. Physical property belonging to the Company, such as computers, portable electronic devices, phone cards, cellular phones, storage devices, computing devices, keys, and key cards must be returned without altering its condition.
5. RESTRICTIVE COVENANTS. Executive acknowledges that Executive will be a member of executive and management personnel at the Company. Executive further acknowledges that during Executive’s employment with the Company, Executive will be privy to extremely sensitive, confidential and valuable commercial information of the Company and its subsidiaries (the “Companies”), which constitutes trade secrets belonging to the Companies, the disclosure of which information and secrets would greatly harm the Companies. As a reasonable measure to protect the Companies from the harm of disclosure and use of their trade secrets and other confidential information against them, Executive agrees to the following restrictions:
5.1 Covenant Not to Compete. During the Restricted Period, Executive shall not engage in any Restricted Activities within the Restricted Territory.
5.2 Customer Non-solicitation Covenant. During the Restricted Period, Executive shall not, except in furtherance of Executive’s duties as an employee of the Company, directly or indirectly solicit, induce, or encourage, or attempt to solicit, induce, or encourage, any Protected Customer to reduce or terminate his/her/its relationship with the Companies.
5.3 Employee Non-solicitation Covenant. During the Restricted Period, Executive shall not, except in furtherance of Executive’s duties as an employee of the Company, directly or indirectly solicit, induce, or encourage, or attempt to solicit, induce, or encourage, any employee, agent, or contractor of any of the Companies to reduce or terminate his/her/its employment, agency or contractor relationship with the Companies.
5.4 Non-disparagement. While the Executive is employed by the Company and at all times following the termination of the Executive’s employment, regardless of the reason therefore, the Executive will not, directly or indirectly, disparage or criticize the Company or any of its affiliates, their respective businesses, management, employees, officers, directors, customers, products or services, and the Executive otherwise will not do or say anything that could disrupt the good morale of employees of the Company or any of its affiliates or harm the interests or reputation of the company or its affiliates. The Company will not disparage or criticize the Executive in authorized public statements and will instruct its senior-level executives and members of the Board not to, directly or indirectly, disparage or criticize the Executive to any Person following termination of the Executive’s employment hereunder.
5.5 Definitions.
5.5.1 “Competing Product or Service” means any product or service that was being developed, marketed, offered, or provided by the Companies in the space exploration industry at any time during the last two (2) years of Executive’s employment with the Company. “Protected Customer” means any individual or entity (a) that was a customer of any of the Companies at any time during the last two (2) years of Executive’s employment with the Company, and (b) with whom Executive had material work-
related contact as an employee of the Company or about whom Executive acquired confidential information as an employee of the Company.
5.5.2 “Restricted Activities” means directly or indirectly (a) developing, marketing, offering or providing any Competing Product or Service or (b) owning, operating, managing, financing or providing any services or assistance of any kind to, whether as owner, shareholder, member, partner, joint venturer, lender, financier, licensor, licensee, franchisor, franchisee, principal, agent, director, officer, manager, employee, consultant, broker, trustee, or in any other capacity whatsoever, any person or entity that is developing, marketing, offering or providing any Competing Product or Service. Notwithstanding the foregoing, Executive’s passive ownership of not more than one percent (1%) of the outstanding voting stock of a publicly traded company shall not, in itself, constitute “Restricted Activities.”
5.5.3 “Restricted Period” means the term of the Executive’s employment with the Company and the period of eighteen (18) months immediately following the termination of Executive’s employment the Company.
5.5.4 “Restricted Territory” means the State of Colorado and those states in which Executive had material responsibility or knowledge for a Competing Product or Service or Protected Customer during the last two (2) years of Executive’s employment.
5.6 Reasonable. Executive acknowledges that the time limitation, territorial restriction and restriction on activities described herein are reasonable in scope and are appropriate to protect the Companies’ trade secrets, goodwill and other protectable interests. Executive further acknowledges and agrees that Executive has received adequate consideration for the restrictions described herein and that such restrictions will not prevent Executive from earning a living.
5.7 Enforcement. Executive acknowledges and agrees that any breach by Executive of anycovenant in this Section 5 will cause the Company irreparable injury and damage and that the Company shall therefore be entitled to, in addition to all other remedies available to it, injunctive and other equitable relief (without the necessity of posting a bond) to prevent or stop such breach and to secure the enforcement of this Agreement. Should a court of competent jurisdiction determine that the restrictions described herein are overly broad or otherwiseunenforceable, in whole or in part, the parties agree that the court shall modify the restrictions to the minimum extent necessary to render the restrictions enforceable.
5.8 Notification of New Employer. Executive consents to the notification of any future employer of Executive of Executive’s rights and obligations under this Agreement.
5.9 Disclosure of New Employment. Executive shall notify the Company of any new consulting or employment Executive obtains within 1 year of the termination of Executive’s employment with the Company (whether voluntary or involuntary). Executive shall provide the Company with sufficient information about Executive’s duties and responsibilities to allow the Company to determine Executive’s compliance with the terms of any post-employment obligations Executive owes to the Company. If Executive’s duties or responsibilities at Executive’s new employer, or any subsequent employer, change during the 1-year period following the termination of Executive’s employment, Executive will provide the Company with updated information sufficient to allow the Company to determine Executive’s compliance with any post-employment obligations Executive owes to the Company.
5.10 Extension of Time-Limited Obligations. If Executive fails to comply with any provision of this Agreement that is time-limited, the applicable time restriction will be extended by one day
for each day Executive has failed to comply with the provision, up to a maximum of eighteen (18) months; provided, however, that this extension of time shall be capped so that once Executive has complied with the restriction for the originally proscribed length of time, it shall expire.
6 ADDITIONAL PROVISIONS
6.1 Notices. All notices to be given to a party hereto shall be properly given if sent by first class mail addressed to such party at the address shown below or at such other address as the party have designated by notice to the other party:
| | | | | | | | |
| The Company: | Executive: |
| Thomas E. Ayres | Dylan Taylor |
| 1225 17th Street, 11th Floor | 8 South Lilhaven Lane |
| Denver, CO 80202 | Littleton, CO 80213 |
6.2 Severability. If any provision of this Agreement is found to be invalid or unenforceable, the remaining provisions will be unaffected and will remain enforceable according to their term.
6.3 Modification; Waiver. Except for judicial modification as provided in Section 5.7, this Agreement cannot be amended or modified except by a writing signed by each of the parties. No waiver of any provision shall be deemed to have occurred unless memorialized in a writing signed by the waiving party. If either party should waive any breach of any provision of this Agreement, such party will not thereby be deemed to have waived any preceding or succeeding breach of the same or any other provision of this Agreement.
6.4 Compliance with Section 409A. The intent of the parties is that payments and benefits under this Agreement comply with Section 409A of the Internal Revenue Code of 1986 (“Section 409A”), to the extent subject thereto, and accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance with Section 409A. The payment of any annual bonus is intended to be a “short term deferral” under Section 409A and any amount payable shall be paid in a lump sum on a date determined by the Company before the end of the “short term deferral” period with respect to such bonus.
Any right to a series of installment payments pursuant to this Agreement is to be treated as a right to a series of separate payments. To the extent permitted under Section 409A, any separate payment or benefit under this Agreement or otherwise shall not be deemed “nonqualified deferred compensation” subject to Section 409A to the extent provided in the exceptions in Treasury Regulation Section 1.409A-1(b)(4), Section 1.409A-1(b)(9) or any other applicable exception or provision of Section 409A. Any payments subject to Section 409A that are subject to execution of a waiver and release which may be executed and/or revoked in a calendar year following the calendar year in which the payment event (such as termination of employment) occurs shall commence payment only in the calendar year in which the consideration period or, if applicable, release revocation period ends, as necessary to comply with Section 409A. All payments of nonqualified deferred compensation subject to Section 409A to be made upon a termination of employment under this Agreement may only be made upon the Executive’s Separation from Service.
To the extent that any payments or reimbursements provided to the Executive under this Agreement are deemed to constitute compensation to the Executive to which Treasury
Regulation Section 1.409A-3(i)(1)(iv) would apply, such amounts shall be paid or reimbursed reasonably promptly, but not later than December 31 of the year following the year in which the expense was incurred. The amount of any such payments eligible for reimbursement in one year shall not affect the payments or expenses that are eligible for payment or reimbursement in any other taxable year, and the Executive’s right to such payments or reimbursement of any such expenses shall not be subject to liquidation or exchange for any other benefit.
Notwithstanding any other provision in this Agreement or in any other document, the Company shall not be responsible for the payment of any applicable taxes incurred by Executive pursuant to this Agreement, including with respect to compliance pursuant to Section 409A. The Company makes no representation that any or all of the payments and benefits described in this Agreement will be exempt from or comply with Section 409A.
6.5 Governing Law; Venue; Waiver of Jury Trial. This Agreement shall be governed by the laws of the State of Colorado and applicable federal law, without regard to any state’s principles regarding conflict of laws. Any action arising out of or relating to this Agreement shall be brought only in the state or federal courts in or for Denver, Colorado, and Executive and the Company hereby irrevocably waive any right that they might have to challenge the selection of those forums, including but not limited to challenges to personal jurisdiction, venue, or the convenience of the forum. Executive and the Company hereby irrevocably waive their respective rights to a jury trial with respect to any action or claims arising out of or relating to this Agreement. Executive understands and agrees that any action or claims arising out of or relating to this Agreement shall be heard only by a judge and not by a jury and that Executive is giving up Executive’s right to have any such action or claims heard by a jury.
6.6 Attorney Fees. In the event of a breach of this Agreement, the non-breaching party shall be entitled to recover such party’s attorney fees incurred as a result of such breach or threatened breach.
6.7 Binding Effect; Assignment. This Agreement shall be enforceable by the Company and its successors and assigns and shall be binding against Executive and Executive’s heirs, beneficiaries and legal representatives. The Company may assign this Agreement to any parent, subsidiary or affiliated company or successor in interest. Executive may not assign this Agreement.
6.8 Taxes. All payments pursuant to this Agreement shall be subject to withholding for taxes as required by applicable law or regulation.
6.9 Construction. This Agreement shall be deemed to have been drafted jointly by the parties, and no ambiguity in the Agreement shall be construed against either the Company or Executive.
6.10 Titles and Headings. Titles and headings in this Agreement are for purpose of reference only and shall not limit, define or otherwise affect the provisions of this Agreement.
6.11 Survival. The respective rights and obligations of the parties under this Agreement shall survive the Executive’s termination of employment and the termination of this Agreement to the extent necessary for the intended preservation of such rights and obligations.
6.12 Complete Agreement. This Agreement is the entire agreement between the parties regarding the matters addressed herein, and it supersedes and replaces all prior agreements, representations, negotiations or discussions between the parties regarding such matters, whether written or oral (except acceptance of the terms of the Company Code of Conduct and Ethics
and Employee Handbook). This Agreement may be signed in counterparts, including fax counterparts, and all counterparts together shall constitute one fully executed agreement.
Executed by the parties effective as of the date first shown above:
| | | | | | | | | | | |
| EXECUTIVE: | | THE COMPANY: |
| | | |
| | | |
| | | |
| /s/ Dylan Taylor | | By: | /s/ Thomas E. Ayres |
| Dylan Taylor | | | Thomas E. Ayres |
| | | CLO/GC & Corp Secty |
| | | |
| | | |
Date: 5/5/2022 | | | Date: 5/5/2022 |
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement (“Agreement”) is made by and between Voyager Space Holdings, Inc., a Delaware corporation (the “Company”), and Matt Kuta, a Colorado resident (the “Executive”), effective as of January 1, 2022 (the “Effective Date”).
WHEREAS, the Company, following the recommendation of the Compensation Committee (the “Compensation Committee”) of the Board of Directors of the Company (the “Board”) and unanimous approval by the Board, desires to employ Executive upon the terms and conditions set forth herein, and Executive desires to accept continued employment with the Company upon such terms and conditions
NOW, THEREFORE, for and in consideration of the above recitals and the mutual promises contained herein, and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the Company and Executive agree as follows:
1. EMPLOYMENT AND DUTIES.
1.1 Position. Executive shall be employed by the Company as its Chief Operating Officer, shall be subject to direction of the Chief Executive Officer, and shall report solely and directly to the Chief Executive Officer. Executive agrees to observe and comply with all written company policies and rules of the Company, as adopted by the Company from time to time. At the Company’s request, Executive shall serve the Company and/or its subsidiaries and affiliates in such other capacities in addition to the foregoing as the Company shall designate, provided that such additional capacities are consistent with the Executive’s position.
1.2 Employment At-Will. Executive’s employment with the Company is “at-will” and is not for a specified period of time. Subject to the Company’s obligations under Section 4 hereof, either Executive or the Company may terminate Executive’s employment at any time and for any reason whatsoever (or for no reason). This at-will employment relationship cannot be changed except in a writing signed by Executive and an authorized representative of the Company.
1.3 Full Attention. Executive shall devote his full business time exclusively to the affairs of the Company and the discharge of his duties and responsibilities hereunder. Executive shall not, without the prior written consent of the Company, engage in any other business activity or serve in any industry, trade, professional, or academic position during the term of this Agreement. Notwithstanding any other provision of this Agreement to the contrary, Executive may continue to serve as a Director of the Air Force Academy Foundation, and nothing in this Agreement shall limit Executive’s ability to participate in reasonable levels of charitable, civic, trade organization, and similar activities and passive personal investment activities, provided that such activities do not, as determined by the Company in its sole and exclusive discretion, create an actual or apparent conflict of interest, violate any provision of this Agreement or any other contract between Executive and the Company, or otherwise materially interfere with the performance of Executive’s duties under this Agreement.
2. COMPENSATION. During the Executive’s employment hereunder, as compensation for all services performed by the Executive for the Company and its affiliates, the Company will provide the Executive the following compensation and benefits:
2.1 Base Salary. Executive shall receive an annualized base salary of $300,000. Executive’s base salary may be increased from time to time at the sole discretion of the Compensation Committee. Executive’s base salary shall be paid in accordance with the Company’s standard payroll practices as they may exist from time-to-time.
2.2 Bonus. Commencing with calendar year 2022, for each calendar year during Executive’s employment with the Company, Executive will be eligible to earn a cash performance bonus (an “Annual Bonus”) with a target amount equal to $600,000. The actual amount of any Annual Bonus shall be determined by the Chief Executive Officer, upon the ratification of the Compensation Committee, and the approval or action of the Board in its discretion, based on such performance goals as may be determined by the Chief Executive Officer in his sole discretion. The payment of any Annual Bonus, to the extent any Annual Bonus becomes payable, will be made on the date on which annual bonuses are paid generally to the Company’s senior executives, but in no event later than March 15th of the calendar year following the calendar year in which such Annual Bonus was earned, subject to the Executive’s continued employment through the payment date.
2.3 Equity-Based Awards. During Executive’s employment with the Company, Executive shall be eligible to participate in the Company’s equity-based incentive plan (currently the Company’s 2020 Incentive Plan) and the Company’s annual equity incentive program applicable to its senior executive officers. The type and amount of any award granted to Executive thereunder, and the terms and conditions of any such awards shall be determined subject to the approval of the Chief Executive Officer, the ratification of the Committee and the approval or action of the Board in its discretion. The terms and conditions of such award(s) will be set forth in separate award agreements in forms prescribed by the Company, to be entered into by the Company and the Executive.
2.4 Benefits. During Executive’s employment with the Company, Executive shall be eligible to participate in the employee benefit plans and programs maintained by the Company from time to time for its senior executive officers, subject to the terms and conditions of such plans and programs. Such benefit plans and programs may be adopted, modified or terminated by the Company from time to time in its sole discretion and may include, without limitation, medical, health and dental care, life insurance, disability protection,401(k) and retirement plans. Nothing contained in this Agreement shall create or be deemed to create any obligation on the part of the Company to adopt or maintain any health, welfare, retirement or other benefit plan or program at any time or to create any limitation on the Company’s ability to modify or terminate any such plan or program.
2.5 Expense Reimbursement. The Company shall reimburse Executive for out-of-pocket expenses reasonably incurred by Executive in the performance of his or her duties under this Agreement in accordance with the Company’s policies as in effect from time to time. Expense reimbursement shall remain subject to the Company’s policies regarding expense reimbursement as they may exist from time to time.
3. TERMINATION OF EMPLOYMENT. The Executive’s employment under this Agreement will continue until terminated pursuant to this Section 3.
3.1 In General. The Executive’s employment may be terminated by the Company or by the Executive at any time upon sixty (60) days’ prior written notice to the other party; provided, however, that the Company may elect to waive such notice period or any portion thereof, in which case the Company will continue to pay to the Executive his base salary for that portion of the notice period so waived.
3.2 Termination by the Company for Cause. Notwithstanding the provisions of Section 3.1, the Company may terminate the Executive’s employment immediately for Cause upon written notice to the Executive setting forth in reasonable detail the nature of the Cause. For purposes of this Agreement, “Cause” means the occurrence of any of the following, as determined by the Chief Executive Officer in consultation with Board in their reasonable judgment: (i) the Executive’s material failure to perform (other than by reason of disability), or substantial misconduct in the performance of, the Executive’s duties and responsibilities for the Company or any of its affiliates which causes material harm to the Company; (ii) the Executive’s material and demonstrable breach of any provision of Section 5 or of any other confidentiality, invention assignment or other restrictive covenant obligation set forth in any written agreement by and between the Executive and the Company or any of its affiliates; (iii) the Executive’s material and demonstrable breach of any other provision of this Agreement or any other written agreement by and between the Executive and the Company or any of its affiliates; (iv) the Executive’s material violation of any applicable policy or code of conduct of the Company or any of its affiliates, which violation causes material reputational or financial harm to the Company; or (v) the Executive’s indictment for, or plea of nolo contendere to, any felony or any crime involving moral turpitude. Notwithstanding anything to the contrary in the foregoing, a circumstance otherwise giving rise to Cause pursuant to the foregoing clause (i), (ii), (iii) or (iv), if capable of cure, will not constitute Cause if cured by the Executive within ten (10) days following the Company’s notice to the Executive thereof; provided, however, that the Company will not be required to provide any such notice or opportunity to cure with respect to any subsequent substantially similar or related conduct.
3.3 Resignation by the Executive for Good Reason. Notwithstanding the provisions of Section 3.1, the Executive may terminate the Executive’s employment for Good Reason upon written notice to the Company. For purposes of this Agreement, Good Reason; means the occurrence of any of the following without the Executive’s consent: (i) a material reduction in Base Salary, other than an across-the-board reduction applicable to similarly situated executives of the Company; or (ii) a material diminution of Executive’s duties, authorities or responsibilities; provided, however, that no resignation for Good Reason shall be effective unless and until (A) Executive has first provided the Company with written notice specifically identifying the acts or omissions constituting the grounds for “Good Reason” within thirty days after the initial existence of the facts or circumstances constituting Good Reason, (2) the Company has not cured such acts or omissions within thirty days of its actual receipt of such notice, and (3) the effective date of Executive’s termination for Good Reason occurs no later than ninety days after the initial existence of the facts or circumstances constituting Good Reason.
3.4 Death or Disability. The Executive’s employment shall terminate automatically upon the Executive’s death. Either the Company or the Executive may terminate the Executive’s
employment in the event of the Executive’s disability during his employment with the Company.
4. OTHER MATTERS RELATED TO TERMINATION
4.1 Final Compensation. In the event of termination of the Executive’s employment with the Company, howsoever occurring, the Company will pay the Executive (i) any earned but unpaid Base Salary through the date on which Executive’s employment terminates (the “Termination Date”); and (ii) reimbursement, in accordance with Section 2.5 hereof, for business expenses incurred by the Executive but not yet paid to the Executive as of the Termination Date, provided that the Executive submits all expenses and supporting documentation required within sixty (60) days of the Termination Date and that such expenses are reimbursable under Company policies then in effect (all of the foregoing, the “Final Compensation”). The amounts set forth in the foregoing clause (i) will be paid to the Executive immediately upon termination of employment.
4.2 Severance Payments. In the event the Executive’s employment is terminated by the Company without Cause or by the Executive for Good Reason, subject to the provisions of Section 4.4 and Executive’s continued compliance with the covenants set forth in Section 5, the Company will pay the Executive, in addition to the Final Compensation, severance payments as provided in this Section 4.2. The Severance Payments will include payment in an amount equal to eighteen (18) months’ Base Salary, payable in the form of salary continuation in accordance with the ordinary 3 payroll practices of the Company over the eighteen (18) months following the Termination Date (the “Severance Payments”).
4.3 Equity. In the event the Executive’s employment is terminated by the Company without Cause or by the Executive for Good Reason, subject to the provisions of Section 4.4 and Executive’s continued compliance with the covenants set forth in Section 5, any outstanding and unvested Company equity-based awards held by the Executive on the Termination Date that vest based solely on the passage of time shall thereupon vest and, to the extent applicable, become exercisable, to the extent such equity awards would have vested had the Executive remained in continuous employment with the Company until the 12 month anniversary of the Termination Date.
4.4 Conditions to and Timing of the Severance Payments. Any obligation of the Company to provide the Severance Payments is conditioned on the Executive signing and returning to the Company, within 21 days following the Termination Date, and not revoking within 7 days thereafter, a timely and effective separation agreement containing a general release of claims and other customary terms in the form provided by the Company to the Executive at the time the Executive’s employment terminates (the “Separation Agreement”), which will contain no additional restrictive covenants beyond those set forth in this Agreement.
4.5 Resignation and Return of Company Documents and Property. In the event of termination of the Executive’s employment with the Company, howsoever occurring, unless otherwise specified in a written agreement between the Executive and the Company, the Executive shall be deemed to have resigned from all offices, directorships, and other employment positions if any, then held with the Company and its subsidiaries, and shall take all actions reasonably requested by the Company to effectuate the foregoing. In addition, upon the termination of the Executive’s employment for any reason, the Executive will return to the Company all
information and property that Executive received from the Company, or that Executive received on behalf of the Company, or that Executive created while working for the Company, which relates to the Company’s business (other than documents regarding Executive’s individual compensation, such as pay stubs and benefit plan information) or contains any proprietary or confidential information of the Company or an affiliate of the Company and all copies thereof. This requirement pertains to all information that is in Executive’s possession, custody, or control,and includes both paper documents and electronically stored information, which must be returned in all forms in which it exists, without alteration or deletion. By way of example only, the information Executive must return includes code, data, programs, databases, printed materials, customer lists, customer information, mailing lists, account information, samples, prototypes, price lists, pricing information, correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents or any other documents concerning the customers, business plans, marketing strategies, products and/or processes of the Company or any of its affiliates and any information received from the Company or any of its affiliates regarding third parties. Physical property belonging to the Company, such as computers, portable electronic devices, phone cards, cellular phones, storage devices, computing devices, keys, and key cards must be returned without altering its condition.
5. RESTRICTIVE COVENANTS. Executive acknowledges that Executive will be a member of executive and management personnel at the Company. Executive further acknowledges that during Executive’s employment with the Company, Executive will be privy to extremely sensitive, confidential and valuable commercial information of the Company and its subsidiaries (the “Companies”), which constitutes trade secrets belonging to the Companies, the disclosure of which information and secrets would greatly harm the Companies. As a reasonable measure to protect the Companies from the harm of disclosure and use of their trade secrets and other confidential information against them, Executive agrees to the following restrictions:
5.1 Covenant Not to Compete. During the Restricted Period, Executive shall not engage in any Restricted Activities within the Restricted Territory.
5.2 Customer Non-solicitation Covenant. During the Restricted Period, Executive shall not, except in furtherance of Executive’s duties as an employee of the Company, directly or indirectly solicit, induce, or encourage, or attempt to solicit, induce, or encourage, any Protected Customer to reduce or terminate his/her/its relationship with the Companies.
5.3 Employee Non-solicitation Covenant. During the Restricted Period, Executive shall not, except in furtherance of Executive’s duties as an employee of the Company, directly or indirectly solicit, induce, or encourage, or attempt to solicit, induce, or encourage, any employee, agent, or contractor of any of the Companies to reduce or terminate his/her/its employment, agency or contractor relationship with the Companies.
5.4 Non-disparagement. While the Executive is employed by the Company and at all times following the termination of the Executive’s employment, regardless of the reason therefore, the Executive will not, directly or indirectly, disparage or criticize the Company or any of its affiliates, their respective businesses, management, employees, officers, directors, customers, products or services, and the Executive otherwise will not do or say anything that could disrupt the good morale of employees of the Company or any of its affiliates or harm the interests or reputation of the company or its affiliates. The Company will not disparage or criticize the Executive in authorized public statements and will instruct its senior-level executives and members of the Board not to, directly or indirectly, disparage or criticize the Executive to any Person following termination of the Executive’s employment hereunder.
5.5 Definitions.
5.5.1 “Competing Product or Service” means any product or service that was being developed, marketed, offered, or provided by the Companies in the space exploration industry at any time during the last two (2) years of Executive’s employment with the Company. “Protected Customer” means any individual or entity (a) that was a customer of any of the Companies at any time during the last two (2) years of Executive’s employment with the Company, and (b) with whom Executive had material work- related contact as an employee of the Company or about whom Executive acquired confidential information as an employee of the Company.
5.5.2 “Restricted Activities” means directly or indirectly (a) developing, marketing, offering or providing any Competing Product or Service or (b) owning, operating, managing, financing or providing any services or assistance of any kind to, whether as owner, shareholder, member, partner, joint venturer, lender, financier, licensor, licensee, franchisor, franchisee, principal, agent, director, officer, manager, employee, consultant, broker, trustee, or in any other capacity whatsoever, any person or entity that is developing, marketing, offering or providing any Competing Product or Service. Notwithstanding the foregoing, Executive’s passive ownership of not more than one percent (1%) of the outstanding voting stock of a publicly traded company shall not, in itself, constitute “Restricted Activities.”
5.5.3 “Restricted Period” means the term of the Executive’s employment with the Company and the period of eighteen (18) months immediately following the termination of Executive’s employment the Company.
5.5.4 “Restricted Territory” means the State of Colorado and those states in which Executive had material responsibility or knowledge for a Competing Product or Service or Protected Customer during the last two (2) years of Executive’s employment.
5.6 Reasonable. Executive acknowledges that the time limitation, territorial restriction and restriction on activities described herein are reasonable in scope and are appropriate to protect the Companies’ trade secrets, goodwill and other protectable interests. Executive further acknowledges and agrees that Executive has received adequate consideration for the restrictions described herein and that such restrictions will not prevent Executive from earning a living.
5.7 Enforcement. Executive acknowledges and agrees that any breach by Executive of any covenant in this Section 5 will cause the Company irreparable injury and damage and that the Company shall therefore be entitled to, in addition to all other remedies available to it, injunctive and other equitable relief (without the necessity of posting a bond) to prevent or stop such breach and to secure the enforcement of this Agreement. Should a court of competent jurisdiction determine that the restrictions described herein are overly broad or otherwiseunenforceable, in whole or in part, the parties agree that the court shall modify the restrictions to the minimum extent necessary to render the restrictions enforceable.
5.8 Notification of New Employer. Executive consents to the notification of any future employer of Executive of Executive’s rights and obligations under this Agreement.
5.9 Disclosure of New Employment. Executive shall notify the Company of any new consulting or employment Executive obtains within 1 year of the termination of Executive’s employment with the Company (whether voluntary or involuntary). Executive shall provide the Company with sufficient information about Executive’s duties and responsibilities to allow the Company to determine Executive’s compliance with the terms of any post-employment obligations
Executive owes to the Company. If Executive’s duties or responsibilities at Executive’s new employer, or any subsequent employer, change during the 1-year period following the termination of Executive’s employment, Executive will provide the Company with updated information sufficient to allow the Company to determine Executive’s compliance with any post-employment obligations Executive owes to the Company.
5.10 Extension of Time-Limited Obligations. If Executive fails to comply with any provision of this Agreement that is time-limited, the applicable time restriction will be extended by one day for each day Executive has failed to comply with the provision, up to a maximum of eighteen (18) months; provided, however, that this extension of time shall be capped so that once Executive has complied with the restriction for the originally proscribed length of time, it shall expire.
6 ADDITIONAL PROVISIONS
6.1 Notices. All notices to be given to a party hereto shall be properly given if sent by first class mail addressed to such party at the address shown below or at such other address as the party have designated by notice to the other party:
| | | | | | | | |
| The Company: | Executive: |
| Thomas E. Ayres | Matt Kuta |
| 1225 17th Street, 11th Floor | |
| Denver, CO 80202 | |
6.2 Severability. If any provision of this Agreement is found to be invalid or unenforceable, the remaining provisions will be unaffected and will remain enforceable according to their term.
6.3 Modification; Waiver. Except for judicial modification as provided in Section 5.7, this Agreement cannot be amended or modified except by a writing signed by each of the parties. No waiver of any provision shall be deemed to have occurred unless memorialized in a writing signed by the waiving party. If either party should waive any breach of any provision of this Agreement, such party will not thereby be deemed to have waived any preceding or succeeding breach of the same or any other provision of this Agreement.
6.4 Compliance with Section 409A. The intent of the parties is that payments and benefits under this Agreement comply with Section 409A of the Internal Revenue Code of 1986 (“Section 409A”), to the extent subject thereto, and accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance with Section 409A. The payment of any annual bonus is intended to be a “short term deferral” under Section 409A and any amount payable shall be paid in a lump sum on a date determined by the Company before the end of the “short term deferral” period with respect to such bonus.
Any right to a series of installment payments pursuant to this Agreement is to be treated as a right to a series of separate payments. To the extent permitted under Section 409A, any separate payment or benefit under this Agreement or otherwise shall not be deemed “nonqualified deferred compensation” subject to Section 409A to the extent provided in the exceptions in Treasury Regulation Section 1.409A-1(b)(4), Section 1.409A-1(b)(9) or any other applicable exception or provision of Section 409A. Any payments subject to Section 409A that are subject to execution of a waiver and release which may be executed and/or revoked in a calendar year following the calendar year in which the payment event (such as termination of employment)
occurs shall commence payment only in the calendar year in which the consideration period or, if applicable, release revocation period ends, as necessary to comply with Section 409A. All payments of nonqualified deferred compensation subject to Section 409A to be made upon a termination of employment under this Agreement may only be made upon the Executive’s Separation from Service.
To the extent that any payments or reimbursements provided to the Executive under this Agreement are deemed to constitute compensation to the Executive to which Treasury Regulation Section 1.409A-3(i)(1)(iv) would apply, such amounts shall be paid or reimbursed reasonably promptly, but not later than December 31 of the year following the year in which the expense was incurred. The amount of any such payments eligible for reimbursement in one year shall not affect the payments or expenses that are eligible for payment or reimbursement in any other taxable year, and the Executive’s right to such payments or reimbursement of any such expenses shall not be subject to liquidation or exchange for any other benefit.
Notwithstanding any other provision in this Agreement or in any other document, the Company shall not be responsible for the payment of any applicable taxes incurred by Executive pursuant to this Agreement, including with respect to compliance pursuant to Section 409A. The Company makes no representation that any or all of the payments and benefits described in this Agreement will be exempt from or comply with Section 409A.
6.5 Governing Law; Venue; Waiver of Jury Trial. This Agreement shall be governed by the laws of the State of Colorado and applicable federal law, without regard to any state’s principles regarding conflict of laws. Any action arising out of or relating to this Agreement shall be brought only in the state or federal courts in or for Denver, Colorado, and Executive and the Company hereby irrevocably waive any right that they might have to challenge the selection of those forums, including but not limited to challenges to personal jurisdiction, venue, or the convenience of the forum. Executive and the Company hereby irrevocably waive their respective rights to a jury trial with respect to any action or claims arising out of or relating to this Agreement. Executive understands and agrees that any action or claims arising out of or relating to this Agreement shall be heard only by a judge and not by a jury and that Executive is giving up Executive’s right to have any such action or claims heard by a jury.
6.6 Attorney Fees. In the event of a breach of this Agreement, the non-breaching party shall be entitled to recover such party’s attorney fees incurred as a result of such breach or threatened breach.
6.7 Binding Effect; Assignment. This Agreement shall be enforceable by the Company and its successors and assigns and shall be binding against Executive and Executive’s heirs, beneficiaries and legal representatives. The Company may assign this Agreement to any parent, subsidiary or affiliated company or successor in interest. Executive may not assign this Agreement.
6.8 Taxes. All payments pursuant to this Agreement shall be subject to withholding for taxes as required by applicable law or regulation.
6.9 Construction. This Agreement shall be deemed to have been drafted jointly by the parties, and no ambiguity in the Agreement shall be construed against either the Company or Executive.
6.10 Titles and Headings. Titles and headings in this Agreement are for purpose of reference only and shall not limit, define or otherwise affect the provisions of this Agreement.
6.11 Survival. The respective rights and obligations of the parties under this Agreement shall survive the Executive’s termination of employment and the termination of this Agreement to the extent necessary for the intended preservation of such rights and obligations.
6.12 Complete Agreement. This Agreement is the entire agreement between the parties regarding the matters addressed herein, and it supersedes and replaces all prior agreements, representations, negotiations or discussions between the parties regarding such matters, whether written or oral (except acceptance of the terms of the Company Code of Conduct and Ethics and Employee Handbook). This Agreement may be signed in counterparts, including fax counterparts, and all counterparts together shall constitute one fully executed agreement.
Executed by the parties effective as of the date first shown above:
| | | | | | | | | | | | | | |
| EXECUTIVE: | | | THE COMPANY: |
| | | | |
| | | | |
| | | | |
| /s/ Matt Kuta | | | By: | /s/ Thomas E. Ayres |
| Matt Kuta | | | | Thomas E. Ayres |
| | | | CLO/GC & Corp Secty |
| | | | |
| | | | |
Date: 9/26/2022 | | | Date: 9/26/2022 |
This Employment Agreement (“Agreement”) is dated September 14, 2022 (“Effective Date”) between Voyager Space Holdings, inc. a Delaware Corporation (“Employer”), and Filipe (Phil) De Sousa (“Employee”).
WHEREAS Employer desires to employ or to continue to employ Employee, and Employee desires to be employed or to continue to be employed by Employer; and
WHEREAS, in connection with such employment, Employee must be given access to, generate or otherwise come into contact with certain proprietary and/or confidential information of Employer; and
WHEREAS Employee and Employer desire to prevent the dissemination or misuse of such information.
NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements set forth herein, Employer and Employee hereby agree as follows:
1.Employment.
1.1 Employer agrees to employ or continue to employ Filipe (Phil) De Sousa as Chief Financial Officer & Member of the Executive Committee (ExCom), commencing October 10, 2022, and Employee hereby accepts such employment or continued employment and agrees to perform their duties and responsibilities upon the terms and conditions set forth below, which shall apply effective on the date the Employee commenced employment.
1.2 Employer employs Employee “at will.” No specific period of employment is promised to Employee. Employer may terminate Employee’s employment with or without cause, as determined by Employer, at any time and without prior notice. Similarly, Employee may terminate their employment at any time. No verbal or oral promise, representation, or communication of any kind, at any time prior to, during or after the employment relationship, should be construed as a change in the at-will employment relationship. Employer expressly disavows any such verbal or oral promises, representations or communications that may be construed to change the at-will relationship.
2.Duties:
2.1 Full Time and Effort. During the term of employment, Employee agrees to devote their full business time, attention, energies, knowledge, and skills to carrying out the duties and responsibilities under this Agreement and to advance the interests and business of the Employer, all of which shall be performed faithfully, diligently and to the best of the Employee’s ability. Employee shall diligently and efficiently perform and discharge any duties and
responsibilities assigned from time to time by the Employer and shall at all times be subject to, observe and carry out such rules, regulations, employment policies, directions, and restrictions as the Employer shall from time to time establish. Employee acknowledges that his duties and responsibilities will require his full-time business efforts and agrees that during the Agreement Term, as defined below, they will not engage in any outside business activities that conflict with obligations under this Agreement. Employee further agrees that they shall not cause the Employer to violate any laws, rules, and regulations applicable to it and its business, and that Employee shall not knowingly engage in or cause or permit the Employer to engage in any activity that is illegal or unethical.
2.2 Days and Hours. Employee agrees that Employer may designate the days and hours to be worked by Employee, which may include day or night hours, Saturdays, Sundays and holidays, or other days or hours deemed necessary by Employer, in line with applicable law. Employee further agrees that Employer may change Employee’s workdays and hours from time to time at the discretion of Employer and in line with applicable law.
3.Compensation.
3.1 Salary. Employee shall receive a base salary of $375,000 annually, less applicable withholdings and deductions. All earnings of Employee shall be paid in accordance with Employer’s standard payroll practices and will be subject to all deductions required by law, including ordinary payroll taxes. The base salary will increase to a minimum of $400,000 during our annual review in 2024.
3.2 Commission/Incentives. Employee will receive 50,000 options granted on or before January 1, 2023, subject to Board approval and customary vesting and based upon the then current 409a or other applicable valuation. Options will vest and become exercisable as to 25% of the total number of shares subject to the Option on the first anniversary of the Vesting Commencement Date, and as to 1/48 of the total number of shares each month thereafter over the following three years, such that the Options will be fully vested on the fourth anniversary of the Vesting Commencement Date, subject to the Executive’s continuous service on each such vesting date.
3.3 Bonus. Employee will be entitled to an annual target bonus of up to $375,000 (100% of base salary) paid on or before March 1st of each year beginning in 2023 (bonus paid in 2024). The bonus will be more or less than the target amount depending on employee and company performance.
3.4 IPO Incentive. Upon completion of a successful public offering prior to August 1, 2023, Employee shall receive a one-time cash bonus of $100,000.
3.5 Sign-On Bonus. You will receive a one-time cash “Sign-on Bonus” of $200,000 to be paid by November 1, 2022. Should your employment terminate any time before October 1, 2024, the Sign-on Bonus will be pro-rated and reimbursed by you to the Company upon demand, unless termination is without cause or resignation is for good reason, as defined in paragraph 3.7 below.
3.6 Relocation Bonus. Upon your decision to relocate your primary residence to Colorado, the Company will provide a relocation package that includes shipment of household
goods and closing costs related to the purchase of a new home and the sale of an existing home. The costs for relocation shall not exceed $50,000.
3.7 Severance.
3.7.1 If the Company terminates Executive's employment without Cause (defined below), or if Executive terminates his employment for Good Reason (defined below), and provided that Executive executes and returns to the Company a complete release of all claims in a form reasonably acceptable to the Company that becomes fully effective within sixty (60) days after the effective date of such termination ("Termination Date"), the Company shall provide severance pay to Executive in an amount equal to one year of base salary, at the rate in effect as of the Termination Date, and accrued bonus as reasonably determined by his direct supervisor or the Board, plus any earned, vested, and determinable but unpaid bonus from a performance year completed before the Termination Date. Severance pay shall be paid in equal installments on the Company's regular paydays, commencing on the first payday that is at least sixty (60) days after the Termination Date; provided, however, that the first such payment shall include all sums that would have been paid had payment commenced on the first payday after the Termination Date. For clarity, if the Company terminates Executive's employment for Cause or Executive resigns for any reason other than Good Reason, Executive shall not be entitled to severance pay.
3.7.2 As used in this Agreement, "Cause" means Executive's: (a) conviction of (including plea of guilty or no-contest to) any felony or any crime involving dishonesty or moral turpitude; (b) violation of law, or act of fraud or dishonesty, in connection with Executive's employment; (c) refusal or failure to comply with any lawful directive of the Company or any of its officers or directors that is not cured (if capable of cure) within ten days after written notice to Executive identifying the refusal or failure; (d) breach of Executive's fiduciary duty or duty of loyalty to any of the Companies that is not cured (if capable of cure) within ten days after written notice to Executive identifying the breach; (e) breach of this Agreement or any other contract with any of the Companies that is not cured (if capable of cure) within ten days after written notice to Executive identifying the breach; or (f) violation of any applicable policy of any of the Companies that is not cured (if capable of cure) within ten days after written notice to Executive identifying the violation. Notwithstanding the foregoing, no event shall constitute "Cause" unless the Company (x) provides written notice to Executive identifying the circumstances that allegedly constitute Cause within thirty days of the Company first becoming aware of such circumstances and (y) terminates Executive's employment within thirty days after the expiration of any applicable cure period.
3.7.3 As used in this Agreement, "Good Reason" means, without Executive's consent: (a) a material diminution in Executive's duties, responsibilities, authority, or reporting relationship, (b) a material reduction in the aggregate compensation provided to you unless such reduction is concurrently made to the entire Company’s Executive Committee, or (c) a material breach of any other material term of this Agreement; provided, however, that any such condition shall not constitute “Good Reason” unless you provide written notice to the Company
of the condition claimed to constitute Good Reason within thirty (30) days of the initial existence of such condition and, thereafter, the Board fails to cure such “Good Reason” within thirty (30) days following its receipt of such written notice from you, and within ten (10) days thereafter, you terminate employment for “Good Reason.”
4.Fringe Benefits.
4.1 Plans. Employee shall be entitled to participate in the Employer’s 401(k), medical, accident and health, disability, and life insurance plans from time to time in effect in accordance with the terms and conditions thereof; provided nothing in this Agreement shall alter the Employer’s ability to amend or terminate such plans.
4.2 Vacations and Holidays. Employee will receive unlimited paid vacation; with the expectation that you will avail yourself of four (4) weeks of family-time or vacation, timing to be approved by the supervisor, as well as paid holiday benefits as company deems necessary or advisable or as required to be provided by law, and may from time to time terminate or revise such benefits at any time, with or without prior notice, subject to applicable law.
5.Employer’s Policies.
5.1 Expenses. Employer shall reimburse the Employee for all pre-approved, necessary, reasonable, and documented expenses incurred in connection with the performance of Employee’s duties hereunder, provided that all requests for expense reimbursement must be submitted on forms and documented in accordance with the policies of the Employer and within the time limits set forth in such policies. For the time between the Acknowledgement Date and October 1, 2024, the Company shall reimburse you, consistent with the Company’s policies and procedures, for your reasonable commuting expenses (which shall be defined to include all travel and lodging costs) associated with maintaining a presence in Denver, Colorado prior to your permanent relocation.
5.2 Policies. The Employee will be responsible to review and become familiar with the policies of the Employer, including without limitation the Employee Handbook, the Code of Conduct and any material relating to the Employee performing their duties. In the event of any conflict between any and all Employee Handbooks and other Employee policies, it is agreed that in the event of such conflicts this Employee Agreement shall take precedence.
6.Miscellaneous.
6.1 Reasonableness. The Employee acknowledges and agrees that the terms of this agreement are fair and reasonable and have been accepted by the Employee without reservation. The Employee has been given a reasonable opportunity to review the agreement and to discuss the terms and is entering into it without duress or pressure.
6.2 Enforceability. The provisions of this Agreement shall be enforceable notwithstanding the existence of any claim or cause of action of the Employee against the Employer whether predicated on this Agreement or otherwise.
6.3 Governing Law; Jurisdiction. The Agreement shall be governed by and construed in accordance with the laws of Colorado. Any and all disputes arising under this Agreement shall be subject to the exclusive jurisdiction of the Federal or State Courts of
Colorado and Employee hereby consents to the jurisdiction (personal and subject matter) of courts located in Colorado.
6.4 Entire Agreement; Amendment and Assignment. This Agreement contains the entire agreement of the parties relating to the subject matter hereof, and expressly supersedes all prior agreements between them, whether oral or written, regardless of what representations may have been made previously with respect to the subject matter hereof. This Agreement may be modified only by a written instrument signed by both parties. All the terms and provisions of this Agreement shall be binding upon and inure to the benefit of and be enforceable by the respective heirs, representatives, successors and assigns of the parties hereto, except that the duties and responsibilities of Employee hereunder are of a personal nature and shall not be assignable or delegable in whole or in part by Employee.
6.5 Notice. Any notice to be given under this Agreement shall be sufficient if it is in writing and is either hand-delivered, sent by e-mail to the recipient’s correct e-mail address (with receipt confirmed), or sent by registered mail as follows:
• If to Employer: Tom Ayres,
1225 17th Street, Suite 1100 Denver, CO 80202.
tom.ayres@voyagerspace.com
• If to Employee: Filipe (Phil) De Sousa,
8 Rosana Way, Coto De Caza, CA 92679
desousap13@gmail.com
6.6 Survival. Notwithstanding the termination of Employee's employment for any reason, Paragraphs 6-9 of this Agreement shall survive the termination of employment for any reason.
6.7 Severability. All the provisions of this Agreement are distinct and severable. If any part, term or provision of this Agreement should be held to be illegal, invalid, unenforceable or in conflict with any applicable law, then the remaining valid and enforceable provisions shall continue in full force and effect.
7.Non-Disparagement. Employee covenants and agrees that during the course of Employee's employment by Employer, and subsequent to the termination thereof, for any reason, Employee shall not disparage or otherwise portray in a negative light, whether verbally or in writing to any third party, Employer, its business or any of its shareholders, directors, officers, employees or agents. This paragraph will not be construed or applied in a manner that interferes with Employee's rights under the National Labor Relations Act, including but not limited to Employee's rights to discuss working conditions and other work-related information with co-workers.
8.Non-Solicitation. Executive acknowledges that Executive will be a member of executive and management personnel at the Company. Executive further acknowledges that during Executive's employment with the Company, Executive will be privy to, develop, and receive extremely sensitive, confidential, and valuable commercial information of the
Companies, which constitutes trade secrets belonging to the Companies, the disclosure of which information and secrets would greatly harm the Companies. As a further reasonable measure to protect the Companies from the harm of disclosure and use of their trade secrets and other confidential information against them, in addition to Executive's agreement and promises not to use or disclose such information to or on behalf of any third party in the Mutual Confidentiality and Non-Disclosure Agreement Executive signed in connection with her employment, Executive agrees to the following restrictions:
8.1 Customer Non-solicitation Covenant. During the Restricted Period (defined as one year from termination), Executive shall not, except in furtherance of Executive's duties as an employee of the Company, directly or indirectly (other than through a general public solicitation) solicit, induce, or encourage, or attempt to solicit, induce, or encourage, any Protected Customer to reduce or terminate his/her/its relationship with the Companies.
8.2 Employee Non-solicitation Covenant. During the Restricted Period, Executive shall not, except in furtherance of Executive's duties as an employee of the Company, directly or indirectly solicit, induce, or encourage, or attempt to solicit, induce, or encourage, any employee, agent, or contractor of any of the Companies to reduce or terminate his/her/its employment, agency or contractor relationship with the Companies for or on behalf of any person or entity who provides a Competing Product or Service.
9.Return of Materials. Employee agrees that all memoranda, notes, records, address books, lists, rolodexes, papers or other documents, all electronic media, all software developed by or for Employer, and all copies thereof relating to Employer's operations or business, and all objects associated therewith in any way obtained by Employee during the course of their employment by Employer shall be Employer's sole and exclusive property. Employee shall not, except for Employer's use, copy or duplicate any of the aforementioned documents or objects, nor remove them from Employer's facilities, nor use any information concerning them except for Employer's benefit, either during his or her employment with Employer or thereafter. Employee agrees that they will deliver all of the aforementioned documents and objects that may be in their possession to Employer on termination of employment, or any other time upon Employer's request, together with Employee's written certification of compliance with the provisions of this Paragraph.
Dated: 9/26/2022
| | | | | | | | |
| Filipe (Phil) De Sousa: | | Thomas E. Ayres: |
| | |
| /s/ Filipe (Phil) De Sousa | | /s/ Thomas E. Ayres |
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into by and between Voyager Technologies, Inc. a Delaware corporation (“PubCo” and together with any other Subsidiaries or Affiliates as may employ Executive from time to time, and any successor(s) thereto, the “Company”) and Dylan Taylor (the “Executive”), effective as of the date of consummation of the initial public offering of PubCo’s Class A common stock (the “Effective Date”).
WHEREAS, the Executive is party to an Employment Agreement, by and between PubCo and the Executive, dated January 1, 2022 (the “Prior Agreement”), and the Company and the Executive intend to amend, restate and supersede the Prior Agreement in its entirety.
WHEREAS, the Company desires to continue to employ the Executive and the Company and the Executive desire to enter into an agreement embodying the terms of such continued employment, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Employment Period. Effective upon the Effective Date, the Executive’s employment hereunder shall be for a term commencing on the Effective Date and will end upon the date of termination of this Agreement under Section 3 (the “Employment Period”). Notwithstanding the foregoing, the Executive’s employment with the Company is and shall be on an “at will” basis, subject to the provisions of Section 3.
2. Terms of Employment.
(a) Position and Duties.
(i) Role and Responsibilities. During the Employment Period, the Executive shall serve as the Company’s Chairman and Chief Executive Officer and shall perform such employment duties as are usual and customary for such position. The Executive shall report directly to the Company’s Board of Directors (the “Board”). At the Company’s request, the Executive shall serve the Company and/or its Subsidiaries or Affiliates in other capacities in addition to the foregoing, consistent with the Executive’s position hereunder. If the Executive, during the Employment Period, serves in any one or more of such additional capacities, the Executive’s compensation shall not be increased beyond that specified in Section 2(b) hereof. In addition, if the Executive’s service in one or more of such additional capacities is terminated, the Executive’s compensation, as specified in Section 2(b), shall not be diminished or reduced in any manner as a result of such termination provided that the Executive otherwise remains employed under the terms of this Agreement.
(ii) Exclusivity. During the Employment Period, and excluding any periods of leave to which the Executive may be entitled, the Executive agrees to devote the Executive’s full business time and attention to the business and affairs of the Company. Notwithstanding the foregoing, during the Employment Period it shall not be a violation of this Agreement for the Executive to: (A) serve on boards, committees or similar bodies of charitable or nonprofit organizations, (B) fulfill limited teaching, speaking and writing engagements, (C) manage the Executive’s personal investments, and (D) engage in any of the activities as set forth on Exhibit A, in each case, so long as such activities do not individually or in the aggregate
materially interfere or conflict with the performance of the Executive’s duties and responsibilities under this Agreement; provided, that with respect to the activities in subclauses (A) and/or (B), the Executive receives prior written approval from the Board. Executive agrees to observe and comply with the rules and policies of the Company as adopted by the Company from time to time, in each case as amended from time to time, as set forth in writing, and as delivered or made available to Executive.
(iii) Principal Location. During the Employment Period, the Executive generally shall perform the services required by this Agreement remotely from Executive’s home office in Denver, Colorado (the “Principal Location”), provided, however, that the parties acknowledge and agree that the Executive may be required to travel to other locations as may be necessary to fulfill the Executive’s duties and responsibilities hereunder.
(b) Compensation and Benefits.
(i) Base Salary. Effective as of the Effective Date and during the Employment Period, the Executive shall receive a base salary (the “Base Salary”) of four hundred thousand dollars ($400,000) per annum. The Base Salary shall be paid in accordance with the Company’s normal payroll practices for executive salaries generally, but no less often than monthly and shall be pro-rated for partial years of employment. The Base Salary may be reviewed in the discretion of the Board (or a subcommittee thereof), not less than annually.
(ii) Annual Cash Bonus. For each calendar year ending during the Employment Period beginning with calendar year 2025, the Executive shall be eligible to earn a cash performance bonus (an “Annual Bonus”) under the Company’s bonus plan or program applicable to senior executives targeted at one hundred percent (100%) of Base Salary paid with respect to such year (the “Target Bonus”). The actual amount of any Annual Bonus shall be determined by the Board (or a subcommittee thereof) in its discretion, based on the achievement of individual and/or Company performance goals as determined by the Board (or a subcommittee thereof), and shall be pro-rated for any partial year of employment. Payment of the Annual Bonus shall be subject to the Executive’s continued employment through the payment date.
(iii) Annual Equity Award(s). For each calendar year during the Employment Period beginning with calendar year 2026, the Executive shall be eligible to receive equity-based compensation awards, as determined by the Board (or a subcommittee thereof), from time to time. The Board or such subcommittee shall determine in its sole discretion the grant timing, amount, form(s) and mix, and such other terms and conditions (including vesting, exercise and settlement) applicable to any such annual equity-based compensation award, taking into account the Executive’s and the Company’s performance. Any such award shall be evidenced by a separate award agreement in a form prescribed by the Company, to be entered into by PubCo and the Executive.
(iv) Benefits. During the Employment Period, the Executive (and the Executive’s spouse and/or eligible dependents to the extent provided in the applicable plans and programs) shall be eligible to participate in and be covered under the health and welfare benefit plans and programs maintained by the Company for the benefit of its employees from time to time, pursuant to the terms of such plans and programs including any medical, dental, vision, health savings accounts, limited purpose and dependent care flexible spending accounts, short- and long-term disability and life insurance plans and programs on the same terms and conditions
as those applicable to similarly situated senior executives. In addition, during the Employment Period, the Executive shall be eligible to participate in any retirement, savings and other employee benefit plans and programs maintained from time to time by the Company for the benefit of its senior executive officers. Nothing contained in this Section 2(b)(iv) shall create or be deemed to create any obligation on the part of the Company to adopt or maintain any health, welfare, retirement or other benefit plan or program at any time or to create any limitation on the Company’s ability to modify or terminate any such plan or program.
(v) Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by the Executive in connection with the performance of the Executive’s duties under this Agreement in accordance with the policies, practices and procedures of the Company provided to employees of the Company.
(vi) Fringe Benefits. During the Employment Period, the Executive shall be eligible to receive such fringe benefits and perquisites as are provided by the Company to its employees from time to time, in accordance with the policies, practices and procedures of the Company, and shall receive such additional fringe benefits and perquisites as the Company may, in its discretion, from time-to-time provide to its senior executive officers.
(vii) Vacation. During the Employment Period, the Executive shall be entitled to paid vacation in accordance with the plans, policies, programs and practices of the Company applicable to its employees, as in effect from time to time.
3. Termination of Employment.
(a) Death or Disability. The Executive’s employment shall terminate automatically upon the Executive’s death during the Employment Period. Either the Company or the Executive may terminate the Executive’s employment in the event of the Executive’s Disability during the Employment Period.
(b) Termination by the Company with or without Cause. The Company may terminate Executive’s employment without Cause. The Company may terminate the Executive’s employment during the Employment Period immediately for Cause upon written notice to the Executive setting forth in reasonable detail the nature of the Cause.
(c) Termination by the Executive with or without Good Reason. Executive may resign Executive’s employment with the Company for any reason other than Good Reason or for no reason. Notwithstanding anything to the contrary in this Section 3, the Executive may terminate the Executive’s employment during the Employment period for Good Reason upon written notice to the Company.
(d) Notice of Termination. Any termination of employment (other than due to the Executive’s death), shall be communicated by a Notice of Termination to the other parties hereto given in accordance with Section 13(b). The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder.
(e) Termination of Offices and Directorships; Return of Property. Upon termination of the Executive’s employment for any reason, unless otherwise specified in a written agreement between the Executive and the Company, the Executive shall be deemed to have resigned from all offices, directorships, and other employment positions if any, then held with the Company, and shall take all actions reasonably requested by the Company to effectuate the foregoing. In addition, upon the termination of the Executive’s employment for any reason, the Executive agrees to return to the Company all documents of the Company and its Affiliates (and all copies thereof) and all other Company or Company Affiliate property that the Executive has in the Executive’s possession, custody or control. Such property includes, without limitation: (i) any materials of any kind that the Executive knows contain or embody any proprietary or confidential information of the Company or an Affiliate of the Company (and all reproductions thereof), (ii) computers (including, but not limited to, laptop computers, desktop computers and similar devices) and other portable electronic devices (including, but not limited to, tablet computers), cellular phones/smartphones, Company credit cards, phone cards, entry cards, identification badges and keys, and (iii) any correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the customers, business plans, marketing strategies, products and/or processes of the Company or any of its Affiliates and any information received from the Company or any of its Affiliates regarding third parties.
4. Obligations of the Company upon Termination.
(a) Accrued Obligations; Equity Awards.
(i) If the Executive’s employment under this Agreement terminates during the Employment Period for any reason, the Company will pay or provide to the Executive: (i) any earned but unpaid Base Salary and accrued vacation time through the Date of Termination, (ii) reimbursement of any business expenses incurred by the Executive prior to the Date of Termination that are reimbursable in accordance with Section 2(b)(v), and (iii) any vested amounts due to the Executive under any plan, program or policy of the Company (together, the “Accrued Obligations”). The Accrued Obligations described in clauses (i) – (ii) of the preceding sentence shall be paid within thirty (30) days after the Date of Termination (or such earlier date as may be required by applicable law) and the Accrued Obligations described in clause (iii) of the preceding sentence shall be paid in accordance with the terms of the governing plan or program.
(ii) Except as set forth in Section 4(b)(ii) below, each outstanding equity or equity-based award granted to the Executive by PubCo that is outstanding and, if applicable, unexercised as of the Date of Termination shall be governed by the applicable award agreement evidencing such award.
(b) Qualifying Termination. Subject to Sections 4(d), 4(f) and 13(d), and the Executive’s continued compliance with the provisions of Sections 7 and 8, if the Executive’s employment with the Company is terminated during the Employment Period due to a Qualifying Termination, then in addition to the Accrued Obligations:
(i) Cash Severance. The Company shall pay the Executive an amount equal to eighteen (18) months of the Executive’s Base Salary (the “Severance”). The Severance shall be paid in substantially equal installments in accordance with the Company’s normal payroll practices over the eighteen (18)-month period following the Date of Termination, but shall commence on the first (1st) normal payroll date following the sixtieth (60th) day
following the Date of Termination, and amounts otherwise payable prior to such first (1st) payroll date shall be paid on such date without interest thereon.
(ii) Equity-Based Awards. Any outstanding and unvested PubCo equity or equity-based award held by the Executive on the Date of Termination that vests based solely on the passage of time shall thereupon vest and, to the extent applicable, become exercisable, to the extent that such equity or equity-based award would have vested had the Executive remained in continuous employment with the Company until the twelve (12) month anniversary of the Date of Termination.
(c) Death or Disability. If the Executive’s employment with the Company terminates as a result of the Executive’s death or Disability, then the Executive (or the Executive’s estate) shall receive the Accrued Obligations.
(d) Release. Notwithstanding the foregoing, it shall be a condition to the Executive’s (or the Executive’s estate’s) right to receive the amounts provided for in Section 4(b) that the Executive (or the Executive’s estate, if applicable) execute and deliver to the Company an effective release of claims in substantially the form attached hereto as Exhibit B (the “Release”) and the Release becomes irrevocable within thirty (30) days (or, to the extent required by law, fifty-two (52) days) following the Date of Termination.
(e) Other Terminations. Except as otherwise set forth in a written agreement by and between the Executive and the Company, if the Executive’s employment is terminated for any reason not described in Section 4(b) or 4(c), the Company will pay the Executive only the Accrued Obligations.
(f) Six-Month Delay. Notwithstanding anything to the contrary in this Agreement, no compensation or benefits, including without limitation any severance payments or benefits payable under this Section 4, shall be paid to the Executive during the six (6)-month period following the Executive’s Separation from Service if the Company determines that paying such amounts at the time or times indicated in this Agreement would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence, then on the first (1st) day of the seventh (7th) month following the date of Separation from Service (or such earlier date upon which such amount can be paid under Section 409A without resulting in a prohibited distribution, including as a result of the Executive’s death), the Company shall pay the Executive a lump-sum amount equal to the cumulative amount that would have otherwise been payable to the Executive during such period.
(g) Exclusive Benefits. Except as expressly provided in this Section 4 and subject to Section 5, the Executive shall not be entitled to any additional payments or benefits upon or in connection with the Executive’s termination of employment.
5. Non-Exclusivity of Rights. Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.
6. Excess Parachute Payments; Limitation on Payments.
(a) Best Pay Cap. Notwithstanding any other provision of this Agreement, if any payment or benefit received or to be received by the Executive (including any payment or benefit received in connection with a termination of the Executive’s employment, whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement) (all such payments and benefits, including the payments and benefits under Section 4, being hereinafter referred to as the “Total Payments”) would be subject (in whole or part), to the excise tax imposed under Section 4999 of the Code (the “Excise Tax”), then, the Total Payments shall be reduced, to the extent necessary so that no portion of the Total Payments is subject to the Excise Tax but only if (i) the net amount of such Total Payments, as so reduced (and after subtracting the net amount of federal, state and local income taxes on such reduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such reduced Total Payments) is greater than or equal to (ii) the net amount of such Total Payments without such reduction (but after subtracting the net amount of federal, state and local income taxes on such Total Payments and the amount of Excise Tax to which the Executive would be subject in respect of such unreduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such unreduced Total Payments). If the Total Payments are so reduced, the Company shall reduce or eliminate the Total Payments (A) by first reducing or eliminating the portion of the Total Payments which are not payable in cash (other than that portion of the Total Payments subject to clause (C)), (B) then by reducing or eliminating cash payments (other than that portion of the Total Payments subject to clause (C)) and (C) then by reducing or eliminating the portion of the Total Payments (whether payable in cash or not payable in cash) to which Treasury Regulation § 1.280G-1 Q/A 24(c) (or successor thereto) applies, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time.
(b) Certain Exclusions. For purposes of determining whether and the extent to which the Total Payments will be subject to the Excise Tax, (i) no portion of the Total Payments the receipt or enjoyment of which the Executive shall have waived at such time and in such manner as not to constitute a “payment” within the meaning of Section 280G(b) of the Code shall be taken into account; (ii) no portion of the Total Payments shall be taken into account which, in the written opinion of an independent, nationally recognized accounting firm (the “Independent Advisors”) selected by the Company, does not constitute a “parachute payment” within the meaning of Section 280G(b)(2) of the Code (including by reason of Section 280G(b)(4)(A) of the Code) and, in calculating the Excise Tax, no portion of such Total Payments shall be taken into account which, in the opinion of Independent Advisors, constitutes reasonable compensation for services actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in excess of the “base amount” (as defined in Section 280G(b)(3) of the Code) allocable to such reasonable compensation; and (iii) the value of any non-cash benefit or any deferred payment or benefit included in the Total Payments shall be determined by the Independent Advisors in accordance with the principles of Sections 280G(d)(3) and (4) of the Code.
7. Restrictive Covenants. The Executive acknowledges that the Company and its Affiliates are engaged in businesses which make it crucial for them to develop and retain trade secrets and other confidential information and that the Executive will develop and learn such information in the course of his employment. In light of these facts and in consideration of the Executive’s continued employment with the Company and the Company’s agreement to compensate the Executive on the terms set forth in Section 2(b), the Executive covenants and agrees as follows:
(a) Covenant to Protect Confidential Information. The Executive shall protect all Confidential Information (as defined below) at all times, both during and after the Employment Period,
and shall not disclose to any Person or otherwise use any Confidential Information, except in accordance with this Agreement.
(i) The Executive has and will continue to receive and otherwise be exposed, directly and indirectly, to confidential and proprietary information of the Company whether in graphic, written, electronic or oral form, including without limitation information relating to the Company’s business, strategies, designs, products, services and technologies and any derivatives, improvements and enhancements relating to any of the foregoing, or to the Company’s suppliers, customers or business partners (collectively “Confidential Information”). Confidential Information may be identified at the time of disclosure as confidential or proprietary information which by its context would reasonably be deemed to be confidential or proprietary. “Confidential Information” includes (a) those portions of computer software programs, codes and related information used by any of the Company and its Affiliates which have been customized for use in the business of any of the Company and its Affiliates; (b) data, formulae, compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions and ideas, past, current, and planned research and development, current and planned building and sales methods and processes, customer lists, contractor and subcontractor lists, price lists, market studies, business plans, computer software and programs and any other information, however documented, of the Company or an Affiliate that is a trade secret under applicable law; (c) any and all information concerning the business and affairs of the Company or an Affiliate (which includes historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans, the names and backgrounds of key personnel and contractors, and personnel training and techniques and materials), however documented; and (d) any and all notes, analysis, compilations, studies, summaries, and other material prepared by or for the Company or an Affiliate containing or based, in whole or in part, on any information included in the foregoing. “Confidential Information” may also include without limitation (a)(i) unpublished patent disclosures and patent applications and other filings, know-how, trade secrets, works of authorship and other intellectual property, as well as any information regarding ideas, Inventions (as defined in Section 8(a)), technology, and processes, including without limitation assays, sketches, schematics, techniques, drawings, designs, descriptions, specifications and technical documentation, (ii) specifications, protocols, models, designs, equipment, engineering, algorithms, software programs, software source documents, formulae, (iii) information concerning or resulting from any research and development or other project, including without limitation, experimental work, product development plans, regulatory compliance information, and research, development and regulatory strategies, and (iv) business and financial information, including without limitation purchasing, procurement, manufacturing, customer lists, information relating to investors, employees, business and contractual relationships, business forecasts, sales and merchandising, business and marketing plans, product plans, and business strategies, including without limitation information the Company provides regarding third parties, such as, but not limited to, suppliers, customers, employees, investors, or vendors; and (b) any other information, to the extent such information contains, reflects or is based upon any of the foregoing Confidential Information. Confidential Information may also include information of a third party that is disclosed to the Executive by the Company or such third party at the Company’s direction.
(ii) The Executive acknowledges the confidential and secret character of Confidential Information, and agrees that Confidential Information is the sole,
exclusive and valuable property of the Company. Accordingly, except as expressly provided in Section 7(a)(iii) below, the Executive agrees not to use Confidential Information except in the performance of the Executive’s authorized duties as an employee of the Company, and not to disclose any Confidential Information in any form to any third party, either during or after the term of the Executive’s employment, without the prior written consent of the Company on a case-by-case basis. Upon termination of the Executive’s employment, the Executive agrees to cease using and to return to the Company all whole and partial copies and derivatives of the Confidential Information, whether in the Executive’s possession or under the Executive’s direct or indirect control, provided that the Executive is entitled to retain the Executive’s personal copies of (a) the Executive’s personal compensation records that do not contain any other Confidential Information, including any compensation information pertaining to any other Person, (b) materials distributed to stockholders generally, and (c) this Agreement. The Executive understands that the Executive’s obligations of nondisclosure with respect to Confidential Information shall not apply to information that the Executive can establish by competent proof (x) was actually in the public domain at the time of disclosure or enters the public domain following disclosure other than as a result of a breach of this Agreement, (y) is already in the Executive’s possession without breach of any obligations of confidentiality at the time of disclosure by the Company as shown by the Executive’s files and records immediately prior to the time of disclosure, or (z) is obtained by the Executive from a third party not under confidentiality obligations and without a breach of any obligations of confidentiality. If the Executive becomes compelled by law, regulation (including without limitation the rules of any applicable securities exchange), court order, or other governmental authority to disclose the Confidential Information, the Executive shall, to the extent possible and permissible under applicable law, first give the Company prompt notice. The Executive agrees to cooperate reasonably with the Company in any proceeding to obtain a protective order or other remedy. If such protective order or other remedy is not obtained, the Executive shall only disclose that portion of such Confidential Information required to be disclosed, in the opinion of the Executive’s legal counsel. The Executive shall request that confidential treatment be accorded such Confidential Information, where available. Compulsory disclosures made pursuant to this section shall not relieve the Executive of the Executive’s obligations of confidentiality and non-use with respect to non-compulsory disclosures.
(iii) The Executive understands that nothing herein is intended to or shall prevent the Executive from (i) communicating directly with, cooperating with, or providing information to, or receiving financial awards from, any federal, state or local government regulatory agency, including, but not limited to, the U.S. Securities and Exchange Commission, the U.S. Commodity Futures Trading Commission, or the U.S. Department of Justice, the U.S. Equal Employment Opportunity Commission, or the U.S. National Labor Relations Board, without notifying or seeking permission from the Company, (ii) discussing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination based on a protected characteristic or any other conduct that the Executive has reason to believe is unlawful or (iii) prohibit Executive from reporting possible violations of federal law or regulation to any United States governmental agency or entity in accordance with the provisions of and rules promulgated under Section 21F of the Securities Exchange Act of 1934 or Section 806 of the Sarbanes-Oxley Act of 2002, or any other whistleblower protection provisions of state or federal law or regulation (including the right to receive an award for information provided to any such government agencies). The Executive shall promptly notify the Company if the Executive learns of any
possible unauthorized use or disclosure of proprietary information and shall cooperate fully with the Company to enforce its rights in such information.
(iv) The Executive acknowledges that the Company has provided the Executive notice of immunity rights under the Defend Trade Secrets Act, which states: “(1) An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that (A) is made (i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal; and (2) an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose a trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual (A) files any document containing the trade secret under seal, and (B) does not disclose a trade secret, except pursuant to court order.”
(b) Covenants Against Competition. The Executive specifically acknowledges that his employment with the Company has and will continue to enable him to acquire valuable information as to the nature and character of the businesses of the Company and its Affiliates. The Executive acknowledges that in the event he were to become employed by some other employer or enter the same or similar business as a business conducted by the Company or its Affiliates on his own or in conjunction with others in competition with the Company or an Affiliate of the Company, such valuable information could give to the Executive an unfair competitive advantage. The Executive further acknowledges and agrees that the covenants contained in this Section 7(b) are reasonable and necessary to protect the legitimate business interests of the Company and its Affiliates, including their trade secrets, other Confidential Information and goodwill. Consequently:
(i) The Executive shall not, except on behalf of the Company or an Affiliate of the Company, at any time during the Restricted Period, directly or indirectly, whether alone or with any other Person as a partner, officer, director, manager, employee, agent, shareholder, member, consultant, or otherwise, directly or indirectly, engage or invest in, own, manage, operate, finance, control, or participate in the ownership, management, operation, financing, or control of, be employed by, or render management, marketing, sales, operational, strategic, or technical services or advice to, any Competitive Business; provided, however, that the Executive may purchase or otherwise acquire up to (but not more than) one percent (1%) of any class of securities of any Competitive Business (but without otherwise participating in the activities of such Competitive Business) if such securities have been registered under Section 12(b) or 12(g) of the Securities Exchange Act of 1934.
(ii) The Executive shall not, except on behalf of the Company or an Affiliate of the Company, at any time during the Restricted Period, directly or indirectly, whether alone or with any other Person as a partner, officer, director, manager, employee, agent, shareholder, member, consultant, or otherwise:
A. Induce or attempt to induce any employee of the Company or its Affiliates to leave the employ of the Company or its Affiliates; or
B. Solicit for employment any employee of the Company or its Affiliates or any Person employed by the Company or its Affiliates during the prior six (6) months.
(iii) The Executive shall not, except on behalf of the Company or an Affiliate of the Company, at any time during the Restricted Period and within the Restricted Territory, directly or indirectly, whether alone or with any other Person as a partner, officer, director, manager, employee, agent, shareholder, member, consultant, or otherwise:
A. In any way interfere with the business relationship between the Company or its Affiliates and any employee of the Company or its Affiliates; or
B. Induce or attempt to induce any Company Customer to cease doing business with the Company or its Affiliates, or in any way interfere with the business relationship between any Company Customer and the Company or its Affiliates.
(c) Non-Disparagement. Except as otherwise provided in Sections 7(a)(iii) and (iv), the Executive agrees and covenants that the Executive will not make, publish, or communicate defamatory or disparaging remarks, comments, or statements concerning any of the Company or its Affiliates’ products or services. The Executive agrees and covenants that the Executive will not at any time make, publish, or communicate to any Person or in any public forum any maliciously false remarks, comments, or statements concerning the Company or its Affiliates, or any of its employees, officers, existing and prospective customers, suppliers, investors, and other associated third parties, now or at any time in the future. For the avoidance of doubt, this Section 7(c) does not restrict or impede the Executive from exercising any rights to communicate with securities regulators or any other administrative or regulatory agency to report suspected unlawful conduct, or rights to discuss or disclose information regarding a sexual assault or sexual harassment dispute arising after the date of this Agreement.
(d) Tolling. The period of any restrictive covenant set forth in this Agreement (including, without limitation, any non-competition or non-solicitation obligation) shall be extended by the length of any period during which the Executive is found to be in breach of such covenant, so that the Company receives the full benefit of the agreed-upon duration of the restriction. The tolling shall continue until the breach has been cured and the Executive is in full compliance with the applicable provision.
8. Inventions and Copyrights.
(a) Inventions. The Executive shall disclose promptly to the Company (which will receive it in confidence), and only to the Company, any invention or idea of the Executive (developed alone or with others) conceived or made during his employment with the Company or within six (6) months following the Executive’s employment termination date in the course of the Executive’s employment by the Company or in any way connected with the Executive’s employment or related to the Company’s business, research or development, or demonstrably anticipated research or development (“Inventions”). The Executive assigns to the Company any such invention or idea, and will cooperate with the Company and sign all documents deemed necessary by the Company to enable it to obtain, maintain, protect, and defend patents covering such inventions and ideas and to confirm the Company’s exclusive ownership of all rights in such inventions, ideas, and patents, and irrevocably appoints the Company as his agent to execute and deliver any assignments or documents that the Executive fails or
refuses to execute and deliver promptly, this power and agency being coupled with an interest and being irrevocable. This constitutes the Company’s written notification that the disclosure requirement and assignment provided in this Section 8(a) does not apply to an invention for which no equipment, supplies, facility, or trade secret information of the Company was used and which was developed entirely on the Executive’s own time, unless (a) the invention relates (i) directly to the business of the Company, or (ii) to the Company’s actual or demonstrably anticipated research or development, or (b) the invention results from any work performed by the Executive for the Company.
(b) Work for Hire Acknowledgment; Assignment. The Executive acknowledges that the Executive’s work on and contributions to documents and other expressions in tangible media (collectively, “Works”) are within the scope of the Executive’s employment and part of the Executive’s duties and responsibilities for the Company and its Affiliates. The Executive’s work on and contributions to any Works will be rendered and made by the Executive for, at the instigation of, and under the overall direction of, the Company, and are and at all times will be regarded, together with any such Works, as “work made for hire” as that term is used in the United States copyright laws. Without limiting this acknowledgment, the Executive assigns, grants, and delivers exclusively to the Company all rights, titles, and interests in and to any such Works, and all copies and versions, including all copyrights and renewals. The Executive shall execute and deliver to the Company, its successors and assigns, any assignments and documents that the Company requests for the purpose of establishing, evidencing, and enforcing or defending its complete, perpetual, and worldwide ownership of all rights, titles, and interests of every kind and nature, including all copyrights, in and to the Works, and the Executive constitutes and appoints the Company as its agent to execute and deliver any assignments or documents that the Executive fails or refuses to execute and deliver, this power and agency being coupled with an interest and being irrevocable.
9. Representations. The Executive hereby represents and warrants to the Company that (a) the Executive is entering into this Agreement voluntarily and that the performance of the Executive’s obligations hereunder will not violate any agreement between the Executive and any other person, firm, organization or other entity, or any policy, program or code of such other person, firm, organization or other entity person, and (b) the Executive is not bound by the terms of any agreement with any previous employer or other party to refrain from competing, directly or indirectly, with the business of such previous employer or other party that would be violated by the Executive’s entering into this Agreement and/or providing services to the Company pursuant to the terms of this Agreement.
10. Successors.
(a) This Agreement is personal to the Executive and, without the prior written consent of the Company, shall not be assignable by the Executive other than Executive’s rights to payment hereunder by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives. The Company may assign its rights and obligations under this Agreement to any of its Affiliates or to any successor to all or substantially all of the business or the assets of the Company (by merger or otherwise).
(b) This Agreement shall inure to the benefit of and be binding upon the Company and its respective successors and assigns.
11. Certain Definitions.
(a) “Affiliate” of any particular Person means any other Person directly or indirectly controlling, controlled by, or under common control with such particular Person, where “control” means the possession, directly or indirectly, of the power to direct the management and policies of a Person whether through the ownership of voting securities, by contract, or otherwise.
(b) “Board” means the Board of Directors of PubCo.
(c) “Cause” means the occurrence of any one or more of the following events as determined by the Board in its reasonable judgement:
(i) the Executive’s material failure to perform (other than by reason of Disability), or substantial misconduct in the performance of the Executive’s duties and responsibilities for the Company or any of its Affiliates which causes material harm to the Company;
(ii) the Executive’s material and demonstrable breach of any provision of Sections 7 or 8 or of any other confidentiality, invention assignment or other restrictive covenant obligation set forth in any written agreement by and between the Executive and the Company or any of its Affiliates;
(iii) the Executive’s material and demonstrable breach of any other provision of this Agreement or any other written agreement by and between the Executive and the Company and or any of its Affiliates;
(iv) the Executive’s material violation of any applicable policy or code of conduct of the Company or any of its Affiliates, which violation causes material reputational or financial harm to the Company; or
(v) the Executive’s indictment for, or plea of nolo contendere to, any felony or any crime involving moral turpitude.
Notwithstanding anything to the contrary in the foregoing, a circumstance otherwise giving rise to Cause pursuant to the foregoing clause (i), (ii), (iii) or (iv), if capable of cure, will not constitute Cause if cured by the Executive within ten (10) days following the Company’s notice to the Executive thereof, provided, however, that the Company will not be required to provide any such notice or opportunity to cure with respect to any subsequent substantially similar or related conduct.
(d) “Change in Control” has the meaning set forth in the Plan.
(e) “Code” means the Internal Revenue Code of 1986, as amended and the regulations thereunder.
(f) “Company Customer” means any individual or entity who (i) is, or was at any time during the two (2) year period prior to the termination of the Executive’s employment with the Company, a customer, supplier, or vendor of the Company or its Affiliates of whom the Executive learned, with whom the Executive had business contact or about whom the Executive obtained Confidential Information (as defined above) at any time during the Executive’s employment with the
Company, or (ii) is a prospective customer, supplier, or vendor of the Company or its Affiliates of whom the Executive learned, with whom the Executive had business contact, or about whom the Executive obtained Confidential Information as part of a solicitation of business on behalf of the Company or its Affiliates at any time during the two (2) year period prior to the Executive’s employment termination date.
(g) “Competitive Business” means any Person engaged in the space exploration and/or defense industries or that offers any product or service that was being developed, marketed, offered, or provided by the Company at any time during the last two (2) years of Executive’s employment with the Company in the Restricted Territory.
(h) “Date of Termination” means the date on which the Executive’s employment with the Company terminates, which, if Executive’s employment is terminated as a result of Executive’s death, will be the date of Executive’s death, and otherwise shall be the date specified in a Notice of Termination, which, other than in the case of a termination by the Company for Cause, shall be at least ninety (90) days following the date of the Notice of Termination; provided, however, that in the event that Executive delivers a Notice of Termination to the Company, the Company may, in its sole discretion, change the Date of Termination to any date that occurs on or following the date of Executive’s Notice of Termination and is prior to the Date of Termination specified in Executive’s Notice of Termination.
(i) “Disability” means that the Executive has become entitled to receive benefits under an applicable Company long-term disability plan or, if no such plan covers the Executive, the Executive’s inability, due to physical or mental illness, to perform the essential functions of the Executive’s job, with or without a reasonable accommodation for one hundred and eighty (180) consecutive days.
(j) “Good Reason” means the occurrence of any one or more of the following events without the Executive’s consent, unless the Company fully corrects the circumstances constituting Good Reason (provided such circumstances are capable of correction) as provided below:
(i) a material diminution in the Executive’s Base Salary, other than as part of an across-the-board reduction applicable to the Company’s senior executives; or
(ii) a material diminution in the Executive’s authority, responsibilities or duties, as contemplated by this Agreement.
Notwithstanding the foregoing, the Executive will not be deemed to have resigned for Good Reason unless (A) the Executive provides the Company with written notice setting forth in reasonable detail the facts and circumstances claimed by the Executive to constitute Good Reason within thirty (30) days after the initial existence of the facts or circumstances constituting Good Reason, (B) the Company fails to cure such acts or omissions within thirty (30) days following its receipt of such notice, and (C) the effective date of the Executive’s termination for Good Reason occurs no later than ninety (90) days after the initial existence of the facts or circumstances constituting Good Reason.
(k) “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated and (iii) if the Date of Termination is other than the date of receipt of such notice,
specifies the termination date (which date shall be not more than thirty (30) days after the giving of such notice unless as otherwise provided upon a termination for Good Reason).
(l) “Person” means any individual, partnership, corporation, limited liability company, association, joint stock company, trust, joint venture, unincorporated organization, bank, or other entity.
(m) “Plan” means Company’s 2025 Incentive Award Plan, as amended from time to time.
(n) “Qualifying Termination” means a termination of the Executive’s employment (i) by the Company without Cause (other than by reason of the Executive’s death or Disability) or (ii) by the Executive for Good Reason.
(o) “Restricted Period” means the period beginning on the Effective Date and ending twelve (12) months after the Executive’s Date of Termination.
(p) “Restricted Territory” means the State of Colorado and those states in which the Executive had material responsibility or knowledge for a Competing Business or Company Customer during the last two (2) years of the Executive’s employment.
(q) “Section 409A” means Section 409A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder.
(r) “Separation from Service” means a “separation from service” (within the meaning of Section 409A).
(s) “Subsidiary” means any entity (other than the Company), whether domestic or foreign, in an unbroken chain of entities beginning with the Company if each of the entities other than the last entity in the unbroken chain beneficially owns, at the time of the determination, securities or interests representing at least fifty percent (50%) of the total combined voting power of all classes of securities or interests in one of the other entities in such chain.
12. Indemnification. The parties hereby acknowledge that in connection with the execution of this Agreement, they are entering into an Indemnification Agreement (the “Indemnification Agreement”), substantially in the form attached hereto as Exhibit C, which shall become effective as of the Effective Date.
13. Miscellaneous.
(a) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect.
(b) Notices. All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party, sent by facsimile or email, or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:
If to the Executive: at the Executive’s most recent address on the records of the Company.
If to the Company:
c/o Head of Human Resources
1225 17th Street
Suite 1100
Denver, Colorado 80202
or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee.
(c) Sarbanes-Oxley Act of 2002. Notwithstanding anything herein to the contrary, if the Company determines, in its good faith judgment, that any transfer or deemed transfer of funds hereunder is likely to be construed as a personal loan prohibited by Section 13(k) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (the “Exchange Act”), then such transfer or deemed transfer shall not be made to the extent necessary or appropriate so as not to violate the Exchange Act and the rules and regulations promulgated thereunder.
(d) Section 409A of the Code.
(i) To the extent applicable, this Agreement shall be interpreted in accordance with Section 409A. Notwithstanding any provision of this Agreement to the contrary, if the Company determines that any compensation or benefits payable under this Agreement may be subject to Section 409A, the Company shall work in good faith with the Executive to adopt such amendments to this Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Company determines are necessary or appropriate to avoid the imposition of taxes under Section 409A, including without limitation, actions intended to (i) exempt the compensation and benefits payable under this Agreement from Section 409A, and/or (ii) comply with the requirements of Section 409A; provided, however, that this Section 13(d) shall not create an obligation on the part of the Company to adopt any such amendment, policy or procedure or take any such other action, nor shall the Company have any liability for failing to do so.
(ii) Any right to a series of installment payments pursuant to this Agreement is to be treated as a right to a series of separate payments. To the extent permitted under Section 409A, any separate payment or benefit under this Agreement or otherwise shall not be deemed “nonqualified deferred compensation” subject to Section 409A to the extent provided in the exceptions in Treasury Regulation Section 1.409A-1(b)(4), Section 1.409A-1(b)(9) or any other applicable exception or provision of Section 409A. Any payments subject to Section 409A that are subject to execution of a waiver and release which may be executed and/or revoked in a calendar year following the calendar year in which the payment event (such as termination of employment) occurs shall commence payment only in the calendar year in which the consideration period or, if applicable, release revocation period ends, as necessary to comply with Section 409A. All payments of nonqualified deferred compensation subject to Section 409A to be
made upon a termination of employment under this Agreement may only be made upon the Executive’s Separation from Service.
(iii) To the extent that any payments or reimbursements provided to the Executive under this Agreement are deemed to constitute compensation to the Executive to which Treasury Regulation Section 1.409A-3(i)(1)(iv) would apply, such amounts shall be paid or reimbursed reasonably promptly, but not later than December 31 of the year following the year in which the expense was incurred. The amount of any such payments eligible for reimbursement in one year shall not affect the payments or expenses that are eligible for payment or reimbursement in any other taxable year, and the Executive’s right to such payments or reimbursement of any such expenses shall not be subject to liquidation or exchange for any other benefit.
(e) Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.
(f) Withholding. The Company may withhold from any amounts payable under this Agreement such federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.
(g) No Waiver. The Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3(c), shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.
(h) Compensation Recovery Policy. Executive acknowledges and agrees that, to the extent the Company adopts any claw-back or similar policy pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act and any rules and regulations promulgated thereunder (collectively, “Dodd-Frank”) or otherwise, he shall take all action necessary to comply with such policy (including, without limitation, entering into any further agreements, amendments or policies reasonably necessary or appropriate to implement and/or enforce such policy with respect to past, present and future compensation, as appropriate).
(i) Entire Agreement. As of the Effective Date, this Agreement, constitutes the final, complete and exclusive agreement between the Executive and the Company with respect to the subject matter hereof and replaces and supersedes any and all other agreements, offers or promises, whether oral or written, by any member of the Company and its Affiliates, or representative thereof (including the Prior Agreement). Notwithstanding anything herein to the contrary, this Agreement and the obligations and commitments hereunder shall neither commence nor be of any force or effect prior to the Effective Date.
(j) Arbitration.
(i) Any controversy or dispute that establishes a legal or equitable cause of action (“Arbitration Claim”) between any two or more Persons Subject to Arbitration (as defined below), including any controversy or dispute, whether based on contract, common law, or federal, state or local statute or regulation, arising out of, or relating to the Executive’s service or the termination thereof, shall be submitted to final and binding arbitration as the sole and exclusive remedy for such controversy or dispute in accordance with the rules of JAMS pursuant to its Employment Arbitration Rules and Procedures, which are available at http://www.jamsadr.com/
rules-employment-arbitration/, and the Company will provide a copy upon the Executive’s request. Notwithstanding the foregoing, this Agreement shall not require any Person Subject to Arbitration to arbitrate pursuant to this Agreement any claims: (A) under a Company benefit plan subject to the Employee Retirement Income Security Act, as amended; or (B) as to which applicable law not preempted by the Federal Arbitration Act prohibits resolution by binding arbitration. Either party may seek provisional non-monetary remedies in a court of competent jurisdiction to the extent that such remedies are not available or not available in a timely fashion through arbitration. It is the parties’ intent that issues of arbitrability of any dispute shall be decided by the arbitrator.
(ii) “Persons Subject to Arbitration” means, individually and collectively, (A) the Executive, (B) any person in privity with or claiming through, on behalf of or in the right of the Executive, (C) the Company, (D) any past, present or future Affiliate, employee, officer, director or agent of the Company, and/or (E) any person or entity alleged to be acting in concert with or to be jointly liable with any of the foregoing.
(iii) The arbitration shall take place before a single neutral arbitrator at the JAMS office in Denver, Colorado. Such arbitrator shall be provided through JAMS by mutual agreement of the parties to the arbitration; provided that, absent such agreement, the arbitrator shall be selected in accordance with the rules of JAMS then in effect. The arbitrator shall permit reasonable discovery. The award or decision of the arbitrator shall be rendered in writing; shall be final and binding on the parties; and may be enforced by judgment or order of a court of competent jurisdiction.
(iv) THE EXECUTIVE AND THE COMPANY UNDERSTAND THAT BY AGREEING TO ARBITRATE ANY ARBITRATION CLAIM, THEY WILL NOT HAVE THE RIGHT TO HAVE ANY ARBITRATION CLAIM DECIDED BY A JURY OR A COURT, BUT SHALL INSTEAD HAVE ANY ARBITRATION CLAIM DECIDED THROUGH ARBITRATION.
(v) THE EXECUTIVE AND THE COMPANY WAIVE ANY CONSTITUTIONAL OR OTHER RIGHT TO BRING CLAIMS COVERED BY THIS AGREEMENT OTHER THAN IN THEIR INDIVIDUAL CAPACITIES. EXCEPT AS MAY BE PROHIBITED BY LAW, THIS WAIVER INCLUDES THE ABILITY TO ASSERT CLAIMS AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING.
(vi) This Section 13(j) shall be interpreted to conform to any applicable law concerning the terms and enforcement of agreements to arbitrate service disputes. To the extent any terms or conditions of this Section 13(j) would preclude its enforcement, such terms shall be severed or interpreted in a manner to allow for the enforcement of this Section 13(j). To the extent applicable law imposes additional requirements to allow enforcement of this Section 13(j), this Agreement shall be interpreted to include such terms or conditions.
(k) Amendment; Survival. No amendment or other modification of this Agreement shall be effective unless made in writing and signed by the parties hereto. The respective rights and obligations of the parties under this Agreement shall survive the Executive’s termination of employment and the termination of this Agreement to the extent necessary for the intended preservation of such rights and obligations (including without limitation the covenants set forth in Sections 7 and 8).
(l) Counterparts. This Agreement and any agreement referenced herein may be executed in two or more counterparts, each of which shall be deemed an original but which together shall constitute one and the same instrument.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the authorization from the Board, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written.
| | | | | | | | | | | |
| VOYAGER TECHNOLOGIES, INC. |
| | | |
| | | |
| | | |
| By: | | |
| | Name: | |
| | Title: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| “EXECUTIVE” | |
| | | |
| | | |
| | | |
| | |
Attachments:
Exhibit A: Exclusivity Carve-Outs
Exhibit B: Release
Exhibit C: Indemnification Agreement
EXHIBIT A
EXCLUSIVITY CARVE-OUTS
1. Service as the Chief Executive Officer of Space for Humanity.
EXHIBIT B1
GENERAL RELEASE
1. Release. For valuable consideration, the receipt and adequacy of which are hereby acknowledged, the undersigned does hereby release and forever discharge the “Releasees” hereunder, consisting of Voyager Technologies, Inc. (the “Company”), and the Company’s partners, Subsidiaries, associates, Affiliates, successors, heirs, assigns, agents, directors, officers, employees, representatives, lawyers, insurers, and all persons acting by, through, under or in concert with them, or any of them, of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liability, claims, demands, damages, losses, costs, attorneys’ fees or expenses, of any nature whatsoever, known or unknown, fixed or contingent (hereinafter called “Claims”), which the undersigned now has or may hereafter have against the Releasees, or any of them, by reason of any matter, cause, or thing whatsoever from the beginning of time to the date hereof. The Claims released herein include, without limiting the generality of the foregoing, any Claims in any way arising out of, based upon, or related to the employment or termination of employment of the undersigned by the Releasees, or any of them; any alleged breach of any express or implied contract of employment; any alleged torts or other alleged legal restrictions on Releasees’ right to terminate the employment of the undersigned; and any alleged violation of any federal, state or local statute or ordinance including, without limitation, Title VII of the Civil Rights Act of 1964, the Age Discrimination In Employment Act (“ADEA”) and the Americans With Disabilities Act.
2. Claims Not Released. Notwithstanding the foregoing, this general release (the “Release”) shall not operate to release any rights or claims of the undersigned (i) to payments or benefits under Section 4(b) of that certain Employment Agreement, dated as of [_____], between the Company and the undersigned (the “Employment Agreement”), with respect to the payments and benefits provided in exchange for this Release, (ii) to payments or benefits under any equity award agreement between the undersigned and the Company or as a holder of any securities of the Company, (iii) with respect to Sections 2(b)(vii) or 4(a) of the Employment Agreement, (iv) to accrued or vested benefits the undersigned may have, if any, as of the date hereof under any applicable plan, policy, practice, program, contract or agreement with the Company, (v) to any Claims, including claims for indemnification and/or advancement of expenses arising under any indemnification agreement between the undersigned and the Company or under the bylaws, certificate of incorporation or other similar governing document of the Company, (vi) to any Claims which cannot be waived by an employee under applicable law or (vii) with respect to the undersigned’s right to communicate directly with, cooperate with, or provide information to, any federal, state or local government regulator.
3. Exceptions. Notwithstanding anything in this Release to the contrary, nothing contained in this Release shall prohibit the undersigned from (i) filing a charge with, reporting possible violations of federal law or regulation to, participating in any investigation by, or cooperating with any governmental agency or entity or making other disclosures that are protected under the whistleblower provisions of applicable law or regulation and/or (ii) communicating directly with, cooperating with, or providing information (including trade secrets) in confidence to, any federal, state or local government regulator (including, but not limited to, the U.S. Securities and Exchange Commission, the U.S. Commodity Futures Trading Commission, or the U.S. Department of Justice) for the purpose of reporting or investigating a suspected violation of law, or from providing such information to the undersigned’s attorney or in a sealed complaint or other document filed in a lawsuit or other governmental proceeding. Pursuant to 18 USC Section 1833(b), (1) the undersigned will not be held criminally or civilly liable
1 Subject to revision for applicable law at time of termination.
under any federal or state trade secret law for the disclosure of a trade secret that is made: (x) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (y) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal and (2) the undersigned acknowledges that an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual files any document containing the trade secret under seal and does not disclose the trade secret, except pursuant to court order.
4. Representations. The undersigned represents and warrants that there has been no assignment or other transfer of any interest in any Claim which the undersigned may have against Releasees, or any of them, and the undersigned agrees to indemnify and hold Releasees, and each of them, harmless from any liability, Claims, demands, damages, costs, expenses and attorneys’ fees incurred by Releasees, or any of them, as the result of any such assignment or transfer or any rights or Claims under any such assignment or transfer. It is the intention of the parties that this indemnity does not require payment as a condition precedent to recovery by the Releasees against the undersigned under this indemnity.
5. No Action. The undersigned agrees that if the undersigned hereafter commences any suit arising out of, based upon, or relating to any of the Claims released hereunder or in any manner asserts against Releasees, or any of them, any of the Claims released hereunder, then the undersigned agrees to pay to Releasees, and each of them, in addition to any other damages caused to Releasees thereby, all attorneys’ fees incurred by Releasees in defending or otherwise responding to said suit or Claim. Notwithstanding the foregoing, this provision shall not apply to any suit or Claim to the extent it challenges the effectiveness of this release with respect to a claim under the ADEA.
6. No Admission. The undersigned further understands and agrees that neither the payment of any sum of money nor the execution of this Release shall constitute or be construed as an admission of any liability whatsoever by the Releasees, or any of them, who have consistently taken the position that they have no liability whatsoever to the undersigned.
7. OWBPA. The undersigned agrees and acknowledges that this Release constitutes a knowing and voluntary waiver and release of all Claims the undersigned has or may have against the Company and/or any of the Releasees as set forth herein, including, but not limited to, all Claims arising under the Older Worker’s Benefit Protection Act and the ADEA. In accordance with the Older Worker’s Benefit Protection Act, the undersigned is hereby advised as follows:
(i) the undersigned has read the terms of this Release, and understands its terms and effects, including the fact that the undersigned agreed to release and forever discharge the Company and each of the Releasees, from any Claims released in this Release;
(ii) the undersigned understands that, by entering into this Release, the undersigned does not waive any Claims that may arise after the date of the undersigned’s execution of this Release, including without limitation any rights or claims that the undersigned may have to secure enforcement of the terms and conditions of this Release;
(iii) the undersigned has signed this Release voluntarily and knowingly in exchange for the consideration described in this Release, which the undersigned acknowledges is adequate
and satisfactory to the undersigned and which the undersigned acknowledges is in addition to any other benefits to which the undersigned is otherwise entitled;
(iv) the Company advises the undersigned to consult with an attorney prior to executing this Release;
(v) the undersigned has been given at least [twenty-one (21)]2 days in which to review and consider this Release. To the extent that the undersigned chooses to sign this Release prior to the expiration of such period, the undersigned acknowledges that the undersigned has done so voluntarily, had sufficient time to consider the Release, to consult with counsel and that the undersigned does not desire additional time and hereby waives the remainder of the [twenty-one (21)]-day period; and
(vi) the undersigned may revoke this Release within seven (7) days from the date the undersigned signs this Release and this Release will become effective upon the expiration of that revocation period if the undersigned has not revoked this Release during such seven (7)-day period. If the undersigned revokes this Release during such seven (7)-day period, this Release will be null and void and of no force or effect on either the Company or the undersigned and the undersigned will not be entitled to any of the payments or benefits which are expressly conditioned upon the execution and non-revocation of this Release. Any revocation must be in writing and sent to [name], via electronic mail at [email address], on or before [5:00 p.m. Eastern time] on the seventh (7th) day after this Release is executed by the undersigned.
8. Acknowledgement. The undersigned acknowledges that different or additional facts may be discovered in addition to what is now known or believed to be true by the undersigned with respect to the matters released in this Release, and the undersigned agrees that this Release shall be and remain in effect in all respects as a complete and final release of the matters released, notwithstanding any different or additional facts
9. Governing Law. This Release is deemed made and entered into in the State of Colorado, and in all respects shall be interpreted, enforced and governed under the internal laws of the State of Colorado, to the extent not preempted by federal law.
IN WITNESS WHEREOF, the undersigned has executed this Release this ____ day of ___________, ____.
2 NTD: Use 45 days in a group termination, and include information regarding terminated positions.
EXHIBIT C
INDEMNIFICATION AGREEMENT
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into by and between Voyager Technologies, Inc. a Delaware corporation (“PubCo” and together with any other Subsidiaries or Affiliates as may employ Executive from time to time, and any successor(s) thereto, the “Company”) and Matt Kuta (the “Executive”), effective as of the date of consummation of the initial public offering of PubCo’s Class A common stock (the “Effective Date”).
WHEREAS, the Executive is party to an Employment Agreement, by and between PubCo and the Executive, dated January 1, 2022 (the “Prior Agreement”), and the Company and the Executive intend to amend, restate and supersede the Prior Agreement in its entirety.
WHEREAS, the Company desires to continue to employ the Executive and the Company and the Executive desire to enter into an agreement embodying the terms of such continued employment, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Employment Period. Effective upon the Effective Date, the Executive’s employment hereunder shall be for a term commencing on the Effective Date and will end upon the date of termination of this Agreement under Section 3 (the “Employment Period”). Notwithstanding the foregoing, the Executive’s employment with the Company is and shall be on an “at will” basis, subject to the provisions of Section 3.
2. Terms of Employment.
(a) Position and Duties.
(i) Role and Responsibilities. During the Employment Period, the Executive shall serve as the Company’s President and shall perform such employment duties as are usual and customary for such position. The Executive shall report directly to the Company’s Chief Executive Officer (the “CEO”). At the Company’s request, the Executive shall serve the Company and/or its Subsidiaries or Affiliates in other capacities in addition to the foregoing, consistent with the Executive’s position hereunder. If the Executive, during the Employment Period, serves in any one or more of such additional capacities, the Executive’s compensation shall not be increased beyond that specified in Section 2(b) hereof. In addition, if the Executive’s service in one or more of such additional capacities is terminated, the Executive’s compensation, as specified in Section 2(b), shall not be diminished or reduced in any manner as a result of such termination provided that the Executive otherwise remains employed under the terms of this Agreement.
(ii) Exclusivity. During the Employment Period, and excluding any periods of leave to which the Executive may be entitled, the Executive agrees to devote the Executive’s full business time and attention to the business and affairs of the Company. Notwithstanding the foregoing, during the Employment Period it shall not be a violation of this Agreement for the Executive to: (A) serve on boards, committees or similar bodies of charitable or nonprofit organizations, (B) fulfill limited teaching, speaking and writing engagements, (C) manage the Executive’s personal investments, and (D) engage in any of the activities as set forth on Exhibit A, in each case, so long as such activities do not individually or in the aggregate
materially interfere or conflict with the performance of the Executive’s duties and responsibilities under this Agreement; provided, that with respect to the activities in subclauses (A) and/or (B), the Executive receives prior written approval from the Company’s Board of Directors (the “Board”). Executive agrees to observe and comply with the rules and policies of the Company as adopted by the Company from time to time, in each case as amended from time to time, as set forth in writing, and as delivered or made available to Executive.
(iii) Principal Location. During the Employment Period, the Executive generally shall perform the services required by this Agreement remotely from Executive’s home office in Denver, Colorado (the “Principal Location”), provided, however, that the parties acknowledge and agree that the Executive may be required to travel to other locations as may be necessary to fulfill the Executive’s duties and responsibilities hereunder.
(b) Compensation and Benefits.
(i) Base Salary. Effective as of the Effective Date and during the Employment Period, the Executive shall receive a base salary (the “Base Salary”) of four hundred thousand dollars ($400,000) per annum. The Base Salary shall be paid in accordance with the Company’s normal payroll practices for executive salaries generally, but no less often than monthly and shall be pro-rated for partial years of employment. The Base Salary may be reviewed in the discretion of the Board (or a subcommittee thereof), not less than annually.
(ii) Annual Cash Bonus. For each calendar year ending during the Employment Period beginning with calendar year 2025, the Executive shall be eligible to earn a cash performance bonus (an “Annual Bonus”) under the Company’s bonus plan or program applicable to senior executives targeted at six hundred thousand dollars ($600,000) paid with respect to such year (the “Target Bonus”). The actual amount of any Annual Bonus shall be determined by the Board (or a subcommittee thereof) in its discretion, based on the achievement of individual and/or Company performance goals as determined by the Board (or a subcommittee thereof), and shall be pro-rated for any partial year of employment. Payment of the Annual Bonus shall be subject to the Executive’s continued employment through the payment date.
(iii) Annual Equity Award(s). For each calendar year during the Employment Period beginning with calendar year 2026, the Executive shall be eligible to receive equity-based compensation awards, as determined by the Board (or a subcommittee thereof), from time to time. The Board or such subcommittee shall determine in its sole discretion the grant timing, amount, form(s) and mix, and such other terms and conditions (including vesting, exercise and settlement) applicable to any such annual equity-based compensation award, taking into account the Executive’s and the Company’s performance. Any such award shall be evidenced by a separate award agreement in a form prescribed by the Company, to be entered into by PubCo and the Executive.
(iv) Benefits. During the Employment Period, the Executive (and the Executive’s spouse and/or eligible dependents to the extent provided in the applicable plans and programs) shall be eligible to participate in and be covered under the health and welfare benefit plans and programs maintained by the Company for the benefit of its employees from time to time, pursuant to the terms of such plans and programs including any medical, dental, vision, health savings accounts, limited purpose and dependent care flexible spending accounts, short- and long-term disability and life insurance plans and programs on the same terms and conditions
as those applicable to similarly situated senior executives. In addition, during the Employment Period, the Executive shall be eligible to participate in any retirement, savings and other employee benefit plans and programs maintained from time to time by the Company for the benefit of its senior executive officers. Nothing contained in this Section 2(b)(iv) shall create or be deemed to create any obligation on the part of the Company to adopt or maintain any health, welfare, retirement or other benefit plan or program at any time or to create any limitation on the Company’s ability to modify or terminate any such plan or program.
(v) Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by the Executive in connection with the performance of the Executive’s duties under this Agreement in accordance with the policies, practices and procedures of the Company provided to employees of the Company.
(vi) Fringe Benefits. During the Employment Period, the Executive shall be eligible to receive such fringe benefits and perquisites as are provided by the Company to its employees from time to time, in accordance with the policies, practices and procedures of the Company, and shall receive such additional fringe benefits and perquisites as the Company may, in its discretion, from time-to-time provide to its senior executive officers.
(vii) Vacation. During the Employment Period, the Executive shall be entitled to paid vacation in accordance with the plans, policies, programs and practices of the Company applicable to its employees, as in effect from time to time.
3. Termination of Employment.
(a) Death or Disability. The Executive’s employment shall terminate automatically upon the Executive’s death during the Employment Period. Either the Company or the Executive may terminate the Executive’s employment in the event of the Executive’s Disability during the Employment Period.
(b) Termination by the Company with or without Cause. The Company may terminate Executive’s employment without Cause. The Company may terminate the Executive’s employment during the Employment Period immediately for Cause upon written notice to the Executive setting forth in reasonable detail the nature of the Cause.
(c) Termination by the Executive with or without Good Reason. Executive may resign Executive’s employment with the Company for any reason other than Good Reason or for no reason. Notwithstanding anything to the contrary in this Section 3, the Executive may terminate the Executive’s employment during the Employment period for Good Reason upon written notice to the Company.
(d) Notice of Termination. Any termination of employment (other than due to the Executive’s death), shall be communicated by a Notice of Termination to the other parties hereto given in accordance with Section 13(b). The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder.
(e) Termination of Offices and Directorships; Return of Property. Upon termination of the Executive’s employment for any reason, unless otherwise specified in a written agreement between the Executive and the Company, the Executive shall be deemed to have resigned from all offices, directorships, and other employment positions if any, then held with the Company, and shall take all actions reasonably requested by the Company to effectuate the foregoing. In addition, upon the termination of the Executive’s employment for any reason, the Executive agrees to return to the Company all documents of the Company and its Affiliates (and all copies thereof) and all other Company or Company Affiliate property that the Executive has in the Executive’s possession, custody or control. Such property includes, without limitation: (i) any materials of any kind that the Executive knows contain or embody any proprietary or confidential information of the Company or an Affiliate of the Company (and all reproductions thereof), (ii) computers (including, but not limited to, laptop computers, desktop computers and similar devices) and other portable electronic devices (including, but not limited to, tablet computers), cellular phones/smartphones, Company credit cards, phone cards, entry cards, identification badges and keys, and (iii) any correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the customers, business plans, marketing strategies, products and/or processes of the Company or any of its Affiliates and any information received from the Company or any of its Affiliates regarding third parties.
4. Obligations of the Company upon Termination.
(a) Accrued Obligations; Equity Awards.
(i) If the Executive’s employment under this Agreement terminates during the Employment Period for any reason, the Company will pay or provide to the Executive: (i) any earned but unpaid Base Salary and accrued vacation time through the Date of Termination, (ii) reimbursement of any business expenses incurred by the Executive prior to the Date of Termination that are reimbursable in accordance with Section 2(b)(v), and (iii) any vested amounts due to the Executive under any plan, program or policy of the Company (together, the “Accrued Obligations”). The Accrued Obligations described in clauses (i) – (ii) of the preceding sentence shall be paid within thirty (30) days after the Date of Termination (or such earlier date as may be required by applicable law) and the Accrued Obligations described in clause (iii) of the preceding sentence shall be paid in accordance with the terms of the governing plan or program.
(ii) Except as set forth in Section 4(b)(ii) below, each outstanding equity or equity-based award granted to the Executive by PubCo that is outstanding and, if applicable, unexercised as of the Date of Termination shall be governed by the applicable award agreement evidencing such award.
(b) Qualifying Termination. Subject to Sections 4(d), 4(f) and 13(d), and the Executive’s continued compliance with the provisions of Sections 7 and 8, if the Executive’s employment with the Company is terminated during the Employment Period due to a Qualifying Termination, then in addition to the Accrued Obligations:
(i) Cash Severance. The Company shall pay the Executive an amount equal to eighteen (18) months of the Executive’s Base Salary (the “Severance”). The Severance shall be paid in substantially equal installments in accordance with the Company’s normal payroll practices over the eighteen (18)-month period following the Date of Termination, but shall commence on the first (1st) normal payroll date following the sixtieth (60th) day
following the Date of Termination, and amounts otherwise payable prior to such first (1st) payroll date shall be paid on such date without interest thereon.
(ii) Equity-Based Awards. Any outstanding and unvested PubCo equity or equity-based award held by the Executive on the Date of Termination that vests based solely on the passage of time shall thereupon vest and, to the extent applicable, become exercisable, to the extent that such equity or equity-based award would have vested had the Executive remained in continuous employment with the Company until the twelve (12) month anniversary of the Date of Termination.
(c) Death or Disability. If the Executive’s employment with the Company terminates as a result of the Executive’s death or Disability, then the Executive (or the Executive’s estate) shall receive the Accrued Obligations.
(d) Release. Notwithstanding the foregoing, it shall be a condition to the Executive’s (or the Executive’s estate’s) right to receive the amounts provided for in Section 4(b) that the Executive (or the Executive’s estate, if applicable) execute and deliver to the Company an effective release of claims in substantially the form attached hereto as Exhibit B (the “Release”) and the Release becomes irrevocable within thirty (30) days (or, to the extent required by law, fifty-two (52) days) following the Date of Termination.
(e) Other Terminations. Except as otherwise set forth in a written agreement by and between the Executive and the Company, if the Executive’s employment is terminated for any reason not described in Section 4(b) or 4(c), the Company will pay the Executive only the Accrued Obligations.
(f) Six-Month Delay. Notwithstanding anything to the contrary in this Agreement, no compensation or benefits, including without limitation any severance payments or benefits payable under this Section 4, shall be paid to the Executive during the six (6)-month period following the Executive’s Separation from Service if the Company determines that paying such amounts at the time or times indicated in this Agreement would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence, then on the first (1st) day of the seventh (7th) month following the date of Separation from Service (or such earlier date upon which such amount can be paid under Section 409A without resulting in a prohibited distribution, including as a result of the Executive’s death), the Company shall pay the Executive a lump-sum amount equal to the cumulative amount that would have otherwise been payable to the Executive during such period.
(g) Exclusive Benefits. Except as expressly provided in this Section 4 and subject to Section 5, the Executive shall not be entitled to any additional payments or benefits upon or in connection with the Executive’s termination of employment.
5. Non-Exclusivity of Rights. Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.
6. Excess Parachute Payments; Limitation on Payments.
(a) Best Pay Cap. Notwithstanding any other provision of this Agreement, if any payment or benefit received or to be received by the Executive (including any payment or benefit received in connection with a termination of the Executive’s employment, whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement) (all such payments and benefits, including the payments and benefits under Section 4, being hereinafter referred to as the “Total Payments”) would be subject (in whole or part), to the excise tax imposed under Section 4999 of the Code (the “Excise Tax”), then, the Total Payments shall be reduced, to the extent necessary so that no portion of the Total Payments is subject to the Excise Tax but only if (i) the net amount of such Total Payments, as so reduced (and after subtracting the net amount of federal, state and local income taxes on such reduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such reduced Total Payments) is greater than or equal to (ii) the net amount of such Total Payments without such reduction (but after subtracting the net amount of federal, state and local income taxes on such Total Payments and the amount of Excise Tax to which the Executive would be subject in respect of such unreduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such unreduced Total Payments). If the Total Payments are so reduced, the Company shall reduce or eliminate the Total Payments (A) by first reducing or eliminating the portion of the Total Payments which are not payable in cash (other than that portion of the Total Payments subject to clause (C)), (B) then by reducing or eliminating cash payments (other than that portion of the Total Payments subject to clause (C)) and (C) then by reducing or eliminating the portion of the Total Payments (whether payable in cash or not payable in cash) to which Treasury Regulation § 1.280G-1 Q/A 24(c) (or successor thereto) applies, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time.
(b) Certain Exclusions. For purposes of determining whether and the extent to which the Total Payments will be subject to the Excise Tax, (i) no portion of the Total Payments the receipt or enjoyment of which the Executive shall have waived at such time and in such manner as not to constitute a “payment” within the meaning of Section 280G(b) of the Code shall be taken into account; (ii) no portion of the Total Payments shall be taken into account which, in the written opinion of an independent, nationally recognized accounting firm (the “Independent Advisors”) selected by the Company, does not constitute a “parachute payment” within the meaning of Section 280G(b)(2) of the Code (including by reason of Section 280G(b)(4)(A) of the Code) and, in calculating the Excise Tax, no portion of such Total Payments shall be taken into account which, in the opinion of Independent Advisors, constitutes reasonable compensation for services actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in excess of the “base amount” (as defined in Section 280G(b)(3) of the Code) allocable to such reasonable compensation; and (iii) the value of any non-cash benefit or any deferred payment or benefit included in the Total Payments shall be determined by the Independent Advisors in accordance with the principles of Sections 280G(d)(3) and (4) of the Code.
7. Restrictive Covenants. The Executive acknowledges that the Company and its Affiliates are engaged in businesses which make it crucial for them to develop and retain trade secrets and other confidential information and that the Executive will develop and learn such information in the course of his employment. In light of these facts and in consideration of the Executive’s continued employment with the Company and the Company’s agreement to compensate the Executive on the terms set forth in Section 2(b), the Executive covenants and agrees as follows:
(a) Covenant to Protect Confidential Information. The Executive shall protect all Confidential Information (as defined below) at all times, both during and after the Employment Period,
and shall not disclose to any Person or otherwise use any Confidential Information, except in accordance with this Agreement.
(i) The Executive has and will continue to receive and otherwise be exposed, directly and indirectly, to confidential and proprietary information of the Company whether in graphic, written, electronic or oral form, including without limitation information relating to the Company’s business, strategies, designs, products, services and technologies and any derivatives, improvements and enhancements relating to any of the foregoing, or to the Company’s suppliers, customers or business partners (collectively “Confidential Information”). Confidential Information may be identified at the time of disclosure as confidential or proprietary information which by its context would reasonably be deemed to be confidential or proprietary. “Confidential Information” includes (a) those portions of computer software programs, codes and related information used by any of the Company and its Affiliates which have been customized for use in the business of any of the Company and its Affiliates; (b) data, formulae, compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions and ideas, past, current, and planned research and development, current and planned building and sales methods and processes, customer lists, contractor and subcontractor lists, price lists, market studies, business plans, computer software and programs and any other information, however documented, of the Company or an Affiliate that is a trade secret under applicable law; (c) any and all information concerning the business and affairs of the Company or an Affiliate (which includes historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans, the names and backgrounds of key personnel and contractors, and personnel training and techniques and materials), however documented; and (d) any and all notes, analysis, compilations, studies, summaries, and other material prepared by or for the Company or an Affiliate containing or based, in whole or in part, on any information included in the foregoing. “Confidential Information” may also include without limitation (a)(i) unpublished patent disclosures and patent applications and other filings, know-how, trade secrets, works of authorship and other intellectual property, as well as any information regarding ideas, Inventions (as defined in Section 8(a)), technology, and processes, including without limitation assays, sketches, schematics, techniques, drawings, designs, descriptions, specifications and technical documentation, (ii) specifications, protocols, models, designs, equipment, engineering, algorithms, software programs, software source documents, formulae, (iii) information concerning or resulting from any research and development or other project, including without limitation, experimental work, product development plans, regulatory compliance information, and research, development and regulatory strategies, and (iv) business and financial information, including without limitation purchasing, procurement, manufacturing, customer lists, information relating to investors, employees, business and contractual relationships, business forecasts, sales and merchandising, business and marketing plans, product plans, and business strategies, including without limitation information the Company provides regarding third parties, such as, but not limited to, suppliers, customers, employees, investors, or vendors; and (b) any other information, to the extent such information contains, reflects or is based upon any of the foregoing Confidential Information. Confidential Information may also include information of a third party that is disclosed to the Executive by the Company or such third party at the Company’s direction.
(ii) The Executive acknowledges the confidential and secret character of Confidential Information, and agrees that Confidential Information is the sole,
exclusive and valuable property of the Company. Accordingly, except as expressly provided in Section 7(a)(iii) below, the Executive agrees not to use Confidential Information except in the performance of the Executive’s authorized duties as an employee of the Company, and not to disclose any Confidential Information in any form to any third party, either during or after the term of the Executive’s employment, without the prior written consent of the Company on a case-by-case basis. Upon termination of the Executive’s employment, the Executive agrees to cease using and to return to the Company all whole and partial copies and derivatives of the Confidential Information, whether in the Executive’s possession or under the Executive’s direct or indirect control, provided that the Executive is entitled to retain the Executive’s personal copies of (a) the Executive’s personal compensation records that do not contain any other Confidential Information, including any compensation information pertaining to any other Person, (b) materials distributed to stockholders generally, and (c) this Agreement. The Executive understands that the Executive’s obligations of nondisclosure with respect to Confidential Information shall not apply to information that the Executive can establish by competent proof (x) was actually in the public domain at the time of disclosure or enters the public domain following disclosure other than as a result of a breach of this Agreement, (y) is already in the Executive’s possession without breach of any obligations of confidentiality at the time of disclosure by the Company as shown by the Executive’s files and records immediately prior to the time of disclosure, or (z) is obtained by the Executive from a third party not under confidentiality obligations and without a breach of any obligations of confidentiality. If the Executive becomes compelled by law, regulation (including without limitation the rules of any applicable securities exchange), court order, or other governmental authority to disclose the Confidential Information, the Executive shall, to the extent possible and permissible under applicable law, first give the Company prompt notice. The Executive agrees to cooperate reasonably with the Company in any proceeding to obtain a protective order or other remedy. If such protective order or other remedy is not obtained, the Executive shall only disclose that portion of such Confidential Information required to be disclosed, in the opinion of the Executive’s legal counsel. The Executive shall request that confidential treatment be accorded such Confidential Information, where available. Compulsory disclosures made pursuant to this section shall not relieve the Executive of the Executive’s obligations of confidentiality and non-use with respect to non-compulsory disclosures.
(iii) The Executive understands that nothing herein is intended to or shall prevent the Executive from (i) communicating directly with, cooperating with, or providing information to, or receiving financial awards from, any federal, state or local government regulatory agency, including, but not limited to, the U.S. Securities and Exchange Commission, the U.S. Commodity Futures Trading Commission, or the U.S. Department of Justice, the U.S. Equal Employment Opportunity Commission, or the U.S. National Labor Relations Board, without notifying or seeking permission from the Company, (ii) discussing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination based on a protected characteristic or any other conduct that the Executive has reason to believe is unlawful or (iii) prohibit Executive from reporting possible violations of federal law or regulation to any United States governmental agency or entity in accordance with the provisions of and rules promulgated under Section 21F of the Securities Exchange Act of 1934 or Section 806 of the Sarbanes-Oxley Act of 2002, or any other whistleblower protection provisions of state or federal law or regulation (including the right to receive an award for information provided to any such government agencies). The Executive shall promptly notify the Company if the Executive learns of any
possible unauthorized use or disclosure of proprietary information and shall cooperate fully with the Company to enforce its rights in such information.
(iv) The Executive acknowledges that the Company has provided the Executive notice of immunity rights under the Defend Trade Secrets Act, which states: “(1) An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that (A) is made (i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal; and (2) an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose a trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual (A) files any document containing the trade secret under seal, and (B) does not disclose a trade secret, except pursuant to court order.”
(b) Covenants Against Competition. The Executive specifically acknowledges that his employment with the Company has and will continue to enable him to acquire valuable information as to the nature and character of the businesses of the Company and its Affiliates. The Executive acknowledges that in the event he were to become employed by some other employer or enter the same or similar business as a business conducted by the Company or its Affiliates on his own or in conjunction with others in competition with the Company or an Affiliate of the Company, such valuable information could give to the Executive an unfair competitive advantage. The Executive further acknowledges and agrees that the covenants contained in this Section 7(b) are reasonable and necessary to protect the legitimate business interests of the Company and its Affiliates, including their trade secrets, other Confidential Information and goodwill. Consequently:
(i) The Executive shall not, except on behalf of the Company or an Affiliate of the Company, at any time during the Restricted Period, directly or indirectly, whether alone or with any other Person as a partner, officer, director, manager, employee, agent, shareholder, member, consultant, or otherwise, directly or indirectly, engage or invest in, own, manage, operate, finance, control, or participate in the ownership, management, operation, financing, or control of, be employed by, or render management, marketing, sales, operational, strategic, or technical services or advice to, any Competitive Business; provided, however, that the Executive may purchase or otherwise acquire up to (but not more than) one percent (1%) of any class of securities of any Competitive Business (but without otherwise participating in the activities of such Competitive Business) if such securities have been registered under Section 12(b) or 12(g) of the Securities Exchange Act of 1934.
(ii) The Executive shall not, except on behalf of the Company or an Affiliate of the Company, at any time during the Restricted Period, directly or indirectly, whether alone or with any other Person as a partner, officer, director, manager, employee, agent, shareholder, member, consultant, or otherwise:
A. Induce or attempt to induce any employee of the Company or its Affiliates to leave the employ of the Company or its Affiliates; or
B. Solicit for employment any employee of the Company or its Affiliates or any Person employed by the Company or its Affiliates during the prior six (6) months.
(iii) The Executive shall not, except on behalf of the Company or an Affiliate of the Company, at any time during the Restricted Period and within the Restricted Territory, directly or indirectly, whether alone or with any other Person as a partner, officer, director, manager, employee, agent, shareholder, member, consultant, or otherwise:
A. In any way interfere with the business relationship between the Company or its Affiliates and any employee of the Company or its Affiliates; or
B. Induce or attempt to induce any Company Customer to cease doing business with the Company or its Affiliates, or in any way interfere with the business relationship between any Company Customer and the Company or its Affiliates.
(c) Non-Disparagement. Except as otherwise provided in Sections 7(a)(iii) and (iv), the Executive agrees and covenants that the Executive will not make, publish, or communicate defamatory or disparaging remarks, comments, or statements concerning any of the Company or its Affiliates’ products or services. The Executive agrees and covenants that the Executive will not at any time make, publish, or communicate to any Person or in any public forum any maliciously false remarks, comments, or statements concerning the Company or its Affiliates, or any of its employees, officers, existing and prospective customers, suppliers, investors, and other associated third parties, now or at any time in the future. For the avoidance of doubt, this Section 7(c) does not restrict or impede the Executive from exercising any rights to communicate with securities regulators or any other administrative or regulatory agency to report suspected unlawful conduct, or rights to discuss or disclose information regarding a sexual assault or sexual harassment dispute arising after the date of this Agreement.
(d) Tolling. The period of any restrictive covenant set forth in this Agreement (including, without limitation, any non-competition or non-solicitation obligation) shall be extended by the length of any period during which the Executive is found to be in breach of such covenant, so that the Company receives the full benefit of the agreed-upon duration of the restriction. The tolling shall continue until the breach has been cured and the Executive is in full compliance with the applicable provision.
8. Inventions and Copyrights.
(a) Inventions. The Executive shall disclose promptly to the Company (which will receive it in confidence), and only to the Company, any invention or idea of the Executive (developed alone or with others) conceived or made during his employment with the Company or within six (6) months following the Executive’s employment termination date in the course of the Executive’s employment by the Company or in any way connected with the Executive’s employment or related to the Company’s business, research or development, or demonstrably anticipated research or development (“Inventions”). The Executive assigns to the Company any such invention or idea, and will cooperate with the Company and sign all documents deemed necessary by the Company to enable it to obtain, maintain, protect, and defend patents covering such inventions and ideas and to confirm the Company’s exclusive ownership of all rights in such inventions, ideas, and patents, and irrevocably appoints the Company as his agent to execute and deliver any assignments or documents that the Executive fails or
refuses to execute and deliver promptly, this power and agency being coupled with an interest and being irrevocable. This constitutes the Company’s written notification that the disclosure requirement and assignment provided in this Section 8(a) does not apply to an invention for which no equipment, supplies, facility, or trade secret information of the Company was used and which was developed entirely on the Executive’s own time, unless (a) the invention relates (i) directly to the business of the Company, or (ii) to the Company’s actual or demonstrably anticipated research or development, or (b) the invention results from any work performed by the Executive for the Company.
(b) Work for Hire Acknowledgment; Assignment. The Executive acknowledges that the Executive’s work on and contributions to documents and other expressions in tangible media (collectively, “Works”) are within the scope of the Executive’s employment and part of the Executive’s duties and responsibilities for the Company and its Affiliates. The Executive’s work on and contributions to any Works will be rendered and made by the Executive for, at the instigation of, and under the overall direction of, the Company, and are and at all times will be regarded, together with any such Works, as “work made for hire” as that term is used in the United States copyright laws. Without limiting this acknowledgment, the Executive assigns, grants, and delivers exclusively to the Company all rights, titles, and interests in and to any such Works, and all copies and versions, including all copyrights and renewals. The Executive shall execute and deliver to the Company, its successors and assigns, any assignments and documents that the Company requests for the purpose of establishing, evidencing, and enforcing or defending its complete, perpetual, and worldwide ownership of all rights, titles, and interests of every kind and nature, including all copyrights, in and to the Works, and the Executive constitutes and appoints the Company as its agent to execute and deliver any assignments or documents that the Executive fails or refuses to execute and deliver, this power and agency being coupled with an interest and being irrevocable.
9. Representations. The Executive hereby represents and warrants to the Company that (a) the Executive is entering into this Agreement voluntarily and that the performance of the Executive’s obligations hereunder will not violate any agreement between the Executive and any other person, firm, organization or other entity, or any policy, program or code of such other person, firm, organization or other entity person, and (b) the Executive is not bound by the terms of any agreement with any previous employer or other party to refrain from competing, directly or indirectly, with the business of such previous employer or other party that would be violated by the Executive’s entering into this Agreement and/or providing services to the Company pursuant to the terms of this Agreement.
10. Successors.
(a) This Agreement is personal to the Executive and, without the prior written consent of the Company, shall not be assignable by the Executive other than Executive’s rights to payment hereunder by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives. The Company may assign its rights and obligations under this Agreement to any of its Affiliates or to any successor to all or substantially all of the business or the assets of the Company (by merger or otherwise).
(b) This Agreement shall inure to the benefit of and be binding upon the Company and its respective successors and assigns.
11. Certain Definitions.
(a) “Affiliate” of any particular Person means any other Person directly or indirectly controlling, controlled by, or under common control with such particular Person, where “control” means the possession, directly or indirectly, of the power to direct the management and policies of a Person whether through the ownership of voting securities, by contract, or otherwise.
(b) “Board” means the Board of Directors of PubCo.
(c) “Cause” means the occurrence of any one or more of the following events as determined by the Board in its reasonable judgement:
(i) the Executive’s material failure to perform (other than by reason of Disability), or substantial misconduct in the performance of the Executive’s duties and responsibilities for the Company or any of its Affiliates which causes material harm to the Company;
(ii) the Executive’s material and demonstrable breach of any provision of Sections 7 or 8 or of any other confidentiality, invention assignment or other restrictive covenant obligation set forth in any written agreement by and between the Executive and the Company or any of its Affiliates;
(iii) the Executive’s material and demonstrable breach of any other provision of this Agreement or any other written agreement by and between the Executive and the Company and or any of its Affiliates;
(iv) the Executive’s material violation of any applicable policy or code of conduct of the Company or any of its Affiliates, which violation causes material reputational or financial harm to the Company; or
(v) the Executive’s indictment for, or plea of nolo contendere to, any felony or any crime involving moral turpitude.
Notwithstanding anything to the contrary in the foregoing, a circumstance otherwise giving rise to Cause pursuant to the foregoing clause (i), (ii), (iii) or (iv), if capable of cure, will not constitute Cause if cured by the Executive within ten (10) days following the Company’s notice to the Executive thereof, provided, however, that the Company will not be required to provide any such notice or opportunity to cure with respect to any subsequent substantially similar or related conduct.
(d) “Change in Control” has the meaning set forth in the Plan.
(e) “Code” means the Internal Revenue Code of 1986, as amended and the regulations thereunder.
(f) “Company Customer” means any individual or entity who (i) is, or was at any time during the two (2) year period prior to the termination of the Executive’s employment with the Company, a customer, supplier, or vendor of the Company or its Affiliates of whom the Executive learned, with whom the Executive had business contact or about whom the Executive obtained Confidential Information (as defined above) at any time during the Executive’s employment with the
Company, or (ii) is a prospective customer, supplier, or vendor of the Company or its Affiliates of whom the Executive learned, with whom the Executive had business contact, or about whom the Executive obtained Confidential Information as part of a solicitation of business on behalf of the Company or its Affiliates at any time during the two (2) year period prior to the Executive’s employment termination date.
(g) “Competitive Business” means any Person engaged in the space exploration and/or defense industries or that offers any product or service that was being developed, marketed, offered, or provided by the Company at any time during the last two (2) years of Executive’s employment with the Company in the Restricted Territory.
(h) “Date of Termination” means the date on which the Executive’s employment with the Company terminates, which, if Executive’s employment is terminated as a result of Executive’s death, will be the date of Executive’s death, and otherwise shall be the date specified in a Notice of Termination, which, other than in the case of a termination by the Company for Cause, shall be at least ninety (90) days following the date of the Notice of Termination; provided, however, that in the event that Executive delivers a Notice of Termination to the Company, the Company may, in its sole discretion, change the Date of Termination to any date that occurs on or following the date of Executive’s Notice of Termination and is prior to the Date of Termination specified in Executive’s Notice of Termination.
(i) “Disability” means that the Executive has become entitled to receive benefits under an applicable Company long-term disability plan or, if no such plan covers the Executive, the Executive’s inability, due to physical or mental illness, to perform the essential functions of the Executive’s job, with or without a reasonable accommodation for one hundred and eighty (180) consecutive days.
(j) “Good Reason” means the occurrence of any one or more of the following events without the Executive’s consent, unless the Company fully corrects the circumstances constituting Good Reason (provided such circumstances are capable of correction) as provided below:
(i) a material diminution in the Executive’s Base Salary, other than as part of an across-the-board reduction applicable to the Company’s senior executives; or
(ii) a material diminution in the Executive’s authority, responsibilities or duties, as contemplated by this Agreement.
Notwithstanding the foregoing, the Executive will not be deemed to have resigned for Good Reason unless (A) the Executive provides the Company with written notice setting forth in reasonable detail the facts and circumstances claimed by the Executive to constitute Good Reason within thirty (30) days after the initial existence of the facts or circumstances constituting Good Reason, (B) the Company fails to cure such acts or omissions within thirty (30) days following its receipt of such notice, and (C) the effective date of the Executive’s termination for Good Reason occurs no later than ninety (90) days after the initial existence of the facts or circumstances constituting Good Reason.
(k) “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated and (iii) if the Date of Termination is other than the date of receipt of such notice,
specifies the termination date (which date shall be not more than thirty (30) days after the giving of such notice unless as otherwise provided upon a termination for Good Reason).
(l) “Person” means any individual, partnership, corporation, limited liability company, association, joint stock company, trust, joint venture, unincorporated organization, bank, or other entity.
(m) “Plan” means Company’s 2025 Incentive Award Plan, as amended from time to time.
(n) “Qualifying Termination” means a termination of the Executive’s employment (i) by the Company without Cause (other than by reason of the Executive’s death or Disability) or (ii) by the Executive for Good Reason.
(o) “Restricted Period” means the period beginning on the Effective Date and ending twelve (12) months after the Executive’s Date of Termination.
(p) “Restricted Territory” means the State of Colorado and those states in which the Executive had material responsibility or knowledge for a Competing Business or Company Customer during the last two (2) years of the Executive’s employment.
(q) “Section 409A” means Section 409A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder.
(r) “Separation from Service” means a “separation from service” (within the meaning of Section 409A).
(s) “Subsidiary” means any entity (other than the Company), whether domestic or foreign, in an unbroken chain of entities beginning with the Company if each of the entities other than the last entity in the unbroken chain beneficially owns, at the time of the determination, securities or interests representing at least fifty percent (50%) of the total combined voting power of all classes of securities or interests in one of the other entities in such chain.
12. Indemnification. The parties hereby acknowledge that in connection with the execution of this Agreement, they are entering into an Indemnification Agreement (the “Indemnification Agreement”), substantially in the form attached hereto as Exhibit C, which shall become effective as of the Effective Date.
13. Miscellaneous.
(a) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect.
(b) Notices. All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party, sent by facsimile or email, or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:
If to the Executive: at the Executive’s most recent address on the records of the Company.
If to the Company:
c/o Head of Human Resources
1225 17th Street
Suite 1100
Denver, Colorado 80202
or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee.
(c) Sarbanes-Oxley Act of 2002. Notwithstanding anything herein to the contrary, if the Company determines, in its good faith judgment, that any transfer or deemed transfer of funds hereunder is likely to be construed as a personal loan prohibited by Section 13(k) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (the “Exchange Act”), then such transfer or deemed transfer shall not be made to the extent necessary or appropriate so as not to violate the Exchange Act and the rules and regulations promulgated thereunder.
(d) Section 409A of the Code.
(i) To the extent applicable, this Agreement shall be interpreted in accordance with Section 409A. Notwithstanding any provision of this Agreement to the contrary, if the Company determines that any compensation or benefits payable under this Agreement may be subject to Section 409A, the Company shall work in good faith with the Executive to adopt such amendments to this Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Company determines are necessary or appropriate to avoid the imposition of taxes under Section 409A, including without limitation, actions intended to (i) exempt the compensation and benefits payable under this Agreement from Section 409A, and/or (ii) comply with the requirements of Section 409A; provided, however, that this Section 13(d) shall not create an obligation on the part of the Company to adopt any such amendment, policy or procedure or take any such other action, nor shall the Company have any liability for failing to do so.
(ii) Any right to a series of installment payments pursuant to this Agreement is to be treated as a right to a series of separate payments. To the extent permitted under Section 409A, any separate payment or benefit under this Agreement or otherwise shall not be deemed “nonqualified deferred compensation” subject to Section 409A to the extent provided in the exceptions in Treasury Regulation Section 1.409A-1(b)(4), Section 1.409A-1(b)(9) or any other applicable exception or provision of Section 409A. Any payments subject to Section 409A that are subject to execution of a waiver and release which may be executed and/or revoked in a calendar year following the calendar year in which the payment event (such as termination of employment) occurs shall commence payment only in the calendar year in which the consideration period or, if applicable, release revocation period ends, as necessary to comply with Section 409A. All payments of nonqualified deferred compensation subject to Section 409A to be
made upon a termination of employment under this Agreement may only be made upon the Executive’s Separation from Service.
(iii) To the extent that any payments or reimbursements provided to the Executive under this Agreement are deemed to constitute compensation to the Executive to which Treasury Regulation Section 1.409A-3(i)(1)(iv) would apply, such amounts shall be paid or reimbursed reasonably promptly, but not later than December 31 of the year following the year in which the expense was incurred. The amount of any such payments eligible for reimbursement in one year shall not affect the payments or expenses that are eligible for payment or reimbursement in any other taxable year, and the Executive’s right to such payments or reimbursement of any such expenses shall not be subject to liquidation or exchange for any other benefit.
(e) Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.
(f) Withholding. The Company may withhold from any amounts payable under this Agreement such federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.
(g) No Waiver. The Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3(c), shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.
(h) Compensation Recovery Policy. Executive acknowledges and agrees that, to the extent the Company adopts any claw-back or similar policy pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act and any rules and regulations promulgated thereunder (collectively, “Dodd-Frank”) or otherwise, he shall take all action necessary to comply with such policy (including, without limitation, entering into any further agreements, amendments or policies reasonably necessary or appropriate to implement and/or enforce such policy with respect to past, present and future compensation, as appropriate).
(i) Entire Agreement. As of the Effective Date, this Agreement, constitutes the final, complete and exclusive agreement between the Executive and the Company with respect to the subject matter hereof and replaces and supersedes any and all other agreements, offers or promises, whether oral or written, by any member of the Company and its Affiliates, or representative thereof (including the Prior Agreement). Notwithstanding anything herein to the contrary, this Agreement and the obligations and commitments hereunder shall neither commence nor be of any force or effect prior to the Effective Date.
(j) Arbitration.
(i) Any controversy or dispute that establishes a legal or equitable cause of action (“Arbitration Claim”) between any two or more Persons Subject to Arbitration (as defined below), including any controversy or dispute, whether based on contract, common law, or federal, state or local statute or regulation, arising out of, or relating to the Executive’s service or the termination thereof, shall be submitted to final and binding arbitration as the sole and exclusive remedy for such controversy or dispute in accordance with the rules of JAMS pursuant to its Employment Arbitration Rules and Procedures, which are available at http://www.jamsadr.com/
rules-employment-arbitration/, and the Company will provide a copy upon the Executive’s request. Notwithstanding the foregoing, this Agreement shall not require any Person Subject to Arbitration to arbitrate pursuant to this Agreement any claims: (A) under a Company benefit plan subject to the Employee Retirement Income Security Act, as amended; or (B) as to which applicable law not preempted by the Federal Arbitration Act prohibits resolution by binding arbitration. Either party may seek provisional non-monetary remedies in a court of competent jurisdiction to the extent that such remedies are not available or not available in a timely fashion through arbitration. It is the parties’ intent that issues of arbitrability of any dispute shall be decided by the arbitrator.
(ii) “Persons Subject to Arbitration” means, individually and collectively, (A) the Executive, (B) any person in privity with or claiming through, on behalf of or in the right of the Executive, (C) the Company, (D) any past, present or future Affiliate, employee, officer, director or agent of the Company, and/or (E) any person or entity alleged to be acting in concert with or to be jointly liable with any of the foregoing.
(iii) The arbitration shall take place before a single neutral arbitrator at the JAMS office in Denver, Colorado. Such arbitrator shall be provided through JAMS by mutual agreement of the parties to the arbitration; provided that, absent such agreement, the arbitrator shall be selected in accordance with the rules of JAMS then in effect. The arbitrator shall permit reasonable discovery. The award or decision of the arbitrator shall be rendered in writing; shall be final and binding on the parties; and may be enforced by judgment or order of a court of competent jurisdiction.
(iv) THE EXECUTIVE AND THE COMPANY UNDERSTAND THAT BY AGREEING TO ARBITRATE ANY ARBITRATION CLAIM, THEY WILL NOT HAVE THE RIGHT TO HAVE ANY ARBITRATION CLAIM DECIDED BY A JURY OR A COURT, BUT SHALL INSTEAD HAVE ANY ARBITRATION CLAIM DECIDED THROUGH ARBITRATION.
(v) THE EXECUTIVE AND THE COMPANY WAIVE ANY CONSTITUTIONAL OR OTHER RIGHT TO BRING CLAIMS COVERED BY THIS AGREEMENT OTHER THAN IN THEIR INDIVIDUAL CAPACITIES. EXCEPT AS MAY BE PROHIBITED BY LAW, THIS WAIVER INCLUDES THE ABILITY TO ASSERT CLAIMS AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING.
(vi) This Section 13(j) shall be interpreted to conform to any applicable law concerning the terms and enforcement of agreements to arbitrate service disputes. To the extent any terms or conditions of this Section 13(j) would preclude its enforcement, such terms shall be severed or interpreted in a manner to allow for the enforcement of this Section 13(j). To the extent applicable law imposes additional requirements to allow enforcement of this Section 13(j), this Agreement shall be interpreted to include such terms or conditions.
(k) Amendment; Survival. No amendment or other modification of this Agreement shall be effective unless made in writing and signed by the parties hereto. The respective rights and obligations of the parties under this Agreement shall survive the Executive’s termination of employment and the termination of this Agreement to the extent necessary for the intended preservation of such rights and obligations (including without limitation the covenants set forth in Sections 7 and 8).
(l) Counterparts. This Agreement and any agreement referenced herein may be executed in two or more counterparts, each of which shall be deemed an original but which together shall constitute one and the same instrument.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the authorization from the Board, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written.
| | | | | | | | | | | |
| VOYAGER TECHNOLOGIES, INC. | |
| | | |
| | | |
| By: | | |
| | Name: | |
| | Title: | |
| | | |
| | | |
| “EXECUTIVE” | |
| | | |
| | | |
Attachments:
Exhibit A: Exclusivity Carve-Outs
Exhibit B: Release
Exhibit C: Indemnification Agreement
EXHIBIT A
EXCLUSIVITY CARVE-OUTS
1. Service as a Director of the Air Force Academy Foundation.
EXHIBIT B1
GENERAL RELEASE
1. Release. For valuable consideration, the receipt and adequacy of which are hereby acknowledged, the undersigned does hereby release and forever discharge the “Releasees” hereunder, consisting of Voyager Technologies, Inc. (the “Company”), and the Company’s partners, Subsidiaries, associates, Affiliates, successors, heirs, assigns, agents, directors, officers, employees, representatives, lawyers, insurers, and all persons acting by, through, under or in concert with them, or any of them, of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liability, claims, demands, damages, losses, costs, attorneys’ fees or expenses, of any nature whatsoever, known or unknown, fixed or contingent (hereinafter called “Claims”), which the undersigned now has or may hereafter have against the Releasees, or any of them, by reason of any matter, cause, or thing whatsoever from the beginning of time to the date hereof. The Claims released herein include, without limiting the generality of the foregoing, any Claims in any way arising out of, based upon, or related to the employment or termination of employment of the undersigned by the Releasees, or any of them; any alleged breach of any express or implied contract of employment; any alleged torts or other alleged legal restrictions on Releasees’ right to terminate the employment of the undersigned; and any alleged violation of any federal, state or local statute or ordinance including, without limitation, Title VII of the Civil Rights Act of 1964, the Age Discrimination In Employment Act (“ADEA”) and the Americans With Disabilities Act.
2. Claims Not Released. Notwithstanding the foregoing, this general release (the “Release”) shall not operate to release any rights or claims of the undersigned (i) to payments or benefits under Section 4(b) of that certain Employment Agreement, dated as of [_____], between the Company and the undersigned (the “Employment Agreement”), with respect to the payments and benefits provided in exchange for this Release, (ii) to payments or benefits under any equity award agreement between the undersigned and the Company or as a holder of any securities of the Company, (iii) with respect to Sections 2(b)(vii) or 4(a) of the Employment Agreement, (iv) to accrued or vested benefits the undersigned may have, if any, as of the date hereof under any applicable plan, policy, practice, program, contract or agreement with the Company, (v) to any Claims, including claims for indemnification and/or advancement of expenses arising under any indemnification agreement between the undersigned and the Company or under the bylaws, certificate of incorporation or other similar governing document of the Company, (vi) to any Claims which cannot be waived by an employee under applicable law or (vii) with respect to the undersigned’s right to communicate directly with, cooperate with, or provide information to, any federal, state or local government regulator.
3. Exceptions. Notwithstanding anything in this Release to the contrary, nothing contained in this Release shall prohibit the undersigned from (i) filing a charge with, reporting possible violations of federal law or regulation to, participating in any investigation by, or cooperating with any governmental agency or entity or making other disclosures that are protected under the whistleblower provisions of applicable law or regulation and/or (ii) communicating directly with, cooperating with, or providing information (including trade secrets) in confidence to, any federal, state or local government regulator (including, but not limited to, the U.S. Securities and Exchange Commission, the U.S. Commodity Futures Trading Commission, or the U.S. Department of Justice) for the purpose of reporting or investigating a suspected violation of law, or from providing such information to the undersigned’s attorney or in a sealed complaint or other document filed in a lawsuit or other governmental proceeding. Pursuant to 18 USC Section 1833(b), (1) the undersigned will not be held criminally or civilly liable
1 Subject to revision for applicable law at time of termination.
under any federal or state trade secret law for the disclosure of a trade secret that is made: (x) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (y) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal and (2) the undersigned acknowledges that an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual files any document containing the trade secret under seal and does not disclose the trade secret, except pursuant to court order.
4. Representations. The undersigned represents and warrants that there has been no assignment or other transfer of any interest in any Claim which the undersigned may have against Releasees, or any of them, and the undersigned agrees to indemnify and hold Releasees, and each of them, harmless from any liability, Claims, demands, damages, costs, expenses and attorneys’ fees incurred by Releasees, or any of them, as the result of any such assignment or transfer or any rights or Claims under any such assignment or transfer. It is the intention of the parties that this indemnity does not require payment as a condition precedent to recovery by the Releasees against the undersigned under this indemnity.
5. No Action. The undersigned agrees that if the undersigned hereafter commences any suit arising out of, based upon, or relating to any of the Claims released hereunder or in any manner asserts against Releasees, or any of them, any of the Claims released hereunder, then the undersigned agrees to pay to Releasees, and each of them, in addition to any other damages caused to Releasees thereby, all attorneys’ fees incurred by Releasees in defending or otherwise responding to said suit or Claim. Notwithstanding the foregoing, this provision shall not apply to any suit or Claim to the extent it challenges the effectiveness of this release with respect to a claim under the ADEA.
6. No Admission. The undersigned further understands and agrees that neither the payment of any sum of money nor the execution of this Release shall constitute or be construed as an admission of any liability whatsoever by the Releasees, or any of them, who have consistently taken the position that they have no liability whatsoever to the undersigned.
7. OWBPA. The undersigned agrees and acknowledges that this Release constitutes a knowing and voluntary waiver and release of all Claims the undersigned has or may have against the Company and/or any of the Releasees as set forth herein, including, but not limited to, all Claims arising under the Older Worker’s Benefit Protection Act and the ADEA. In accordance with the Older Worker’s Benefit Protection Act, the undersigned is hereby advised as follows:
(i) the undersigned has read the terms of this Release, and understands its terms and effects, including the fact that the undersigned agreed to release and forever discharge the Company and each of the Releasees, from any Claims released in this Release;
(ii) the undersigned understands that, by entering into this Release, the undersigned does not waive any Claims that may arise after the date of the undersigned’s execution of this Release, including without limitation any rights or claims that the undersigned may have to secure enforcement of the terms and conditions of this Release;
(iii) the undersigned has signed this Release voluntarily and knowingly in exchange for the consideration described in this Release, which the undersigned acknowledges is adequate
and satisfactory to the undersigned and which the undersigned acknowledges is in addition to any other benefits to which the undersigned is otherwise entitled;
(iv) the Company advises the undersigned to consult with an attorney prior to executing this Release;
(v) the undersigned has been given at least [twenty-one (21)]2 days in which to review and consider this Release. To the extent that the undersigned chooses to sign this Release prior to the expiration of such period, the undersigned acknowledges that the undersigned has done so voluntarily, had sufficient time to consider the Release, to consult with counsel and that the undersigned does not desire additional time and hereby waives the remainder of the [twenty-one (21)]-day period; and
(vi) the undersigned may revoke this Release within seven (7) days from the date the undersigned signs this Release and this Release will become effective upon the expiration of that revocation period if the undersigned has not revoked this Release during such seven (7)-day period. If the undersigned revokes this Release during such seven (7)-day period, this Release will be null and void and of no force or effect on either the Company or the undersigned and the undersigned will not be entitled to any of the payments or benefits which are expressly conditioned upon the execution and non-revocation of this Release. Any revocation must be in writing and sent to [name], via electronic mail at [email address], on or before [5:00 p.m. Eastern time] on the seventh (7th) day after this Release is executed by the undersigned.
8. Acknowledgement. The undersigned acknowledges that different or additional facts may be discovered in addition to what is now known or believed to be true by the undersigned with respect to the matters released in this Release, and the undersigned agrees that this Release shall be and remain in effect in all respects as a complete and final release of the matters released, notwithstanding any different or additional facts
9. Governing Law. This Release is deemed made and entered into in the State of Colorado, and in all respects shall be interpreted, enforced and governed under the internal laws of the State of Colorado, to the extent not preempted by federal law.
IN WITNESS WHEREOF, the undersigned has executed this Release this ____ day of ___________, ____.
_______________________________________
2 NTD: Use 45 days in a group termination, and include information regarding terminated positions.
EXHIBIT C
INDEMNIFICATION AGREEMENT
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into by and between Voyager Technologies, Inc. a Delaware corporation (“PubCo” and together with any other Subsidiaries or Affiliates as may employ Executive from time to time, and any successor(s) thereto, the “Company”) and Filipe De Sousa (the “Executive”) , effective as of the date of consummation of the initial public offering of PubCo’s Class A common stock (the “Effective Date”)..
WHEREAS, the Executive is party to an Employment Agreement, by and between PubCo and the Executive, dated September 14, 2022 (as amended, the “Prior Agreement”), and the Company and the Executive intend to amend, restate and supersede the Prior Agreement in its entirety.
WHEREAS, the Company desires to continue to employ the Executive and the Company and the Executive desire to enter into an agreement embodying the terms of such continued employment, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Employment Period. Effective upon the Effective Date, the Executive’s employment hereunder shall be for a term commencing on the Effective Date and will end upon the date of termination of this Agreement under Section 3 (the “Employment Period”). Notwithstanding the foregoing, the Executive’s employment with the Company is and shall be on an “at will” basis, subject to the provisions of Section 3.
2. Terms of Employment.
(a) Position and Duties.
(i) Role and Responsibilities. During the Employment Period, the Executive shall serve as the Company’s Chief Financial Officer and shall perform such employment duties as are usual and customary for such position. The Executive shall report directly to the Company’s Chief Executive Officer (“CEO”). At the Company’s request, the Executive shall serve the Company and/or its Subsidiaries or Affiliates in other capacities in addition to the foregoing, consistent with the Executive’s position hereunder. If the Executive, during the Employment Period, serves in any one or more of such additional capacities, the Executive’s compensation shall not be increased beyond that specified in Section 2(b) hereof. In addition, if the Executive’s service in one or more of such additional capacities is terminated, the Executive’s compensation, as specified in Section 2(b), shall not be diminished or reduced in any manner as a result of such termination provided that the Executive otherwise remains employed under the terms of this Agreement.
(ii) Exclusivity. During the Employment Period, and excluding any periods of leave to which the Executive may be entitled, the Executive agrees to devote the Executive’s full business time and attention to the business and affairs of the Company. Notwithstanding the foregoing, during the Employment Period it shall not be a violation of this Agreement for the Executive to: (A) serve on boards, committees or similar bodies of charitable or nonprofit organizations, (B) fulfill limited teaching, speaking and writing engagements, (C) manage the Executive’s personal investments, and (D) engage in any of the activities as set forth on Exhibit A, in each case, so long as such activities do not individually or in the aggregate
materially interfere or conflict with the performance of the Executive’s duties and responsibilities under this Agreement; provided, that with respect to the activities in subclauses (A) and/or (B), the Executive receives prior written approval from the Company’s Board of Directors (the “Board”). Executive agrees to observe and comply with the rules and policies of the Company as adopted by the Company from time to time, in each case as amended from time to time, as set forth in writing, and as delivered or made available to Executive.
(iii) Principal Location. During the Employment Period, the Executive generally shall perform the services required by this Agreement remotely from Executive’s home office in Orange County, California (the “Principal Location”), provided, however, that the parties acknowledge and agree that the Executive may be required to travel to other locations as may be necessary to fulfill the Executive’s duties and responsibilities hereunder.
(b) Compensation and Benefits.
(i) Base Salary. Effective as of the Effective Date and during the Employment Period, the Executive shall receive a base salary (the “Base Salary”) of four hundred and sixteen thousand ($416,000) per annum. The Base Salary shall be paid in accordance with the Company’s normal payroll practices for executive salaries generally, but no less often than monthly and shall be pro-rated for partial years of employment. The Base Salary may be reviewed in the discretion of the Board (or a subcommittee thereof), not less than annually.
(ii) Annual Cash Bonus. For each calendar year ending during the Employment Period beginning with calendar year 2025, the Executive shall be eligible to earn a cash performance bonus (an “Annual Bonus”) under the Company’s bonus plan or program applicable to senior executives targeted at one hundred percent (100%) of Base Salary paid with respect to such year (the “Target Bonus”). The actual amount of any Annual Bonus shall be determined by the Board (or a subcommittee thereof) in its discretion, based on the achievement of individual and/or Company performance goals as determined by the Board (or a subcommittee thereof), and shall be pro-rated for any partial year of employment. Payment of the Annual Bonus shall be subject to the Executive’s continued employment through the payment date.
(iii) Annual Equity Award(s). For each calendar year during the Employment Period beginning with calendar year 2026, the Executive shall be eligible to receive equity-based compensation awards, as determined by the Board (or a subcommittee thereof), from time to time. The Board or such subcommittee shall determine in its sole discretion the grant timing, amount, form(s) and mix, and such other terms and conditions (including vesting, exercise and settlement) applicable to any such annual equity-based compensation award, taking into account the Executive’s and the Company’s performance. Any such award shall be evidenced by a separate award agreement in a form prescribed by the Company, to be entered into by PubCo and the Executive.
(iv) Benefits. During the Employment Period, the Executive (and the Executive’s spouse and/or eligible dependents to the extent provided in the applicable plans and programs) shall be eligible to participate in and be covered under the health and welfare benefit plans and programs maintained by the Company for the benefit of its employees from time to time, pursuant to the terms of such plans and programs including any medical, dental, vision, health savings accounts, limited purpose and dependent care flexible spending accounts, short- and long-term disability and life insurance plans and programs on the same terms and conditions
as those applicable to similarly situated senior executives. In addition, during the Employment Period, the Executive shall be eligible to participate in any retirement, savings and other employee benefit plans and programs maintained from time to time by the Company for the benefit of its senior executive officers. Nothing contained in this Section 2(b)(iv) shall create or be deemed to create any obligation on the part of the Company to adopt or maintain any health, welfare, retirement or other benefit plan or program at any time or to create any limitation on the Company’s ability to modify or terminate any such plan or program.
(v) Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by the Executive in connection with the performance of the Executive’s duties under this Agreement in accordance with the policies, practices and procedures of the Company provided to employees of the Company.
(vi) Fringe Benefits. During the Employment Period, the Executive shall be eligible to receive such fringe benefits and perquisites as are provided by the Company to its employees from time to time, in accordance with the policies, practices and procedures of the Company, and shall receive such additional fringe benefits and perquisites as the Company may, in its discretion, from time-to-time provide to its senior executive officers.
(vii) Vacation. During the Employment Period, the Executive shall be entitled to paid vacation in accordance with the plans, policies, programs and practices of the Company applicable to its employees, as in effect from time to time.
3. Termination of Employment.
(a) Death or Disability. The Executive’s employment shall terminate automatically upon the Executive’s death during the Employment Period. Either the Company or the Executive may terminate the Executive’s employment in the event of the Executive’s Disability during the Employment Period.
(b) Termination by the Company with or without Cause. The Company may terminate Executive’s employment without Cause. The Company may terminate the Executive’s employment during the Employment Period immediately for Cause upon written notice to the Executive setting forth in reasonable detail the nature of the Cause.
(c) Termination by the Executive with or without Good Reason. Executive may resign Executive’s employment with the Company for any reason other than Good Reason or for no reason. Notwithstanding anything to the contrary in this Section 3, the Executive may terminate the Executive’s employment during the Employment period for Good Reason upon written notice to the Company.
(d) Notice of Termination. Any termination of employment (other than due to the Executive’s death), shall be communicated by a Notice of Termination to the other parties hereto given in accordance with Section 13(b). The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder.
(e) Termination of Offices and Directorships; Return of Property. Upon termination of the Executive’s employment for any reason, unless otherwise specified in a written agreement between the Executive and the Company, the Executive shall be deemed to have resigned from all offices, directorships, and other employment positions if any, then held with the Company, and shall take all actions reasonably requested by the Company to effectuate the foregoing. In addition, upon the termination of the Executive’s employment for any reason, the Executive agrees to return to the Company all documents of the Company and its Affiliates (and all copies thereof) and all other Company or Company Affiliate property that the Executive has in the Executive’s possession, custody or control. Such property includes, without limitation: (i) any materials of any kind that the Executive knows contain or embody any proprietary or confidential information of the Company or an Affiliate of the Company (and all reproductions thereof), (ii) computers (including, but not limited to, laptop computers, desktop computers and similar devices) and other portable electronic devices (including, but not limited to, tablet computers), cellular phones/smartphones, Company credit cards, phone cards, entry cards, identification badges and keys, and (iii) any correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the customers, business plans, marketing strategies, products and/or processes of the Company or any of its Affiliates and any information received from the Company or any of its Affiliates regarding third parties.
4. Obligations of the Company upon Termination.
(a) Accrued Obligations; Equity Awards.
(i) If the Executive’s employment under this Agreement terminates during the Employment Period for any reason, the Company will pay or provide to the Executive: (i) any earned but unpaid Base Salary and accrued vacation time through the Date of Termination, (ii) reimbursement of any business expenses incurred by the Executive prior to the Date of Termination that are reimbursable in accordance with Section 2(b)(v), (iii) any unpaid annual bonus earned by Executive for the year prior to the year in which the Date of Termination occurs and as yet unpaid, and (iv) any vested amounts due to the Executive under any plan, program or policy of the Company (together, the “Accrued Obligations”). The Accrued Obligations described in clauses (i) – (iii) of the preceding sentence shall be paid within thirty (30) days after the Date of Termination (or such earlier date as may be required by applicable law) and the Accrued Obligations described in clause (iv) of the preceding sentence shall be paid in accordance with the terms of the governing plan or program.
(ii) Except as set forth in Section 4(b)(ii) below, each outstanding equity or equity-based award granted to the Executive by PubCo that is outstanding and, if applicable, unexercised as of the Date of Termination shall be governed by the applicable award agreement evidencing such award.
(b) Qualifying Termination. Subject to Sections 4(d), 4(f) and 13(d), and the Executive’s continued compliance with the provisions of Sections 7 and 8, if the Executive’s employment with the Company is terminated during the Employment Period due to a Qualifying Termination, then in addition to the Accrued Obligations:
(i) Cash Severance. The Company shall pay the Executive an amount equal to twelve (12) months of the Executive’s Base Salary plus the accrued bonus for the year in which such Qualifying Termination occurs, as reasonably determined by the Board (or a
subcommittee thereof) (the “Severance”). The Severance shall be paid in substantially equal installments in accordance with the Company’s normal payroll practices over the twelve (12)-month period following the Date of Termination, but shall commence on the first (1st) normal payroll date following the sixtieth (60th) day following the Date of Termination, and amounts otherwise payable prior to such first (1st) payroll date shall be paid on such date without interest thereon.
(c) Death or Disability. If the Executive’s employment with the Company terminates as a result of the Executive’s death or Disability, then the Executive (or the Executive’s estate) shall receive the Accrued Obligations.
(d) Release. Notwithstanding the foregoing, it shall be a condition to the Executive’s (or the Executive’s estate’s) right to receive the amounts provided for in Section 4(b) that the Executive (or the Executive’s estate, if applicable) execute and deliver to the Company an effective release of claims in substantially the form attached hereto as Exhibit B (the “Release”) and the Release becomes irrevocable within thirty (30) days (or, to the extent required by law, fifty-two (52) days) following the Date of Termination.
(e) Other Terminations. Except as otherwise set forth in a written agreement by and between the Executive and the Company, if the Executive’s employment is terminated for any reason not described in Section 4(b) or 4(c), the Company will pay the Executive only the Accrued Obligations.
(f) Six-Month Delay. Notwithstanding anything to the contrary in this Agreement, no compensation or benefits, including without limitation any severance payments or benefits payable under this Section 4, shall be paid to the Executive during the six (6)-month period following the Executive’s Separation from Service if the Company determines that paying such amounts at the time or times indicated in this Agreement would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence, then on the first (1st) day of the seventh (7th) month following the date of Separation from Service (or such earlier date upon which such amount can be paid under Section 409A without resulting in a prohibited distribution, including as a result of the Executive’s death), the Company shall pay the Executive a lump-sum amount equal to the cumulative amount that would have otherwise been payable to the Executive during such period.
(g) Exclusive Benefits. Except as expressly provided in this Section 4 and subject to Section 5, the Executive shall not be entitled to any additional payments or benefits upon or in connection with the Executive’s termination of employment.
5. Non-Exclusivity of Rights. Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.
6. Excess Parachute Payments; Limitation on Payments.
(a) Best Pay Cap. Notwithstanding any other provision of this Agreement, if any payment or benefit received or to be received by the Executive (including any payment or benefit received in connection with a termination of the Executive’s employment, whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement) (all such payments and benefits,
including the payments and benefits under Section 4, being hereinafter referred to as the “Total Payments”) would be subject (in whole or part), to the excise tax imposed under Section 4999 of the Code (the “Excise Tax”), then, the Total Payments shall be reduced, to the extent necessary so that no portion of the Total Payments is subject to the Excise Tax but only if (i) the net amount of such Total Payments, as so reduced (and after subtracting the net amount of federal, state and local income taxes on such reduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such reduced Total Payments) is greater than or equal to (ii) the net amount of such Total Payments without such reduction (but after subtracting the net amount of federal, state and local income taxes on such Total Payments and the amount of Excise Tax to which the Executive would be subject in respect of such unreduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such unreduced Total Payments). If the Total Payments are so reduced, the Company shall reduce or eliminate the Total Payments (A) by first reducing or eliminating the portion of the Total Payments which are not payable in cash (other than that portion of the Total Payments subject to clause (C)), (B) then by reducing or eliminating cash payments (other than that portion of the Total Payments subject to clause (C)) and (C) then by reducing or eliminating the portion of the Total Payments (whether payable in cash or not payable in cash) to which Treasury Regulation § 1.280G-1 Q/A 24(c) (or successor thereto) applies, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time.
(b) Certain Exclusions. For purposes of determining whether and the extent to which the Total Payments will be subject to the Excise Tax, (i) no portion of the Total Payments the receipt or enjoyment of which the Executive shall have waived at such time and in such manner as not to constitute a “payment” within the meaning of Section 280G(b) of the Code shall be taken into account; (ii) no portion of the Total Payments shall be taken into account which, in the written opinion of an independent, nationally recognized accounting firm (the “Independent Advisors”) selected by the Company, does not constitute a “parachute payment” within the meaning of Section 280G(b)(2) of the Code (including by reason of Section 280G(b)(4)(A) of the Code) and, in calculating the Excise Tax, no portion of such Total Payments shall be taken into account which, in the opinion of Independent Advisors, constitutes reasonable compensation for services actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in excess of the “base amount” (as defined in Section 280G(b)(3) of the Code) allocable to such reasonable compensation; and (iii) the value of any non-cash benefit or any deferred payment or benefit included in the Total Payments shall be determined by the Independent Advisors in accordance with the principles of Sections 280G(d)(3) and (4) of the Code.
7. Restrictive Covenants. The Executive acknowledges that the Company and its Affiliates are engaged in businesses which make it crucial for them to develop and retain trade secrets and other confidential information and that the Executive will develop and learn such information in the course of his employment. In light of these facts and in consideration of the Executive’s continued employment with the Company and the Company’s agreement to compensate the Executive on the terms set forth in Section 2(b), the Executive covenants and agrees as follows:
(a) Covenant to Protect Confidential Information. The Executive shall protect all Confidential Information (as defined below) at all times, both during and after the Employment Period, and shall not disclose to any Person or otherwise use any Confidential Information, except in accordance with this Agreement.
(i) The Executive has and will continue to receive and otherwise be exposed, directly and indirectly, to confidential and proprietary information of the Company whether in graphic, written, electronic or oral form, including without limitation information
relating to the Company’s business, strategies, designs, products, services and technologies and any derivatives, improvements and enhancements relating to any of the foregoing, or to the Company’s suppliers, customers or business partners (collectively “Confidential Information”). Confidential Information may be identified at the time of disclosure as confidential or proprietary information which by its context would reasonably be deemed to be confidential or proprietary. “Confidential Information” includes (a) those portions of computer software programs, codes and related information used by any of the Company and its Affiliates which have been customized for use in the business of any of the Company and its Affiliates; (b) data, formulae, compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions and ideas, past, current, and planned research and development, current and planned building and sales methods and processes, customer lists, contractor and subcontractor lists, price lists, market studies, business plans, computer software and programs and any other information, however documented, of the Company or an Affiliate that is a trade secret under applicable law; (c) any and all information concerning the business and affairs of the Company or an Affiliate (which includes historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans, the names and backgrounds of key personnel and contractors, and personnel training and techniques and materials), however documented; and (d) any and all notes, analysis, compilations, studies, summaries, and other material prepared by or for the Company or an Affiliate containing or based, in whole or in part, on any information included in the foregoing. “Confidential Information” may also include without limitation (a)(i) unpublished patent disclosures and patent applications and other filings, know-how, trade secrets, works of authorship and other intellectual property, as well as any information regarding ideas, Inventions (as defined in Section 8(a)), technology, and processes, including without limitation assays, sketches, schematics, techniques, drawings, designs, descriptions, specifications and technical documentation, (ii) specifications, protocols, models, designs, equipment, engineering, algorithms, software programs, software source documents, formulae, (iii) information concerning or resulting from any research and development or other project, including without limitation, experimental work, product development plans, regulatory compliance information, and research, development and regulatory strategies, and (iv) business and financial information, including without limitation purchasing, procurement, manufacturing, customer lists, information relating to investors, employees, business and contractual relationships, business forecasts, sales and merchandising, business and marketing plans, product plans, and business strategies, including without limitation information the Company provides regarding third parties, such as, but not limited to, suppliers, customers, employees, investors, or vendors; and (b) any other information, to the extent such information contains, reflects or is based upon any of the foregoing Confidential Information. Confidential Information may also include information of a third party that is disclosed to the Executive by the Company or such third party at the Company’s direction.
(ii) The Executive acknowledges the confidential and secret character of Confidential Information, and agrees that Confidential Information is the sole, exclusive and valuable property of the Company. Accordingly, except as expressly provided in Section 7(a)(iii) below, the Executive agrees not to use Confidential Information except in the performance of the Executive’s authorized duties as an employee of the Company, and not to disclose any Confidential Information in any form to any third party, either during or after the term of the Executive’s employment, without the prior written consent of the Company on a case-by-case basis. Upon termination of the Executive’s employment, the
Executive agrees to cease using and to return to the Company all whole and partial copies and derivatives of the Confidential Information, whether in the Executive’s possession or under the Executive’s direct or indirect control, provided that the Executive is entitled to retain the Executive’s personal copies of (a) the Executive’s personal compensation records that do not contain any other Confidential Information, including any compensation information pertaining to any other Person, (b) materials distributed to stockholders generally, and (c) this Agreement. The Executive understands that the Executive’s obligations of nondisclosure with respect to Confidential Information shall not apply to information that the Executive can establish by competent proof (x) was actually in the public domain at the time of disclosure or enters the public domain following disclosure other than as a result of a breach of this Agreement, (y) is already in the Executive’s possession without breach of any obligations of confidentiality at the time of disclosure by the Company as shown by the Executive’s files and records immediately prior to the time of disclosure, or (z) is obtained by the Executive from a third party not under confidentiality obligations and without a breach of any obligations of confidentiality. If the Executive becomes compelled by law, regulation (including without limitation the rules of any applicable securities exchange), court order, or other governmental authority to disclose the Confidential Information, the Executive shall, to the extent possible and permissible under applicable law, first give the Company prompt notice. The Executive agrees to cooperate reasonably with the Company in any proceeding to obtain a protective order or other remedy. If such protective order or other remedy is not obtained, the Executive shall only disclose that portion of such Confidential Information required to be disclosed, in the opinion of the Executive’s legal counsel. The Executive shall request that confidential treatment be accorded such Confidential Information, where available. Compulsory disclosures made pursuant to this section shall not relieve the Executive of the Executive’s obligations of confidentiality and non-use with respect to non-compulsory disclosures.
(iii) The Executive understands that nothing herein is intended to or shall prevent the Executive from (i) communicating directly with, cooperating with, or providing information to, or receiving financial awards from, any federal, state or local government regulatory agency, including, but not limited to, the U.S. Securities and Exchange Commission, the U.S. Commodity Futures Trading Commission, or the U.S. Department of Justice, the U.S. Equal Employment Opportunity Commission, or the U.S. National Labor Relations Board, without notifying or seeking permission from the Company, (ii) discussing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination based on a protected characteristic or any other conduct that the Executive has reason to believe is unlawful or (iii) prohibit Executive from reporting possible violations of federal law or regulation to any United States governmental agency or entity in accordance with the provisions of and rules promulgated under Section 21F of the Securities Exchange Act of 1934 or Section 806 of the Sarbanes-Oxley Act of 2002, or any other whistleblower protection provisions of state or federal law or regulation (including the right to receive an award for information provided to any such government agencies). The Executive shall promptly notify the Company if the Executive learns of any possible unauthorized use or disclosure of proprietary information and shall cooperate fully with the Company to enforce its rights in such information.
(iv) The Executive acknowledges that the Company has provided the Executive notice of immunity rights under the Defend Trade Secrets Act, which states: “(1) An individual shall not be held criminally or civilly liable under any Federal or State trade
secret law for the disclosure of a trade secret that (A) is made (i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal; and (2) an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose a trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual (A) files any document containing the trade secret under seal, and (B) does not disclose a trade secret, except pursuant to court order.”
(b) Covenants Against Competition. The Executive specifically acknowledges that his employment with the Company has and will continue to enable him to acquire valuable information as to the nature and character of the businesses of the Company and its Affiliates. The Executive acknowledges and agrees that the covenants contained in this Section 7(b) are reasonable and necessary to protect the legitimate business interests of the Company and its Affiliates, including their trade secrets, other Confidential Information and goodwill. Consequently:
(i) The Executive shall not, except on behalf of the Company or an Affiliate of the Company, at any time during the term of the Executive’s employment, directly or indirectly, whether alone or with any other Person as a partner, officer, director, manager, employee, agent, shareholder, member, consultant, or otherwise, directly or indirectly, engage or invest in, own, manage, operate, finance, control, or participate in the ownership, management, operation, financing, or control of, be employed by, or render management, marketing, sales, operational, strategic, or technical services or advice to, any Competitive Business; provided, however, that the Executive may purchase or otherwise acquire up to (but not more than) one percent (1%) of any class of securities of any Competitive Business (but without otherwise participating in the activities of such Competitive Business) if such securities have been registered under Section 12(b) or 12(g) of the Securities Exchange Act of 1934.
(ii) The Executive shall not, except on behalf of the Company or an Affiliate of the Company, at any time during the term of the Executive’s employment, directly or indirectly, whether alone or with any other Person as a partner, officer, director, manager, employee, agent, shareholder, member, consultant, or otherwise:
A. Induce or attempt to induce any employee of the Company or its Affiliates to leave the employ of the Company or its Affiliates; or
B. Solicit for employment any employee of the Company or its Affiliates or any Person employed by the Company or its Affiliates with whom the Executive had contact during the six (6) months prior to the Executive’s Date of Termination.
(iii) The Executive shall not, except on behalf of the Company or an Affiliate of the Company, at any time during the term of the Executive’s employment and within the Restricted Territory, directly or indirectly, whether alone or with any other Person
as a partner, officer, director, manager, employee, agent, shareholder, member, consultant, or otherwise:
A. In any way interfere with the business relationship between the Company or its Affiliates and any employee of the Company or its Affiliates; or
B. Induce or attempt to induce any Company Customer to cease doing business with the Company or its Affiliates, or in any way interfere with the business relationship between any Company Customer and the Company or its Affiliates.
(c) Non-Disparagement. Except as otherwise provided in Sections 7(a)(iii) and (iv), the Executive agrees and covenants that the Executive will not make, publish, or communicate defamatory or disparaging remarks, comments, or statements concerning any of the Company or its Affiliates’ products or services. The Executive agrees and covenants that the Executive will not at any time make, publish, or communicate to any Person or in any public forum any maliciously false remarks, comments, or statements concerning the Company or its Affiliates, or any of its employees, officers, existing and prospective customers, suppliers, investors, and other associated third parties, now or at any time in the future. For the avoidance of doubt, this Section 7(c) does not restrict or impede the Executive from exercising any rights to communicate with securities regulators or any other administrative or regulatory agency to report suspected unlawful conduct, or rights to discuss or disclose information regarding a sexual assault or sexual harassment dispute arising after the date of this Agreement.
(d) Tolling. The period of any restrictive covenant set forth in this Agreement (including, without limitation, any non-competition or non-solicitation obligation) shall be extended by the length of any period during which the Executive is found to be in breach of such covenant, so that the Company receives the full benefit of the agreed-upon duration of the restriction. The tolling shall continue until the breach has been cured and the Executive is in full compliance with the applicable provision.
8. Inventions and Copyrights.
(a) Inventions. The Executive shall disclose promptly to the Company (which will receive it in confidence), and only to the Company, any invention or idea of the Executive (developed alone or with others) conceived or made during his employment with the Company or within six (6) months following the Executive’s employment termination date in the course of the Executive’s employment by the Company or in any way connected with the Executive’s employment or related to the Company’s business, research or development, or demonstrably anticipated research or development (“Inventions”). The Executive assigns to the Company any such invention or idea, and will cooperate with the Company and sign all documents deemed necessary by the Company to enable it to obtain, maintain, protect, and defend patents covering such inventions and ideas and to confirm the Company’s exclusive ownership of all rights in such inventions, ideas, and patents, and irrevocably appoints the Company as his agent to execute and deliver any assignments or documents that the Executive fails or refuses to execute and deliver promptly, this power and agency being coupled with an interest and being irrevocable. This constitutes the Company’s written notification that the disclosure requirement and assignment provided in this Section 8(a) does not apply to an invention for which no equipment, supplies, facility, or trade secret information of the Company was used and which was developed entirely on the Executive’s own time, unless (a) the invention relates (i) directly to the business of the Company, or (ii)
to the Company’s actual or demonstrably anticipated research or development, or (b) the invention results from any work performed by the Executive for the Company.
(b) Work for Hire Acknowledgment; Assignment. The Executive acknowledges that the Executive’s work on and contributions to documents and other expressions in tangible media (collectively, “Works”) are within the scope of the Executive’s employment and part of the Executive’s duties and responsibilities for the Company and its Affiliates. The Executive’s work on and contributions to any Works will be rendered and made by the Executive for, at the instigation of, and under the overall direction of, the Company, and are and at all times will be regarded, together with any such Works, as “work made for hire” as that term is used in the United States copyright laws. Without limiting this acknowledgment, the Executive assigns, grants, and delivers exclusively to the Company all rights, titles, and interests in and to any such Works, and all copies and versions, including all copyrights and renewals. The Executive shall execute and deliver to the Company, its successors and assigns, any assignments and documents that the Company requests for the purpose of establishing, evidencing, and enforcing or defending its complete, perpetual, and worldwide ownership of all rights, titles, and interests of every kind and nature, including all copyrights, in and to the Works, and the Executive constitutes and appoints the Company as its agent to execute and deliver any assignments or documents that the Executive fails or refuses to execute and deliver, this power and agency being coupled with an interest and being irrevocable.
9. Representations. The Executive hereby represents and warrants to the Company that (a) the Executive is entering into this Agreement voluntarily and that the performance of the Executive’s obligations hereunder will not violate any agreement between the Executive and any other person, firm, organization or other entity, or any policy, program or code of such other person, firm, organization or other entity person, and (b) the Executive is not bound by the terms of any agreement with any previous employer or other party to refrain from competing, directly or indirectly, with the business of such previous employer or other party that would be violated by the Executive’s entering into this Agreement and/or providing services to the Company pursuant to the terms of this Agreement.
10. Successors.
(a) This Agreement is personal to the Executive and, without the prior written consent of the Company, shall not be assignable by the Executive other than Executive’s rights to payment hereunder by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives. The Company may assign its rights and obligations under this Agreement to any of its Affiliates or to any successor to all or substantially all of the business or the assets of the Company (by merger or otherwise).
(b) This Agreement shall inure to the benefit of and be binding upon the Company and its respective successors and assigns.
11. Certain Definitions.
(a) “Affiliate” of any particular Person means any other Person directly or indirectly controlling, controlled by, or under common control with such particular Person, where “control” means the possession, directly or indirectly, of the power to direct the management and policies of a Person whether through the ownership of voting securities, by contract, or otherwise.
(b) “Board” means the Board of Directors of PubCo.
(c) “Cause” means the occurrence of any one or more of the following events as determined by the Board in its reasonable judgement:
(i) the Executive’s conviction of (including plea of guilty or no-contest to) any felony or crime involving dishonesty or moral turpitude;
(ii) the Executive’s violation of law, or act of fraud or dishonesty, in connection with his employment;
(iii) the Executive's refusal or failure to comply with any lawful directive of the Company or any of its officers or directors that is not cured (if capable of cure) within ten (10) days after written notice to the Executive identifying the refusal or failure;
(iv) the Executive’s breach of his fiduciary duty or duty of loyalty to the Company or any of its Affiliates that is not cured (if capable of cure) within ten (10) days after written notice to the Executive identifying the breach;
(v) the Executive’s breach of this Agreement or any other contract with the Company or any of its Affiliates that is not cured (if capable of cure) within ten (10) days after written notice to the Executive identifying the violation; or
(vi) the Executive’s violation of any applicable policy of the Company or any of its Affiliates that is not cured (if capable of cure) within ten (10) days after written notice to the Executive identifying the violation.
Notwithstanding anything to the contrary in the foregoing, no event shall constitute Cause unless the Company (A) provides written notice to the Executive identifying the circumstances that allegedly constitute Cause within thirty (30) days of the Company first becoming aware of such circumstances and (B) terminates Executive’s employment within thirty (30) days after the expiration of any applicable cure period.
(d) “Change in Control” has the meaning set forth in the Plan.
(e) “Code” means the Internal Revenue Code of 1986, as amended and the regulations thereunder.
(f) “Company Customer” means any individual or entity who (i) is, or was at any time during the two (2) year period prior to the termination of the Executive’s employment with the Company, a customer, supplier, or vendor of the Company or its Affiliates of whom the Executive learned, with whom the Executive had business contact or about whom the Executive obtained Confidential Information (as defined above) at any time during the Executive’s employment with the Company, or (ii) is a prospective customer, supplier, or vendor of the Company or its Affiliates of whom the Executive learned, with whom the Executive had business contact, or about whom the Executive obtained Confidential Information as part of a solicitation of business on behalf of the Company or its Affiliates at any time during the two (2) year period prior to the Executive’s employment termination date.
(g) “Competitive Business” means any Person engaged in the space exploration and/or defense industries or that offers any product or service that was being developed, marketed, offered, or
provided by the Company at any time during the last two (2) years of Executive’s employment with the Company in the Restricted Territory.
(h) “Date of Termination” means the date on which the Executive’s employment with the Company terminates, which, if Executive’s employment is terminated as a result of Executive’s death, will be the date of Executive’s death, and otherwise shall be the date specified in a Notice of Termination, which, other than in the case of a termination by the Company for Cause, shall be at least ninety (90) days following the date of the Notice of Termination; provided, however, that in the event that Executive delivers a Notice of Termination to the Company, the Company may, in its sole discretion, change the Date of Termination to any date that occurs on or following the date of Executive’s Notice of Termination and is prior to the Date of Termination specified in Executive’s Notice of Termination.
(i) “Disability” means that the Executive has become entitled to receive benefits under an applicable Company long-term disability plan or, if no such plan covers the Executive, the Executive’s inability, due to physical or mental illness, to perform the essential functions of the Executive’s job, with or without a reasonable accommodation for one hundred and eighty (180) consecutive days.
(j) “Good Reason” means the occurrence of any one or more of the following events without the Executive’s consent, unless the Company fully corrects the circumstances constituting Good Reason (provided such circumstances are capable of correction) as provided below:
(i) a material diminution in Executive’s authority, responsibilities, duties, or reporting relationship;
(ii) a material reduction in Executive’s aggregate compensation, unless such reduction is concurrently made to the entire Company’s Executive Committee; or
(iii) a material breach of any other material term of this Agreement.
Notwithstanding the foregoing, the Executive will not be deemed to have resigned for Good Reason unless (A) the Executive provides the Company with written notice setting forth in reasonable detail the facts and circumstances claimed by the Executive to constitute Good Reason within thirty (30) days after the initial existence of the facts or circumstances constituting Good Reason, (B) the Company fails to cure such acts or omissions within thirty (30) days following its receipt of such notice, and (C) the effective date of the Executive’s termination for Good Reason occurs no later than ninety (90) days after the initial existence of the facts or circumstances constituting Good Reason.
(k) “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated and (iii) if the Date of Termination is other than the date of receipt of such notice, specifies the termination date (which date shall be not more than thirty (30) days after the giving of such notice unless as otherwise provided upon a termination for Good Reason).
(l) “Person” means any individual, partnership, corporation, limited liability company, association, joint stock company, trust, joint venture, unincorporated organization, bank, or other entity.
(m) “Plan” means Company’s 2025 Incentive Award Plan, as amended from time to time.
(n) “Qualifying Termination” means a termination of the Executive’s employment (i) by the Company without Cause (other than by reason of the Executive’s death or Disability) or (ii) by the Executive for Good Reason.
(o) “Restricted Territory” means the State of California and those states in which the Executive had material responsibility or knowledge for a Competing Business or Company Customer during the last two (2) years of the Executive’s employment.
(p) “Section 409A” means Section 409A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder.
(q) “Separation from Service” means a “separation from service” (within the meaning of Section 409A).
(r) “Subsidiary” means any entity (other than the Company), whether domestic or foreign, in an unbroken chain of entities beginning with the Company if each of the entities other than the last entity in the unbroken chain beneficially owns, at the time of the determination, securities or interests representing at least fifty percent (50%) of the total combined voting power of all classes of securities or interests in one of the other entities in such chain.
12. Indemnification. The parties hereby acknowledge that in connection with the execution of this Agreement, they are entering into an Indemnification Agreement (the “Indemnification Agreement”), substantially in the form attached hereto as Exhibit C, which shall become effective as of the Effective Date.
13. Miscellaneous.
(a) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect.
(b) Notices. All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party, sent by facsimile or email, or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:
If to the Executive: at the Executive’s most recent address on the records of the Company.
If to the Company:
c/o Head of Human Resources
1225 17th Street
Suite 1100
Denver, Colorado 80202
or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee.
(c) Sarbanes-Oxley Act of 2002. Notwithstanding anything herein to the contrary, if the Company determines, in its good faith judgment, that any transfer or deemed transfer of funds hereunder is likely to be construed as a personal loan prohibited by Section 13(k) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (the “Exchange Act”), then such transfer or deemed transfer shall not be made to the extent necessary or appropriate so as not to violate the Exchange Act and the rules and regulations promulgated thereunder.
(d) Section 409A of the Code.
(i) To the extent applicable, this Agreement shall be interpreted in accordance with Section 409A. Notwithstanding any provision of this Agreement to the contrary, if the Company determines that any compensation or benefits payable under this Agreement may be subject to Section 409A, the Company shall work in good faith with the Executive to adopt such amendments to this Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Company determines are necessary or appropriate to avoid the imposition of taxes under Section 409A, including without limitation, actions intended to (i) exempt the compensation and benefits payable under this Agreement from Section 409A, and/or (ii) comply with the requirements of Section 409A; provided, however, that this Section 13(d) shall not create an obligation on the part of the Company to adopt any such amendment, policy or procedure or take any such other action, nor shall the Company have any liability for failing to do so.
(ii) Any right to a series of installment payments pursuant to this Agreement is to be treated as a right to a series of separate payments. To the extent permitted under Section 409A, any separate payment or benefit under this Agreement or otherwise shall not be deemed “nonqualified deferred compensation” subject to Section 409A to the extent provided in the exceptions in Treasury Regulation Section 1.409A-1(b)(4), Section 1.409A-1(b)(9) or any other applicable exception or provision of Section 409A. Any payments subject to Section 409A that are subject to execution of a waiver and release which may be executed and/or revoked in a calendar year following the calendar year in which the payment event (such as termination of employment) occurs shall commence payment only in the calendar year in which the consideration period or, if applicable, release revocation period ends, as necessary to comply with Section 409A. All payments of nonqualified deferred compensation subject to Section 409A to be made upon a termination of employment under this Agreement may only be made upon the Executive’s Separation from Service.
(iii) To the extent that any payments or reimbursements provided to the Executive under this Agreement are deemed to constitute compensation to the Executive to which Treasury Regulation Section 1.409A-3(i)(1)(iv) would apply, such amounts shall be paid or reimbursed reasonably promptly, but not later than December 31 of the year following the year in which the expense was incurred. The amount of any such payments eligible for reimbursement in one year shall not affect the payments or expenses that are eligible for payment or reimbursement in any other taxable year, and the Executive’s right to such payments or reimbursement of any such expenses shall not be subject to liquidation or exchange for any other benefit.
(e) Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.
(f) Withholding. The Company may withhold from any amounts payable under this Agreement such federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.
(g) No Waiver. The Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3(c), shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.
(h) Compensation Recovery Policy. Executive acknowledges and agrees that, to the extent the Company adopts any claw-back or similar policy pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act and any rules and regulations promulgated thereunder (collectively, “Dodd-Frank”) or otherwise, he shall take all action necessary to comply with such policy (including, without limitation, entering into any further agreements, amendments or policies reasonably necessary or appropriate to implement and/or enforce such policy with respect to past, present and future compensation, as appropriate).
(i) Entire Agreement. As of the Effective Date, this Agreement, constitutes the final, complete and exclusive agreement between the Executive and the Company with respect to the subject matter hereof and replaces and supersedes any and all other agreements, offers or promises, whether oral or written, by any member of the Company and its Affiliates, or representative thereof (including the Prior Agreement). Notwithstanding anything herein to the contrary, this Agreement and the obligations and commitments hereunder shall neither commence nor be of any force or effect prior to the Effective Date.
(j) Arbitration.
(i) Any controversy or dispute that establishes a legal or equitable cause of action (“Arbitration Claim”) between any two or more Persons Subject to Arbitration (as defined below), including any controversy or dispute, whether based on contract, common law, or federal, state or local statute or regulation, arising out of, or relating to the Executive’s service or the termination thereof, shall be submitted to final and binding arbitration as the sole and exclusive remedy for such controversy or dispute in accordance with the rules of JAMS pursuant to its Employment Arbitration Rules and Procedures, which are available at http://www.jamsadr.com/rules-employment-arbitration/, and the Company will provide a copy upon the Executive’s request. Notwithstanding the foregoing, this Agreement shall not require any Person Subject to Arbitration to arbitrate pursuant to this Agreement any claims: (A) under a Company benefit plan subject to the Employee Retirement Income Security Act, as amended; or (B) as to which applicable law not preempted by the Federal Arbitration Act prohibits resolution by binding arbitration. Either party may seek provisional non-monetary remedies in a court of competent jurisdiction to the extent that such remedies are not available or not available in a timely fashion through arbitration. It is the parties’ intent that issues of arbitrability of any dispute shall be decided by the arbitrator.
(ii) “Persons Subject to Arbitration” means, individually and collectively, (A) the Executive, (B) any person in privity with or claiming through, on behalf of or in the right of the Executive, (C) the Company, (D) any past, present or future Affiliate, employee, officer, director or agent of the Company, and/or (E) any person or entity alleged to be acting in concert with or to be jointly liable with any of the foregoing.
(iii) The arbitration shall take place before a single neutral arbitrator at the JAMS office in Denver, Colorado. Such arbitrator shall be provided through JAMS by mutual agreement of the parties to the arbitration; provided that, absent such agreement, the arbitrator shall be selected in accordance with the rules of JAMS then in effect. The arbitrator shall permit reasonable discovery. The award or decision of the arbitrator shall be rendered in writing; shall be final and binding on the parties; and may be enforced by judgment or order of a court of competent jurisdiction.
(iv) THE EXECUTIVE AND THE COMPANY UNDERSTAND THAT BY AGREEING TO ARBITRATE ANY ARBITRATION CLAIM, THEY WILL NOT HAVE THE RIGHT TO HAVE ANY ARBITRATION CLAIM DECIDED BY A JURY OR A COURT, BUT SHALL INSTEAD HAVE ANY ARBITRATION CLAIM DECIDED THROUGH ARBITRATION.
(v) THE EXECUTIVE AND THE COMPANY WAIVE ANY CONSTITUTIONAL OR OTHER RIGHT TO BRING CLAIMS COVERED BY THIS AGREEMENT OTHER THAN IN THEIR INDIVIDUAL CAPACITIES. EXCEPT AS MAY BE PROHIBITED BY LAW, THIS WAIVER INCLUDES THE ABILITY TO ASSERT CLAIMS AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING.
(vi) This Section 13(j) shall be interpreted to conform to any applicable law concerning the terms and enforcement of agreements to arbitrate service disputes. To the extent any terms or conditions of this Section 13(j) would preclude its enforcement, such terms shall be severed or interpreted in a manner to allow for the enforcement of this Section 13(j). To the extent applicable law imposes additional requirements to allow enforcement of this Section 13(j), this Agreement shall be interpreted to include such terms or conditions.
(k) Amendment; Survival. No amendment or other modification of this Agreement shall be effective unless made in writing and signed by the parties hereto. The respective rights and obligations of the parties under this Agreement shall survive the Executive’s termination of employment and the termination of this Agreement to the extent necessary for the intended preservation of such rights and obligations (including without limitation the covenants set forth in Sections 7 and 8).
(l) Counterparts. This Agreement and any agreement referenced herein may be executed in two or more counterparts, each of which shall be deemed an original but which together shall constitute one and the same instrument.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the authorization from the Board, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written.
| | | | | | | | | | | | | | |
| VOYAGER TECHNOLOGIES, INC. |
| | | | |
| | | | |
| | | | |
| By: | | |
| | Name: | | |
| | Title: | | |
| | | | |
| | | | |
| | | | |
| “EXECUTIVE” |
| | | | |
| | | | |
| | | | |
Attachments:
Exhibit A: Exclusivity Carve-Outs
Exhibit B: Release
Exhibit C: Indemnification Agreement
EXHIBIT A
EXCLUSIVITY CARVE-OUTS
1. None.
EXHIBIT B1
GENERAL RELEASE
1. Release. For valuable consideration, the receipt and adequacy of which are hereby acknowledged, the undersigned does hereby release and forever discharge the “Releasees” hereunder, consisting of Voyager Technologies, Inc. (the “Company”), and the Company’s partners, Subsidiaries, associates, Affiliates, successors, heirs, assigns, agents, directors, officers, employees, representatives, lawyers, insurers, and all persons acting by, through, under or in concert with them, or any of them, of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liability, claims, demands, damages, losses, costs, attorneys’ fees or expenses, of any nature whatsoever, known or unknown, fixed or contingent (hereinafter called “Claims”), which the undersigned now has or may hereafter have against the Releasees, or any of them, by reason of any matter, cause, or thing whatsoever from the beginning of time to the date hereof. The Claims released herein include, without limiting the generality of the foregoing, any Claims in any way arising out of, based upon, or related to the employment or termination of employment of the undersigned by the Releasees, or any of them; any alleged breach of any express or implied contract of employment; any alleged torts or other alleged legal restrictions on Releasees’ right to terminate the employment of the undersigned; and any alleged violation of any federal, state or local statute or ordinance including, without limitation, Title VII of the Civil Rights Act of 1964, the Age Discrimination In Employment Act (“ADEA”) and the Americans With Disabilities Act.
2. Claims Not Released. Notwithstanding the foregoing, this general release (the “Release”) shall not operate to release any rights or claims of the undersigned (i) to payments or benefits under Section 4(b) of that certain Employment Agreement, dated as of [_____], between the Company and the undersigned (the “Employment Agreement”), with respect to the payments and benefits provided in exchange for this Release, (ii) to payments or benefits under any equity award agreement between the undersigned and the Company or as a holder of any securities of the Company, (iii) with respect to Sections 2(b)(vii) or 4(a) of the Employment Agreement, (iv) to accrued or vested benefits the undersigned may have, if any, as of the date hereof under any applicable plan, policy, practice, program, contract or agreement with the Company, (v) to any Claims, including claims for indemnification and/or advancement of expenses arising under any indemnification agreement between the undersigned and the Company or under the bylaws, certificate of incorporation or other similar governing document of the Company, (vi) to any Claims which cannot be waived by an employee under applicable law or (vii) with respect to the undersigned’s right to communicate directly with, cooperate with, or provide information to, any federal, state or local government regulator.
3. Exceptions. Notwithstanding anything in this Release to the contrary, nothing contained in this Release shall prohibit the undersigned from (i) filing a charge with, reporting possible violations of federal law or regulation to, participating in any investigation by, or cooperating with any governmental agency or entity or making other disclosures that are protected under the whistleblower provisions of applicable law or regulation and/or (ii) communicating directly with, cooperating with, or providing information (including trade secrets) in confidence to, any federal, state or local government regulator (including, but not limited to, the U.S. Securities and Exchange Commission, the U.S. Commodity Futures Trading Commission, or the U.S. Department of Justice) for the purpose of reporting or investigating a suspected violation of law, or from providing such information to the undersigned’s attorney or in a sealed complaint or other document filed in a lawsuit or other governmental proceeding. Pursuant to 18 USC Section 1833(b), (1) the undersigned will not be held criminally or civilly liable
1 Subject to revision for applicable law at time of termination.
under any federal or state trade secret law for the disclosure of a trade secret that is made: (x) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (y) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal and (2) the undersigned acknowledges that an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual files any document containing the trade secret under seal and does not disclose the trade secret, except pursuant to court order.
4. Representations. The undersigned represents and warrants that there has been no assignment or other transfer of any interest in any Claim which the undersigned may have against Releasees, or any of them, and the undersigned agrees to indemnify and hold Releasees, and each of them, harmless from any liability, Claims, demands, damages, costs, expenses and attorneys’ fees incurred by Releasees, or any of them, as the result of any such assignment or transfer or any rights or Claims under any such assignment or transfer. It is the intention of the parties that this indemnity does not require payment as a condition precedent to recovery by the Releasees against the undersigned under this indemnity.
5. No Action. The undersigned agrees that if the undersigned hereafter commences any suit arising out of, based upon, or relating to any of the Claims released hereunder or in any manner asserts against Releasees, or any of them, any of the Claims released hereunder, then the undersigned agrees to pay to Releasees, and each of them, in addition to any other damages caused to Releasees thereby, all attorneys’ fees incurred by Releasees in defending or otherwise responding to said suit or Claim. Notwithstanding the foregoing, this provision shall not apply to any suit or Claim to the extent it challenges the effectiveness of this release with respect to a claim under the ADEA.
6. No Admission. The undersigned further understands and agrees that neither the payment of any sum of money nor the execution of this Release shall constitute or be construed as an admission of any liability whatsoever by the Releasees, or any of them, who have consistently taken the position that they have no liability whatsoever to the undersigned.
7. OWBPA. The undersigned agrees and acknowledges that this Release constitutes a knowing and voluntary waiver and release of all Claims the undersigned has or may have against the Company and/or any of the Releasees as set forth herein, including, but not limited to, all Claims arising under the Older Worker’s Benefit Protection Act and the ADEA. In accordance with the Older Worker’s Benefit Protection Act, the undersigned is hereby advised as follows:
(i) the undersigned has read the terms of this Release, and understands its terms and effects, including the fact that the undersigned agreed to release and forever discharge the Company and each of the Releasees, from any Claims released in this Release;
(ii) the undersigned understands that, by entering into this Release, the undersigned does not waive any Claims that may arise after the date of the undersigned’s execution of this Release, including without limitation any rights or claims that the undersigned may have to secure enforcement of the terms and conditions of this Release;
(iii) the undersigned has signed this Release voluntarily and knowingly in exchange for the consideration described in this Release, which the undersigned acknowledges is adequate
and satisfactory to the undersigned and which the undersigned acknowledges is in addition to any other benefits to which the undersigned is otherwise entitled;
(iv) the Company advises the undersigned to consult with an attorney prior to executing this Release;
(v) the undersigned has been given at least [twenty-one (21)]2 days in which to review and consider this Release. To the extent that the undersigned chooses to sign this Release prior to the expiration of such period, the undersigned acknowledges that the undersigned has done so voluntarily, had sufficient time to consider the Release, to consult with counsel and that the undersigned does not desire additional time and hereby waives the remainder of the [twenty-one (21)]-day period; and
(vi) the undersigned may revoke this Release within seven (7) days from the date the undersigned signs this Release and this Release will become effective upon the expiration of that revocation period if the undersigned has not revoked this Release during such seven (7)-day period. If the undersigned revokes this Release during such seven (7)-day period, this Release will be null and void and of no force or effect on either the Company or the undersigned and the undersigned will not be entitled to any of the payments or benefits which are expressly conditioned upon the execution and non-revocation of this Release. Any revocation must be in writing and sent to [name], via electronic mail at [email address], on or before [5:00 p.m. Eastern time] on the seventh (7th) day after this Release is executed by the undersigned.
8. Acknowledgement. The undersigned acknowledges that different or additional facts may be discovered in addition to what is now known or believed to be true by the undersigned with respect to the matters released in this Release, and the undersigned agrees that this Release shall be and remain in effect in all respects as a complete and final release of the matters released, notwithstanding any different or additional facts
9. Governing Law. This Release is deemed made and entered into in the State of California, and in all respects shall be interpreted, enforced and governed under the internal laws of the State of California, to the extent not preempted by federal law.
IN WITNESS WHEREOF, the undersigned has executed this Release this ____ day of ___________, ____.
_______________________________________
2 NTD: Use 45 days in a group termination, and include information regarding terminated positions.
EXHIBIT C
INDEMNIFICATION AGREEMENT
THIS WARRANT AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER ANY OTHER APPLICABLE SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, (B) THE SALE IS MADE IN ACCORDANCE WITH RULE 144 UNDER THE ACT, OR (C) THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF SUCH SECURITIES REASONABLY SATISFACTORY TO THE COMPANY STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.
VOYAGER SPACE HOLDINGS, INC.
WARRANT TO PURCHASE COMMON STOCK
Date of Issuance:
December 22, 2021
THIS CERTIFIES THAT, for value received, JPMORGAN CHASE BANK, N.A. (the “Holder”) is entitled, subject to the terms and conditions of this Warrant to Purchase Common Stock (this “Warrant”), to subscribe for and purchase from VOYAGER SPACE HOLDINGS, INC., a Delaware corporation (the “Company”), the Exercise Shares at the Exercise Price (each subject to adjustment as provided herein) at any time during the Exercise Period.
1. DEFINITIONS. As used herein, the following terms shall have the following
respective meanings:
(a) “Affiliate” of any specified person shall mean any other person who directly or indirectly controls, is controlled by, or is under direct or indirect common control with such specified person. For the purposes of this definition, “control” when used with respect to any person means the power to direct the management and policies of such specified person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise, and the term “controlled” has a meaning correlative to the foregoing.
(b) “Business Day” shall mean any day other than a Saturday, Sunday or a day on which banks in New York, New York are authorized or required by law to close.
(c) “Change of Control Event” shall mean (i) the Company consummates a merger, share exchange or consolidation with another entity and as a result of such transaction less than 50% of the outstanding voting securities of the surviving or resulting entity shall be owned in the aggregate by the former holders of the shares of the Company, (ii) the Company sells at least 50% or more of its assets by value in a single transaction or in a series of transactions to a third party which is not a wholly owned subsidiary of the Company, or (iii) a
person, within the meaning of Section 3(a)(9) or of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (as in effect on the Date of Issuance), other than a holder of the shares of the Company as of the Date of Issuance, shall acquire 50% or more of the outstanding voting securities of the Company (whether directly, indirectly, beneficially or of record).
(d) “Constituent Documents” shall mean with respect to any person, such person’s articles or certificate of incorporation, association or formation, deed of incorporation, bylaws, limited liability company agreement, partnership agreement or other constitutive documents, as applicable (and, in each case, such similar instruments or documents as applicable under a relevant jurisdiction).
(e) “Date of Issuance” shall mean the date this Warrant is issued as first set forth above.
(f) “Designated Expert” means an impartial and disinterested appraisal or valuation firm of national reputation as may be mutually and reasonably agreed upon in a timely manner by the Company and the Holder at the Company’s expense; provided, however, that if the Company and the Holder shall fail to agree to the identity of such firm within fifteen (15) days, then the Company and the Holder shall each select an independent valuation expert within five (5) days, and such valuation experts shall mutually agree upon the determinations then the subject of appraisal (including, if applicable, the Fair Market Value). If within thirty (30) days after appointment of the two appraisers they are unable to agree upon the amount in question, a third independent appraiser shall be chosen within ten (10) days thereafter by the mutual consent of such first two appraisers, or, if such two first appraisers fail to agree upon the appointment of a third appraiser, such appointment shall be made by the American Arbitration Association, or any organization successor thereto, from a panel of arbitrators having experience in appraisal of the subject matter to be appraised. The decision of the third appraiser so appointed and chosen shall be given within thirty (30) days after the selection of such third appraiser. If three appraisers shall be appointed and the determination of one appraiser is disparate from the middle determination by more than twice the amount by which the other determination is disparate from the middle determination, then the determination of such appraiser shall be excluded, the remaining two determinations shall be averaged and such average shall be binding and conclusive upon the Company and the Holder; otherwise, the average of all three determinations shall be binding upon the Company and the Holder. The costs of conducting any appraisal procedure shall be borne by the Company. The Company and the Holder acknowledge, covenant and agree that the Exercise Period shall be extended automatically during the pendency of such valuation exercise and, if necessary, for five (5) Business Days following the conclusion thereof to complete the exercise of this Warrant. During the pendency of such valuation exercise, the parties will (i) cooperate with the Designated Expert, (ii) have the opportunity to make presentations and provide supporting material to the Designated Expert in support of their positions and (iii) subject to customary confidentiality agreements, provide the Designated Expert with reasonable access to their respective books and records, personnel, and representatives, and such other information as the Designated Expert may reasonably require in order to render its determination.
(g) “Exercise Period” shall mean the period commencing on the Date of Issuance and ending on the tenth (10th) anniversary thereof, unless sooner terminated as provided below.
(h) “Exercise Price” shall mean the exercise price per share of the Warrant Stock, initially set at $0.01, subject to adjustment as provided in Section 6. (i) “Exercise Shares” shall mean up to an aggregate total of 48,311 shares of Warrant Stock subject to adjustment pursuant to Section 6. (j) “Fair Market Value” of one Exercise Share shall mean the price per share as determined by the Company’s Board of Directors in good faith or, if the Holder objects to the Board of Directors’ determination of fair market value within ten (10) days of receipt of notice thereof, such price as determined by the Designated Expert; provided, however, that (i) if the Warrant Stock is traded on a securities exchange, the fair market value per share shall be deemed to be the average of the closing or last reported sale prices of such share of Warrant Stock on such exchange or market, over the ten (10) consecutive trading days immediately preceding the date of determination of fair market value or (ii) if otherwise traded in an over-the-counter market, the fair market value per share shall be deemed to be the average of the closing ask prices of such share of Warrant Stock as quoted in the Over-The-Counter Markets Group reports or other reporting system over the ten (10) consecutive trading days immediately preceding the date of determination of fair market value.
(k) “shares” shall mean shares in a corporation or units representing limited liability company interest or limited partnership interests, as applicable.
(l) “Warrant” shall mean this Warrant and any warrant(s) delivered in substitution or exchange therefor, as provided herein.
(m) “Warrant Stock” shall mean the Company’s Common Stock, $0.0001 par value per share.
2. EXERCISE OF WARRANT.
2.1 Exercise of Warrant. Subject to the terms and conditions of this Warrant, the rights for the Exercise Shares represented by this Warrant may be exercised in whole or in part at any time during the Exercise Period, by delivery of the following to the Company at its address set forth on the signature page of this Warrant (or at such other address as it may designate by notice in writing to the Holder);
(a) An executed Notice of Exercise in the form attached as Exhibit A hereto (“Notice of Exercise”);
(b) Payment of the Exercise Price in cash or by check; and
(c) This Warrant.
Upon the exercise of the rights represented by this Warrant, a certificate or certificates (or uncertificated issuances reflected in book-entry form only in the equity ledger maintained by the Company’s transfer agent) for the Exercise Shares so purchased, registered in the name of the Holder or persons affiliated with the Holder, if the Holder so designates, shall be issued and delivered to the Holder as promptly as practicable (in any event within five (5) Business Days) after the rights represented by this Warrant shall have been so exercised. In the event that this Warrant is being exercised for less than all of the then-current number of Exercise Shares purchasable hereunder, the Company shall, concurrently with the issuance by the Company of the number of Exercise Shares for which this Warrant is then being exercised, issue a new Warrant exercisable for the remaining number of Exercise Shares purchasable hereunder. If at any point after the exercise of this Warrant, the Company establishes an investors’ rights agreement, voting agreement, right of first refusal, or similar shareholder agreement and the Company requests the Holder to become a party to same, any joinder or counterpart signature page to any such agreement may include an election by the Holder to waive one or more rights (but not obligations) that would otherwise be provided to the Holder as a party to such agreement.
2.2 Net Exercise. Notwithstanding any provisions herein to the contrary, if the Fair Market Value of one Exercise Share is greater than the Exercise Price (at the date of calculation as set forth below), in lieu of exercising the Exercise Shares under this Warrant by payment of cash, at any time during the Exercise Period the Holder may elect to receive a number of shares equal to the value (as determined below) of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Company together with the properly endorsed Notice of Exercise, in which event the Company shall issue to the Holder a number of Exercise Shares computed using the following formula:
X = Y (A-B)
A
Where X = the number of Exercise Shares to be issued to the Holder
Y = the number of Exercise Shares purchasable under the Warrant or, if only a portion of the Warrant is being exercised, that portion of the Warrant being canceled (at the date of such calculation)
A = the Fair Market Value of one Exercise Share (at the date of such calculation)
B = Exercise Price (as adjusted to the date of such calculation)
2.3 Conditional Exercise. At its election, the Holder may exercise this Warrant conditioned upon (and effective immediately prior to) consummation of any transaction described herein. Without limiting the generality of the foregoing, in the event of, at any time during the Exercise Period, an initial public offering of securities of the Company registered under the Act, or a Change of Control Event, the Company shall provide to the Holder ten (10) days advance written notice of such public offering or Change of Control Event and, at its
election, the Holder shall have the option to exercise this Warrant conditioned upon (and effective immediately prior to) consummation of such public offering or Change of Control Event (without regard to satisfaction of any conditions to exercise contained herein).
3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.
3.1 Representations. In connection with the issuance of this Warrant, the Company hereby represents and warrants to the Holder that:
(a) Organization and Existence. The Company is duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation or organization, with all requisite power and authority to carry on its business as conducted. The Company is duly qualified to transact business in each jurisdiction in which the failure to so qualify would have a material adverse effect on its business.
(b) Authorization. All corporate or other requisite action on the part of the Company, its officers, directors and stockholders necessary for the authorization, execution and delivery of this Warrant, the performance of all obligations of the Company hereunder, and the authorization, issuance (or reservation for issuance), sale and delivery of the Exercise Shares has been taken, and this Warrant constitutes a valid and legally binding obligation of the Company, enforceable in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other laws of general application affecting enforcement of creditors’ rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.
(c) Valid Issuance of Warrant and Warrant Stock. The Warrant and the Exercise Shares, when issued, sold and delivered in accordance with the terms of this Warrant for the consideration expressed herein, will be duly and validly issued, fully paid and nonassessable and will be free of restrictions on transfer other than restrictions on transfer under this Warrant, the Constituent Documents, and under applicable state and federal securities laws. The Company has authorized and reserved, free from preemptive rights, sufficient shares of Warrant Stock to allow for the exercise of this Warrant.
(d) No Preemptive Right. The issuance of this Warrant or the shares under the Warrant is not subject to any preemptive rights of any person that have not previously been waived.
(e) Compliance with Law. The Company is in compliance in all material respects with all applicable laws, rules and regulations; and the Company has not received and does not have any basis to expect to receive, any notice, order or other communication from any governmental agency or instrumentality of any alleged, actual, or potential violation of or failure to comply with any law, rule or regulation. The authorization, execution and delivery of the Warrant will not constitute or result in any default or breach of any term or provision of any law, rule or regulation applicable to the Company, the Company’s current Constituent Documents, or any material agreement or instrument by which it is bound or to which its properties or assets are subject.
3.2 Information Rights. For so long as this Warrant is outstanding, promptly following December 31 and June 30 of each year during the Exercise Period, the Company shall provide to the Holder (i) an up-to-date capitalization table of the Company and (ii) any 409A valuation reports on the Warrant Stock finalized during the prior six (6) months. In addition, for so long as this Warrant remains outstanding, the Company shall provide to the Holder (w) as soon as practicable, but in any event within one hundred fifty (150) days after then end of each fiscal year of the Company, an income statement for such fiscal year, a balance sheet of the Company and a statement of stockholders’ equity as of the end of such fiscal year, and a statement of cash flows for such fiscal year, all such financial statements to be prepared by the Company (or, if required by the Company’s board of directors, audited and certified by independent public accountants of nationally recognized standing selected by the Company), (x) as soon as practicable, but in any event within forty-five (45) days after the end of each fiscal month beginning with June 2022, unaudited summary financial statements of the Company for such month, (y) as soon as practicable, but in any event within thirty (30) days after the end of each fiscal year, a budget and business plan for the then-current fiscal year approved by the Board of Directors of the Company and prepared on a monthly basis, including balance sheets, income statements and statements of cash flow for such months, and (z) such other information and documents that are provided to the holders of shares of Warrant Stock. The Company shall reasonably cooperate with the Holder to answer any questions the Holder may have with respect to the information provided pursuant to this Section 3.2. The Holder agrees to keep confidential, and to use the same degree of care as the Holder uses to protect its own confidential information, but in no event less than a commercially reasonable degree of care, to keep confidential any information furnished to the Holder pursuant to this Section 3.2 (so long as such information is not in the public domain), except that the Holder may disclose such confidential information as required by applicable law. It is understood and agreed that nothing in this Warrant prevents the Holder from making available to its bank regulators any confidential information that may be in its possession in the course of the regular bank supervision and examination process and subject to the confidentiality protections afforded thereto under applicable law. 3.3 No Impairment. The Company will not, by amendment of any of its Constituent Documents or through reorganization, consolidation, merger, dissolution, issue or sale of securities, sale of assets or any other voluntary action, willfully avoid or seek to avoid the observance or performance of any of the material terms of this Warrant, but will, at all times in good faith, assist in the carrying out of all such material terms and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the Holder against wrongful impairment.
4. REPRESENTATIONS AND COVENANTS OF HOLDER.
4.1 Representations and Warranties. The Holder represents and warrants that:
(a) Accredited Investor Status. The Holder is an “accredited investor” as defined in Rule 501(a) of Regulation D, as presently in effect, as promulgated under the Act. The Holder acknowledges that there is and may be no market for the Warrants. The Holder has had access, during the period prior to the receipt of any Warrants, to sufficient information
concerning the Company and that such Holder has had, during such period and prior to receipt of any Warrants, the opportunity to ask questions of, and receive answers from, the Company concerning the terms and conditions of the Warrants, the underlying shares of Common Stock, and the business, affairs and prospects of the Company and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable effort or expense) necessary to verify the accuracy of any information furnished to such Holder or to which it had access.
(b) Investment Intent. It is acquiring the Warrant solely for its account for investment and not with a view to or for sale or distribution of said Warrant or the Exercise Shares or any part thereof. The Holder also represents that the entire legal and beneficial interests of the Warrant the Holder is acquiring is being acquired for, and will be held for, its account only.
(c) Securities are Not Registered.
(i) The Holder understands that the Warrant and the Exercise Shares have not been registered under the Securities Act of 1933, as amended (the “Act”), on the basis that no distribution or public offering of the stock of the Company is to be effected and the Company’s reliance on such exemption is predicated on the representations and warranties of the Holder set forth herein. The Holder realizes that the basis for the exemption may not be present if, notwithstanding its representations, the Holder has a present intention of acquiring the securities for a fixed or determinable period in the future, selling (in connection with a distribution or otherwise), granting any participation in, or otherwise distributing the securities in violation of securities laws. The Holder has no such present intention.
(ii) The Holder is aware that neither the Warrant nor the Exercise Shares may be sold pursuant to Rule 144 adopted under the Act unless certain conditions are met, including, among other things, the existence of a public market for the shares, the availability of certain current public information about the Company, the resale following the required holding period under Rule 144 and the number of shares being sold during any three month period not exceeding specified limitations. The Holder is aware that the conditions for resale set forth in Rule 144 have not been satisfied and that the Company presently has no plans to satisfy these conditions in the foreseeable future.
4.2 Disposition of Warrant and Exercise Shares.
(a) The Holder may transfer or assign this Warrant to any Person at any time without the consent of the Company, subject to the other provisions of this Section 4.2 and Section 166. The Holder further agrees not to make any disposition of all or any part of the Warrant or Exercise Shares in any event unless and until: (i) There is then in effect a registration statement under the Act covering such proposed disposition and such disposition is made in accordance with said registration statement;
(ii) Such disposition will be made in accordance with Rule 144 under the Act; or
(iii) Such disposition will not require registration of such Warrant or Exercise Shares under the Act or any applicable state securities laws.
(b) The Holder understands and agrees that all certificates evidencing the shares to be issued to the Holder may bear a legend in substantially the following form (in addition to any legend prescribed by the Constituent Documents and that the Company or its transfer agent may implement stop transfer procedures consistent with such legend):
THIS WARRANT AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER ANY OTHER APPLICABLE SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, (B) THE SALE IS MADE IN ACCORDANCE WITH RULE 144 UNDER THE ACT, OR (C) THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF SUCH SECURITIES REASONABLY SATISFACTORY TO THE COMPANY STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.
5. NO FRACTIONAL SHARES. No fractional shares shall be issued upon the exercise of this Warrant as a consequence of any adjustment pursuant hereto. All Exercise Shares (including fractions) to be issued upon exercise of this Warrant shall be aggregated for purposes of determining whether the exercise would result in the issuance of any fractional share. If, after aggregation, the exercise would result in the issuance of a fractional share, the Company shall, in lieu of issuance of any fractional share, pay the Holder otherwise entitled to such fraction a sum in cash equal to the product resulting from multiplying the then current Fair Market Value of one Exercise Share by such fraction.
6. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF EXERCISE SHARES.
The number and kind of Exercise Shares purchasable upon exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time as follows:
6.1 Subdivisions, Combinations and Other Issuances. In the event that the outstanding shares of Warrant Stock are subdivided (by stock split, issuance of additional shares as a dividend or otherwise) into a greater number of shares of such securities, the number of shares of Warrant Stock issuable upon exercise of the rights under this Warrant immediately prior to such subdivision shall, concurrently with the effectiveness of such subdivision, be proportionately increased, and the Exercise Price shall be proportionately decreased such that the
aggregate Exercise Price payable for the total number of Exercise Shares purchasable under this Warrant (as adjusted) shall remain the same. In the event the outstanding shares of the securities issuable upon exercise of this Warrant are combined (by reclassification, reverse stock split or otherwise) into a lesser number of shares of Warrant Stock, the number of shares of Warrant Stock issuable upon exercise of the rights under this Warrant immediately prior to such combination shall, concurrently with the effectiveness of such combination, be proportionately decreased, and the Exercise Price shall be proportionately increased such that the aggregate Exercise Price payable for the total number of Exercise Shares purchasable under this Warrant (as adjusted) shall remain the same. Any adjustment under this Section 6.1 shall become effective (i) in the case of any subdivision or combination, at the close of business on the date the subdivision or combination becomes effective, or (ii) in the case of an issuance of additional shares of Warrant Stock as a dividend, as of the record date of such dividend, or in the event that no record date is fixed, upon the making of such dividend. 6.2 Adjustments for Dividends and Distributions. In case the Company shall make or issue, or shall fix a record date for the determination of eligible holders entitled to receive a dividend or other distribution payable with respect to the Exercise Shares (or, prior to the Holder’s exercise of this Warrant, the Warrant Stock) that is payable in (i) securities of the Company or (ii) evidence of indebtedness, rights, warrants, cash or other assets which dividend or distribution is actually made (other than in the case of each of clause (i) and clause (ii), issuances with respect to which adjustment is made under Sections 6.1 or 6.3) (each a “Dividend Event”), then, and in each such case, the Exercise Price in effect prior to such record date shall be reduced immediately thereafter to the price determined by multiplying the Exercise Price in effect immediately prior to the reduction by the quotient of (x) the Fair Market Value of the Warrant Stock minus the amount of cash and/or the Fair Market Value of the securities, evidences of indebtedness, assets, rights or warrants to be so distributed in respect of one Exercise Share divided by (y) such Fair Market Value specified in clause (x). In such event, the number of Exercise Shares issuable upon the exercise of this Warrant shall be increased to the number obtained by dividing (x) the product of (1) the number of Exercise Shares issuable upon the exercise of this Warrant before such adjustment, and (2) the Exercise Price in effect immediately prior to the distribution giving rise to this adjustment by (y) the new Exercise Price determined in accordance with the immediately preceding sentence. In the event that such distribution is not so made, the Exercise Price and the number of Exercise Shares issuable upon exercise of this Warrant then in effect shall be readjusted, effective as of the date when the Board of Directors determines not to distribute such securities, evidences of indebtedness, rights, warrants, cash or other assets, as the case may be, to the Exercise Price that would then be in effect and the number of Exercise Shares that would then be issuable upon exercise of this Warrant if such record date had not been fixed. 6.3 Reclassification, Reorganization and Consolidation. In case of any reclassification, capital reorganization or change in the capital stock of the Company (each a “Reorganization Event”; provided, that, none of the foregoing resulting from a subdivision, combination or stock dividend provided for in Section 6.1 above shall constitute a Reorganization Event), then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly executed documents evidencing the same from the
Company or its successor shall be delivered to the Holder, so that the Holder shall have the right at any time prior to the expiration of this Warrant to receive, without the payment by the Holder of any additional consideration, the kind and amount of shares of stock and other securities or property (including cash) receivable in connection with such reclassification, reorganization or change, which the Holder would have been entitled to receive upon such Reorganization Event if, immediately prior to such Reorganization Event, the Holder had completed such exercise of this Warrant, all subject to further adjustment as provided in this Warrant. In any such case appropriate provisions shall be made with respect to the rights and interest of the Holder so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities or property deliverable upon exercise hereof, and appropriate adjustments shall be made to the Exercise Price per Exercise Share payable hereunder, provided the aggregate Exercise Price shall remain the same. In determining the kind and amount of stock, securities or the property receivable upon exercise of this Warrant following the consummation of such Reorganization Event, if the holders of Warrant Stock have the right to elect the kind or amount of consideration receivable upon consummation of such Reorganization Event, then (i) the Holder shall have the right to make a similar election upon exercise of this Warrant with respect to the number of shares of stock or other securities or property which the Holder will receive upon exercise of this Warrant or (ii) in the event the Holder does not make such election within ten (10) days upon notice, the consideration that the Holder shall be entitled to receive upon exercise shall be deemed to be the types and amounts of consideration received by the majority of all holders of the shares of Warrant that affirmatively make an election (or of all such holders if none make an election).
7. RESERVATION OF SHARES; NO IMPAIRMENT.
7.1 The Company further covenants and agrees that the Company will, at all times during the Exercise Period, take such corporate or other requisite action as required in order to have authorized and reserved, free from preemptive rights, a sufficient number of shares of Warrant Stock to satisfy the exercise of this Warrant from time to time as these Warrants are presented for exercise in accordance with the terms hereof. If, at any time during the Exercise Period, the number of authorized but unissued shares of the Company’s equity securities shall not be sufficient to permit exercise of this Warrant, the Company will promptly take such corporate or other requisite action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of the Company’s equity securities to such number of shares as shall be sufficient for such purposes. The Company covenants and agrees that all Exercise Shares that may be issued upon the exercise of this Warrant in accordance with the terms hereof will be duly authorized, validly issued, fully paid, non-assessable, free from all taxes, liens and charges with respect to the issuance thereof and free and clear of preemptive rights.
7.2 Certificates for Exercise Shares issued upon exercise of these Warrants will be issued in such name(s) as the Holder may designate and will be delivered to such named person(s) within a reasonable time, not to exceed five (5) Business Days after any date on which the Holder exercises the right to purchase the Exercise Shares.
7.3 The Company will not, by amendment of its Constituent Documents or any other voluntary action, willfully avoid the observance or performance of any of the terms of
this Warrant, but will at all times in good faith assist in the carrying out of all such material terms and in the taking of all such actions as may be necessary or appropriate in order to protect the rights of the Holder against wrongful impairment.
8. NO RIGHTS OF HOLDERS OF SHARES; TRANSFER BOOKS.
8.1 Prior to exercise of this Warrant, except as otherwise provided in this Warrant, this Warrant in and of itself shall not entitle the Holder to any voting rights or other rights as a holder of the shares of the Company. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a holder of the shares of the Company, whether such liabilities are asserted by the Company or by creditors of the Company.
8.2 The person in whose name any certificate or certificates for Exercise Shares are to be issued upon exercise of this Warrant shall be deemed to have become the holder of record of such shares immediately prior to the close of business on the date on which this Warrant was surrendered and exercise procedures completed pursuant to Section 2.1, including payment of the Exercise Price, irrespective of the date of delivery of such certificate or certificates, except that, if the date of such surrender and payment is a date when the stock transfer books of the Company are closed, such person shall be deemed to have become the holder of such shares at the close of business on the next succeeding date on which the stock transfer books are open. The Company will at no time close its transfer books against transfer of this Warrant in any manner which interferes with the timely exercise of this Warrant.
9. LOST, STOLEN, MUTILATED OR DESTROYED WARRANT. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of mutilation, on surrender and cancellation of this Warrant, the Company shall execute and deliver, in lieu of this Warrant, a new Warrant of like tenor.
10. ENTIRE AGREEMENT; AMENDMENT. This Warrant and any other documents delivered pursuant hereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof. Any term of this Warrant may be amended or waived only with the written consent of the Company and the Holder.
11. NOTICES, ETC.
11.1 Notices Generally. All notices required or permitted hereunder shall be in writing and shall be deemed effectively given: (a) upon personal delivery to the party to be notified, (b) when sent by electronic mail or confirmed facsimile if sent during normal business hours of the recipient, if not, then on the next Business Day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage pre-paid, or (d) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt. All communications shall be sent to the Company at the address listed on the signature page (or at such other address as it may designate by notice in writing to
the Holder) and to the Holder at its address of record in the Company’s books and records, or at such other address as the Company or the Holder may designate by ten (10) days’ advance written notice to the other party hereto.
11.2 Notices of Adjustment, Change of Control Event and offer. In the event the Company shall propose to take any action of the type described in Section 6 (for the avoidance of doubt, including any Change of Control Event) (but only if the action of the type described in Section 6 would (whether or not at the Holder’s election) result in an adjustment in the Exercise Price or the number of shares of Warrant Stock or a change in the type of securities or property to be delivered upon exercise of such Warrants), the Company shall give notice to the Holder in accordance with Section 11.1, which notice shall specify the record date, if any, with respect to any such action and the approximate date on which such action is to take place. Such notice shall also set forth the facts with respect thereto as shall be reasonably necessary to indicate the effect on the Exercise Price and the number, kind or class of shares or other securities or property which shall be deliverable upon exercise of the Warrant. In the case of any action which would require the fixing of a record date, such notice shall be given at least five (5) Business Days prior to the date so fixed, and in the case of all other action, such notice shall be given at least ten (10) Business Days prior to the taking of such proposed action. If at any time the Company shall cancel any of such proposed action for which notice has been given prior to the consummation thereof, the Company shall give the Holder prompt notice of such cancellation.
11.3 Other Required Notices. To the extent the Company has an obligation to provide any notice to the holders of Warrant Stock pursuant to its Constituent Documents, the Company shall provide such notice (along with material delivered in connection therewith) to the Holder as soon as practicable.
12. ACCEPTANCE. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to all of the terms and conditions contained herein.
13. PIGGYBACK RIGHTS; LISTING.
13.1 In the event the Company decides to register any Company securities in connection with which notice and an opportunity to register shares is given to any other holder of such Company securities, the Company shall also deliver prompt written notice of the Company’s intent to register such Company securities to the Holder, and the Holder shall have the opportunity to register (or cause to be registered) the number of Exercise Shares as the Holder may request, in accordance with the procedures applicable to the other holders of such Company securities who are eligible to register such Company securities; provided, however, any such registration right given to the Holder shall be on terms and subject to conditions that are consistent and pari passu with those granted to such other holder of Company Securities. The Holder shall be permitted to withdraw all or part of the Exercise Shares at any time at least two (2) Business Days prior to the effective date of such registration.
13.2 If at any time the Company’s Warrant Stock shall be listed on any national securities exchange, the Company will use its commercially reasonable efforts to list, and keep
listed, so long as the Warrant Stock shall be so listed on such exchange, any Exercise Shares issuable upon exercise.
14. DISSOLUTION, LIQUIDATION OR WINDING UP. If, during the Exercise Period, the Company (or any other person controlling the Company) shall propose a voluntary or involuntary dissolution, liquidation, or winding up of the affairs of the Company, the Company shall give written notice thereof to the Holder at least ten (10) days’ advance written notice. If the Holder has not elected to exercise this Warrant pursuant to Section 2, the Holder shall receive the securities, cash or other property which the Holder would have been entitled to receive had the Holder been the holder of record of the Exercise Shares into which the Warrant were exercisable immediately prior to such dissolution, liquidation or winding up (net of the then applicable Exercise Price) and the rights to exercise the Warrant shall terminate on the date specified in such notice as the date on which the holders of record of the shares of the Warrant Stock shall be entitled to exchange their shares of the Warrant Stock for securities, cash or other property deliverable upon such dissolution, liquidation or winding up, as the case may be. 15. SUCCESSORS AND ASSIGNS. The terms and provisions of this Warrant shall inure to the benefit of, and be binding upon, the Company and the Holder and their respective successors, transferees and assigns.
16. TRANSFER OF WARRANT. Subject to the restrictions on transfer under this Warrant, the Constituent Documents, and under applicable state and federal securities laws, this Warrant and all rights hereunder may be transferred, in whole or in part, without charge to the Holder, upon surrender of this Warrant with a properly executed Assignment Form in the form attached as Exhibit B hereto (the “Assignment Form”). Notwithstanding the foregoing or anything to the contrary contained herein, this Warrant and the Exercise Shares issued hereunder may not be transferred to a vulture debt fund or a direct competitor of the Company (as reasonably determined by the board of directors of the Company).
17. SEVERABILITY. If any provision of this Warrant is held to be unenforceable under applicable law, such provision shall be excluded from this Warrant and the balance of the Warrant shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms.
18. TERMINATION BY THE HOLDER. This Warrant may be terminated anytime by the Holder at its election effective immediately upon written notice to the Company.
19. CONFIDENTIALITY. Each party (and their respective partners, members, attorneys, agents, employees, underwriters and consultants) will each treat information disclosed to such party by the other party as confidential and shall disclose the foregoing only to their respective partners, members, attorneys, agents, employees, underwriters and consultants or otherwise as reasonably required in connection herewith and the transactions hereby (the “Confidential Information”) (and shall direct such recipients to keep such information confidential), giving it the same care as its own confidential information, and shall make no use of any such Confidential Information not independently known to such party, except that such party may disclose such Confidential Information as required by applicable law. It is understood
and agreed that nothing in this Warrant prevents the Holder from making available to its bank regulators any Confidential Information that may be in its possession in the course of the regular bank supervision and examination process and subject to the confidentiality protections afforded thereto under applicable law.
20. GOVERNING LAW. This Warrant and all rights, obligations and liabilities hereunder shall be governed by and construed under the laws of the State of Delaware as applied to agreements among Delaware residents, made and to be performed entirely within the State of Delaware without giving effect to conflicts of laws principles.
[Signatures Appear on Following Page]
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its duly authorized officer as of the date first written above.
| | | | | | | | | | | | | | | | | |
| VOYAGER SPACE HOLDINGS, INC. |
| | | | | |
| By: /s/ Matthew Kuta |
| Name: | Matthew Kuta |
| Title: | President and Chief Operating Officer |
| | | | | |
| Address: | 1225 17th Street, Suite 1100 Denver, CO 80202 |
| | | | | | | | |
Acknowledged and Agreed by the Holder: |
| | |
| | |
| JPMORGAN CHASE BANK, N.A. | |
| | |
| | |
| | |
| By: | | |
| Name: | | |
| Title: | | |
[Signature Page to Warrant to Purchase Common Stock]
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its duly authorized officer as of the date first written above.
| | | | | | | | | | | | | | | | | |
| VOYAGER SPACE HOLDINGS, INC. |
| | | | | |
| By: |
| Name: | |
| Title: | |
| | | | | |
| Address: | 1225 17th Street, Suite 1100 Denver, CO 80202 |
| | | | | | | | |
Acknowledged and Agreed by the Holder: |
| | |
| | |
| JPMORGAN CHASE BANK, N.A. | |
| | |
| | |
| | |
| By: | /s/ Hormuz Kapadia | |
| Name: | Hormuz Kapadia | |
| Title: | Authorized Officer | |
[Signature Page to Warrant to Purchase Common Stock]
EXHIBIT A
NOTICE OF EXERCISE
TO: VOYAGER SPACE HOLDINGS, INC.
(1) ☐ The undersigned hereby elects to purchase ________ shares of Warrant Stock (the “Exercise Shares”) of VOYAGER SPACE HOLDINGS, INC. pursuant to the terms of the attached Warrant, and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
☐ The undersigned hereby elects to purchase ________ shares of Warrant Stock (the “Exercise Shares”) of VOYAGER SPACE HOLDINGS, INC. pursuant to the terms of the net exercise provisions set forth in Section 2.2 of the attached Warrant, and shall tender payment of all applicable transfer taxes, if any. (2) Please issue a certificate or certificates representing said Exercise Shares in the name of the undersigned.
| | | | | | | | |
| | |
| (Date) | | (Signature) |
| | |
| | |
| | (Print name) |
EXHIBIT B
ASSIGNMENT FORM
(To assign the foregoing Warrant, execute this form
and supply required information.
Do not use this form to purchase shares.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to
Name: _____________________________________________________________
(Please Print)
Address: _____________________________________________________________
(Please Print)
Dated: __________, 20__
Holder’s
Signature: _____________________________________________
Holder’s
Address: _____________________________________________
THIS WARRANT AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER ANY OTHER APPLICABLE SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, (B) THE SALE IS MADE IN ACCORDANCE WITH RULE 144 UNDER THE ACT, OR (C) THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF SUCH SECURITIES REASONABLY SATISFACTORY TO THE COMPANY STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.
VOYAGER TECHNOLOGIES, INC.
WARRANT TO PURCHASE COMMON STOCK
Date of Issuance: May 27, 2025
THIS CERTIFIES THAT, for value received, World Equity Group, Inc. (the “Holder”) is entitled, subject to the terms and conditions of this Warrant to Purchase Common Stock (this “Warrant”), to subscribe for and purchase from VOYAGER TECHNOLOGIES, INC., a Delaware corporation (the “Company”), the Exercise Shares at the Exercise Price (each subject to adjustment as provided herein) at any time during the Exercise Period.
1. DEFINITIONS. As used herein, the following terms shall have the following respective meanings:
(a) “Affiliate” of any specified person shall mean any other person who directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with such specified person. For the purposes of this definition, “control” when used with respect to any person means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of such specified person, whether through the ownership of voting securities, by contract or otherwise, and the term “controlled” has a meaning correlative to the foregoing.
(b) “Business Day” shall mean any day other than a Saturday, Sunday or a day on which banks in New York, New York are authorized or required by law to close.
(c) “Change of Control Event” shall mean (i) the Company consummates a merger, share exchange or consolidation with another entity and as a result of such transaction less than 50% of the outstanding voting securities of the surviving or resulting entity shall be owned in the aggregate by the former holders of the shares of the Company, (ii) the Company sells at least 50% or more of its assets by value in a single transaction or in a series
of transactions to a third party which is not a wholly owned subsidiary of the Company, or (iii) a person, within the meaning of Section 3(a)(9) or of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (as in effect on the Date of Issuance), other than a holder of the shares of the Company as of the Date of Issuance, shall acquire 50% or more of the outstanding voting securities of the Company (whether directly, indirectly, beneficially or of record).
(d) “Constituent Documents” shall mean with respect to any person, such person’s articles or certificate of incorporation, association or formation, deed of incorporation, bylaws, limited liability company agreement, partnership agreement or other constitutive documents, as applicable (and, in each case, such similar instruments or documents as applicable under a relevant jurisdiction).
(e) “Date of Issuance” shall mean the date this Warrant is issued as first set forth above.
(f) “Exercise Period” shall mean the period commencing on the Date of Issuance and ending on the fifth (5th) anniversary thereof, unless sooner terminated as provided below.
(g) “Exercise Price” shall mean the exercise price per share of the Warrant Stock, initially set at $43.82, subject to adjustment as provided in Section 6.
(h) “Exercise Shares” shall mean up to an aggregate total of 86,889 shares of Warrant Stock subject to adjustment pursuant to Section 6.
(i) “Fair Market Value” of one Exercise Share shall mean the price per share as determined by the Company’s Board of Directors in good faith; provided, however, that (i) if the Warrant Stock is traded on a securities exchange, the fair market value per share shall be deemed to be the average of the closing or last reported sale prices of such share of Warrant Stock on such exchange or market, over the ten (10) consecutive trading days immediately preceding the date of determination of fair market value or (ii) if otherwise traded in an over-the-counter market, the fair market value per share shall be deemed to be the average of the closing ask prices of such share of Warrant Stock as quoted in the Over-The-Counter Markets Group reports or other reporting system over the ten (10) consecutive trading days immediately preceding the date of determination of fair market value.
(j) “shares” shall mean shares in a corporation or units representing limited liability company interest or limited partnership interests, as applicable.
(k) “Warrant” shall mean this Warrant and any warrant(s) delivered in substitution or exchange therefor, as provided herein.
(l) “Warrant Stock” shall mean the Company’s Common Stock, $0.0001 par value per share.
2. EXERCISE OF WARRANT.
2.1 Exercise of Warrant. Subject to the terms and conditions of this Warrant, the rights for the Exercise Shares represented by this Warrant may be exercised in whole or in part at any time during the Exercise Period, by delivery of the following to the Company at its address set forth on the signature page of this Warrant (or at such other address as it may designate by notice in writing to the Holder);
(a) An executed Notice of Exercise in the form attached as Exhibit A hereto (“Notice of Exercise”);
(b) Payment of the Exercise Price in cash or by check; and
(c) This Warrant.
Upon the exercise of the rights represented by this Warrant, a certificate or certificates (or uncertificated issuances reflected in book-entry form only in the equity ledger maintained by the Company’s transfer agent) for the Exercise Shares so purchased, registered in the name of the Holder or persons affiliated with the Holder, if the Holder so designates, shall be issued and delivered to the Holder as promptly as practicable (in any event within five (5) Business Days) after the rights represented by this Warrant shall have been so exercised. In the event that this Warrant is being exercised for less than all of the then-current number of Exercise Shares purchasable hereunder, the Company shall, concurrently with the issuance by the Company of the number of Exercise Shares for which this Warrant is then being exercised, issue a new Warrant exercisable for the remaining number of Exercise Shares purchasable hereunder.
2.2 Net Exercise. Notwithstanding any provisions herein to the contrary, if the Fair Market Value of one Exercise Share is greater than the Exercise Price (at the date of calculation as set forth below), in lieu of exercising the Exercise Shares under this Warrant by payment of cash, at any time during the Exercise Period the Holder may elect to receive by “cashless exercise” a number of shares equal to the value (as determined below) of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Company together with the properly endorsed Notice of Exercise, in which event the Company shall issue to the Holder a number of Exercise Shares computed using the following formula:
X = Y (A-B)
A
Where X = the number of Exercise Shares to be issued to the Holder
Y = the number of Exercise Shares purchasable under the Warrant or, if only a portion of the Warrant is being exercised, that portion of the Warrant being canceled (at the date of such calculation)
A = the Fair Market Value of one Exercise Share (at the date of such calculation)
B = Exercise Price (as adjusted to the date of such calculation)
2.3 Conditional Exercise. At its election, the Holder may exercise this Warrant conditioned upon (and effective immediately prior to) consummation of any transaction described herein. Without limiting the generality of the foregoing, in the event of, at any time during the Exercise Period, an initial public offering of securities of the Company registered under the Act, or a Change of Control Event, the Company shall provide to the Holder twenty (20) days’ advance written notice of such public offering or Change of Control Event and, at its election, the Holder shall have the option to exercise this Warrant conditioned upon (and effective immediately prior to) consummation of such public offering or Change of Control Event (without regard to satisfaction of any conditions to exercise contained herein); provided, that any failure to provide such notice shall not affect the validity of any such transaction.
3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.
3.1 Representations. In connection with the issuance of this Warrant, the Company hereby represents and warrants to the Holder that:
(a) Organization and Existence. The Company is duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation or organization, with all requisite power and authority to carry on its business as conducted. The Company is duly qualified to transact business in each jurisdiction in which the failure to so qualify would have a material adverse effect on its business.
(b) Authorization. All corporate or other requisite action on the part of the Company, its officers, directors and stockholders necessary for the authorization, execution and delivery of this Warrant, the performance of all obligations of the Company hereunder, and the authorization, issuance (or reservation for issuance), sale and delivery of the Exercise Shares has been taken, and this Warrant constitutes a valid and legally binding obligation of the Company, enforceable in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other laws of general application affecting enforcement of creditors’ rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.
(c) Valid Issuance of Warrant and Warrant Stock. The Warrant and the Exercise Shares, when issued, sold and delivered in accordance with the terms of this Warrant for the consideration expressed herein, will be duly and validly issued, fully paid and nonassessable and will be free of restrictions on transfer other than restrictions on transfer under this Warrant, the Constituent Documents, and under applicable state and federal securities laws. The Company has authorized and reserved, free from preemptive rights, sufficient shares of Warrant Stock to allow for the exercise of this Warrant.
(d) No Preemptive Right. The issuance of this Warrant or the shares under the Warrant is not subject to any preemptive rights of any person that have not previously been waived.
(e) Compliance with Law. The authorization, execution and delivery of the Warrant will not constitute or result in any default or breach of any term or provision of any law, rule or regulation applicable to the Company; the Company’s current Constituent Documents; or any material agreement or instrument by which it is bound or to which its properties or assets are subject.
4. REPRESENTATIONS AND COVENANTS OF HOLDER.
4.1 Representations and Warranties. The Holder represents and warrants that:
(a) Accredited Investor Status. The Holder is an “accredited investor” as defined in Rule 501(a) or Regulation D, as presently in effect, as promulgated under the Act, and is experienced in evaluating and investing in companies such as the Company, is able to fend for itself with respect to acquiring the Warrant and/or Exercise Shares, has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of such Holder’s investment and to make an informed investment decision, and has the ability to bear the economic risks of such Holder’s investment. The Holder acknowledges that an investment in the Company is highly speculative and involves significant risks and there is and may be no market for the Warrants. Such Holder has had access, during the period prior to the receipt of any Warrants, to sufficient information concerning the Company and that such Holder has had, during such period and prior to receipt of any Warrants, the opportunity to ask questions of, and receive answers from, the Company concerning the terms and conditions of the Warrants, the underlying shares of Common Stock, and the business, affairs and prospects of the Company and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable effort or expense) necessary to verify the accuracy of any information furnished to such Holder or to which it had access.
(b) Investment Intent. It is acquiring the Warrant solely for its account for investment and not with a view to or for sale or distribution of said Warrant or the Exercise Shares or any part thereof and that such Holder has no present intention of assigning, pledging, hypothecating, selling, making subject to a security interest, or otherwise transferring, the same. The Holder also represents that the entire legal and beneficial interests of the Warrant the Holder is acquiring is being acquired for, and will be held for, its account only. Such Holder does not have any contract, undertaking, agreement or arrangement with any person to assign, pledge, hypothecate, sell, make subject to a security interest, or otherwise transfer, to any such person, the Warrant or any securities to be acquired upon exercise of such Warrant.
(c) Securities are Not Registered.
(i) The Holder understands that the Warrant and the Exercise Shares have not been registered under the Securities Act of 1933, as amended (the “Act”), on the basis that no distribution or public offering of the stock of the Company is to be effected and the Company’s reliance on such exemption is predicated on the representations and warranties of the such Holder set forth herein. The Holder realizes that the basis for the exemption may not be present if, notwithstanding its representations, the Holder has a present intention of acquiring the
securities for a fixed or determinable period in the future, selling (in connection with a distribution or otherwise), granting any participation in, or otherwise distributing the securities in violation of securities laws. The Holder has no such present intention. The Holder understands that the Warrants and the Exercise Shares may not be assigned, pledged, hypothecated, sold, made subject to a security interest, or otherwise transferred, unless pursuant to registration under the Securities Act or an exemption therefrom, and that in the absence of an effective registration statement covering the Warrants or the Exercise Shares or an available exemption from registration under the Securities Act, the Warrants and/or the Exercise Shares must be held indefinitely.
(ii) The Holder is aware that neither the Warrant nor the Exercise Shares may be sold pursuant to Rule 144 adopted under the Act unless certain conditions are met, including, among other things, the existence of a public market for the shares, the availability of certain current public information about the Company, the resale following the required holding period under Rule 144 and the number of shares being sold during any three month period not exceeding specified limitations. The Holder is aware that the conditions for resale set forth in Rule 144 have not been satisfied and that the Company presently has no plans to satisfy these conditions in the foreseeable future.
4.2 Disposition of Warrant and Exercise Shares.
(a) The Holder shall not make any disposition of all or any part of the Warrant or Exercise Shares in any event unless and until:
(i) There is then in effect a registration statement under the Act covering such proposed disposition and such disposition is made in accordance with said registration statement and the restrictions set forth in Section 4.3 have been concluded or waived and;
(ii) Such disposition is to an Affiliate;
(iii) Such disposition will be made in accordance with Rule 144 under the Act; or
(iv) Such disposition will not otherwise require registration of such Warrant or Exercise Shares under the Act or any applicable state securities laws, and the Holder has provided the Company with an opinion of counsel for the Holder, reasonably satisfactory to the Company, to that effect.
(b) The Holder understands and agrees that all certificates evidencing the shares to be issued to the Holder may bear a legend in substantially the following form (in addition to any legend prescribed by the Constituent Documents and that the Company or its transfer agent may implement stop transfer procedures consistent with such legend):
THIS WARRANT AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT
OF 1933, AS AMENDED (THE “ACT”), OR UNDER ANY OTHER APPLICABLE SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, (B) THE SALE IS MADE IN ACCORDANCE WITH RULE 144 UNDER THE ACT, OR (C) THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF SUCH SECURITIES REASONABLY SATISFACTORY TO THE COMPANY STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.
4.3 “Market Stand-Off” Agreement. Holder agrees that it will not, without the prior written consent of the managing underwriter, during the period commencing on the date of the final prospectus relating to the registration by the Company of shares of its Common Stock or any other equity securities under the Securities Act on a registration statement on Form S-1 or Form S-3, and ending on the date specified by the Company and the managing underwriter (such period not to exceed one hundred eighty (180) days in the case of the Company’s first underwritten public offering of its Common Stock under the Act (the “IPO”), or such other period as may be requested by the Company or an underwriter to accommodate regulatory restrictions on (1) the publication or other distribution of research reports and (2) analyst recommendations and opinions, including, but not limited to, the restrictions contained in applicable FINRA rules, or any successor provisions or amendments thereto), (i) lend; offer; pledge; sell; contract to sell; sell any option or contract to purchase; purchase any option or contract to sell; grant any option, right, or warrant to purchase; or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable (directly or indirectly) for Common Stock held immediately before the effective date of the registration statement for such offering or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of such securities, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or other securities, in cash, or otherwise. The foregoing provisions of this Section 4.3 shall apply only to the IPO, shall not apply to the sale of any shares to an underwriter pursuant to an underwriting agreement or to the establishment of a trading plan pursuant to Rule 10b5-1, provided that such plan does not permit transfers during the restricted period, or the transfer of any shares to any trust for the direct or indirect benefit of the Investor or the immediate family of the Holder, provided that the trustee of the trust agrees to be bound in writing by the restrictions set forth herein, and provided further that any such transfer shall not involve a disposition for value, and shall be applicable to the Holder only if all officers and directors are subject to substantially similar restrictions and the Company uses commercially reasonable efforts to obtain a similar agreement from all stockholders individually owning more than one percent (1%) of the Company’s outstanding Common Stock (after giving effect to conversion into Common Stock of all outstanding Preferred Stock). The underwriters in connection with such registration are intended third-party beneficiaries of this Section 4.3 and shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto. The Holder further agrees to execute such
agreements as may be reasonably requested by the underwriters in connection with such registration that are consistent with this Section 4.3 or that are necessary to give further effect thereto.
5. NO FRACTIONAL SHARES. No fractional shares shall be issued upon the exercise of this Warrant as a consequence of any adjustment pursuant hereto. All Exercise Shares (including fractions) to be issued upon exercise of this Warrant shall be aggregated for purposes of determining whether the exercise would result in the issuance of any fractional share. If, after aggregation, the exercise would result in the issuance of a fractional share, the Company shall, in lieu of issuance of any fractional share, pay the Holder otherwise entitled to such fraction a sum in cash equal to the product resulting from multiplying the then current Fair Market Value of one Exercise Share by such fraction.
6. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF EXERCISE SHARES.
The number and kind of Exercise Shares purchasable upon exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time as follows:
6.1 Stock Dividends - Split-Ups. If after the date hereof, and subject to the provisions of Section 5 above, the number of outstanding shares of Warrant Stock is increased by a stock dividend payable in shares of Warrant Stock, or by a split-up of shares of Warrant Stock, or other similar event, then, on the effective date of such stock dividend, split-up or similar event, the number of Exercise Shares shall be increased in proportion to such increase in outstanding shares of Warrant Stock.
6.2 Aggregation of Shares. If after the date hereof, and subject to the provisions of Section 5 above, the number of outstanding shares of Warrant Stock is decreased by a consolidation, combination, reverse stock split or reclassification of shares of Warrant Stock or other similar event, then, on the effective date of such consolidation, combination, reverse stock split, reclassification or similar event, the number of shares of Exercise Stock shall be decreased in proportion to such decrease in outstanding shares of Common Stock.
6.3 Adjustments in Exercise Price. Whenever the number of shares of Warrant Stock is adjusted, as provided in Section 6.1 and 6.2 above, the Exercise Price shall be adjusted (to the nearest cent) by multiplying such Exercise Price immediately prior to such adjustment by a fraction (x) the numerator of which shall be the number of shares of Warrant Stock purchasable upon the exercise of the Warrants immediately prior to such adjustment, and (y) the denominator of which shall be the number of shares of Warrant Stock so purchasable immediately thereafter
6.4 Reclassification, Reorganization and Consolidation. In case of any reclassification, capital reorganization or change in the capital stock of the Company (each a “Reorganization Event”; provided, that, none of the foregoing resulting from an event provided for in Section 6.1 or 6.2 above shall constitute a Reorganization Event), then, as a condition of such reclassification, reorganization or change, lawful provision shall be made,
and duly executed documents evidencing the same from the Company or its successor shall be delivered to the Holder, so that the Holder shall have the right at any time prior to the expiration of this Warrant to receive, without the payment by the Holder of any additional consideration, the kind and amount of shares of stock and other securities or property (including cash) receivable in connection with such reclassification, reorganization or change, which the Holder would have been entitled to receive upon such Reorganization Event if, immediately prior to such Reorganization Event, the Holder had completed such exercise of this Warrant, all subject to further adjustment as provided in this Warrant. In any such case appropriate provisions shall be made with respect to the rights and interest of the Holder so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities or property deliverable upon exercise hereof, and appropriate adjustments shall be made to the Exercise Price per Exercise Share payable hereunder, provided the aggregate Exercise Price shall remain the same. In determining the kind and amount of stock, securities or the property receivable upon exercise of this Warrant following the consummation of such Reorganization Event, if the holders of Warrant Stock have the right to elect the kind or amount of consideration receivable upon consummation of such Reorganization Event, then (i) the Holder shall have the right to make a similar election upon exercise of this Warrant with respect to the number of shares of stock or other securities or property which the Holder will receive upon exercise of this Warrant or (ii) in the event the Holder does not make such election within ten (10) days upon notice, the consideration that the Holder shall be entitled to receive upon exercise shall be deemed to be the types and amounts of consideration received by the majority of all holders of the shares of Warrant that affirmatively make an election (or of all such holders if none make an election).
7. RESERVATION OF SHARES; NO IMPAIRMENT.
7.1 The Company further covenants and agrees that the Company will, at all times during the Exercise Period, take such corporate or other requisite action as required in order to have authorized and reserved, free from preemptive rights, a sufficient number of shares of Warrant Stock to satisfy the exercise of this Warrant from time to time as these Warrants are presented for exercise in accordance with the terms hereof. If, at any time during the Exercise Period, the number of authorized but unissued shares of the Company’s equity securities shall not be sufficient to permit exercise of this Warrant, the Company will promptly take such corporate or other requisite action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of the Company’s equity securities to such number of shares as shall be sufficient for such purposes. The Company covenants and agrees that all Exercise Shares that may be issued upon the exercise of this Warrant in accordance with the terms hereof will be duly authorized, validly issued, fully paid, non-assessable, free from all taxes, liens and charges with respect to the issuance thereof and free and clear of preemptive rights.
7.2 Certificates for Exercise Shares issued upon exercise of these Warrants will be issued in such name(s) as the Holder may designate and will be delivered to such named person(s) within a reasonable time, not to exceed five (5) Business Days after any date on which the Holder exercises the right to purchase the Exercise Shares.
7.3 The Company will not, by amendment of its Constituent Documents or any other voluntary action, willfully avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such material terms and in the taking of all such actions as may be necessary or appropriate in order to protect the rights of the Holder against wrongful impairment.
8. NO RIGHTS OF HOLDERS OF SHARES; TRANSFER BOOKS.
8.1 Prior to exercise of this Warrant, except as otherwise provided in this Warrant, this Warrant in and of itself shall not entitle the Holder to any voting rights or other rights as a holder of the shares of the Company. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a holder of the shares of the Company, whether such liabilities are asserted by the Company or by creditors of the Company.
8.2 The person in whose name any certificate or certificates for Exercise Shares are to be issued upon exercise of this Warrant shall be deemed to have become the holder of record of such shares immediately prior to the close of business on the date on which this Warrant was surrendered and exercise procedures completed, including payment of the Exercise Price, irrespective of the date of delivery of such certificate or certificates, except that, if the date of such surrender and payment is a date when the stock transfer books of the Company are closed, such person shall be deemed to have become the holder of such shares at the close of business on the next succeeding date on which the stock transfer books are open. The Company will at no time close its transfer books against transfer of this Warrant in any manner which interferes with the timely exercise of this Warrant.
9. LOST, STOLEN, MUTILATED OR DESTROYED WARRANT. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of mutilation, on surrender and cancellation of this Warrant, the Company shall execute and deliver, in lieu of this Warrant, a new Warrant of like tenor.
10. ENTIRE AGREEMENT; AMENDMENT. This Warrant and any other documents delivered pursuant hereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof. Any term of this Warrant may be amended or waived only with the written consent of the Company and the Holder.
11. NOTICES, ETC.
11.1 Notices Generally. All notices required or permitted hereunder shall be in writing and shall be deemed effectively given: (a) upon personal delivery to the party to be notified, (b) when sent by electronic mail or confirmed facsimile if sent during normal business hours of the recipient, if not, then on the next Business Day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage pre-paid, or (d) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to the Company at the address listed on the signature page (or at such other address as it may designate by notice in writing to the Holder) and to the Holder at its address of record in the Company’s books and records, or at such other address as the Company or the Holder may designate by ten (10) days’ advance written notice to the other party hereto.
11.2 Notices of Adjustment, Change of Control Event and offer. In the event the Company shall propose to take any action of the type described in Section 6 (for the avoidance of doubt, including any Change of Control Event) (but only if the action of the type described in Section 6 would (whether or not at the Holder’s election) result in an adjustment in the Exercise Price or the number of shares of Warrant Stock or a change in the type of securities or property to be delivered upon exercise of such Warrants), the Company shall give notice to the Holder in accordance with Section 11.1, which notice shall specify the record date, if any, with respect to any such action and the approximate date on which such action is to take place; provided, that any failure to provide such notice shall not affect the validity of such action. Such notice shall also set forth the facts with respect thereto as shall be reasonably necessary to indicate the effect on the Exercise Price and the number, kind or class of shares or other securities or property which shall be deliverable upon exercise of the Warrant. In the case of any action which would require the fixing of a record date, such notice shall be given at least five (5) Business Days prior to the date so fixed, and in the case of all other action, such notice shall be given at least ten (10) Business Days prior to the taking of such proposed action. If at any time the Company shall cancel any of such proposed action for which notice has been given prior to the consummation thereof, the Company shall give the Holder prompt notice of such cancellation.
11.3 Other Required Notices. To the extent the Company has an obligation to provide any notice to the holders of Warrant Stock pursuant to its Constituent Documents, the Company shall provide such notice (along with material delivered in connection therewith) to the Holder as soon as practicable.
12. ACCEPTANCE. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to all of the terms and conditions contained herein.
13. PIGGYBACK RIGHTS; LISTING.
13.1 Following and up through the third anniversary of the consummation of a firm-commitment underwritten public offering of the Company’s Common Stock listed on a national securities exchange, whether primary or secondary, registered with the Securities and Exchange Commission, in the event the Company decides to subsequently register any Company securities in connection with which notice and an opportunity to register shares is given to any other holder of such Company securities, the Company shall also deliver prompt written notice of the Company’s intent to register such Company securities to the Holder, and the Holder shall have the opportunity to register (or cause to be registered) the number of Exercise Shares as the Holder may request, in accordance with the procedures applicable to the other holders of such Company securities who are eligible to register such Company securities; provided, however, any such registration right given to the Holder shall be on terms and subject to conditions that are
consistent and pari passu with those granted to such other holder of Company securities. The Holder shall be permitted to withdraw all or part of the Exercise Shares at any time at least two (2) Business Days prior to the effective date of such registration.
13.2 If at any time the Company’s Warrant Stock shall be listed on any national securities exchange, the Company will use its commercially reasonable efforts to list, and keep listed, so long as the Warrant Stock shall be so listed on such exchange, any Exercise Shares issuable upon exercise.
13.3 If the Warrant Shares are not registered for resale under the Act, but are eligible for resale under Rule 144 promulgated under the Act (or any successor rule), and the Holder provides the Company with any documentation or representations reasonably requested by the Company or its counsel to confirm such eligibility (which may include an opinion of counsel, a customary representation letter, and a broker's representation letter), then the Company shall, upon request of the Holder, promptly (and in any event within two (2) business days) take all steps necessary to cause any restrictive legends or transfer restrictions to be removed from the Exercise Shares, including with respect to any shares held in book-entry form through the facilities of The Depository Trust Company (DTC) or another electronic share settlement system. The Company shall cause its legal counsel to issue any necessary legal opinions required in connection with such removal and shall instruct its transfer agent to process the legend removal without any additional action by the Holder other than the required documentation. The Company shall bear all costs and expenses associated with such removal, including the reasonable fees of its counsel and any fees charged by the transfer agent.
14. DISSOLUTION, LIQUIDATION OR WINDING UP. If, during the Exercise Period, the Company (or any other person controlling the Company) shall propose a voluntary or involuntary dissolution, liquidation, or winding up of the affairs of the Company, the Company shall give written notice thereof to the Holder at least ten (10) days’ advance written notice; provided that any failure to give such notice shall not affect the validity of such action. If the Holder has not elected to exercise this Warrant pursuant to Section 2, the Holder shall receive the securities, cash or other property which the Holder would have been entitled to receive had the Holder been the holder of record of the Exercise Shares into which the Warrant were exercisable immediately prior to such dissolution, liquidation or winding up (net of the then applicable Exercise Price) and the rights to exercise the Warrant shall terminate on the date specified in such notice as the date on which the holders of record of the shares of the Warrant Stock shall be entitled to exchange their shares of the Warrant Stock for securities, cash or other property deliverable upon such dissolution, liquidation or winding up, as the case may be.
15. SUCCESSORS AND ASSIGNS. The terms and provisions of this Warrant shall inure to the benefit of, and be binding upon, the Company and the Holder and their respective successors, transferees and assigns. Notwithstanding any other provision of this Warrant, the Holder may freely transfer all of this Warrant or the shares issuable upon exercise of this Warrant (or the securities issuable, directly or indirectly, upon conversion of the shares, if any) at any time to an Affiliate by giving the Company notice of the portion of the Warrant being transferred setting forth the name, address and taxpayer identification number of the transferee
and surrendering this Warrant to the Company for reissuance to the transferees(s) (and the Holder, if applicable); provided, however, that any such transfer to any such Affiliate of the Holder shall be subject to compliance with applicable federal and state securities laws and Holder shall provide the Company with such documentation as the Company may reasonably request in order to establish such compliance. In the event this Warrant is transferred in accordance with its terms with respect to some or all the Exercise Shares, the Company shall promptly (and in any event within five (5) business days) issue to the transferee a new warrant exercisable for the applicable number of Exercise Shares and, if the Warrant is transferred with respect to less than all the Exercise Shares, issue to the Holder a new warrant exercisable for the remaining number of Exercise Shares.
16. SEVERABILITY. If any provision of this Warrant is held to be unenforceable under applicable law, such provision shall be excluded from this Warrant and the balance of the Warrant shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms.
17. TERMINATION BY THE HOLDER. This Warrant may be terminated anytime by the Holder at its election effective immediately upon written notice to the Company.
18. CONFIDENTIALITY. Each party (and their respective partners, members, attorneys, agents, employees, underwriters and consultants) will each treat information disclosed to such party by the other party as confidential and shall disclose the foregoing only to their respective partners, members, attorneys, agents, employees, underwriters and consultants or otherwise as reasonably required in connection herewith and the transactions hereby (the “Confidential Information”) (and shall direct such recipients to keep such information confidential), giving it the same care as its own confidential information, and shall make no use of any such Confidential Information not independently known to such party, except that such party may disclose such Confidential Information as required by applicable law. It is understood and agreed that nothing in this Warrant prevents the Holder from making available to its bank regulators any Confidential Information that may be in its possession in the course of the regular bank supervision and examination process and subject to the confidentiality protections afforded thereto under applicable law.
19. GOVERNING LAW. This Warrant and all rights, obligations and liabilities hereunder shall be governed by and construed under the laws of the State of Delaware as applied to agreements among Delaware residents, made and to be performed entirely within the State of Delaware without giving effect to conflicts of laws principles.
[Signatures Appear on Following Page]
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its duly authorized officer as of the date first written above.
VOYAGER TECHNOLOGIES, INC.
By: /s/ Dylan Taylor
Name: Dylan Taylor
Title: Chief Executive Officer
Address: 1225 17th Street, Suite 1100
Denver, CO 80202
Acknowledged and Agreed by the Holder:
WORLD EQUITY GROUP, INC.
By: /s/ William Webb
Name: William Webb
Title: Chief Compliance Officer
[Signature Page to Warrant to Purchase Common Stock]
EXHIBIT A
NOTICE OF EXERCISE
TO: VOYAGER TECHNOLOGIES, INC.
The undersigned (the “Holder”) hereby represents and warrants to Voyager Technologies, Inc., a Delaware corporation (the “Company”), with respect to outstanding warrants (the “Warrants”) to purchase common stock of the Company (the “Exercise Shares”):
1. The Exercise Shares are being authorized for issuance to such Holder upon exercise in reliance upon the representations and warranties of such Holder to the Company.
2. The Holder is an “accredited investor” as defined in Rule 501(a) or Regulation D, as presently in effect, as promulgated under the Act, and is experienced in evaluating and investing in companies such as the Company, is able to fend for itself with respect to acquiring the Exercise Shares, has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of such Holder’s investment and to make an informed investment decision, and has the ability to bear the economic risks of such Holder’s investment. The Holder acknowledges that an investment in the Company may be speculative and involve significant risks and there may be no market for the Exercise Shares. Such Holder has had access, during the period prior to the receipt of any Exercise Shares, to sufficient information concerning the Company and that such Holder has had, during such period and prior to receipt of any Exercise Shares, the opportunity to ask questions of, and receive answers from, the Company concerning the terms and conditions of the Exercise Shares, and the business, affairs and prospects of the Company and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable effort or expense) necessary to verify the accuracy of any information furnished to such Holder or to which it had access.
3. It is acquiring the Exercise Shares solely for its account for investment and not with a view to or for sale or distribution of said the Exercise Shares or any part thereof and that such Holder has no present intention of assigning, pledging, hypothecating, selling, making subject to a security interest, or otherwise transferring, the same. The Holder also represents that the entire legal and beneficial interests of the Exercise Shares the Holder is acquiring is being acquired for, and will be held for, its account only. Such Holder does not have any contract, undertaking, agreement or arrangement with any person to assign, pledge, hypothecate, sell, make subject to a security interest, or otherwise transfer, to any such person, the Exercise Shares.
4. The Holder understands that the Exercise Shares are not required to be registered under the Securities Act of 1933, as amended (the “Act”), on the basis that no distribution or public offering of the stock of the Company is to be effected and the Company’s reliance on such exemption is predicated on the representations and warranties of the such Holder set forth herein. The Holder realizes that the basis for
the exemption may not be present if, notwithstanding its representations, the Holder has a present intention of acquiring the securities for a fixed or determinable period in the future, selling (in connection with a distribution or otherwise), granting any participation in, or otherwise distributing the securities in violation of securities laws. The Holder has no such present intention.
5. The Holder is aware that the Exercise Shares may not be sold pursuant to Rule 144 adopted under the Act unless certain conditions are met, including, among other things, the existence of a public market for the shares, the availability of certain current public information about the Company, the resale following the required holding period under Rule 144 and the number of shares being sold during any three month period not exceeding specified limitations.
ACCORDINGLY, the undersigned hereby executes this Notice of Exercise as day and year indicated below and makes the following election with respect to such exercise:
(1) The undersigned hereby elects to purchase ________ shares of Warrant Stock (the “Exercise Shares”) of VOYAGER TECHNOLOGIES, INC. pursuant to the terms of the attached Warrant, and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
The undersigned hereby elects to purchase ________ shares of Warrant Stock (the “Exercise Shares”) of VOYAGER TECHNOLOGIES, INC. pursuant to the terms of the cashless net exercise provisions set forth in Section 2.2 of the attached Warrant, and shall tender payment of all applicable transfer taxes, if any.
(2) Please issue a certificate or certificates representing said Exercise Shares in the name of the undersigned.
| | | | | | | | |
| | |
| (Date) | | (Signature) |
| | |
| | (Print name) |
THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE APPLICABLE STATE SECURITIES LAWS AND NO INTEREST MAY BE SOLD, DISTRIBUTED, ASSIGNED, OFFERED, PLEDGED OR OTHERWISE TRANSFERRED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS COVERING ANY SUCH TRANSACTION INVOLVING SAID SECURITIES, (B) VOYAGER SPACE HOLDINGS, INC. RECEIVES AN OPINION OF LEGAL COUNSEL FOR THE HOLDER OF THESE SECURITIES SATISFACTORY TO VOYAGER SPACE HOLDINGS, INC. STATING THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS, OR (C) VOYAGER SPACE HOLDINGS, INC. OTHERWISE SATISFIES ITSELF THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS.
WARRANT TO PURCHASE SHARES OF COMMON STOCK
| | | | | |
| Company: | VOYAGER SPACE HOLDINGS, INC., a Delaware corporation |
| |
| Class of Stock: | Common Stock, par value $0.0001 per share |
| |
| Number of Shares: | 466,494. |
| |
| Warrant Price: | $ $39.13, per share of common stock, subject to adjustment as set forth herein |
| |
| Issue Date: | March 10, 2022 |
| |
| Expiration Date: | 7 years from the Issue Date |
| |
| Loan Agreement: | This Warrant to Purchase Shares of Common Stock (“Warrant”) is issued in connection with, and as consideration of the commitments pursuant to, that certain Loan and Guaranty Agreement of even date herewith among the Company and certain other borrowers and guarantors from time to time party thereto, JGB Collateral LLC, as administrative agent for the lenders, and the lenders party thereto (as amended, restated, supplemented or otherwise modified from time to time, the “Loan Agreement”). Capitalized terms used herein without definition, shall have the meanings set forth in the Loan Agreement. |
This WARRANT TO PURCHASE COMMON STOCK certifies that, for good and valuable consideration, [ ] (together with any successor or permitted assignee or transferee of this Warrant or of any shares issued upon exercise hereof, “Holder”) is entitled to subscribe for and purchase from the above-named company (the “Company”) the number of fully paid and non-assessable shares of the above-stated class, series and type of stock of the Company at the above-stated Warrant Price, all as set forth above and as adjusted pursuant to Section 2 of this Warrant, subject to the provisions and upon the terms and conditions set forth in this Warrant.
SECTION 1 DEFINITIONS.
As used in this Warrant, the following terms have the following meanings:
“Acknowledgement” has the meaning set forth in Section 3.5.
“Aggregate Warrant Price” means, with respect to any exercise of this Warrant, an amount equal to the product of (i) the number of Shares in respect of which this Warrant is then being exercised pursuant to Section 3 hereof, multiplied by (ii) the applicable Warrant Price in effect as of the Exercise Date.
“Assignment” has the meaning set forth in Section 6.1.
“Board” means the board of directors of the Company.
“Business Day” means any day which is neither a Saturday or Sunday nor a legal holiday on which banks are authorized or required to be closed in New York, New York.
“Commission” means the Securities and Exchange Commission or any other federal agency administering the Securities Act and the Exchange Act at the time.
“Common Stock” means the common stock, par value $0.0001 per share, of the Company, and any capital stock into which such Common Stock shall have been converted, exchanged or reclassified following the date hereof.
“Company” has the meaning set forth in the preamble.
“Convertible Securities” means any securities, whether debt, equity or other securities (directly or indirectly) convertible into or exchangeable for Common Stock, but excluding Options.
“Covered Persons” has the meaning set forth in Section 3.9.
“Disqualification Events” has the meaning set forth in Section 3.9.
“dollars” or “$” refers to lawful money of the United States of America.
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
“Exercise Date” means, for any given exercise of this Warrant, the date on which the conditions to such exercise as set forth in Section 3 shall have been satisfied at or prior to 5:00 p.m., New York time, on a Business Day, including, without limitation, the receipt by the Company of a Subscription Agreement, the Warrant and the Aggregate Warrant Price.
“Exercise Period” has the meaning set forth in Section 2.
“Expiration Date” has the meaning set for in the preamble.
“Fair Market Value” means, as of any particular date, for one share of Common Stock: (i) the volume weighted average of the closing sales prices of the Common Stock over the ten (10) consecutive trading days immediately preceding such day on the national securities exchange (within the meaning of the Securities Exchange Act of 1934, as amended) on which the Common Stock may at the time be listed, if so listed; (ii) if on any such day the Common Stock is not listed on a domestic securities exchange or there have been no sales of the Common Stock on any such national securities exchange on any such day, the average closing sales price of the Common Stock as quoted on the OTCQX, the OTCQB, the Pink Market or similar quotation system or association over the ten (10) consecutive trading days immediately preceding such day, if so quoted; or (iii) if on any such day the Common Stock is not listed on a domestic securities exchange or there have been no sales of the Common Stock on any such national securities exchange on any such day and if there have been no sales of the Common Stock on the OTCQX, the OTCQB, the Pink Market or similar quotation system or association on such day, the fair market value per share as determined jointly by the Board and the Holder, subject to Section 3.10 hereof; provided, that if the Common Stock is listed on any domestic securities exchange, the term “Business Day” as used in this sentence means Business Days on which such exchange is open for trading.
“Form S-1” means such form under the Securities Act as in effect on the date hereof or any successor registration form under the Securities Act subsequently adopted by the Securities and Exchange Commission.
“Holder” has the meaning set forth in the preamble.
“Inspectors” has the meaning set forth in Section 5.2(h).
“Marketable Securities” shall mean securities meeting all of the following requirements: (i) the issuer thereof is then subject to the reporting requirements of Section 13 or Section 15(d) of the Exchange Act and is then current in its filing of all required reports and other information under the Act and the Exchange Act; (ii) the class and series of shares or other security of the issuer that would be received by the Holder in connection with the Change in Control were the Holder to exercise this Warrant on or prior to the closing thereof is then listed and traded on a securities exchange or the Nasdaq market, and (iii) following the closing of such Change in Control, the Holder would not be restricted from publicly re-selling any or all of the issuer’s shares and/or other securities that would be received by the Holder in such Change in Control were the Holder to exercise this Warrant in full, freely, without limitation as to amount or manner of sale, and without the need for any further registration under any applicable laws, rules or regulations, on or prior to the closing of such Change in Control, except to the extent that (1) any such restriction both (x) arises solely under federal or state securities laws, rules or regulations, and (y) does not extend beyond six (6) months from the closing of such Change in Control, or (2) such restriction is limited to a need to register such shares for re-sale under applicable securities laws and the issuer thereof has entered into a binding agreement with the Holder that requires the issuer to so register such shares for re-sale to the extent required under applicable securities laws (at the request of, or otherwise controlled by or guaranteed to the Holder) within six (6) months from the closing of such Change in Control in a manner that permits re-sale by the Holder without any restriction or limitation as to amount or manner of sale.
“Options” means any warrants or other rights or options to subscribe for or purchase Common Stock or Convertible Securities.
“Person” means any individual, sole proprietorship, partnership, limited liability company, corporation, joint venture, trust, incorporated organization or government or department or agency thereof.
“Piggyback Registration” has the meaning set forth in Section 5.1(a).
“Prospectus” means the prospectus or prospectuses included in any Registration Statement, as amended or supplemented by any prospectus supplement with respect to the terms of the offering of any portion of the Registrable Securities covered by such Registration Statement and by all other amendments and supplements to the prospectus, including post- effective amendments and all material incorporated by reference in such prospectus or prospectuses.
“Records” has the meaning set forth in Section 5.2(h).
“Registrable Securities” means (x) any shares of Common Stock held by any Person or issuable upon conversion, exercise or exchange of any securities owned by any Person at any time (including Warrant Shares exercisable upon exercise of this Warrant), and (y) any shares of Common Stock issued or issuable with respect to any shares described in subsection (x) above by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization (it being understood that for purposes of this Warrant, a Person shall be deemed to be a holder of Registrable Securities whenever such Person has the right to then acquire or obtain from the Company any Registrable Securities, whether or not such acquisition has actually been effected). As to any particular Registrable Securities, such securities shall cease to be Registrable Securities when (i) a Registration Statement covering such securities has been declared effective by the Commission and such securities have been disposed of pursuant to such effective Registration Statement, (ii) such securities are sold under circumstances in which all of the applicable conditions of Rule 144 (or any similar provisions then in force) under the Securities Act are met, (iii) such securities are otherwise transferred and such securities may be resold without subsequent registration under the Securities Act, or (iv) such securities shall have ceased to be outstanding.
“Registration Statement” means any registration statement of the Company which covers any of the Registrable Securities pursuant to the provisions of this Agreement, including the Prospectus, amendments and supplements to such Registration Statement, including post- effective amendments, all exhibits and all materials incorporated by reference in such Registration Statement.
“Securities Act” means the Securities Act of 1933, as amended.
“Solicitor” has the meaning set forth in Section 3.9.
“Subscription Agreement” means a subscription agreement in substantially the form attached hereto as Exhibit A.
“Warrant” has the meaning set forth in the preamble.
“Warrant Price” has the meaning set forth in the preamble.
“Warrant Shares” means shares of the Common Stock of the Company purchasable upon exercise of this Warrant.
SECTION 2 TERM OF WARRANT.
Subject to the terms and conditions hereof, at any time or from time to time after the date hereof up to and including 5:00 p.m., New York time, on the Expiration Date (or, if such day is not a Business Day, on the next preceding Business Day) (such period, the “Exercise Period”), the Holder of this Warrant may exercise this Warrant for all or any part of the Warrant Shares (subject to adjustment as provided herein).
SECTION 3 EXERCISE OF WARRANT.
3.1 Exercise Procedure. Subject to the terms and conditions of this Warrant, this Warrant may be exercised from time to time on any Business Day during the Exercise Period, for all or any part of the unexercised Warrant Shares, upon:
(a)surrender of this Warrant (if, but only if, this Warrant is being exercised in full) to the Company at its then principal executive offices (or an indemnification undertaking with respect to this Warrant in the case of its loss, theft or destruction), together with one or more Subscription Agreements, duly completed (including specifying the number and type of Warrant Shares to be purchased) and executed; and
(b)payment to the Company of the Aggregate Warrant Price in accordance with Section 3.2.
3.2 Method of Payment of the Aggregate Warrant Price. Payment of the Aggregate Warrant Price shall be made, at the option of the Holder as expressed in one or more Subscription Agreements, by the following methods:
(a)by delivery to the Company of a certified bank check payable to the order of the Company or by wire transfer of immediately available funds to an account designated in writing by the Company, in the amount of such Aggregate Warrant Price;
(b)by instructing the Company to withhold and not issue a number of Warrant Shares then issuable upon exercise of this Warrant with an aggregate Fair Market Value as of the Exercise Date equal to such Aggregate Warrant Price; or
(c)any combination of the foregoing.
In the event of any withholding and non-issuance of Warrant Shares pursuant to clause (b) above where the number of Warrant Shares whose value is equal to the Aggregate Warrant Price is not a whole number, the number of Warrant Shares withheld and not issued by the Company shall be rounded down or up, at the Company’s discretion, to the nearest whole share and the Company shall make a cash payment to the Holder (by delivery of a certified or official bank check or by wire transfer of immediately available funds) based on the incremental fraction of a Warrant Share being so withheld by the Company in an amount equal to the product of (x) such incremental fraction
of a Warrant Share being so withheld multiplied by (y) the Fair Market Value per Warrant Share as of the Exercise Date; provided that such valuation shall be subject to Section 3.10.
3.3 Delivery of Stock Certificates. Upon receipt by the Company of a Subscription Agreement, surrender of this Warrant (if, but only if, this Warrant is being exercised in full) and payment of the Aggregate Warrant Price (in accordance with Section 3.1 hereof), the Company shall, as promptly as practicable, and in any event within two (2) Business Days thereafter, deliver (or cause to be delivered) to the Holder the Warrant Shares issuable upon such exercise, together with cash in lieu of any fraction of a Warrant Share, as provided in Section 3.4 hereof. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Transfer Agent to the Holder by (i) physical delivery of a certificate, registered in the Company’s share register in the name of the Holder or (ii) by crediting the account of the Holder’s or its designee’s balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner-of-sale limitations pursuant to Rule 144 (assuming exercise of the Warrants pursuant to 3.2(b). This Warrant shall be deemed to have been exercised (in whole or in part, as the case may be) and such Warrant Shares shall be deemed to have been issued, and the Holder or any other Person so designated to be named therein shall be deemed to have become a holder of record of such Warrant Shares for all purposes, as of the Exercise Date.
3.4 Fractional Shares. The Company shall not be required to issue a fractional Warrant Share upon exercise of any Warrant. As to any fraction of a Warrant Share that the Holder would otherwise be entitled to purchase upon such exercise, the Company shall pay to such Holder an amount in cash (by delivery of a certified or official bank check or by wire transfer of immediately available funds) equal to the product of (i) such fraction multiplied by (ii) the Fair Market Value of one Warrant Share on the Exercise Date.
3.5 Acknowledgement; Partial Exercise. Unless the purchase rights represented by this Warrant shall have expired or shall have been fully exercised, the Company shall, at the time of delivery of the Warrant Shares being issued in accordance with Section 3.3 hereof, deliver to the Holder promptly an acknowledgement in substantially the form attached hereto as Exhibit B (each, an “Acknowledgement”) indicating the number and type of Warrant Shares which remain issuable upon exercise of this Warrant, if any, and this Warrant shall be automatically and without further action of any Party be deemed to be amended as necessary to reflect the reduced number and any change to type of Warrant Shares which remain issuable upon exercise of this Warrant for all purposes hereof.
3.6 Representations, Warranties and Covenants. With respect to the exercise of this Warrant, the Company hereby represents, covenants and agrees:
(a)This Warrant is, and any Warrant issued in substitution for or replacement of this Warrant shall be, upon issuance, duly authorized and validly issued.
(b)All Warrant Shares issuable upon the exercise of this Warrant pursuant to the terms hereof shall be, upon issuance, and the Company shall take all such actions as may be necessary or appropriate in order that such Warrant Shares are, validly issued, fully paid and non-assessable, issued without violation of any preemptive or similar rights of any stockholder of the Company and free and clear of all taxes, liens and charges other than any restrictions on transfer under applicable securities laws.
(c)The Company shall take all such actions as may be necessary to ensure that all such Warrant Shares are issued without violation by the Company of any applicable law or governmental regulation or any requirements of any domestic securities exchange upon which shares of Common Stock or other securities constituting Warrant Shares may be listed at the time of such exercise (except for official notice of issuance which shall be immediately delivered by the Company upon each such issuance).
(d)Without in any way limiting Section 5 hereof, the Company shall use its commercially reasonable efforts to have the Warrant Shares, immediately upon such exercise, to be listed on any domestic securities exchange upon which shares of Common Stock are listed at the time of such exercise.
(e)The Company shall pay all expenses in connection with, and all taxes and other governmental charges that may be imposed with respect to, the issuance or delivery of Warrant Shares upon exercise of this Warrant; provided, that the Company shall not be required to pay any tax or governmental charge that may be imposed with respect to any applicable withholding or the issuance or delivery of the Warrant Shares to any Person other than the Holder, and no such issuance or delivery shall be made unless and until the Person requesting such issuance has paid to the Company the amount of any such tax, if any, or has established to the satisfaction of the Company that such tax has been paid.
3.7 Conditional Exercise; Early Termination of Warrant upon Change in Control. Notwithstanding any other provision hereof, if an exercise of any portion of this Warrant is to be made in connection with a Change in Control (pursuant to a merger, sale of stock, sale of assets or otherwise), such exercise may at the election of the Holder be conditioned upon the consummation of such transaction, in which case such exercise shall not be deemed to be effective until immediately prior to the consummation of such transaction.
In the event of a Change in Control wherein the consideration payable to the Company’s equityholders consists entirely of cash or Marketable Securities (or entirely of a combination of cash and Marketable Securities), this Warrant shall, if not exercised in connection with such Change in Control, terminate as of the date of the consummation of such Change in Control. In the event of a Change in Control wherein the consideration payable to the Company’s equityholders does not consist entirely of cash or Marketable Securities (or entirely of a combination of cash and Marketable Securities), upon the closing of such Change in Control, the acquiring, surviving or successor entity shall assume this Warrant and the obligations of the Company hereunder, and this Warrant shall, from and after such closing, be exercisable for the same class, number and kind of securities, cash and other property as would have been paid for or in respect of the Warrant Shares issuable (as of immediately prior to such closing) upon exercise in full hereof as if such Warrant Shares had been issued and outstanding on and as of such closing, at an aggregate Exercise Price equal to the aggregate Exercise Price in effect as of immediately prior to such closing; and subject to further adjustment thereafter from time to time in accordance with the provisions of this Warrant, and the Company shall require as a condition to the Change in Control that such acquiring, surviving or successor entity agree to and effect the foregoing. If the acquirer refuses to so assume the Company’s obligations hereunder, then, at the sole discretion of the Holder of the Warrant, in lieu of the foregoing, as of the consummation of the Change in Control, the Holder may elect upon request of the Company that this Warrant (and the right to purchase Warrant Shares upon exercise hereof) shall terminate in exchange for a cash amount payable by the Company to the Holder equal to the Fair Market Value multiplied by the number of Warrant Shares then exercisable under this Warrant immediately prior to the consummation of the Change in Control.
3.8 Reservation of Shares. During the Exercise Period, the Company shall at all times reserve and keep available out of its authorized but unissued Common Stock or other securities constituting Warrant Shares, solely for the purpose of issuance upon the exercise of this Warrant, the maximum number of Warrant Shares issuable upon the exercise of this Warrant, and the par value per Warrant Share shall at all times be less than or equal to the lowest applicable Warrant Price. The Company shall not increase the par value of any Warrant Shares receivable upon the exercise of this Warrant above the lowest Warrant Price then in effect, and shall take all such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of this Warrant.
3.9 No “Bad Actor” Disqualification. The Company has exercised reasonable care, in accordance with Commission rules and guidance, to determine whether any Covered Person (as defined below) is subject to any of the “bad actor” disqualifications described in Rule 506(d)(1)(i) through (viii) under the Securities Act (“Disqualification Events”). To the Company’s knowledge, no Covered Person is subject to a Disqualification Event. The Company has complied, to the extent applicable, with all disclosure obligations under Rule 506(e) under the Securities Act. “Covered Persons” are those persons specified in Rule 506(d)(1) under the Securities Act, including the Company, any predecessor or affiliate of the Company, any director, executive officer, other officer
participating in the offering, general partner or managing member of the Company, any beneficial owner of 20% or more of the Company’s outstanding voting equity securities, calculated on the basis of voting power, any promoter (as defined in Rule 405 under the Securities Act) connected with the Company in any capacity at the time of the exercise of this Warrant, and any person that has been or will be paid (directly or indirectly) remuneration for solicitation of purchasers in connection with the sale of any securities of the Company (a “Solicitor”), any general partner or managing member of any Solicitor, and any director, executive officer or other officer participating in the offering of any Solicitor or general partner or managing member of any such Solicitor.
3.10 Dispute Resolution. In the case of any dispute as to the determination of any closing sales price, the calculation of any Warrant Price or Aggregate Warrant Price, the determination of Fair Market Value or any other computation or valuation required to be made hereunder or in connection herewith, in the event the Holder, on the one hand, and the Company, on the other hand, each acting in good faith, are unable to settle such dispute within five (5) Business Days, then either party may elect to submit the disputed matter(s) for resolution by a public accounting firm as may be mutually agreed upon by the Holder and the Board acting in good faith. Such accounting firm’s determination of such disputed matter(s) shall be binding upon all parties absent demonstrable error, and the Company and the Holder shall each pay one half of the fees and costs of such firm.
3.11 Put Provision. Without prejudice to any other provisions of this Warrant, upon (i) the repayment in full of the Obligations, (ii) the consummation of a Change in Control, or (iii) upon the acceleration of the Obligations following the occurrence, and during the continuance, of an Event of Default, or, in each case, at any time during the fifteen (15) Trading Days immediately thereafter, Holder may, at its sole option, require (such right, the “Put Right”) the Company to purchase all or a portion of this Warrant from the Holder for a purchase price equal to $____1 (subject to appropriate adjustment for any stock split, stock dividend, stock combination, reverse stock split or similar event) per share of Common Stock issuable upon exercise of this Warrant or the applicable portion thereof (the “Put Price”) by delivering of a written notice to the Company (the “Put Notice”). The Put Price shall be due and in payable in cash within three (3) Trading Days after the Company’s receipt of the Put Notice.
SECTION 4 ADJUSTMENT TO WARRANT PRICE AND NUMBER OF WARRANT SHARES.
The Warrant Price and the number of Warrant Shares issuable upon exercise of this Warrant shall be subject to adjustment from time to time as provided in this Section 4.
4.1 Dividends and Distributions of Non-Company Securities. If, at any time or from time to time after the Issue Date, the Company makes or declares, or fixes a record date for the determination of holders of Common Stock entitled to receive, a dividend or any other distribution payable in securities of the Company (other than a dividend or distribution of shares of Common Stock or Options or Convertible Securities in each case in respect of Common Stock), cash or other property, then, and in each such event, provision shall be made so that the Holder shall receive upon exercise in full of the Warrant, in addition to the number of Warrant Shares receivable thereupon, the kind and amount of securities of the Company, cash or other property which the Holder would have been entitled to receive had the Warrant been exercised in full into Warrant Shares on the date of such event and had the Holder thereafter, during the period from the date of such event to and including the Exercise Date, retained such securities, cash or other property receivable by them as aforesaid during such period, giving application to all adjustments called for during such period under this Section 4 with respect to the rights of the Holder; provided that no such provision shall be made if the Holder receives, simultaneously with the distribution to the holders of Common Stock, a dividend or other distribution of such securities, cash or other property in an amount equal to the amount of such securities, cash or other property as the Holder would have received if the Warrant had been exercised in full into Warrant Shares on the date of such event.
4.2 Adjustment to Warrant Price and Warrant Shares Upon Dividend, Subdivision or Combination of Common Stock. If the Company shall, at any time or from time to time after the Issue Date, (i) pay a dividend or make any other distribution upon the Common Stock or any other capital stock of the Company payable in shares of Common Stock or in Options or Convertible Securities (in each case in respect of Common Stock), or (ii) subdivide (by any stock split, recapitalization or otherwise) its outstanding shares of Common Stock into a greater number of
1 NTD: Aggregate price to equal $2.75MM
shares, each Warrant Price in effect immediately prior to any such dividend, distribution or subdivision shall be proportionately reduced and the number of Warrant Shares issuable upon exercise of this Warrant shall be proportionately increased. If the Company at any time combines (by combination, reverse stock split or otherwise) its outstanding shares of Common Stock into a smaller number of shares, each Warrant Price in effect immediately prior to such combination shall be proportionately increased and the number of Warrant Shares issuable upon exercise of this Warrant shall be proportionately decreased. Any adjustment under this Section 4.2 shall become effective at the close of business on the date the dividend, subdivision or combination becomes effective.
4.3 Adjustment to Warrant Price and Warrant Shares Upon Reorganization or Reclassification. In the event of any (i) capital reorganization of the Company, (ii) reclassification of the stock of the Company (other than a change in par value or from par value to no par value or from no par value to par value or as a result of a stock dividend or subdivision, split-up or combination of shares), or (iii) other similar transaction, in each case which entitles the holders of Common Stock to receive (either directly or upon subsequent liquidation) cash, stock, securities or assets with respect to or in exchange for Common Stock, each Warrant shall, immediately after such reorganization, reclassification, or similar transaction, remain outstanding and shall thereafter, in lieu of or in addition to (as the case may be) the number of Warrant Shares then exercisable under this Warrant, be exercisable for the amount of cash or the kind and number of shares of stock or other securities or assets of the Company or of the successor Person resulting from such transaction to which the Holder would have been entitled upon such reorganization, reclassification, or similar transaction if the Holder had exercised this Warrant in full immediately prior to the time of such reorganization, reclassification, consolidation, merger, sale, Change in Control or similar transaction and acquired the applicable number of Warrant Shares then issuable hereunder as a result of such exercise (without taking into account any limitations or restrictions on the exercisability of this Warrant); and, in such case, appropriate adjustment (in form and substance satisfactory to the Holder) shall be made with respect to the Holder’s rights under this Warrant to insure that the provisions of this Section 4 hereof shall thereafter be applicable, as nearly as possible, to this Warrant in relation to any cash, shares of stock, securities or assets thereafter acquirable upon exercise of this Warrant. The provisions of this Section 4.3 shall similarly apply to successive reorganizations, reclassifications, or similar transactions. Notwithstanding anything to the contrary contained herein, with respect to any corporate event or other transaction contemplated by the provisions of this Section 4.3, the Holder shall have the right to elect prior to the consummation of such event or transaction, to give effect to the exercise rights contained in Section 2 instead of giving effect to the provisions contained in this Section 4.3 with respect to this Warrant.
4.4 Reserved.
4.5 Certain Events. If any event of the type contemplated by the provisions of this Section 4 but not expressly provided for by such provisions occurs where the failure to make any adjustment would not, in the good faith opinion of the Holder, fairly protect the purchase rights represented by this Warrant in accordance with the essential intent and principles of this Section 4, then the Board shall consider such in good faith and, to the extent the Board in good faith determines an adjustment on a basis consistent with the essential intent and principles established in this Section 4, is necessary to preserve the purchase rights represented by this Warrant, make an appropriate adjustment, on a basis consistent with the essential intent and principles established in this Section 4, in the Warrant Price or the number of Warrant Shares issuable upon exercise of this Warrant, as applicable, so as to protect the rights of the Holder in a manner consistent with the provisions of this Section 4; provided that no such adjustment pursuant to this Section 4.5 shall increase the Warrant Price or decrease the number of Warrant Shares issuable as otherwise determined pursuant to this Section 4 and nothing in this Section 4.5 shall require any adjustment upon a sale or issuance of shares by the Company at a price per share less than the Exercise Price.
4.6 Certificate as to Adjustment.
(a)Following any adjustment of the Warrant Price, the Company shall furnish to the Holder a certificate of an executive officer setting forth in reasonable detail such adjustment and the facts upon which it is based and certifying the calculation thereof. The Company shall furnish such certificate to the Holder every quarter in which an adjustment occurs.
(b)As promptly as reasonably practicable following the receipt by the Company of a reasonable, written request by the Holder, not more than once in any calendar year, but in any event not later than seven (7) Business Days thereafter, the Company shall furnish to the Holder a certificate (in substantially the form of Exhibit B) of an executive officer certifying the Warrant Price then in effect and the number and type of Warrant Shares or the amount, if any, of other shares of stock, securities or assets then issuable upon exercise of the Warrant.
4.7 Notices. In the event:
(a)that the Company shall take a record of the holders of its Common Stock (or other capital stock or securities at the time issuable upon exercise of the Warrant) for the purpose of entitling or enabling them to receive any dividend or other distribution, to vote at a meeting (or by written consent), to receive any right to subscribe for or purchase any shares of capital stock of any class or any other securities, or to receive any other security; or
(b)of any capital reorganization of the Company, any reclassification of the Common Stock of the Company, any consolidation or merger of the Company with or into another Person, or sale of all or substantially all of the Company’s assets to another Person; or
(c)of the voluntary or involuntary dissolution, liquidation or winding-up of the Company; then, and in each such case, the Company shall send or cause to be sent to the Holder at least ten (10) Business Days prior to the applicable record date or the applicable expected effective date, as the case may be, for the event, a written notice specifying, as the case may be, (A) the record date for such dividend, distribution, meeting or consent or other right or action, and a description of such dividend, distribution or other right or action to be taken at such meeting or by written consent, or (B) the effective date on which such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding-up is proposed to take place, and the date, if any is to be fixed, as of which the books of the Company shall close or a record shall be taken with respect to which the holders of record of Common Stock (or such other capital stock or securities at the time issuable upon exercise of the Warrant) shall be entitled to exchange their shares of Common Stock (or such other capital stock or securities) for securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding- up, and the amount per share and character of such exchange applicable to the Warrant and the Warrant Shares.
SECTION 5 REGISTRATION RIGHTS.
5.1 Piggyback Registration.
(a)Following, and for the avoidance of doubt not including, the initial public offering of the Company, whenever the Company proposes to register for sale any shares of its Common Stock under the Securities Act (other than (i) a registration effected to implement an employee benefit plan or a transaction to which Rule 145 of the Securities Act is applicable or (ii) a registration statement on Form S-4, Form S-8 or any successor form thereto or another form not available for registering the Registrable Securities for sale to the public), whether for its own account or for the account of one or more stockholders of the Company (a “Piggyback Registration”), the Company shall give prompt written notice (in any event no later than five (5) days prior to the filing of such Registration Statement) to the Holder of its intention to effect such a registration and shall include, subject to the limitations below, in such registration all Warrant Shares with respect to which the Company has received written requests for inclusion from the Holder within five (5) days after the Company’s notice has been given to the Holder.
(b)If a Piggyback Registration is initiated as a primary underwritten offering on behalf of the Company and the managing underwriter advises the Company in writing that in its opinion the number of shares of Common Stock proposed to be included in such registration, including all Registrable Securities and all other shares of Common Stock proposed to be included in such underwritten offering, exceeds the number of shares of Common Stock which can be sold in such offering and/or that the number of shares of Common Stock proposed to be included in any such registration would adversely affect the price per share of the Common Stock to be sold in such offering or otherwise negatively impact such offering, the Company shall include in such registration (A) first, the
number of shares of Common Stock that the Company proposes to sell; and (B) other shares of Common Stock by holders of piggyback registration or similar rights pursuant to the order of priority set forth in Section 5.1(c) below.
(c)If a Piggyback Registration is initiated as an underwritten offering on behalf of one or more holders of Common Stock other than Warrant Shares, and the managing underwriter advises the Company in writing that in its opinion the number of shares of Common Stock proposed to be included in such registration, including all Warrant Shares and all other shares of Common Stock proposed to be included in such underwritten offering, exceeds the number of shares of Common Stock which can be sold in such offering and/or that the number of shares of Common Stock proposed to be included in any such registration would adversely affect the price per share of the Common Stock to be sold in such offering or otherwise negatively impact such offering, the Company shall, subject to the proviso below, include in such registration, in each case subject to any restrictions, limitations, requirements or other provisions of any other agreement entered into by the Company and involving registration rights or similar provisions (including that certain Investment Agreement, made as of March [●], 2022, by and between the Company and the Investor named therein) (i) first, the number of shares of Common Stock requested to be included therein by the initiating holders of Common Stock other than Warrant Shares, (ii) second, if applicable, the number of shares of Common Stock requested to be included therein by holders of Common Stock having demand registration rights or similar rights requiring inclusion, (iii) third, the number of shares of Common Stock requested to be included therein by other holders of Common Stock including the Holder, allocated among such holders on a pro rata basis based on aggregate ownership of Common Stock (on an as-converted and as-exercised basis) and (iv) fourth, the number of shares of Common Stock proposed to be included by the Company, if any.
(d)If any Piggyback Registration is initiated as a primary underwritten offering on behalf of the Company, the Company shall select the investment banking firm or firms to act as the managing underwriter or underwriters in connection with such offering.
(e)The Holder hereby agrees that it will not, without the prior written consent of the managing underwriter, during the period commencing on the date of the final prospectus relating to the registration by the Company of shares of its Common Stock or any other equity securities under the Securities Act on a registration statement on Form S-1, and ending on the date specified by the Company and the managing underwriter (such period not to exceed one hundred eighty (180) days in the case of the IPO, or such other period as may be requested by the Company or an underwriter to accommodate regulatory restrictions on (1) the publication or other distribution of research reports and (2) analyst recommendations and opinions, including, but not limited to, the restrictions contained in applicable FINRA rules, or any successor provisions or amendments thereto), (i) lend; offer; pledge; sell; contract to sell; sell any option or contract to purchase; purchase any option or contract to sell; grant any option, right, or warrant to purchase; or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable (directly or indirectly) for Common Stock held immediately before the effective date of the registration statement for such offering, or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of such securities, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or other securities, in cash, or otherwise. The foregoing provisions of this Section 5.1(e) shall not apply to (A) the sale of any shares to an underwriter pursuant to an underwriting agreement or to the establishment of a trading plan pursuant to Rule 10b5-1 of the Securities Act, provided that such plan does not permit transfers during the restricted period, or (B) the transfer of any shares to any trust for the direct or indirect benefit of the Holder or the immediate family of the Holder, provided that the trustee of the trust agrees to be bound in writing by the restrictions set forth herein, and provided further that any such transfer shall not involve a disposition for value. The foregoing provisions of this Section 5.1(e) shall be applicable to the Holder only if all directors and executive officers of the Company holding a non-de minimis number of shares and all holders of more than 5% of the Company’s issued and outstanding shares of Common Stock are subject to similar restrictions. The underwriters in connection with such registration are intended third-party beneficiaries of this Section 5.1(e) and shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto. The Holder further agrees to execute such agreements as may be reasonably requested by the underwriters in connection with such registration that are consistent with this Section 5.1(e) or that are necessary to give further effect thereto.
SECTION 6 TRANSFERS.
6.1 Transfer of Warrant. Subject to the transfer conditions referred to in the legend endorsed hereon and in Section 7.4 hereof, this Warrant and all rights hereunder are freely transferable, in whole or in part, by the Holder without charge to the Holder, upon delivery to the Company of a written request for assignment in the form attached hereto as Exhibit C (each, an “Assignment”) by the Holder and surrender of this Warrant to the Company at its then principal executive offices, together with funds sufficient to pay any transfer taxes described in Section 3.6(e) in connection with the making of such transfer. If requested by the Company, the Holder will also provide an opinion of counsel satisfactory to the Company to the effect that the transfer or assignment is in compliance with (or is exempt from) applicable federal and state securities laws. Upon such compliance, surrender and delivery and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees and in the denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant, if any, not so assigned and this Warrant shall promptly be cancelled. Notwithstanding the foregoing, no part of this Warrant or the Shares issuable upon exercise of this Warrant (or the securities issuable directly or indirectly, upon conversion of the Shares, if any) may be transferred except to a person named as a “Designated Holder” of [JGB] in the Loan Agreement in a manner consistent with the terms thereof.
6.2 Holder Not Deemed a Stockholder; Limitations on Liability. Except as otherwise specifically provided herein (including Section 4.1), prior to the exercise of this Warrant and the issuance to the Holder of the Warrant Shares to which the Holder is then entitled to receive upon the due exercise of this Warrant, the Holder shall not be entitled to vote or receive dividends or be deemed the holder of shares of capital stock of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, as such, any of the rights of a stockholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company. Notwithstanding this Section 5, the Company shall provide the Holder with copies of the same notices and other information given to its stockholders generally contemporaneously with the giving thereof to such stockholders.
SECTION 7 REPLACEMENT ON LOSS; DIVISION AND COMBINATION.
7.1 Replacement of Warrant on Loss. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and upon delivery of an indemnity reasonably satisfactory to it (it being understood that a written indemnification agreement or affidavit of loss of the Holder in customary form shall be a sufficient indemnity) and, in case of mutilation, upon surrender of such Warrant for cancellation to the Company, the Company at its own expense shall execute and deliver to the Holder, in lieu hereof, a new Warrant of like tenor and exercisable for an equivalent number of Warrant Shares as the Warrant so lost, stolen, mutilated or destroyed; provided that, in the case of mutilation, no indemnity shall be required if this Warrant in identifiable form is surrendered to the Company for cancellation.
7.2 Division and Combination of Warrant. Subject to compliance with the applicable provisions of this Warrant as to any transfer or other assignment which may be involved in such division or combination, this Warrant may be divided or, following any such division of this Warrant, subsequently combined with other Warrants, upon the surrender of this Warrant or Warrants to the Company at its then principal executive offices, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the respective Holders or their authorized agents or attorneys. Subject to compliance with the applicable provisions of this Warrant as to any transfer or assignment which may be involved in such division or combination, the Company shall at its own expense execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants so surrendered in accordance with such notice. Such new Warrant or Warrants shall be of like tenor to the surrendered Warrant or Warrants and shall be exercisable in the aggregate for an equivalent number of Warrant Shares as the Warrant or Warrants so surrendered in accordance with such notice.
7.3 No Impairment. The Company shall not, by amendment of its Articles of Incorporation or Bylaws, or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities, or any other voluntary action, avoid or circumvent or seek to avoid or circumvent the observance or performance of any of the terms to be observed or performed by it hereunder, but shall at all times in good faith assist in the carrying out of all the provisions of this Warrant and in the taking of all such action as may reasonably necessary in order to protect the exercise rights of the Holder against impairment (which, for the avoidance of doubt shall not include dilution), consistent with the tenor and purpose of this Warrant.
7.4 Compliance with the Securities Act. The parties hereto agree as follows:
(a)The Holder, by acceptance of this Warrant, agrees to comply in all respects with the provisions of this Section 7.4 and the restrictive legend requirements set forth on the face of this Warrant and further agrees that such Holder shall not offer, sell or otherwise dispose of this Warrant or any Warrant Shares to be issued upon exercise hereof except under circumstances that will not result in a violation of the Securities Act. The Holder further agrees not to make any disposition of all or any part of the Warrant or Warrant Shares in any event other than in a manner consistent with Section 6.1 and in any event unless and until:
(i) There is then in effect a registration statement under the Act covering such proposed disposition and such disposition is made in accordance with said registration statement; or
(ii) Such disposition will not require registration of such Warrant or Warrant Shares under the Act or any applicable state securities laws.
(b)This Warrant and all Warrant Shares issued upon exercise of this Warrant (unless registered under the Securities Act) shall be stamped or imprinted with a legend in substantially the following form:
“THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE APPLICABLE STATE SECURITIES LAWS AND NO INTEREST MAY BE SOLD, DISTRIBUTED, ASSIGNED, OFFERED, PLEDGED OR OTHERWISE TRNASFERRED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS COVERING ANYS UCH TRNASACTION INVOLVING SAID SECURITIES, (B) VOYAGER SPACE HOLDINGS, INC. RECEIVES AN OPINION OF LEGAL COUNSEL FOR THE HOLDER OF THESE SECURITIES SATISFACTORY TO VOYAGER SPACE HOLDINGS, INC. STATING THAT SUCH TRNASACTION IS EXEMPT FROM REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS, OR (C) VOYAGER SPACE HOLDINGS, INC. OTEHWRISE SATISFIES ITSELF THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS.”
7.5 Removal of Legends. Upon the Holder’s request at any time following delivery of reasonable assurances, including an opinion of counsel to the Holder in sufficient form and reasonably acceptable to the Company, that this Warrant and the Warrant Shares can be freely sold pursuant to Rule 144 without any limitation as to amount, method of sale or other factors, the Company shall promptly (but in any event within five (5) Business Days following such request and delivery), at its sole cost and expense, issue a replacement Warrant or replacement Warrant Shares, as the case may be, deleting the legends required pursuant to Section 7.4(b) above.
SECTION 8 REPRESENTATIONS OF THE HOLDER.
In connection with the issuance of this Warrant, the Holder specifically represents, as of the date hereof, to the Company by acceptance of this Warrant as follows:
8.1 The Holder is an “accredited investor” as defined in Rule 501 of Regulation D promulgated under the Securities Act. The Holder is acquiring this Warrant and the Warrant Shares to be issued upon exercise hereof for investment for its own account and not with a view towards, or for sale or resale in connection with, the public sale or distribution of this Warrant or the Warrant Shares or otherwise. The Holder also represents that the entire
legal and beneficial interests of the Warrant and Warrant Shares the Holder is acquiring is being acquired for, and will be held for, its account only.
8.2 The Holder understands and acknowledges that this Warrant and the Warrant Shares to be issued upon exercise hereof have not been registered under the Act on the basis that no distribution or public offering of the stock of the Company is to be effected and are “restricted securities” under the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that, under such laws and applicable regulations, such securities may be resold without registration under the Securities Act only in certain limited circumstances. The Holder realizes that the basis for the exemption may not be present if, notwithstanding its representations, the Holder has a present intention of acquiring the securities for a fixed or determinable period in the future, selling (in connection with a distribution or otherwise), granting any participation in, or otherwise distributing the securities in violation of securities laws. The Holder has no such present intention.
The Holder recognizes that the Warrant and the Warrant Shares must be held indefinitely unless their sale or transfer are registered under the Act or an exemption from such registration is available. Except as provided herein or as otherwise agreed by the Company, the Holder recognizes that the Company has no obligation to register the Warrant or the Warrant Shares, or to comply with any exemption from such registration.
In addition, the Holder represents that it is familiar with Rule 144 under the Securities Act, as presently in effect, and understands the resale limitations imposed thereby and by the Securities Act.
8.3 The Holder acknowledges that it can bear the economic and financial risk of its investment for an indefinite period, and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in the Warrant and the Warrant Shares. The Holder has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of the Warrant and the business, properties, prospects and financial condition of the Company.
SECTION 9 WARRANT REGISTER.
The Company shall keep and properly maintain at its principal executive offices books for the registration of the Warrant and any transfers thereof. The Company may deem and treat the Person in whose name the Warrant is registered on such register as the Holder thereof for all purposes, and the Company shall not be affected by any notice to the contrary, except any assignment, division, combination or other transfer of the Warrant effected in accordance with the provisions of this Warrant.
SECTION 10 NOTICES.
All notices and other communications provided hereunder shall be in writing and mailed, delivered or transmitted, if to the Company or the Holder, to the applicable party at its address or email address set forth on the signature pages hereto, or at such other address or email address as may be designated by such party in a notice to the other party. Any notice, if mailed and properly addressed with postage prepaid or if properly addressed and sent by pre-paid courier service, shall be deemed given when received; any notice, if transmitted by email, shall be deemed given on the date properly sent. Unless otherwise indicated, all references to the time of a day shall refer to New York City time.
SECTION 11 CUMULATIVE REMEDIES.
The rights and remedies provided in this Warrant are cumulative and are not exclusive of, and are in addition to and not in substitution for, any other rights or remedies available at law, in equity or otherwise.
SECTION 12 EQUITABLE RELIEF.
Each of the Company and the Holder acknowledges that a breach or threatened breach by such party of any of its obligations under this Warrant may give rise to irreparable harm to the other party hereto for which monetary damages would not be an adequate remedy and hereby agrees that in the event of a breach or a threatened breach by
such party of any such obligations, the other party hereto shall, in addition to any and all other rights and remedies that may be available to it in respect of such breach, be entitled to pursue equitable relief, including a restraining order, an injunction, specific performance and any other relief that may be available from a court of competent jurisdiction.
SECTION 13 FINDER’S FEE.
Each party represents to the other party that the other party is not and will not be obligated for any finder’s fee or commission of or due and payable by such original party in connection with the transactions contemplated by this Warrant. The Holder agrees to indemnify and to hold harmless the Company from any liability for any commission or compensation in the nature of a finder’s fee (and the costs and expenses of defending against such liability or asserted liability) for which the Holder or any of its officers, employees or representatives is responsible. The Company agrees to indemnify and hold harmless the Holder from any liability for any commission or compensation in the nature of a finder’s fee (and the costs and expenses of defending against such liability or asserted liability) for which the Company or any of its officers, employees or representatives is responsible.
SECTION 14 ADDITIONAL PROVISIONS.
14.1 Expenses. The Company will reimburse the reasonable fees and expenses of the Holder, including reasonable legal fees and expenses, with respect to the negotiation, execution and delivery of this Warrant as provided in Section 2.4(b) of the Loan Agreement.
14.2 Entire Agreement. This Warrant constitutes the sole and entire agreement of the parties to this Warrant with respect to the subject matter contained herein, and supersedes all prior and contemporaneous understandings and agreements, both written and oral, with respect to such subject matter.
14.3 Successor and Assigns. This Warrant and the rights evidenced hereby shall be binding upon and shall inure to the benefit of the parties hereto and the successors of the Company and the successors and permitted assigns of the Holder. Such successors and/or permitted assigns of the Holder shall be deemed to be a Holder for all purposes hereunder.
14.4 No Third-Party Beneficiaries. This Warrant is for the sole benefit of the Company and the Holder and their respective successors and, in the case of the Holder, permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person any legal or equitable right, benefit or remedy of any nature whatsoever, under or by reason of this Warrant.
14.5 Acceptance. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to
all of the terms and conditions contained herein.
14.6 Termination by Holder. This Warrant may be terminated anytime by the Holder at its election
effective immediately upon written notice to the Company.
SECTION 15 HEADINGS.
The headings in this Warrant are for reference only and shall not affect the interpretation of this Warrant.
SECTION 16 AMENDMENT AND MODIFICATION; WAIVER.
Except as otherwise provided herein, this Warrant may only be amended, modified or supplemented by an agreement in writing signed by each party hereto. No waiver by the Company or the Holder of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No waiver by any party shall operate or be construed as a waiver in respect of any failure, breach or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any rights, remedy, power or privilege arising from this Warrant shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege hereunder.
SECTION 17 SEVERABILITY.
If any term or provision of this Warrant is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Warrant or invalidate or render unenforceable such term or provision in any other jurisdiction.
SECTION 18 GOVERNING LAW.
This Warrant shall be governed by and construed in accordance with the internal laws of the State of New York without giving effect to any choice or conflict of law provision or rule (whether of the State of New York or any other jurisdiction) that would cause the application of laws of any jurisdiction other than those of the State of New York.
SECTION 19 SUBMISSION TO JURISDICTION.
Any legal suit, action or proceeding arising out of or based upon this Warrant or the transactions contemplated hereby may be instituted in the federal courts of the United States of America or the courts of the State of New York, in either case sitting in the Borough of Manhattan, and each party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action or proceeding. Service of process, summons, notice or other document by certified or registered mail to such party’s address set forth herein shall be effective service of process for any suit, action or other proceeding brought in any such court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, action or any proceeding in such courts and irrevocably waive and agree not to plead or claim in any such court that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.
SECTION 20 WAIVER OF JURY TRIAL.
Each party acknowledges and agrees that any controversy which may arise under this Warrant is likely to involve complicated and difficult issues and, therefore, each such party irrevocably and unconditionally waives any right it may have to a trial by jury in respect of any legal action arising out of or relating to this Warrant or the transactions contemplated hereby.
SECTION 21 COUNTERPARTS.
This Warrant may be executed in counterparts, each of which shall be deemed an original, but both of which together shall be deemed to be one and the same agreement. A signed copy of this Warrant delivered by e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Warrant.
SECTION 22 NO STRICT CONSTRUCTION.
This Warrant shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting an instrument or causing any instrument to be drafted.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
[SIGNATURE PAGE TO WARRANT TO PURCHASE COMMON STOCK]
IN WITNESS WHEREOF, the Company has duly executed this Warrant on the Issue Date.
| | | | | | | | | | | | | | | | | |
| VOYAGER SPACE HOLDINGS, INC. | |
| | | | | |
| | | | | |
| By: | |
| | | | | |
| Name: | |
| | | | | |
| Title: |
| | | | | | | | | | | | | | |
| Accepted and agreed, | |
| | | | |
| [JGB] |
| | | | |
| | | | |
| By: | |
| | | | |
| Name: | | |
| | | | |
| Title: | | |
EXHIBIT A
FORM OF SUBSCRIPTION AGREEMENT
(To be signed only upon exercise of Warrant)
The undersigned, as holder of a right to purchase shares of Common Stock of VOYAGER SPACE HOLDINGS, INC., a Delaware corporation (the “Company”), pursuant to that certain Warrant to Purchase Shares of Common Stock of the Company (the “Warrant”), dated as of [____________], hereby irrevocably elects to exercise the purchase right represented by such Warrant for, and to purchase thereunder, __________ (_____) shares of Common Stock of the Company and herewith makes payment of _________ Dollars ($____) therefor by the following method:
(Check all that apply):
| | | | | | | | |
| _______(check if applicable) | | The undersigned hereby elects to make payment of the Aggregate Warrant Price of ____________________________________ Dollars ($ _______) in cash for ________________(______) shares of Common Stock using the method described in Section 3.2(a) of the Warrant. |
| | |
| _______(check if applicable) | | The undersigned hereby elects to make payment of the Aggregate Warrant Price of ________________________________ Dollars ($ __________) for ___________ (_____) shares of Common Stock using the method described in Section 3.2(b) of the Warrant. |
| | |
| | |
| Requested Denomination of | | |
| | |
| Common Stock: | | _____________________ shares |
| | |
| Registered Holder: | | ___________________ |
In order to induce the issuance of such securities the undersigned makes to the Company, as of the date hereof, the representations and warranties set forth in Section 8 of the Warrant. Unless otherwise defined herein, capitalized terms have the meanings provided in the Warrant.
| | | | | | | | | | | | | | | | | | | | | | | |
| DATED: | | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | [HOLDER] | |
| | | | | | | |
| | | | | | | |
| | | By: | | |
| | | | | | | |
| | | Name: | | |
| | | | | | | |
| | | Title: | | |
EXHIBIT B
FORM OF ACKNOWLEDGMENT
To: [JGB Collateral LLC]
The undersigned hereby acknowledges that as of the date hereof _______________ (_____) shares of Common Stock remain subject to the right of purchase in favor of [HOLDER] pursuant to that certain Warrant to Purchase Shares of Common Stock of VOYAGER SPACE HOLDINGS, INC. in favor of [HOLDER], dated as of [___________________]
| | | | | | | | | | | | | | | | | | | | | | | |
| DATED: | | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | VOYAGER SPACE HOLDINGS, INC. | |
| | | | | | | |
| | | | | | | |
| | | By: | | |
| | | | | | | |
| | | Name: | | |
| | | | | | | |
| | | Title: | | |
EXHBIT C
FORM OF ASSIGNMENT
REFERENCE IS MADE to that certain Warrant to Purchase Shares of Common Stock of VOYAGER SPACE HOLDINGS, INC. (the “Warrant”), dated as of [______________], in favor of [HOLDER]. Unless otherwise defined, terms used herein have the meanings ascribed thereto in the Warrant.
FOR VALUE RECEIVED, the undersigned Holder of record of this Warrant of VOYAGER SPACE HOLDINGS, INC. (the “Company”), hereby sells, assigns and transfers unto the Assignee named below all of the rights, including, without limitation, the Purchase Rights (as such term is defined in this Warrant) of the undersigned under the within Warrant, with respect to the number of shares of Common Stock set forth below:
Name of Transferee/Assignee Address [No. of Shares]1
and does hereby irrevocably constitute and appoint the Secretary of the Company to make such transfer on the books of the Company, maintained for the purpose, with full power of substitution in the premises.
Attached hereto, if and to the extent requested by the Company, is an opinion of counsel that the assignment is in compliance with or is exempt from, applicable federal and state securities laws. As provided in the Warrant, including but not limited to Section 6.2 of the Warrant, the Company may, in its reasonable discretion, decide whether such opinion is satisfactory, and Assignee and Holder agree to any reasonable delay in transfer caused by such evaluation.
The Assignee acknowledges and agrees that the Warrant and the shares of Common Stock to be issued upon exercise thereof or conversion thereof are being acquired for investment and that the Assignee will not offer, sell or otherwise dispose of the Warrant or any shares of stock to be issued upon exercise thereof or conversion thereof except under circumstances which will not result in a violation of the Securities Act of 1933, as amended (the “Act”), or any applicable state securities laws.
ACCORDINGLY, THE FOLLOWING RESTRICTIVE LEGEND IS MADE APPLICABLE TO THIS ASSIGNMENT (AND TO THE WARRANT AND SECURITIES COVERED BY THE WARRANT AS ASSIGNED HEREBY TO ASSIGNEE):
THIS ASSIGNMENT AND THE WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE APPLICABLE STATE SECURITIES LAWS AND NO INTEREST MAY BE SOLD, DISTRIBUTED, ASSIGNED, OFFERED, PLEDGED OR OTHERWISE TRANSFERRED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS COVERING ANY SUCH TRANSACTION INVOLVING SAID SECURITIES, (B) VOYAGER SPACE HOLDINGS, INC. RECEIVES AN OPINION OF LEGAL COUNSEL FOR THE HOLDER OF THESE SECURITIES SATISFACTORY TO VOYAGER SPACE HOLDINGS, INC. STATING THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS, OR (C) VOYAGER SPACE HOLDINGS, INC. OTHERWISE SATISFIES ITSELF THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
| | | | | | | | | | | | | | | | | | | | |
| Dated: | | | HOLDER: |
| | | | | | |
| | | | | | |
| | | By: | |
| | | | | | |
| | | Name: | |
| | | | | | |
| | | Title: | |
| | | | | | |
| | | | | | |
| | | | | | |
| Dated: | | | ASSIGNEE: |
| | | | | | |
| | | | | | |
| | | By: | |
| | | | | | |
| | | Name: | |
| | | | | | |
| | | Title: | |
WARRANT AMENDMENT AGREEMENT
This WARRANT AMENDMENT AGREEMENT, (this “Amendment Agreement”) effective as of July 12, 2024, is entered into between Voyager Space Holdings, Inc. (the “Company”) and each of Chicago Atlantic Credit Opportunities, LLC, Chicago Atlantic Credit Company, LLC, Chicago Atlantic Portfolio, LP, Midtown Madison Management, LLC, JGB Capital, LP, JGB Partners, LP and JGB (Cayman) Lakenvelder Ltd. (each a “Lender” and collectively, the “Lenders” and together with the Company, the “Parties” and each a “Party”).
WHEREAS, the Company has issued to each of the Lenders one or more warrants to purchase Common Stock, par value $0.0001 per share, of the Company, specifically set forth as follows:
• Warrant CW-2, dated March 10, 2023 for 18,660 shares to Chicago Atlantic Credit Company, LLC;
• Warrant CW-3, dated March 10, 2023 for 93,299 shares to Chicago Atlantic Credit Opportunities, LLC;
• Warrant CW-4, dated March 10, 2023 for 91,433 shares to JGB (Cayman) Lakenvelder LTD ;
• Warrant CW-5, dated March 10, 2023 for 19,593 shares to JGB Capital, LP
• Warrant CW-6, dated March 10, 2023 for 150,211 shares to JGB Partners, LP
• Warrant CW-7, dated March 14, 2023 for 83,195 shares to Midtown Madison Management, LLC;
• Warrant CW-8, dated March 14, 2023 for 10,104 shares to Midtown Madison Management, LLC;
• Warrant CW-10, dated March 29,2024 for 11,723 shares to Chicago Atlantic Credit Opportunities, LLC;
• Warrant CW-11, dated March 29,2024 for 4,689 shares to Chicago Atlantic Credit Company, LLC;
• Warrant CW-12, dated March 29,2024 for 11,723 shares to Chicago Atlantic Portfolio, LP;
• Warrant CW-13, dated March 29,2024 for 23,447 shares to Midtown Madison Management, LLC;
• Warrant CW-14, dated March 29,2024 for 4,924 shares to JGB Capital, LP;
• Warrant CW-15, dated March 29,2024 for 37,749 shares to JGB Partners, LP; and
• Warrant CW-16, dated March 29,2024 for 22,978 shares to JGB (Cayman) Lakenvelder Ltd. (the foregoing, each a “Lender Warrant” and collectively, the “Lender Warrants”).
WHEREAS, in connection with the repayment of certain loans outstanding to the Lenders, the Lenders and the Company have agreed to amend the terms of each of the Lender Warrants as set forth below.
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each of the Parties hereto agrees as follows:
1. SECTION 3.11 of each Lender Warrant is amended and restated in its entirety as follows:
3.11 Put Provision. Without prejudice to any other provisions of this Warrant, (i) beginning on July 1, 2025, or (ii) upon the consummation of a Change in Control, or, in each case, at any time during the six (6) months immediately thereafter, Holder may, at its sole option, require (such right, the “Put Right”) the Company to purchase all or a portion of this Warrant from the Holder for a purchase price equal to $6.90 (subject to appropriate adjustment for any stock split, stock dividend, stock combination, reverse stock split or similar event) per share of Common Stock issuable upon exercise of this Warrant or the applicable portion thereof (the “Put Price”) by delivering of a written notice to the Company (the “Put Notice”). The Put Price shall be due and payable in cash within sixty (60) calendar days after the Company’s receipt of the Put Notice.
2. Each Party hereby represents and warrants to the other Parties that: (i) it has the full right, power, and authority to enter into this Amendment Agreement and to perform its obligations hereunder and under the Lender Warrants as amended by this Amendment Agreement; (ii) the execution of this Amendment Agreement by the individual whose signature is set forth at the end of this Amendment Agreement on behalf of such Party, and the delivery of this Amendment Agreement by such Party, have been duly authorized by all necessary action on the part of such Party; and (iii) this Amendment Agreement has been executed and delivered by such Party and (assuming due authorization, execution, and delivery by the other Party hereto) constitutes the legal, valid, and binding obligation of such Party, enforceable against such Party in accordance with its terms, except as may be limited by any applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws and equitable principles related to or affecting creditors' rights generally or the effect of general principles of equity.
3. Except as expressly provided in this Amendment Agreement, all of the terms and provisions of each Lender Warrant are and will remain in full force and effect and are hereby ratified and confirmed by the Parties in all respects. Except as explicitly set forth herein, the amendments contained herein will not be construed as an amendment to or waiver of any other provision of any Lender Warrant (or of any other agreement or document relating to the subject matter hereof), or as a waiver of or consent to any further or future action on the part of either Party that would require the waiver or consent of the other Party.
4. Miscellaneous.
a) This Amendment Agreement is governed by and construed in accordance with the laws of the State of New York, without regard to the conflict of laws provisions of such State.
b) This Amendment shall inure to the benefit of and be binding upon each of the Parties and each of their respective permitted successors and permitted assigns.
c) The headings in this Amendment Agreement are for reference only and do not affect the interpretation of this Amendment Agreement.
d) This Amendment Agreement may be executed in counterparts, each of which is deemed an original, but all of which constitute one and the same agreement. Delivery of an executed counterpart of this Amendment Agreement electronically or by facsimile shall be effective as delivery of an original executed counterpart of this Amendment Agreement.
e) This Amendment Agreement and each Lender Warrant, together, constitute the sole and entire agreement between the Parties with respect to its subject matter, and supersede all prior and contemporaneous understandings, agreements, representations, and warranties, both written and oral, with respect to such subject matter.
[Remainder of Page Intentionally Blank]
IN WITNESS WHEREOF, the undersigned have set their hands as of the date first set forth above.
| | | | | | | | | | | | | | | | | | | | |
| VOYAGER SPACE HOLDINGS, INC. |
| | | | | | |
| | | | | | |
| | | | | | |
| By: | |
| Name: | | |
| Title: | | |
| | | | | | |
| | | | | | |
| | | | | | |
| JGB CAPITAL, LP |
| | | | | | |
| | | | | | |
| | | | | | |
| By: | |
| Name: | | |
| Title: | | |
| | | | | | |
| | | | | | |
| | | | | | |
| JGB PARTNERS, LP |
| | | | | | |
| | | | | | |
| | | | | | |
| By: | |
| Name: | | |
| Title: | | |
| | | | | | |
| | | | | | |
| | | | | | |
| JGB (CAYMAN) LAKENVELDER, LTD. |
| | | | | | |
| | | | | | |
| | | | | | |
| By: | |
| Name: | | |
| Title: | | |
| | | | | | |
| | | | | | |
| | | | | | |
| MIDTOWN MADISON MANAGEMENT,
LLC |
| | | | | | |
| | | | | | |
| | | | | | |
| By: | | |
| Name: | | |
| Title: | | |
| | | | | | | | | | | | | | | | | | | | |
| CHICAGO ATLANTIC CREDIT
OPPORTUNITIES, LLC |
| | | | | | |
| | | | | | |
| | | | | | |
| By: | |
| Name: | | |
| Title: | | |
| | | | | | |
| | | | | | |
| | | | | | |
| CHICAGO ATLANTIC CREDIT
COMPANY, LLC |
| | | | | | |
| | | | | | |
| | | | | | |
| By: | |
| Name: | | |
| Title: | | |
| | | | | | |
| | | | | | |
| | | | | | |
| CHICAGO ATLANTIC PORTFOLIO, LP |
| | | | | | |
| | | | | | |
| | | | | | |
| By: | |
| Name: | | |
| Title: | | |
Exhibit 10.26
Execution Version
NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE 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 OR ASSIGNED (I) 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 TO THE HOLDER (IF REQUESTED BY THE COMPANY), IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD OR ELIGIBLE TO BE SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES. THE NUMBER OF SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT MAY BE LESS THAN THE AMOUNTS SET FORTH ON THE FACE HEREOF PURSUANT TO SECTION 1(a) OF THIS WARRANT. VOYAGER SPACE HOLDINGS, INC.
WARRANT TO PURCHASE COMMON STOCK
Warrant No.: CW-9
Date of Issuance: July 28, 2023 (“Issuance Date”)
Voyager Space Holdings, Inc., a Delaware corporation (the “Company”), hereby certifies that, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, WALLEYE OPPORTUNITIES MASTER FUND, LTD., the registered holder hereof or its permitted assigns (the “Holder”), is entitled, subject to the terms set forth below, to purchase from the Company, at the Exercise Price (as defined below) then in effect, upon exercise of this Warrant to Purchase Common Stock (including any Warrants to Purchase Common Stock issued in exchange, transfer or replacement hereof, the “Warrant”), at any time or times on or after the Issuance Date, but not after 11:59 p.m., New York time, on the Expiration Date (as defined below), 65,709 (subject to adjustment as provided herein) fully paid and non-assessable shares of Common Stock (as defined below) (the “Warrant Shares”, and such number of Warrant Shares, the “Warrant Number”). Except as otherwise defined herein, capitalized terms in this Warrant shall have the meanings set forth in Section 20. This Warrant is one of the Warrants to Purchase Common Stock (the “SPA Warrants”) issued in connection with that certain Subscription Agreement, dated as of December 20, 2021, by and among the Company and the investors (the “Buyers”) referred to therein, as amended from time to time (the “Subscription Agreement”). 1. EXERCISE OF WARRANT.
(a) Mechanics of Exercise. Subject to the terms and conditions hereof (including, without limitation, the limitations set forth in Section 1(f)), this Warrant may be exercised by the
Holder on any day on or after the Issuance Date (an “Exercise Date”), in whole or in part, by delivery (whether via e-mail or otherwise) of a written notice, in the form attached hereto as Exhibit A (the “Exercise Notice”), of the Holder’s election to exercise this Warrant. Within one (1) Trading Day following an exercise of this Warrant as aforesaid, the Holder shall deliver payment to the Company of an amount equal to the Exercise Price in effect on the date of such exercise multiplied by the number of Warrant Shares as to which this Warrant was so exercised (the “Aggregate Exercise Price”) in cash or via wire transfer of immediately available funds if the Holder did not notify the Company in such Exercise Notice that such exercise was made pursuant to a Cashless Exercise (as defined in Section 1(d)). The Holder shall not be required to deliver the original of this Warrant in order to effect an exercise hereunder. Execution and delivery of an Exercise Notice with respect to less than all of the Warrant Shares shall have the same effect as cancellation of the original of this Warrant and issuance of a new Warrant evidencing the right to purchase the remaining number of Warrant Shares. Execution and delivery of an Exercise Notice for all of the then-remaining Warrant Shares shall have the same effect as cancellation of the original of this Warrant after delivery of the Warrant Shares in accordance with the terms hereof. On or before the first (1st) Trading Day following the date on which the Company has received an Exercise Notice, the Company shall transmit by electronic mail an acknowledgment of confirmation of receipt of such Exercise Notice, in the form attached hereto as Exhibit B, to the Holder and, if after the Public Company Date, the Company’s transfer agent (the “Transfer Agent”), which confirmation shall, if after the Public Company Date, constitute an instruction to the Transfer Agent to process such Exercise Notice in accordance with the terms herein. On or before the first (1st) Trading Day following the date on which the Company has received such Exercise Notice (or such earlier date as required pursuant to the 1934 Act or other applicable law, rule or regulation for the settlement of a trade of such Warrant Shares initiated on the applicable Exercise Date), the Company shall (X) if on or after the Public Company Date, provided that the Transfer Agent is participating in The Depository Trust Company (“DTC”) Fast Automated Securities Transfer Program (“FAST”), upon the request of the Holder, credit such aggregate number of shares of Common Stock to which the Holder is entitled pursuant to such exercise to the Holder’s or its designee’s balance account with DTC through its Deposit/Withdrawal at Custodian system, or (Y) if either (x) prior to the Public Company Date or (y) on or after the Public Company Date, if the Transfer Agent is not participating in FAST, upon the request of the Holder, issue and deliver to the address as specified in the Exercise Notice, a certificate (or, if applicable, e-mail of electronic ledger entry), registered in the name of the Holder or its designee, for the number of shares of Common Stock to which the Holder shall be entitled pursuant to such exercise. Upon delivery of an Exercise Notice, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date such Warrant Shares are credited to the Holder’s DTC account or the date of delivery of the certificates (or e-mail confirmation of electronic ledger entry, as applicable) evidencing such Warrant Shares (as the case may be). If this Warrant is submitted in connection with any exercise pursuant to this Section 1(a) and the number of Warrant Shares represented by this Warrant submitted for exercise is greater than the number of Warrant Shares being acquired upon an exercise and upon surrender of this Warrant to the Company by the Holder, then, at the request of the Holder, the Company shall as soon as practicable and in no event later than two (2) Business Days after any exercise and at its own expense, issue and deliver to the Holder (or its designee) a new Warrant (in accordance with Section 7(d)) representing the right to purchase the number of Warrant Shares purchasable immediately prior to such exercise under this
Warrant, less the number of Warrant Shares with respect to which this Warrant is exercised. No fractional shares of Common Stock are to be issued upon the exercise of this Warrant, but rather the number of shares of Common Stock to be issued shall be rounded up to the nearest whole number. The Company shall pay any and all transfer, stamp, issuance and similar taxes, costs and expenses (including, without limitation, fees and expenses of the Transfer Agent) that may be payable with respect to the issuance and delivery of Warrant Shares upon exercise of this Warrant. Notwithstanding the foregoing, except in the case where an exercise of this Warrant is validly made pursuant to a Cashless Exercise, the Company’s failure to deliver Warrant Shares to the Holder on or prior to the later of (i) one (1) Trading Day after receipt of the applicable Exercise Notice (or, after the Public Company Date, such earlier date as required pursuant to the 1934 Act or other applicable law, rule or regulation for the settlement of a trade of such Warrant Shares initiated on the applicable Exercise Date) and (ii) one (1) Trading Day after the Company’s receipt of the Aggregate Exercise Price (or valid notice of a Cashless Exercise) (such later date, the “Share Delivery Deadline”) shall not be deemed to be a breach of this Warrant.
(b) Exercise Price. For purposes of this Warrant, “Exercise Price” means $38.05, subject to adjustment as provided herein.
(c) Company’s Failure to Timely Deliver Securities.
(i) General. The Company shall in all cases use its reasonable best efforts to comply with the delivery requirements set forth herein and shall do all things and take all actions reasonably requested by the Holder in furtherance thereof.
(ii) Exercise Failures On or After the Public Company Date. If on or after the Public Company Date, the Company shall fail, for any reason or for no reason, on or prior to the Share Delivery Deadline, if the Transfer Agent is not participating in FAST, to issue and deliver to the Holder (or its designee) a certificate for the number of Warrant Shares to which the Holder is entitled and register such Warrant Shares on the Company’s share register or, if the Transfer Agent is participating in FAST, to credit the balance account of the Holder or the Holder’s designee with DTC for such number of Warrant Shares to which the Holder is entitled upon the Holder’s exercise of this Warrant (as the case may be) (a “Delivery Failure”), and if on or after such Share Delivery Deadline the Holder acquires (in an open market transaction, stock loan or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of all or any portion of the number of shares of Common Stock issuable upon such exercise that the Holder anticipated receiving from the Company (a “Buy-In”), then, in addition to all other remedies available to the Holder, the Company shall, within two (2) 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, stock loan costs and other out-of-pocket expenses, if any) for the shares of Common Stock so acquired (including, without limitation, by any other Person in respect, or on behalf, of the Holder) (the “Buy-In Price”), at which point the Company’s obligation to so issue and deliver such certificate (and to issue such shares of Common Stock) or credit the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of Warrant Shares to which the Holder is entitled upon the Holder’s exercise hereunder (as the case may be) (and to issue such Warrant Shares) shall terminate, or (ii) promptly honor its obligation to
so issue and deliver to the Holder a certificate or certificates representing such Warrant Shares or credit the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of Warrant Shares to which the Holder is entitled upon the Holder’s exercise hereunder (as the case may be) 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 Warrant Shares multiplied by (B) the lowest Closing Sale Price of the Common Stock on any Trading Day during the period commencing on the date of the applicable Exercise Notice and ending on the date of such issuance and payment under this clause (ii) (the “Buy-In Payment Amount”). Nothing shall limit the Holder’s right to pursue any other remedies available to it hereunder, at law or in equity, including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing shares of Common Stock (or to electronically deliver such shares of Common Stock) upon the exercise of this Warrant as required pursuant to the terms hereof. In addition to the foregoing rights, if after the Public Company Date, (i) if the Company fails to deliver the applicable number of Warrant Shares upon an exercise pursuant to Section 1 by the applicable Share Delivery Deadline, then the Holder shall have the right to rescind such exercise in whole or in part and retain and/or have the Company return, as the case may be, any portion of this Warrant that has not been exercised pursuant to such Exercise Notice; provided that the rescission of an exercise shall not affect the Company’s obligation to make any payments that have accrued prior to the date of such notice pursuant to this Section 1(c) or otherwise, and (ii) if a registration statement covering the issuance or resale of the Warrant Shares that are subject to an Exercise Notice is not available for the issuance or resale, as applicable, of such Warrant Shares and the Holder has submitted an Exercise Notice prior to receiving notice of the non-availability of such registration statement and the Company has not already delivered the Warrant Shares underlying such Exercise Notice electronically without any restrictive legend by crediting such aggregate number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the Holder’s or its designee’s balance account with DTC through its Deposit / Withdrawal At Custodian system, the Holder shall have the option, by delivery of notice to the Company, to (x) rescind such Exercise Notice in whole or in part and retain or have returned, as the case may be, any portion of this Warrant that has not been exercised pursuant to such Exercise Notice; provided that the rescission of an Exercise Notice shall not affect the Company’s obligation to make any payments that have accrued prior to the date of such notice pursuant to this Section 1(c) or otherwise, and/or (y) switch some or all of such Exercise Notice from a cash exercise to a Cashless Exercise. (d) Cashless Exercise. Notwithstanding anything contained herein to the contrary (other than Section 1(f) below), the Holder may, in its sole discretion, exercise this Warrant in whole or in part and, in lieu of making the cash payment otherwise contemplated to be made to the Company upon such exercise in payment of the Aggregate Exercise Price, elect instead to receive upon such exercise the “Net Number” of Warrant Shares determined according to the following formula (a “Cashless Exercise”): Net Number = (A x B) - (A x C)
B
For purposes of the foregoing formula:
A= the total number of shares with respect to which this Warrant is then being exercised.
B = (i) prior to the Public Company Date, the fair market value of the Common Stock as mutually determined by the Company and the Required Holders and (ii) on or after the Public Company Date, as elected by the Holder, (A) the VWAP of the shares of Common Stock on the Trading Day immediately preceding the date of the applicable Exercise Notice if such Exercise Notice is (1) both executed and delivered pursuant to Section 1(a) hereof on a day that is not a Trading Day or (2) both executed and delivered pursuant to Section 1(a) hereof on a Trading Day prior to the opening of “regular trading hours” (as defined in Rule 600(b)(64) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (B) either (x) the VWAP on the Trading Day immediately preceding the date of the applicable Exercise Notice or (y) the Bid Price of the shares of Common Stock as of the time of the Holder’s execution of the applicable Exercise Notice if such Exercise Notice is executed during “regular trading hours” on a Trading Day and is delivered within two (2) hours thereafter pursuant to Section 1(a) hereof, or (C) the Closing Sale Price of the Common Stock on the date of the applicable Exercise Notice if the date of such Exercise Notice is a Trading Day and such Exercise Notice is both executed and delivered pursuant to Section 1(a) hereof after the close of “regular trading hours” on such Trading Day. C = the Exercise Price then in effect for the applicable Warrant Shares at the time of such exercise.
If the Warrant Shares are issued in a Cashless Exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the 1933 Act, the Warrant Shares take on the registered characteristics of the Warrants being exercised. For purposes of Rule 144(d) promulgated under the 1933 Act, as in effect on the Issuance Date, it is intended that the Warrant Shares issued in a Cashless Exercise shall be deemed to have been acquired by the Holder, and the holding period for the Warrant Shares shall be deemed to have commenced, on the date this Warrant was originally issued.
In the event of termination or expiration of this Warrant (including upon the Expiration Date), to the extent that this Warrant is then exercisable and such exercise would result in the issuance of Warrant Shares to the Holder, this Warrant shall be deemed automatically exercised pursuant to a Cashless Exercise immediately prior to the time at which it would otherwise terminate or expire.
(e) Disputes. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the number of Warrant Shares to be issued pursuant to the terms hereof, the Company shall promptly issue to the Holder the number of Warrant Shares that are not disputed and resolve such dispute in accordance with Section 13.
(f) Limitations on Exercises. From and after the Public Company Date, the Company shall not effect the exercise of any portion of this Warrant, and the Holder shall not have the right to exercise any portion of this Warrant, pursuant to the terms and conditions of this Warrant and any such exercise shall be null and void and treated as if never made, to the extent that after giving effect to such exercise, the Holder together with the other Attribution Parties collectively would beneficially own in excess of 4.99% (the “Maximum Percentage”) of the shares of Common Stock outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by the Holder and the other Attribution Parties shall include the number of shares of Common Stock held by the Holder and all other Attribution Parties plus the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which the determination of such sentence is being made, but shall exclude shares of Common Stock which would be issuable upon (A) exercise of the remaining, unexercised portion of this Warrant beneficially owned by the Holder or any of the other Attribution Parties and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company (including, without limitation, any convertible notes or convertible preferred stock or warrants, including other SPA Warrants) beneficially owned by the Holder or any other Attribution Party subject to a limitation on conversion or exercise analogous to the limitation contained in this Section 1(f). For purposes of this Section 1(f), beneficial ownership shall be calculated in accordance with Section 13(d) of the 1934 Act. For purposes of determining the number of outstanding shares of Common Stock the Holder may acquire upon the exercise of this Warrant without exceeding the Maximum Percentage, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Company’s most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K or other public filing with the SEC, as the case may be, (y) a more recent public announcement by the Company or (z) any other written notice by the Company or the Transfer Agent, if any, setting forth the number of shares of Common Stock outstanding (the “Reported Outstanding Share Number”). From and after the Public Company Date, if the Company receives an Exercise Notice from the Holder at a time when the actual number of outstanding shares of Common Stock is less than the Reported Outstanding Share Number, the Company shall (i) notify the Holder in writing of the number of shares of Common Stock then outstanding and, to the extent that such Exercise Notice would otherwise cause the Holder’s beneficial ownership, as determined pursuant to this Section 1(f)(i), to exceed the Maximum Percentage, the Holder must notify the Company of a reduced number of Warrant Shares to be acquired pursuant to such Exercise Notice (the number of shares by which such purchase is reduced, the “Reduction Shares”) and (ii) as soon as reasonably practicable, the Company shall return to the Holder any exercise price paid by the Holder for the Reduction Shares. For any reason at any time, upon the written or oral request of the Holder, the Company shall within one (1) Business Day confirm orally and in writing or by electronic mail to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder and any other Attribution Party since the date as of which the Reported Outstanding Share Number was reported. From and after the Public Company Date, in the event that the issuance of shares of Common Stock to the Holder upon exercise of this Warrant results in the Holder and the other Attribution Parties being deemed to beneficially own, in the aggregate, more than the Maximum Percentage of the number of outstanding shares of Common Stock (as determined under Section 13(d) of the 1934 Act), the number of shares so issued by which the Holder’s and the other
Attribution Parties’ aggregate beneficial ownership exceeds the Maximum Percentage (the “Excess Shares”) shall be deemed null and void and shall be cancelled ab initio, and the Holder shall not have the power to vote or to transfer the Excess Shares. As soon as reasonably practicable after the issuance of the Excess Shares has been deemed null and void, the Company shall return to the Holder the exercise price paid by the Holder for the Excess Shares. Upon delivery of a written notice to the Company, the Holder may from time to time increase (with such increase not effective until the sixty-first (61st) day after delivery of such notice) or decrease the Maximum Percentage to any other percentage not in excess of 9.99% as specified in such notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st) day after such notice is delivered to the Company and (ii) any such increase or decrease will apply only to the Holder and the other Attribution Parties and not to any other holder of SPA Warrants that is not an Attribution Party of the Holder. For purposes of clarity, the shares of Common Stock issuable pursuant to the terms of this Warrant in excess of the Maximum Percentage shall not be deemed to be beneficially owned by the Holder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934 Act. No prior inability to exercise this Warrant pursuant to this paragraph shall have any effect on the applicability of the provisions of this paragraph with respect to any subsequent determination of exercisability. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 1(f) to the extent necessary to correct this paragraph or any portion of this paragraph which may be defective or inconsistent with the intended beneficial ownership limitation contained in this Section 1(f) or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation contained in this paragraph may not be waived and shall apply to a successor holder of this Warrant. (g) Reservation of Shares.
(i) Required Reserve Amount. So long as this Warrant remains outstanding, the Company shall at all times keep reserved for issuance under this Warrant a number of shares of Common Stock at least equal to 100% of the maximum number of shares of Common Stock as shall be necessary to satisfy the Company’s obligation to issue shares of Common Stock under the SPA Warrants then outstanding (without regard to any limitations on exercise) (the “Required Reserve Amount”); provided that at no time shall the number of shares of Common Stock reserved pursuant to this Section 1(g)(i) be reduced other than proportionally in connection with any exercise or redemption of SPA Warrants or such other event covered by Section 2(a) below. The Required Reserve Amount (including, without limitation, each increase in the number of shares so reserved) shall be allocated pro rata among the holders of the SPA Warrants based on number of shares of Common Stock issuable upon exercise of SPA Warrants held by each holder on the Closing Date (without regard to any limitations on exercise) or increase in the number of reserved shares, as the case may be (the “Authorized Share Allocation”). In the event that a holder shall sell or otherwise transfer any of such holder’s SPA Warrants, each transferee shall be allocated a pro rata portion of such holder’s Authorized Share Allocation. Any shares of Common Stock reserved and allocated to any Person which ceases to hold any SPA Warrants shall be allocated to the remaining holders of SPA Warrants, pro rata based on the number of shares of Common Stock issuable upon exercise of the SPA Warrants then held by such holders (without regard to any limitations on exercise).
(ii) Insufficient Authorized Shares. If, notwithstanding Section 1(g)(i) above, and not in limitation thereof, at any time while any of the SPA Warrants remain outstanding, the Company does not have a sufficient number of authorized and unreserved shares of Common Stock to satisfy its obligation to reserve the Required Reserve Amount (an “Authorized Share Failure”), then the Company shall immediately take all action necessary to increase the Company’s authorized shares of Common Stock to an amount sufficient to allow the Company to reserve the Required Reserve Amount for all the SPA Warrants then outstanding. Without limiting the generality of the foregoing sentence, as soon as practicable after the date of the occurrence of an Authorized Share Failure, but in no event later than sixty (60) days after the occurrence of such Authorized Share Failure, the Company shall hold a meeting of its stockholders for the approval of an increase in the number of authorized shares of Common Stock. In connection with such meeting, if after the Public Company Date, the Company shall provide each stockholder with a proxy statement. The Company shall use its best efforts to solicit its stockholders’ approval of such increase in authorized shares of Common Stock and to cause its board of directors to recommend to the stockholders that they approve such proposal. Notwithstanding the foregoing, if any such time of an Authorized Share Failure, the Company is able to obtain the written consent of a majority of the shares of its issued and outstanding shares of Common Stock to approve the increase in the number of authorized shares of Common Stock, the Company may satisfy this obligation by obtaining such consent and, if after the Public Company Date, submitting for filing with the SEC an Information Statement on Schedule 14C. In the event that the Company is prohibited from issuing shares of Common Stock upon an exercise of this Warrant due to the failure by the Company to have sufficient shares of Common Stock available out of the authorized but unissued shares of Common Stock (such unavailable number of shares of Common Stock, the “Authorization Failure Shares”), in lieu of delivering such Authorization Failure Shares to the Holder, the Company shall pay cash in exchange for the cancellation of such portion of this Warrant exercisable into such Authorization Failure Shares at a price equal to the sum of (i) the product of (x) such number of Authorization Failure Shares and (y) the greatest Closing Sale Price of the Common Stock on any Trading Day during the period commencing on the date the Holder delivers the applicable Exercise Notice with respect to such Authorization Failure Shares to the Company and ending on the date of such issuance and payment under this Section 1(g); and (ii) to the extent 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 Authorization Failure Shares, any Buy-In Payment Amount, brokerage commissions and other out-of-pocket expenses, if any, of the Holder incurred in connection therewith. Nothing contained in this Section 1(g) shall limit any obligations of the Company under any provision of the Securities Purchase Agreement. 2. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and number of Warrant Shares issuable upon exercise of this Warrant are subject to adjustment from time to time as set forth in this Section 2.
(a) Stock Dividends and Splits. Without limiting any provision of Section Error! Reference source not found. or Section 4, if the Company, at any time on or after the Issuance Date, (i) pays a stock dividend on one or more classes of its then outstanding shares of Common
Stock or otherwise makes a distribution on any class of capital stock that is payable in shares of Common Stock, (ii) subdivides (by any stock split, stock dividend, recapitalization or otherwise) one or more classes of its then outstanding shares of Common Stock into a larger number of shares or (iii) combines (by combination, reverse stock split or otherwise) one or more classes of its then outstanding shares of Common Stock into a smaller number of shares, then in each such case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant to clause (i) of this paragraph shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution, and any adjustment pursuant to clause (ii) or (iii) of this paragraph shall become effective immediately after the effective date of such subdivision or combination. If any event requiring an adjustment under this paragraph occurs during the period that an Exercise Price is calculated hereunder, then the calculation of such Exercise Price shall be adjusted appropriately to reflect such event.
(b) Number of Warrant Shares. Simultaneously with any adjustment to the Exercise Price pursuant to this Section 2, the number of Warrant Shares that may be purchased upon exercise of this Warrant shall be increased or decreased proportionately, so that after such adjustment the aggregate Exercise Price payable hereunder for the adjusted number of Warrant Shares shall be the same as the aggregate Exercise Price in effect immediately prior to such adjustment (without regard to any limitations on exercise contained herein). On the Public Company Date, if the Warrant Number is less that the aggregate number of shares of Common Stock issued, or issuable, upon conversion or exchange of Series B Preferred Stock with $2.5 in aggregate initial Original Liquidation Preference (as defined in the Series B Certificate of Designations) as of the Public Company Date (such aggregate number, the “Series B Preferred Underlying Share Amount”), on the Public Company Date the Warrant Number shall automatically be increased to the Series B Preferred Underlying Share Amount. (c) Calculations. All calculations under this Section 2 shall be made by rounding to the nearest cent or the nearest 1/100th of a share, as applicable. The number of shares of Common Stock outstanding at any given time shall not include shares owned or held by or for the account of the Company, and the disposition of any such shares shall be considered an issuance or sale of Common Stock. (d) Voluntary Adjustment By Company. The Company may at any time during the term of this Warrant reduce the then current Exercise Price to any amount and for any period of time deemed appropriate by the board of directors of the Company; provided, that as of the Public Company Date, the foregoing shall be subject to the rules and regulations of the Principal Market.
3. RIGHTS UPON DISTRIBUTION OF ASSETS. In addition to any adjustments pursuant to Section 2 above or Section 4 below, if the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property, options, evidence of indebtedness or any other assets by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), at any time after the issuance of this Warrant, then, in each
such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations or restrictions on exercise of this Warrant, including without limitation, the Maximum Percentage) immediately before the date on which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution (provided, however, that, on or after the Public Company Date, to the extent that the Holder’s right to participate in any such Distribution would result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, then the Holder shall not be entitled to participate in such Distribution to the extent of the Maximum Percentage (and shall not be entitled to beneficial ownership of such shares of Common Stock as a result of such Distribution (and beneficial ownership) to the extent of any such excess) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time or times, if ever, as its right thereto would not result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time or times the Holder shall be granted such Distribution (and any Distributions declared or made on such initial Distribution or on any subsequent Distribution held similarly in abeyance) to the same extent as if there had been no such limitation).
4. PURCHASE RIGHTS; CHANGE OF CONTROL.
(a) Purchase Rights. In addition to any adjustments pursuant to Sections 2 or 3 above, if at any time the Company grants, issues or sells any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations or restrictions on exercise of this Warrant, including without limitation, the Maximum Percentage) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issuance or sale of such Purchase Rights (provided, however, that, on or after the Public Company Date, to the extent that the Holder’s right to participate in any such Purchase Right would result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, then the Holder shall not be entitled to participate in such Purchase Right to the extent of the Maximum Percentage (and shall not be entitled to beneficial ownership of such shares of Common Stock as a result of such Purchase Right (and beneficial ownership) to the extent of any such excess) and such Purchase Right to such extent shall be held in abeyance for the benefit of the Holder until such time or times, if ever, as its right thereto would not result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time or times the Holder shall be granted such right (and any Purchase Right granted, issued or sold on such initial Purchase Right or on any subsequent Purchase Right held similarly in abeyance) to the same extent as if there had been no such limitation). (b) Fundamental Transactions.
(i) Change of Control. In the event of a Change of Control, this Warrant shall, if not exercised in connection with such Change of Control, terminate as of the date of the consummation of such Change of Control.
(ii) Other Fundamental Transactions. In the event of any Fundamental Transaction that is not a Change of Control, the Successor Entity shall assume in writing all of the obligations of the Company under this Warrant and shall deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument satisfactory to the Holder that is substantially similar in form and substance to this Warrant, including, without limitation, which is exercisable for a corresponding number of shares of capital stock equivalent to the shares of Common Stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital stock, such adjustments to the number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction). Upon the consummation of such a Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the date of the applicable Fundamental Transaction, the provisions of this Warrant and the other Transaction Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Warrant and the other Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein. Upon consummation of each Fundamental Transaction, the Successor Entity shall deliver to the Holder confirmation that there shall be issued upon exercise of this Warrant at any time after the consummation of the applicable Fundamental Transaction, in lieu of the shares of Common Stock (or other securities, cash, assets or other property (except such items still issuable under Sections 3 and 4(a) above, which shall continue to be receivable thereafter)) issuable upon the exercise of this Warrant prior to the applicable Fundamental Transaction, such shares of publicly traded common stock (or its equivalent) of the Successor Entity (including its Parent Entity) which the Holder would have been entitled to receive upon the happening of the applicable Fundamental Transaction had this Warrant been exercised immediately prior to the applicable Fundamental Transaction (without regard to any limitations on the exercise of this Warrant), as adjusted in accordance with the provisions of this Warrant. (iii) Application. The provisions of this Section 4 shall apply similarly and equally to successive Changes of Control and shall be applied as if this Warrant (and any such subsequent warrants) were fully exercisable and without regard to any limitations on the exercise of this Warrant (provided that the Holder shall continue to be entitled to the benefit of the Maximum Percentage, applied however with respect to shares of capital stock registered under the 1934 Act and thereafter receivable upon exercise of this Warrant (or any such other warrant)).
5. NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company
will not, by amendment of its certificate of incorporation, bylaws or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issuance 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 Warrant, and will at all times in good faith carry out all the provisions of this Warrant and take all action as may be required to protect the rights of the Holder. Without limiting the generality of the foregoing, the Company (a) shall not increase the par value of any shares of Common Stock receivable upon the exercise of this Warrant above the Exercise Price then in effect, and (b) shall take all such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and non-assessable shares of Common Stock upon the exercise of this Warrant. Notwithstanding anything herein to the contrary, if after the sixty (60) calendar day anniversary of the Issuance Date, the Holder is not permitted to exercise this Warrant in full for any reason (other than pursuant to restrictions set forth in Section 1(f) hereof), the Company shall use its best efforts to promptly remedy such failure, including, without limitation, obtaining such consents or approvals as necessary to permit such exercise into shares of Common Stock. 6. WARRANT HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided herein, the Holder, solely in its capacity as a holder of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder of share capital of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in its capacity as the Holder of this Warrant, any of the rights of a stockholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance to the Holder of the Warrant Shares which it is then entitled to receive upon the due exercise of this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company. Notwithstanding this Section 6, the Company shall provide the Holder with copies of the same notices and other information given to the stockholders of the Company generally, contemporaneously with the giving thereof to the stockholders. 7. REISSUANCE OF WARRANTS.
(a) Transfer of Warrant. If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company, whereupon the Company will forthwith issue and deliver upon the order of the Holder a new Warrant (in accordance with Section 7(d)), registered as the Holder may request, representing the right to purchase the number of Warrant Shares being transferred by the Holder and, if less than the total number of Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with Section 7(d)) to the Holder representing the right to purchase the number of Warrant Shares not being transferred. (b) Lost, Stolen or Mutilated Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant (as to which a written certification and the indemnification contemplated below shall suffice as such evidence), and, in the case of loss, theft or destruction, of any indemnification undertaking
by the Holder to the Company in customary and reasonable form and, in the case of mutilation, upon surrender and cancellation of this Warrant, the Company shall execute and deliver to the Holder a new Warrant (in accordance with Section 7(d)) representing the right to purchase the Warrant Shares then underlying this Warrant. (c) Exchangeable for Multiple Warrants. This Warrant is exchangeable, upon the surrender hereof by the Holder at the principal office of the Company, for a new Warrant or Warrants (in accordance with Section 7(d)) representing in the aggregate the right to purchase the number of Warrant Shares then underlying this Warrant, and each such new Warrant will represent the right to purchase such portion of such Warrant Shares as is designated by the Holder at the time of such surrender; provided, however, no warrants for fractional shares of Common Stock shall be given. (d) Issuance of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant (i) shall be of like tenor with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant, the right to purchase the Warrant Shares then underlying this Warrant (or in the case of a new Warrant being issued pursuant to Section 7(a) or Section 7(c), the Warrant Shares designated by the Holder which, when added to the number of shares of Common Stock underlying the other new Warrants issued in connection with such issuance, does not exceed the number of Warrant Shares then underlying this Warrant), (iii) shall have an issuance date, as indicated on the face of such new Warrant which is the same as the Issuance Date, and (iv) shall have the same rights and conditions as this Warrant. 8. NOTICES. Whenever notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance with Section 4.21 of the Subscription Agreement. The Company shall provide the Holder with prompt written notice of all actions taken pursuant to this Warrant (other than the issuance of shares of Common Stock upon exercise in accordance with the terms hereof), including in reasonable detail a description of such action and the reason therefor. Without limiting the generality of the foregoing, the Company will give written notice to the Holder (i) immediately upon each adjustment of the Exercise Price and the number of Warrant Shares, setting forth in reasonable detail, and certifying, the calculation of such adjustment(s), (ii) at least fifteen (15) days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon the shares of Common Stock, and (B) for determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation, provided in each case that such information shall be made known to the public prior to or in conjunction with such notice being provided to the Holder, and (iii) at least ten (10) Trading Days prior to the consummation of any Fundamental Transaction. From and after the Public Company Date, to the extent that any notice provided hereunder constitutes, or contains, material, non-public information regarding the Company or any of its Subsidiaries (as defined in the Securities Purchase Agreement), the Company shall simultaneously file such notice with the SEC (as defined in the Securities Purchase Agreement) pursuant to a Current Report on Form 8-K. From and after the Public Company Date, if the Company or any of its Subsidiaries provides material non-public information to the Holder that is not simultaneously filed in a Current Report on Form 8-K and the Holder has not agreed to receive such material non-public information, the Company hereby covenants and agrees that the Holder shall not have any duty of confidentiality to the Company, any of its Subsidiaries or any of their respective officers, directors, employees,
affiliates or agents with respect to, or a duty to any of the foregoing not to trade on the basis of, such material non-public information. . It is expressly understood and agreed that the time of execution specified by the Holder in each Exercise Notice shall be definitive and may not be disputed or challenged by the Company.
9. AMENDMENT AND WAIVER. Except as otherwise provided herein, the provisions of this Warrant (other than Section 1(f)) may be amended and the Company may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained the written consent of the Holder and the Company. No waiver shall be effective unless it is in writing and signed by an authorized representative of the waiving party. 10. SEVERABILITY. If any provision of this Warrant is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity of the remaining provisions of this Warrant so long as this Warrant as so modified continues to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).
11. GOVERNING LAW. This Warrant shall be governed by and construed and enforced in accordance with, and all questions concerning the construction, validity, interpretation and performance of this Warrant 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. The Company 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 the Company at the address set forth in the Subscription Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. The Company 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. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing contained herein shall be deemed or operate to preclude the Holder from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on the Company’s obligations to the Holder, to realize on any collateral or any other security for such obligations, or to enforce a judgment or other court ruling in favor of the Holder. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT
IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY TRANSACTION CONTEMPLATED HEREBY.
12. CONSTRUCTION; HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed against any Person as the drafter hereof. The headings of this Warrant are for convenience of reference and shall not form part of, or affect the interpretation of, this Warrant. Terms used in this Warrant but defined in the other Transaction Documents shall have the meanings ascribed to such terms on the Closing Date (as defined in the Subscription Agreement) in such other Transaction Documents unless otherwise consented to in writing by the Holder.
13. DISPUTE RESOLUTION.
(a) Submission to Dispute Resolution.
(i) In the case of a dispute relating to the Exercise Price, the Closing Sale Price, the Bid Price, or fair market value or the arithmetic calculation of the number of Warrant Shares (as the case may be) (including, without limitation, a dispute relating to the determination of any of the foregoing), the Company or the Holder (as the case may be) shall submit the dispute to the other party via email (A) if by the Company, within two (2) Business Days after the occurrence of the circumstances giving rise to such dispute or (B) if by the Holder, at any time after the Holder learned of the circumstances giving rise to such dispute. If the Holder and the Company are unable to promptly resolve such dispute relating to such Exercise Price, such Closing Sale Price, such Bid Price, or such fair market value or such arithmetic calculation of the number of Warrant Shares (as the case may be), at any time after the second (2nd) Business Day following such initial notice by the Company or the Holder (as the case may be) of such dispute to the Company or the Holder (as the case may be), then the Holder may, at its sole option, select an independent, reputable investment bank to resolve such dispute.
(ii) The Holder and the Company shall each deliver to such investment bank (A) a copy of the initial dispute submission so delivered in accordance with the first sentence of this Section 13 and (B) written documentation supporting its position with respect to such dispute, in each case, no later than 5:00 p.m. (New York time) by the fifth (5th) Business Day immediately following the date on which the Holder selected such investment bank (the “Dispute Submission Deadline”) (the documents referred to in the immediately preceding clauses (A) and (B) are collectively referred to herein as the “Required Dispute Documentation”) (it being understood and agreed that if either the Holder or the Company fails to so deliver all of the Required Dispute Documentation by the Dispute Submission Deadline, then the party who fails to so submit all of the Required Dispute Documentation shall no longer be entitled to (and hereby waives its right to) deliver or submit any written documentation or other support to such investment bank with respect to such dispute and such investment bank shall resolve such dispute based solely on the Required Dispute Documentation that was delivered to such investment bank prior to the Dispute Submission Deadline). Unless otherwise agreed to in writing by both the
Company and the Holder or otherwise requested by such investment bank, neither the Company nor the Holder shall be entitled to deliver or submit any written documentation or other support to such investment bank in connection with such dispute (other than the Required Dispute Documentation).
(iii) The Company and the Holder shall cause such investment bank to determine the resolution of such dispute and notify the Company and the Holder of such resolution no later than ten (10) Business Days immediately following the Dispute Submission Deadline. The fees and expenses of such investment bank shall be borne solely by the Company, and such investment bank’s resolution of such dispute shall be final and binding upon all parties absent manifest error.
(b) Miscellaneous. The Company expressly acknowledges and agrees that (i) this Section 13 constitutes an agreement to arbitrate between the Company and the Holder (and constitutes an arbitration agreement) under the rules then in effect under § 7501, et seq. of the New York Civil Practice Law and Rules (“CPLR”) and that the Holder is authorized to apply for an order to compel arbitration pursuant to CPLR § 7503(a) in order to compel compliance with this Section 13, (ii) a dispute relating to the Exercise Price includes, without limitation, disputes as to (A) whether an issuance or sale or deemed issuance or sale of Common Stock occurred under Section Error! Reference source not found., (B) the consideration per share at which an issuance or deemed issuance of Common Stock occurred, (C) whether any issuance or sale or deemed issuance or sale of Common Stock was an issuance or sale or deemed issuance or sale of Excluded Securities, (D) whether an agreement, instrument, security or the like constitutes and Option or Convertible Security and (E) whether a Dilutive Issuance occurred, (iii) the terms of this Warrant and each other applicable Transaction Document shall serve as the basis for the selected investment bank’s resolution of the applicable dispute, such investment bank shall be entitled (and is hereby expressly authorized) to make all findings, determinations and the like that such investment bank determines are required to be made by such investment bank in connection with its resolution of such dispute (including, without limitation, determining (A) whether an issuance or sale or deemed issuance or sale of Common Stock occurred under Section Error! Reference source not found., (B) the consideration per share at which an issuance or deemed issuance of Common Stock occurred, (C) whether any issuance or sale or deemed issuance or sale of Common Stock was an issuance or sale or deemed issuance or sale of Excluded Securities, (D) whether an agreement, instrument, security or the like constitutes and Option or Convertible Security and (E) whether a Dilutive Issuance occurred) and in resolving such dispute such investment bank shall apply such findings, determinations and the like to the terms of this Warrant and any other applicable Transaction Documents, (iv) the Holder (and only the Holder), in its sole discretion, shall have the right to submit any dispute described in this Section 13 to any state or federal court sitting in The City of New York, Borough of Manhattan in lieu of utilizing the procedures set forth in this Section 13 and (v) nothing in this Section 13 shall limit the Holder from obtaining any injunctive relief or other equitable remedies (including, without limitation, with respect to any matters described in this Section 13). 14. REMEDIES, CHARACTERIZATION, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Warrant shall be cumulative and in addition to all other remedies available under this Warrant and the other Transaction Documents,
at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the right of the Holder to pursue actual and consequential damages for any failure by the Company to comply with the terms of this Warrant. The Company covenants to the Holder that there shall be no characterization concerning this instrument other than as expressly provided herein. Amounts set forth or provided for herein with respect to payments, exercises and the like (and the computation thereof) shall be the amounts to be received by the Holder and shall not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance thereof). The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, the holder of this Warrant shall be entitled, in addition to all other available remedies, to an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other security being required. The Company shall provide all information and documentation to the Holder that is requested by the Holder to enable the Holder to confirm the Company’s compliance with the terms and conditions of this Warrant (including, without limitation, compliance with Section 2 hereof). The issuance of shares and certificates for shares as contemplated hereby upon the exercise of this Warrant shall be made without charge to the Holder or such shares for any issuance tax or other costs in respect thereof, provided that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved in the issuance and delivery of any certificate in a name other than the Holder or its agent on its behalf. 15. PAYMENT OF COLLECTION, ENFORCEMENT AND OTHER COSTS. If (a) this Warrant is placed in the hands of an attorney for collection or enforcement or is collected or enforced through any legal proceeding or the holder otherwise takes action to collect amounts due under this Warrant or to enforce the provisions of this Warrant or (b) there occurs any bankruptcy, reorganization, receivership of the company or other proceedings affecting company creditors’ rights and involving a claim under this Warrant, then the Company shall pay the costs incurred by the Holder for such collection, enforcement or action or in connection with such bankruptcy, reorganization, receivership or other proceeding, including, without limitation, attorneys’ fees and disbursements.
16. TRANSFER. This Warrant may be offered for sale, sold, transferred or assigned without the consent of the Company, except as may otherwise be required by Section 4.18 of the Subscription Agreement.
17. DISCLOSURE. From and after the Public Company Date, upon delivery by the Company to the Holder (or receipt by the Company from the Holder) of any notice in accordance with the terms of this Warrant, unless the Company has in good faith determined that the matters relating to such notice do not constitute material, non-public information relating to the Company or any of its Subsidiaries, the Company shall on or prior to 9:00 am, New York city time on the Business Day immediately following such notice delivery date, publicly disclose such material, non-public information on a Current Report on Form 8-K or otherwise. From and after the Public Company Date, in the event that the Company believes that a notice contains material, non-public information relating to the Company or any of its Subsidiaries, the Company so shall indicate to the Holder explicitly in writing in such notice (or immediately upon receipt of notice from the
Holder, as applicable), and in the absence of any such written indication in such notice (or notification from the Company immediately upon receipt of notice from the Holder), the Holder shall be entitled to presume that information contained in the notice does not constitute material, non-public information relating to the Company or any of its Subsidiaries.
19. ABSENCE OF TRADING AND DISCLOSURE RESTRICTIONS. The Company acknowledges and agrees that the Holder is not a fiduciary or agent of the Company and that the Holder shall have no obligation to (a) maintain the confidentiality of any information provided by the Company or (b) refrain from trading any securities while in possession of such information in the absence of a written non-disclosure agreement signed by an officer of the Holder that explicitly provides for such confidentiality and trading restrictions. In the absence of such an executed, written non-disclosure agreement, the Company acknowledges that the Holder may freely trade in any securities issued by the Company, may possess and use any information provided by the Company in connection with such trading activity, and may disclose any such information to any third party.
20. CERTAIN DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:
(a) “1933 Act” means the Securities Act of 1933, as amended, and the rules and regulations thereunder.
(b) “1934 Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.
(c) “Affiliate” means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by, or is under common control with, such Person, it being understood for purposes of this definition that “control” of a Person means the power directly or indirectly either to vote 10% or more of the stock having ordinary voting power for the election of directors of such Person or direct or cause the direction of the management and policies of such Person whether by contract or otherwise.
(d) “Attribution Parties” means, collectively, the following Persons and entities: (i) any investment vehicle, including, any funds, feeder funds or managed accounts, currently, or from time to time after the Issuance Date, directly or indirectly managed or advised by the Holder’s investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates of the Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with the Holder or any of the foregoing and (iv) any other Persons whose beneficial ownership of the Company’s Common Stock would or could be aggregated with the Holder’s and the other Attribution Parties for purposes of Section 13(d) of the 1934 Act. For clarity, the purpose of the foregoing is to subject collectively the Holder and all other Attribution Parties to the Maximum Percentage.
(e) “Bid Price” means, for any security as of the particular time of determination, the bid price for such security on the Principal Market as reported by Bloomberg as of such time of determination, or, if the Principal Market is not the principal securities exchange or trading market for such security, the bid price of such security on the principal securities exchange or trading
market where such security is listed or traded as reported by Bloomberg as of such time of determination, or if the foregoing does not apply, the bid price of such security in the over-the- counter market on the electronic bulletin board for such security as reported by Bloomberg as of such time of determination, or, if no bid price is reported for such security by Bloomberg as of such time of determination, the average of the bid prices of any market makers for such security as reported in The Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices) as of such time of determination. If the Bid Price cannot be calculated for a security as of the particular time of determination on any of the foregoing bases, the Bid Price of such security as of such time of determination 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 in accordance with the procedures in Section 13. All such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction during such period. (f) “Bloomberg” means Bloomberg, L.P.
(g) “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; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally are open for use by customers on such day.
(h) “Closing Sale Price” means, for any security as of any date, the last closing trade price for such security on 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 trade price, then the last trade 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 trade 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 does not apply, the last trade 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 last trade price is reported for such security by Bloomberg, the average of the ask prices of any market makers for such security as reported in The Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices). If the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Sale 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 in accordance with the procedures in Section 13. All such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction during such period. (i) “Change of Control” means (i) any Fundamental Transaction other than (x) any merger of the Company or any of its, direct or indirect, wholly-owned Subsidiaries with or into
any of the foregoing Persons, (y) any reorganization, recapitalization or reclassification of the Common Stock in which holders of the Company’s voting power immediately prior to such reorganization, recapitalization or reclassification continue after such reorganization, recapitalization or reclassification to hold publicly traded securities and, directly or indirectly, are, in all material respects, the holders of the voting power of the surviving entity (or entities with the authority or voting power to elect the members of the board of directors (or their equivalent if other than a corporation) of such entity or entities) after such reorganization, recapitalization or reclassification, or (z) pursuant to a migratory merger effected solely for the purpose of changing the jurisdiction of incorporation of the Company or any of its Subsidiaries or (ii) any going-private transaction or other similar event or occurrence after which the Common Stock of the Company ceases to be registered under the 1934 Act.
(j) “Common Stock” means (i) the Company’s shares of common stock, $0.0001 par value per share, and (ii) any capital stock into which such common stock shall have been changed or any share capital resulting from a reclassification of such common stock.
(k) “Convertible Securities” means any stock or other security (other than Options) that is at any time and under any circumstances, directly or indirectly, convertible into, exercisable or exchangeable for, or which otherwise entitles the holder thereof to acquire, any shares of Common Stock.
(l) “Eligible Market” means The New York Stock Exchange, the NYSE American, the Nasdaq Global Select Market, the Nasdaq Global Market, the Nasdaq Capital Market.
(m) “Expiration Date” means the date that is the tenth (10th) anniversary of the Issuance Date or, if such date falls on a day other than a Trading Day or on which trading does not take place on the Principal Market (a “Holiday”), the next date that is not a Holiday.
(n) “Fundamental Transaction” means (A) that the Company shall, directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is the surviving corporation) another Subject Entity, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties or assets of the Company or any of its “significant subsidiaries” (as defined in Rule 1-02 of Regulation S-X) to one or more Subject Entities, or (iii) make, or allow one or more Subject Entities to make, or allow the Company to be subject to or have its Common Stock be subject to or party to one or more Subject Entities making, a purchase, tender or exchange offer that is accepted by the holders of at least either (x) 50% of the outstanding shares of Common Stock, (y) 50% of the outstanding shares of Common Stock calculated as if any shares of Common Stock held by all Subject Entities making or party to, or Affiliated with any Subject Entities making or party to, such purchase, tender or exchange offer were not outstanding; or (z) such number of shares of Common Stock such that all Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such purchase, tender or exchange offer, become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50% of the outstanding shares of Common Stock, or (iv) consummate a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with one or more Subject Entities whereby all such Subject Entities, individually or in the aggregate, acquire, either (x) at least 50% of the outstanding shares of
Common Stock, (y) at least 50% of the outstanding shares of Common Stock calculated as if any shares of Common Stock held by all the Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such stock purchase agreement or other business combination were not outstanding; or (z) such number of shares of Common Stock such that the Subject Entities become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50% of the outstanding shares of Common Stock, or (v) reorganize, recapitalize or reclassify its Common Stock, (B) that the Company shall, directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions, allow any Subject Entity individually or the Subject Entities in the aggregate to be or become the “beneficial owner” (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly, whether through acquisition, purchase, assignment, conveyance, tender, tender offer, exchange, reduction in outstanding shares of Common Stock, merger, consolidation, business combination, reorganization, recapitalization, spin-off, scheme of arrangement, reorganization, recapitalization or reclassification or otherwise in any manner whatsoever, of either (x) at least 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock, (y) at least 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock not held by all such Subject Entities as of the date of this Warrant calculated as if any shares of Common Stock held by all such Subject Entities were not outstanding, or (z) a percentage of the aggregate ordinary voting power represented by issued and outstanding shares of Common Stock or other equity securities of the Company sufficient to allow such Subject Entities to effect a statutory short form merger or other transaction requiring other shareholders of the Company to surrender their shares of Common Stock without approval of the shareholders of the Company or (C) directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions, the issuance of or the entering into any other instrument or transaction structured in a manner to circumvent, or that circumvents, the intent of this definition in which case this definition shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this definition to the extent necessary to correct this definition or any portion of this definition which may be defective or inconsistent with the intended treatment of such instrument or transaction.
(o) “Group” means a “group” as that term is used in Section 13(d) of the 1934 Act and as defined in Rule 13d-5 thereunder.
(p) “Options” means any rights, warrants or options to subscribe for or purchase
shares of Common Stock or Convertible Securities.
(q) “Parent Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person and whose common stock or equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person or Parent Entity, the Person or Parent Entity with the largest public market capitalization as of the date of consummation of the Fundamental Transaction.
(r) “Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization, any other entity or a government or any department or agency thereof.
(s) “Public Company Date” means the date on which the shares of Common Stock of the Company (or its direct or indirect successor, subsidiary or parent company, whose securities
are issued or issuable to holders of Common Stock), whether as a result of a public offering, merger, recapitalization, reorganization or otherwise, are registered under the 1934 Act.
(t) “Principal Market” means, as of any date of determination, the principal securities exchange market for the Common Stock as of such date of determination.
(u) “SEC” means the United States Securities and Exchange Commission or the successor thereto.
(v) “Series B Preferred Stock” means (i) the Company’s shares of Series B preferred stock, $0.0001 par value per share, and (ii) any capital stock into which such preferred stock shall have been changed or any share capital resulting from a reclassification of such preferred stock.
(w) “Series B Certificate of Designations” means that certain Certificate of Designations for the Series B Preferred Stock.
(x) “Subject Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
(y) “Trading Day” means, as applicable, (i) prior to the Public Company Date, any Business Day, and (ii) from and after the Public Company Date, (x) with respect to all price or trading volume determinations relating to the Common Stock, any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market is not the principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common Stock is then traded, provided that “Trading Day” shall not include any day on which the Common Stock is scheduled to trade on such exchange or market for less than 4.5 hours or any day that the Common Stock is suspended from trading during the final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time) unless such day is otherwise designated as a Trading Day in writing by the Holder or (y) with respect to all determinations other than price or trading volume determinations relating to the Common Stock, any day on which The New York Stock Exchange (or any successor thereto) is open for trading of securities.
(z) “VWAP” means, for any security as of any date, the dollar volume-weighted average price for such security on the principal trading market for such security, during the period beginning at 9:30 a.m., New York time, and ending at 4:00 p.m., New York time, as reported by Bloomberg through its “VAP” function (set to 09:30 start time and 16:00 end time) or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over- the-counter market on the electronic bulletin board for such security during the period beginning at 9:30 a.m., New York time, and ending at 4:00 p.m., New York time, as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for such security by Bloomberg for such hours, the average of the highest closing bid price and the lowest closing ask price of any of the market makers for such security as reported in The Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices). If the VWAP cannot be calculated for such security on such date on any of the foregoing bases, the VWAP 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 in accordance with the procedures in Section 13. All such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination, recapitalization or other similar transaction during such period. [signature page follows]
IN WITNESS WHEREOF, the Company has caused this Warrant to Purchase Common Stock to be duly executed as of the Issuance Date set out above.
| | | | | | | | | | | | | | | | | |
| | | VOYAGER SPACE HOLDINGS, INC. | |
| | | | | |
| | | | | |
| | | | | |
| | | By: | /s/ Matthew Kuta | |
| | | | Name: Matthew Kuta | |
| | | | Title: President | |
| | | | | |
| Acknowledged and Agreed | | | | |
| | | | | |
| WALLEYE OPPORTUNITIES MASTER FUND, LTD. | |
| | | | | |
| | | | | |
| By: | /s/ William England | | | | |
| Name: William England | | | | |
| Title: Chief Executive Officer | | | | |
EXHIBIT A
EXERCISE NOTICE
TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS
WARRANT TO PURCHASE COMMON STOCK
VOYAGER SPACE HOLDINGS, INC.
The undersigned holder hereby elects to exercise the Warrant to Purchase Common Stock No. _______ (the “Warrant”) of Voyager Space Holdings, Inc., a Delaware corporation (the “Company”) as specified below. Capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Warrant.
1. Form of Exercise Price. The Holder intends that payment of the Aggregate Exercise Price shall be made as:
☐ a “Cash Exercise” with respect to ________________ Warrant Shares; and/or
☐ a “Cashless Exercise” with respect to _______________ Warrant Shares.
In the event that the Holder has elected a Cashless Exercise with respect to some or all of the Warrant Shares to be issued pursuant hereto, the Holder hereby represents and warrants that (i) this Exercise Notice was executed by the Holder at ___________ [a.m.][p.m.] on the date set forth below and (ii) if applicable, the Bid Price as of such time of execution of this Exercise Notice was $_________.
2. Payment of Exercise Price. In the event that the Holder has elected a Cash Exercise with respect to some or all of the Warrant Shares to be issued pursuant hereto, the Holder shall pay the Aggregate Exercise Price in the sum of $_____________________ to the Company in accordance with the terms of the Warrant.
3. Delivery of Warrant Shares. The Company shall deliver to Holder, or its designee or agent as specified below, ___________ shares of Common Stock in accordance with the terms of the Warrant. Delivery shall be made to Holder, or for its benefit, as follows:
☐ Check here if requesting delivery as a certificate to the following name and to the following address:
☐ Check here if after the Public Company Date and requesting delivery by Deposit/Withdrawal at Custodian as follows:
| | | | | | | | |
| DTC Participant: | |
| | |
| DTC Number: | |
| | |
| Account Number: | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Date: | | | | , | | |
| |
| Name of Registered Holder | |
| | | | | | | |
| By: | | | |
| Name: | | | | |
| Title: | | | | |
EXHIBIT B
ACKNOWLEDGMENT
The Company hereby acknowledges this Exercise Notice [INSERT AFTER PUBLIC COMPANY DATE: and hereby directs __________________ to issue the above indicated number of shares of Common Stock].
| | | | | | | | | | | | | | | | | | | | |
| | | VOYAGER SPACE HOLDINGS, INC. | |
| | | | | | |
| | | | | | |
| | | | | | |
| | | By: | | | |
| | | | Name: | |
| | | | Title: | |
THIS CONVERTIBLE PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. NO SALE OR DISPOSITION MAY BE EFFECTED EXCEPT IN COMPLIANCE WITH RULE 144 UNDER SAID ACT OR AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL FOR THE LENDERS, SATISFACTORY TO BORROWER, THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE ACT OR RECEIPT OF A NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION.
STARLAB SPACE LLC
CONVERTIBLE PROMISSORY NOTE
For Value Received, Starlab Space LLC, a Delaware limited liability company ("Borrower"), hereby unconditionally promises to pay to the order of Helios Holdings XXI a series of Helios Holdings Master LLC, a Delaware limited liability company with its address at 216 Ashworth Street, West Palm Beach, Florida 33405 ("Lender"), in lawful money of the United States of America and in immediately available funds, the principal sum of $3,595,900 (the "Note") together with accrued and unpaid interest thereon, each due and payable on the dates, in the manner, and subject to the terms and conditions set forth below.
This Note is one of a series of similar Notes (collectively, the "Notes") executed and delivered in connection with that certain Convertible Promissory Note Purchase Agreement, dated as of June 3, 2024, and executed by Borrower and Lender, among others (the "Purchase Agreement"). For purposes hereof, the term "Lenders" means (as the context requires) more than one of the holders of the Notes or all the holders of the Notes collectively, and the term "Majority in Interest of the Lenders" means one or more Lenders holding Notes with an aggregate principal amount greater than 50% of the aggregate principal amount of all the Notes then outstanding purchased pursuant to the Purchase Agreement.
1. Maturity and Conversion.
(a) Maturity; Prepayment. Unless this Note has been (i) converted in accordance with the terms of this Section 1 or (ii) repaid, the outstanding principal balance of this Note and all accrued and unpaid interest thereon will mature on the 36-month anniversary of the date hereof (the "Maturity Date"), provided, however, that the Maturity Date may be extended upon the written approval of a Majority in Interest of the Lenders and Borrower. Borrower may prepay the Note without penalty at any time with the prior written consent of a Majority in Interest of the Lenders and the Borrower.
(b) New Securities Conversion upon a Qualified Financing. In the event that (i) Borrower issues and sells units of any class or series of equity securities (the "New Securities") to one or more investors including any of the Lenders (the "Investors") in a bona fide arms' length transaction or series of related transactions with the principal purpose of raising capital either (A) that results in aggregate gross proceeds to Borrower of at least $10,000,000, excluding the amount represented by the conversion of any outstanding indebtedness, including the Notes,
in accordance with their respective terms (a "Qualified Financing"), or (B) in a financing that is not a Qualified Financing but in which Lender elects to convert such Note ((A) or (B) a "Subsequent Financing"), and (ii) the Note has not been paid in full, then the outstanding principal balance of this Note and all accrued and unpaid interest thereon shall automatically convert in whole without any further action by Lender into the number of Conversion Units equal to (1) the outstanding principal balance of this Note and all accrued and unpaid interest due on the Note on the date of conversion, divided by (2) 85% of the price per unit paid by the Investors to purchase the New Securities in the Subsequent Financing. For purposes of this Note, the term "Conversion Units" means the same class and series of units as sold to the Investors in the Subsequent Financing, other than with respect to the per unit liquidation preference, which will equal the conversion price (as described herein), with corresponding adjustments to any price-based anti-dilution protection and dividend rights provisions, which will be based on such conversion price. Subject to the provisions of Section 6 of the Purchase Agreement, such issuance of Conversion Units pursuant to this Section 1(b) will be completed pursuant to the same terms and conditions as given to the Investors in such Subsequent Financing. For the avoidance of doubt, New Securities shall not include the Company’s units, or other equity securities that are convertible into, or exercisable for, such units, that are granted, issued and/or sold by the Company (i) to any director, officer, employee, advisor or consultant of the Company in such capacity for the primary purpose of soliciting or retaining their services, (ii) to banks, equipment lessors, financial institutions or other persons engaged in the business of making loans pursuant to a debt financing or commercial leasing arrangement, (iii) to suppliers or third-party service providers in connection with the provision of goods or services, (iv) in connection with sponsored research, collaboration, technology license, development, OEM, marketing or other similar agreements or strategic partnerships, or (v) to any strategic corporate partner (and its affiliates).
(c) Conversion Upon a Liquidity Event. In the event that prior to the Maturity Date there is (i) a Liquidity Event, and (ii) the Note has not been paid in full or converted as provided above, then the outstanding principal balance of this Note and all accrued and unpaid interest thereon shall be converted into the number of Borrower's Class A-1 Units equal to (a) the outstanding principal balance of this Note and all accrued and unpaid interest due on the Note as of immediately prior to the closing of the Liquidity Event, divided by (b) 85% of the price per Class A-1 Unit in connection with such Liquidity Event (based on a fully-diluted capitalization assuming the full exercise or conversion of all exercisable or convertible securities then outstanding other than the Notes). If the Note is converted for Class A-1 Units pursuant to this Section 1(c), such units shall have the same rights, preferences, and privileges as the Class A-1 Units. Borrower shall provide Lender ten days' prior written notice of the closing of a Liquidity Event. "Liquidity Event" means (x) a consolidation or merger of Borrower with or into any other corporation or other entity or person, or any other corporate reorganization or transaction, in which the stockholders of Borrower immediately prior to such consolidation, merger or reorganization, own less than 50% of the voting power of the surviving entity immediately after such consolidation, merger or reorganization, (y) a sale, lease, conveyance, exclusive license or other disposition by Borrower of all or substantially all of its assets or (z) the closing of Borrower's first firm commitment underwritten public offering of common units (or any successor or replacement equity thereto) registered under the Securities Act of 1933, as amended.
(d) Conversion Upon the Maturity Date. In the event that, at the Maturity Date, the Note has not been paid in full or converted as provided above, then the outstanding principal balance of the Note and all accrued and unpaid interest thereon shall convert into the number of Class A-1 Units equal to (a) the outstanding principal balance of this Note and all accrued and unpaid interest due on the Note as of immediately prior to the closing of the Maturity Date, divided by (b) 85% of the then-current price per Class A-1 Unit.
(e) Interest on Note. Notwithstanding the terms of Sections 1(b), 1(c) and 1(d), above, at any time when the Note is being converted into equity of the Borrower pursuant to this Section 1, Borrower may, at its option and upon notice to Lender, choose to pay all or any amount of the accrued but unpaid interest on the Note in cash on the date of conversion.
2. Mechanics of Conversion. Upon the occurrence of the event specified in Section 1(b) or 1(d) as applicable, this Note shall be converted automatically without any further action by Lender and whether or not this Note is surrendered to Borrower or its transfer agent; provided, however, that Borrower shall not be obligated to issue certificates evidencing the units of the New Securities or Class A-1 Units issuable upon such conversion unless its Board so determines. In no event shall Borrower be required to issue any authorized certificates representing the units of New Securities or Class A-1 Units unless this Note is either delivered to Borrower or its transfer agent as provided below, or Lender notifies Borrower or its transfer agent in writing that this Note has been lost, stolen or destroyed and executes an agreement satisfactory to Borrower to indemnify Borrower from any loss incurred by it in connection with such Note. Upon the occurrence of such automatic conversion, Lender shall surrender the Note at the office of Borrower or any transfer agent for the units of the New Securities. Thereupon, if the Board has authorized certificates for such units, there shall be issued and delivered to Lender, at such office and in its name as shown on such surrendered Note, a certificate for the number of units of New Securities or Class A-1 Units as applicable into which the Note was convertible on the date on which such automatic conversion occurred. Upon the occurrence of an event specified in Section 1(c)(2), this Note shall be converted only upon the delivery by Lender to the office of Borrower or its transfer agent of (i) this Note or (ii) written notification that this Note has been lost, stolen or destroyed and the subsequent execution of an agreement satisfactory to Borrower indemnifying Borrower from any loss incurred by it in connection with such Note. Thereupon, if the Board has authorized certificates for such units, there shall be issued and delivered to Lender, at such office and in its name as shown on such Note, a certificate for the number of Class A-1 Units into which the Note was convertible on the date on which such delivery occurred.
3. Fractional Units. No fractional unit shall be issued upon the conversion of this Note. All units issuable upon conversion of the outstanding amount of this Note shall be aggregated for purposes of determining whether the conversion would result in the issuance of any fractional unit. If, after the aforementioned aggregation, the conversion would result in the issuance of a fraction of a unit of New Securities or Class A-1 Units, Borrower shall, in lieu of issuing any fractional unit, pay Lender who is otherwise entitled to such fraction a sum in cash equal to the fair market value of such fraction on the date of conversion (as determined in good faith by the Board of Directors of Borrower).
4. Interest. The principal balance of this Note shall bear simple interest at the rate of five percent (5.0%) per annum. Interest shall be calculated on the basis of a 365 day year for the actual number of days elapsed. Interest shall commence with the date hereof and shall continue on the outstanding principal balance hereof until paid in full or converted.
5. Payments. All payments of principal and interest shall be in lawful money of the United States of America and shall be payable at the address set forth in the opening paragraph of this Note unless another place of payment shall be specified in writing by Lender. Payment on this Note shall be applied first to accrued interest, and thereafter to the outstanding principal balance hereof. If any payments on this Note become due on a Saturday, Sunday, or a public holiday under the laws of the State of Delaware, such payment shall be made on the next succeeding business day and such extension of time shall be included in computing interest in connection with such payment.
6. Default. Each of the following events shall be an "Event of Default" hereunder:
(a) Borrower fails to pay timely any of the principal amount due under this Note on the date the same becomes due and payable or any accrued interest or other amounts due under this Note on the date the same becomes due and payable;
(b) Borrower engages in any liquidation, dissolution, winding up of Borrower;
(c) Borrower files any petition or action for relief under any bankruptcy, reorganization, insolvency or moratorium law or any other law for the relief of, or relating to, debtors, now or hereafter in effect, or makes any assignment for the benefit of creditors or takes any corporate action in furtherance of any of the foregoing;
(d) An involuntary petition is filed against Borrower under any bankruptcy statute now or hereafter in effect, and such petition is not dismissed or discharged within 60 days, or a custodian, receiver, trustee, assignee for the benefit of creditors (or other similar official) is appointed to take possession, custody or control of any property of Borrower; and
(e) Borrower breaches any warranty or agreement made by Borrower in this Note in any material respect (except as provided in subsection (a) above) and, as to any such breach that is capable of cure, Borrower fails to cure such breach within 30 days after Borrower has been provided with written notice of such breach.
7. Remedies. Upon the occurrence and during the continuance of any Event of Default, the outstanding principal balance of this Note and all accrued and unpaid interest thereon shall, all at the option of Lender, upon notice to Borrower (except that no such election by Lender and notice to Borrower shall be required in the case of an Event of Default of the type specified in Sections 6(c) or (d)), automatically be immediately due, payable and collectible by Lender pursuant to applicable law.
8. Cumulative Remedies. The Lenders' rights and remedies under this Note and the other Notes shall be cumulative. The Lenders shall have all other rights and remedies not inconsistent herewith as provided under the Uniform Commercial Code, by law or in equity. No
exercise by the Lenders of one right or remedy shall be deemed an election, and no waiver by the Lenders of any Event of Default shall be deemed a continuing waiver.
9. Creditor's Rights. Borrower waives presentment and demand for payment, notice of dishonor, protest and notice of protest of this Note. Borrower hereby acknowledges that Lender shall be entitled to recover, and the undersigned agrees to pay when incurred, all reasonable costs and expenses of collection of this Note, including without limitation, reasonable attorneys' fees. The right to plead any and all statutes of limitations as a defense to any demands hereunder is hereby waived to the full extent permitted by law. Borrower consents irrevocably to personal jurisdiction in the state and federal courts located in Denver, Colorado for the resolution of any disputes with Lender arising hereunder or relating hereto.
10. Usury. In no event shall the interest rate or rates payable under this Note, plus any other amounts paid in connection herewith and therewith, exceed the highest rate permissible under any law that a court of competent jurisdiction shall, in a final determination, deem applicable. Borrower and Lender, in executing and delivering this Note and the Purchase Agreement, intend legally to agree upon the rate or rates of interest and manner of payment stated within it; provided, however, that, anything contained herein to the contrary notwithstanding, if said rate or rates of interest or manner of payment exceeds the maximum allowable under applicable law, then, ipso facto, as of the date of this Note, Borrower is and shall be liable only for the payment of such maximum as allowed by law, and payment received from Borrower in excess of such legal maximum, whenever received, shall be applied to reduce the principal balance of any remaining obligations to the extent of such excess.
11. Governing Law. This Note shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, excluding conflict of laws principles that would cause the application of laws of any other jurisdiction.
12. Amendment and Waiver. Any provision of this Note may be amended or waived in a writing signed by both Borrower and a Majority in Interest of the Lenders and such amendment or waiver shall be binding on all Lenders.
13. Successors and Assigns. The provisions of this Note shall inure to the benefit of and be binding on any successor to Borrower and shall extend to Lender hereof.
14. Transfers. Any transfer of this Note must comply with the provisions of Section 6 of the Purchase Agreement. This Note may be transferred only upon its surrender to Borrower for registration of transfer, duly endorsed, or accompanied by a duly executed written instrument of transfer in form satisfactory to Borrower. Thereupon, this Note shall be reissued to, and registered in the name of, the transferee, or a new Note for like principal amount and interest shall be issued to, and registered in the name of, the transferee. Interest and principal shall be paid solely to the registered holder of this Note. Such payment shall constitute full discharge of Borrower's obligation to pay such interest and principal.
[Signature page follows.]
The parties have executed this Note as of the date first above written.
| | | | | | | | |
| BORROWER: |
| | |
| STARLAB SPACE LLC |
| | |
| | |
| | |
| By: | /s/ Thomas E. Ayres |
| Name: Thomas E. Ayres |
| Title: Chief Legal Officer and General Counsel |
AMENDED AND RESTATED PROMISSORY NOTE
Dated: [___]
$[___](US)
THIS AMENDED AND RESTATED PROMISSORY NOTE (this “Promissory Note” amends and restates in its entirety that certain Promissory Note made by Voyager Space Holdings, Inc. in favor of [___], dated as of [___].
FOR VALUE RECEIVED, Voyager Space Holdings, Inc., a Delaware corporation (“Maker”) promises to pay to [___], (“Payee”) the principal amount of [___] ($[___](US)) (the “Principal Amount”), together with interest thereon from the date hereof until the date fully paid, at a rate of interest equal to the Interest Rate (as hereinafter defined). Principal of and interest on this Promissory Note shall be payable in full on [___] (the “Maturity Date”) or such other earlier date if the Maker completes a Qualified Transaction on or before [___], then the Maker shall pay all principal and accrued interest outstanding under this Promissory Note either in cash or Maker Shares, the form of such payment to be determined at the option of the Maker. Subject to the terms and conditions below, all payments of principal and interest hereunder shall be made in shares of common stock of the Maker (“Maker Shares”) issued to the Payee.
As used herein, the term “Qualified Transaction” shall mean: 1) an initial public offering of its capital stock on a major U.S. stock exchange raising at least $25 million in gross proceeds (a “Qualified IPO”) or 2) either of the following: (a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended), other than the Payee (or any “group” including the Payee), is or becomes the beneficial owner, directly or indirectly, of more than 50% of the total outstanding equity interests of the Maker; or (b) the Maker transfers all or substantially all of its assets to any person other than the Maker or an affiliate of the Maker (each a “Qualified Acquisition”).
This Promissory Note is being entered into in connection with that certain Stock Transfer Agreement, of even date herewith, by and between Maker and Payee (the “Stock Transfer Agreement”). All capitalized terms used herein and not otherwise defined shall have the meanings given to them in the Stock Transfer Agreement.
The amounts outstanding under this Promissory Note shall bear interest at a rate (the “Interest Rate”) per annum equal to the Prime Rate. For each calendar quarter, or portion thereof, the Interest Rate for such calendar quarter shall be the Prime Rate in effect as of the last day of the immediately preceding calendar quarter. As used herein, the “Prime Rate” shall mean, at any time, the rate of interest noted in The Wall Street Journal, Money Rates section, as the “Prime Rate”. In the event that The Wall Street Journal quotes more than one rate, or a range of rates, as the Prime Rate, then the Prime Rate shall mean the average of the quoted rates. In the event that The Wall Street Journal ceases to publish a Prime Rate, then the Prime Rate shall be the average of the prime rate or base rate announced by the three (3) largest U.S. money center commercial banks, as determined by the Payee.
If the Maker completes a Qualified Transaction on or before [___] the Maker Shares shall be valued at a price per share equal to the price per share received in the Qualified IPO or the price per share payable by the acquirer in the Qualifying Acquisition, as applicable.
On the Maturity Date and if no Qualified Transaction has occurred, the Maker shall pay all principal and accrued interest outstanding under this Promissory Note either in cash or Maker Shares, the form of such payment to be determined at the option of the Maker. For purposes of this payment the Maker Shares shall be valued at a price per share equal to the most recent priced private round of the Maker.
Upon any payment as set forth above, Payee shall surrender this Promissory Note at the principal business office of Maker. Thereupon, if payment was made in the form of Maker Shares, Maker shall take such action as is required to record and issue the shares of its common stock to Payee on the date on which such payment occurred.
Time is of the essence hereof. In the event of any default in any payment of the principal of or interest on this Promissory Note when due and payable as hereinabove provided or any other default or event of default hereunder, then the entire principal sum of and interest on this Promissory Note and all other obligations of Maker to Payee, direct or indirect, absolute or contingent, now existing or hereafter arising, shall, at the option of Payee, become immediately due and payable without notice or demand, and whether or not such option has been exercised, the outstanding principal balance of this Promissory Note shall thereafter bear interest at a rate of interest equal to (a) the Interest Rate plus (b) two percent (2.00%) per annum above the Interest Rate from the date of such default until such outstanding principal balance and such accrued interest and all such other obligations are paid in full.
It is not intended hereby to charge interest at a rate in excess of the maximum rate of interest that Payee may charge to Maker under applicable usury and other laws, but if, notwithstanding the above, interest in excess of such rate shall be paid hereunder, the excess shall be retained by the holder of this Promissory Note as additional cash collateral for the payment of the indebtedness evidenced hereby, unless such retention is not permitted by law, in which case the interest rate on this Promissory Note shall be adjusted to the maximum permitted under applicable law during the period or periods that the interest rate otherwise provided herein would exceed such rate.
If Maker fails to pay any amount due under this Promissory Note, or Payee has to take any action to collect the amount due or to exercise its rights hereunder, including, without limitation, retaining attorneys for collection of this Promissory Note, or if any suit or proceeding is brought for the recovery of all or any part of Maker’s obligations hereunder, then Maker agrees to pay on demand all reasonable costs and expenses of any such action, exercise, suit or proceeding, or any appeal of any such suit or proceeding, incurred by Payee, including, but not limited to, the reasonable fees and disbursements of Payee’s attorneys and their staff.
Maker hereby waives presentment, demand for payment, notice of nonpayment, notice of acceleration, protest, notice of protest and notice of dishonor, and all other notices in connection herewith, as well as filing of suit (if permitted by law) and diligence in collecting this Promissory Note, and assents to any extension of time with respect to any payment due under this
Promissory Note, to any substitution or release of collateral (if any) and to the addition or release of any party.
MAKER AND PAYEE EACH HEREBY UNCONDITIONALLY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS PROMISSORY NOTE, ANY OF THE RELATED DOCUMENTS OR ANY DEALINGS BETWEEN MAKER AND PAYEE RELATING TO THE SUBJECT MATTER OF THIS TRANSACTION. IN THE EVENT OF LITIGATION, THIS PROMISSORY NOTE MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
If any provision in this Promissory Note is held invalid, illegal or unenforceable in any jurisdiction, the validity, legality or enforceability of any other provision shall not be in any way affected or impaired in such jurisdiction, and any defective provision shall not be in any way affected or impaired in any other jurisdiction. No delay or failure of Payee in the exercise of any right or remedy provided for hereunder shall be deemed a waiver of such right or remedy by Payee, and no exercise of any right or remedy shall be deemed a waiver of any other right or remedy that Payee might have.
[Remainder of page left blank]
This Promissory Note is to be governed by and construed in accordance with the laws of the State of Delaware, without application of any conflict of law provision thereof.
| | | | | | | | | | | |
| MAKER: | |
| | | |
| Voyager Space Holdings, Inc., a Delaware corporation |
| | | |
| | | |
| By: | | |
| | | |
| Name: | | |
| | | |
| Title: | | |
| | | | | | | | |
Payee hereby acknowledges and agrees to the terms herein as of the date first written above: |
| | |
| | |
| | |
| | |
| By: | | |
| | |
| | |
| By: |
| |
| | |
Subsidiaries of Voyager Technologies, Inc.
| | | | | |
| Legal Name | Jurisdiction of Formation |
| Altius Space Machines, Inc. | Colorado |
| DreamUp PBC | Delaware |
| LeoCloud, Inc. | Virginia |
| Nanoracks Space Outpost Europe, S.r.l. | Italy |
| Nanoracks UK | United Kingdom |
| Nanoracks, LLC | Nevada |
| Optical Physics Company, Inc. | Nevada |
| Pioneer Invention, LLC | Colorado |
| Space Micro, Inc. | Delaware |
| Starlab Space, LLC | Delaware |
| The Launch Company, LLC | Alaska |
| Valley Tech Systems, Inc. | California |
| Voyager Space IP Holdings, LLC | Delaware |
| Voyager Space IPX, LLC | Delaware |
| Voyager Space Science Park, LLC | Ohio |
| Voyager Space Services, LLC | Delaware |
| Voyager Space Exploration, LLC | Delaware |
| Voyager Ventures, LLC | Delaware |
| Voyager Workforce, LLC | Delaware |
| XO Airlock, LLC | Delaware |
| XO Markets Holdings, Inc. | Delaware |
| ZIN Aerospace, Inc. | Delaware |
| ZIN Technologies, Inc. | Delaware |
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the use in this Amendment No. 1 to the Registration Statement on Form S-1 of Voyager Technologies, Inc. of our report dated March 20, 2025, except for the effects of the stock split discussed in Note 2 to the consolidated financial statements, as to which the date is June 2, 2025, relating to the financial statements of Voyager Technologies, Inc., which appears in this Registration Statement. We also consent to the reference to us under the heading “Experts” in such Registration Statement.
/s/ PricewaterhouseCoopers LLP
Denver, Colorado
June 2, 2025
