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ARTICLES OF AMENDMENT
of
SPACEHAB, INCORPORATED
______________________________
pursuant to Chapter 10 of the
Washington Business Corporation Act
______________________________
SPACEHAB, Incorporated, (the "Corporation"), a corporation organized and
existing under and by virtue of the Washington Business Corporation Act, as
amended, (the "WBCA"), hereby certifies that:
1. The name of the corporation is SPACEHAB, Incorporated.
2. ARTICLE FOURTH of the Articles of Incorporation of the Corporation are
amended to read as follows:
FOURTH: The total number of shares of capital stock which the
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Corporation shall have authority to issue is 32,500,000 shares, consisting of
30,000,000 shares of common stock, no par value per share (the "Common Stock")
and 2,500,000 shares of preferred stock, no par value per share (the "Preferred
Stock").
3. These Articles of Amendment were duly approved by the shareholders of
the Corporation on October 14, 1999 in accordance with the provisions of WBCA
23B.10.030 and 23B.10.040.
4. The manner in which the amendment to ARTICLE FOURTH effects a change
in authorized capital stock is to increase the number of shares of authorized
Preferred Stock.
These Articles of Amendment are executed by the Corporation by its
duly authorized officer.
DATED: October 14, 1999
SPACEHAB, INCORPORATED
By: /s/ Shelley A. Harrison
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Shelley A. Harrison
Chairman of the Board and
Chief Executive Officer
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DESIGNATION OF RIGHTS, TERMS AND PREFERENCES
OF
ADDITIONAL SHARES OF
SERIES B SENIOR CONVERTIBLE PREFERRED STOCK
OF
SPACEHAB, INCORPORATED
(Pursuant to Chapter 6 of the
Washington Business Corporation Act)
Spacehab, Incorporated, a corporation organized and existing under the
Business Corporation Act of the State of Washington (hereinafter called the
"Corporation"), hereby certifies that the following resolution was adopted by
the Board of Directors of the Corporation as required by Chapter 6 of the
Business Corporation Act at a meeting duly called and held on August 26, 1999:
RESOLVED, that pursuant to the authority granted to and vested in the
Board of Directors of this Corporation (hereinafter called the "Board of
Directors" or the "Board") in accordance with the provisions of the
Articles of Incorporation, the Board of Directors hereby designates
additional shares of Series B Preferred Stock of the Corporation, no par
value per share (the "Preferred Stock"), as follows:
Series B Senior Convertible Preferred Stock:
Section 1. Designation and Amount. The shares of such series shall be
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designated as "Series B Senior Convertible Preferred Stock" (the "Series B
Preferred Stock"). The number of existing and outstanding shares of Series B
Preferred Stock is Nine Hundred Seventy-Five Thousand (975,000) and the number
of additional shares of Series B Preferred Stock shall be Three Hundred Fifty-
Eight Thousand Three Hundred Thirty-Four (358,334). As a result, the total
number of shares of Series B Preferred Stock shall be One Million Three Hundred
Thirty-Three Thousand Three Hundred Thirty-Four (1,333,334). Such number of
shares may be decreased by resolution of the Board of Directors; provided that
no decrease shall reduce the number of shares of Series B Preferred Stock to a
number less than the number of shares then outstanding.
Section 2. Dividends. The holders of the Series B Preferred Stock shall
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been titled to receive, out of funds legally available therefor, such dividends
with respect to the shares of Series B Preferred Stock as may be declared by the
Board of Directors. In addition, when and if the Board of Directors shall
declare a dividend payable with respect to the then outstanding shares of Common
Stock, no par value per share ("Common Stock") of the Corporation, each holder
of Series B Preferred Stock shall be entitled to the amount of dividends as
would be payable on the largest number of whole shares of
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Common Stock into which shares of Series B Preferred Stock held by such holder
could then be converted pursuant to Section 5 hereof (such number to be
determined as of the record date for the determination of holders of Common
Stock entitled to receive such dividend). Dividends shall not be declared or
paid to holders of Common Stock unless and until the Corporation shall
simultaneously declare and pay to holders of Series B Preferred Stock the
dividend referred to in the preceding sentence.
Section 3. Liquidation, Dissolution or Winding Up; Certain Mergers,
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Consolidations and Asset Sales.
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a. In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, the holders of shares of Series B
Preferred Stock then outstanding shall be entitled to be paid out of the assets
of the Corporation available for distribution to its stockholders, before any
payment shall be made to the holders of Common Stock or any other class or
series of stock ranking on liquidation junior to the Series B Preferred Stock
(the Common Stock and any other class or series of stock ranking on liquidation
junior to the Series B Preferred Stock, including without limitation, the Series
A Junior Participating Preferred Stock of the Corporation, being collectively
referred to as "Junior Stock") by reason of their ownership thereof, an amount
equal to Nine Dollars ($9.00) for each outstanding share of Series B Preferred
Stock (the "Series B Original Issue Price")(subject to appropriate adjustment in
the event of any stock dividend, stock split, combination or other similar
recapitalization affecting such shares) plus (ii) any dividends declared or
accrued but unpaid thereon. If upon any such liquidation, dissolution or winding
up of the Corporation, the remaining assets of the Corporation available for
distribution to its stockholders shall be insufficient to pay the holders of
shares of Series B Preferred Stock the full amount to which they shall be
entitled, the holders of shares of Series B Preferred Stock and any class or
series of stock ranking on liquidation on a parity with the Series B Preferred
Stock shall share ratably (based upon the sum of each series respective Original
Issue Price plus accrued but unpaid dividends) in any distribution of the
remaining assets and funds of the Corporation in proportion to the respective
amounts which would otherwise be payable in respect of the shares held by them
upon such distribution if all amounts payable on or with respect to such shares
were paid in full.
b. After the payment of all preferential amounts required to be
paid to the holders of Series B Preferred Stock and any other class or series of
stock of the Corporation ranking on liquidation on a parity with the Series B
Preferred Stock upon the dissolution, liquidation or winding up of the
Corporation, the holders of shares of Junior Stock then outstanding shall be
entitled to receive the remaining assets and funds of the Corporation available
for distribution to its stockholders.
c. The consolidation or merger of the Corporation into or with any
other entity or entities which results in the exchange of outstanding shares of
the Corporation for securities or other consideration issued or paid or caused
to be issued or paid by any such entity or affiliate thereof, and the sale or
transfer by the Corporation of all or substantially all its assets, shall be
deemed to be a liquidation, dissolution or winding up of the Corporation within
the meaning of the provisions of this Section 3, but
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only for the purposes of the redemption of such Series B Preferred Stock, and
only if so elected by the holders of a majority of the outstanding shares of
Series B Preferred Stock, in their sole discretion.
Section 4. Voting.
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a. Each holder of outstanding shares of Series B Preferred Stock
shall be entitled to the number of votes equal to the number of whole shares of
Common Stock into which the shares of Series B Preferred Stock held by such
holder are then convertible (as adjusted from time to time pursuant to Section 5
hereof), at each meeting of stockholders of the Corporation (and written actions
of stockholders in lieu of meetings) with respect to any and all matters
presented to the stockholders of the Corporation for their action or
consideration. Except as provided by law, or by the provisions of Subsections
4(b), 4(c) and 4(d) below, holders of Series B Preferred Stock shall vote
together with the holders of Common Stock, as a single class.
b. For so long as (i) any shares of Series B Preferred Stock
remain outstanding and (ii) any holder thereof is a Qualified Holder (as defined
in the Preferred Stock Purchase Agreement (the "Purchase Agreement") dated as of
August 2, 1999 between the Corporation and Daimler Chrysler Aerospace AG
("DASA")), the Series B Preferred Stock (voting as a class) will elect one of
the Directors (the "Preferred Director") and the Common Stock (voting as a
class) will elect the remaining Directors. The Preferred Director shall be
included as a member of the Executive Committee of the Board. If at any time
Series B Preferred Stock issued remains outstanding but there is no Qualified
Holder, all of the Directors will be elected by the Series B Preferred Stock and
Common Stock voting together as one class. This Section 4(b) shall not affect or
limit provisions of Section 8.1 of the Purchase Agreement as to the right of a
Qualified Holder to designate a nominee for election to the Board (and for such
designee, if elected by the shareholders, to serve on the Executive Committee of
the Board), which provisions may remain applicable notwithstanding there not
being any shares of Series B Preferred Stock outstanding.
c. Any Preferred Director may be removed at any time, by the
vote of the holders of more than fifty percent (50%) of all of the then
outstanding shares of Series B Preferred Stock, voting as a separate class in
person or by proxy at a special meeting of stockholders called for such purpose
(or at any adjournment thereof) by holders of at least twenty percent (20%) of
the outstanding shares of Series B Preferred Stock or at any annual meeting of
stockholders, or by written consent delivered to the Secretary of the
Corporation, and no Preferred Director may be removed at any time without the
affirmative vote or consent of the holders of more than fifty percent (50%) of
all of the outstanding shares of Series B Preferred Stock. Any vacancy created
by the removal, death or resignation of a Preferred Director may be filled by
the holders of more than fifty percent (50%) of all of the outstanding shares of
Series B Preferred Stock by vote in person or by proxy at a special meeting of
stockholders of the Corporation called for such purpose by holders of at least
twenty percent (20%) of the outstanding shares of Series B Preferred Stock, or
at any annual meeting, or by written consent delivered to the Secretary of the
Corporation.
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d. So long as any shares of the Series B Preferred Stock remain
outstanding, unless the vote or consent of the holders of a greater number of
shares shall then be required by law, the affirmative vote or consent of the
holders of more than fifty percent (50%) of all of the shares of Series B
Preferred Stock at the time outstanding, voting separately as a class, given in
person or by proxy either in writing (as may be permitted by law and the
Articles of Incorporation and By-laws of the Corporation) or at any special or
annual meeting, shall be necessary to permit, effect or validate the taking of
any of the following actions by the Corporation:
(i) create, authorize, issue or sell (i) any class or
series of capital stock ranking prior to or on parity with the Series B
Preferred Stock as to dividends or upon liquidation, dissolution or winding
up; provided, however, that holders of Common Stock may receive dividends
to the extent provided by Section 2 above and, provided further, that the
consent to issuance of any class or series of capital stock ranking on
parity with the Series B Preferred Stock shall not be unreasonably
withheld; or (ii) any rights, options or other securities convertible,
exercisable or exchangeable for or into, or having rights to purchase, any
shares of capital stock described in clause (i) hereof; or
(ii) amend the Articles of Incorporation or By-laws of the
Corporation, or in any other manner alter or change the powers, rights,
privileges or preferences of the Series B Preferred Stock, if such
amendment or action would alter, change or affect adversely the powers,
rights, privileges or preferences of the holders of the Series B Preferred
Stock; or
(iii) increase the number of shares of Series B Preferred
Stock authorized for issuance above 1,333,334 shares; or
(iv) at any time after the initial issuance date of the
Series B Preferred Stock, issue any shares of Series B Preferred Stock,
except (i) issuances pursuant to the Purchase Agreement, or (ii) issuances
of share certificates upon transfers or exchanges of shares by holders
(other than the Corporation) or in replacement of lost, stolen, damaged or
mutilated share certificates;
Section 5. Optional Conversion. The holders of the Series B Preferred
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Stock shall each have conversion rights as follows (the "Conversion Rights"):
a. Right to Convert. Shares of Series B Preferred Stock shall be
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convertible, at the option of the holder thereof, at any time and from time to
time, and without the payment of additional consideration by the holder thereof,
into such number of fully paid and nonassessable shares of Common Stock as is
determined by dividing the aggregate Series B Original Issue Price of the Shares
of Series B Preferred Stock being converted by the Series B Conversion Price in
effect at the time of conversion or such share. The initial "Series B Conversion
Price" shall be Nine Dollars ($9.00), subject to adjustment as provided below.
For purposes of this Section 5, "Original Issue Date" shall mean, for the Series
B Preferred Stock, the date on which the first share of Series B Preferred Stock
was issued.
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In the event of a liquidation of the Corporation, the
Conversion Rights shall terminate at the close of business on the first full day
preceding the date fixed for the payment of any amounts distributable on
liquidation to the holders of Series B Preferred Stock.
b. Fractional Shares. No fractional shares of Common Stock
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shall be issued upon conversion of the Series B Preferred Stock, and the number
of shares of Common Stock to be issued shall be rounded to the nearest whole
share. The shares issuable upon such conversion shall be determined on the basis
of the total number of shares of Series B Preferred Stock which the holder is at
the time converting into Common Stock and the number of shares of Common Stock
issuable upon such aggregate conversion.
c. Mechanics of Conversion.
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(i) In order for a holder of Series B Preferred Stock to
convert shares of Series B Preferred Stock into shares of Common Stock, such
holder shall surrender the certificate or certificates for such shares of Series
B Preferred Stock, at the office of the transfer agent for the Corporation (or
at the principal office of the Corporation if the Corporation serves as its own
transfer agent), together with written notice that such holder elects to convert
all or any number of the shares of the Series B Preferred Stock represented by
such certificate or certificates. Such notice shall state such holder's name or
the names of the nominees in which such holder wishes the certificate or
certificates for shares of Common Stock to be issued. If required by the
Corporation, certificates surrendered for conversion shall be endorsed or
accompanied by a written instrument or instruments of transfer, in form
satisfactory to the Corporation, duly executed by the registered holder or his,
her or its attorney duly authorized in writing. The date of receipt of such
certificates and notice by the transfer agent (or by the Corporation if the
Corporation serves as its own transfer agent) shall be the conversion date
("Conversion Date"). The Corporation shall, as soon as practicable after the
Conversion Date, issue and deliver at such office to such holder of Series B
Preferred Stock, or to his, her or its nominees, a certificate or certificates
for the number of shares of Common Stock to which such holder shall be entitled,
together with cash in lieu of any fraction of a share. In case less than all the
shares of Series B Preferred Stock represented by any certificate are being
converted, a new certificate representing the unconverted shares of Series B
Preferred Stock shall be issued to the holder thereof without cost to such
holder.
(ii) The Corporation shall at all times when the Series B
Preferred Stock shall be outstanding, reserve and keep available out of its
authorized but unissued stock, for the purpose of effecting the conversion of
the Series B Preferred Stock, such number of its duly authorized shares of
Common Stock as shall from time to time be sufficient to effect the conversion
of all outstanding Series B Preferred Stock.
(iii) Upon any such conversion, no adjustment to the Series
B Conversion Price shall be made for any declared or accrued but unpaid
dividends on the Series B Preferred Stock surrendered for conversion or on the
Common Stock delivered
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upon conversion, but, as provided in clause (iv) below, such dividends shall
remain payable to the holder thereof.
(iv) All shares of Series B Preferred Stock which shall
have been surrendered for conversion as herein provided shall no longer be
deemed to be outstanding and all rights with respect to such shares, including
the rights, if any, to receive notices and to vote, shall immediately cease and
terminate on the Conversion Date, except only the right of the holders thereof
to receive shares of Common Stock in exchange therefor and payment of any
dividends declared or accrued but unpaid thereon. Any shares of Series B
Preferred Stock so converted shall be retired and cancelled and shall not be
reissued, and the Corporation (without the need for stockholder action) may from
time to time take such appropriate action as may be necessary to reduce the
authorized Series B Preferred Stock accordingly.
(v) The Corporation shall pay any and all issue and other
taxes that may be payable in respect of any issuance or delivery of shares of
Common Stock upon conversion of shares of Series B Preferred Stock pursuant to
this Section 5. The Corporation shall not, however, be required to pay any tax
which may be payable in respect of any transfer involved in the issuance and
delivery of shares of Common Stock in a name other than that in which the shares
of Series B Preferred Stock so converted were registered, and no such issuance
or delivery shall be made unless and until the person or entity requesting such
issuance has paid to the Corporation the amount of any such tax or has
established, to the satisfaction of the Corporation, that such tax has been
paid.
d. Adjustment for Stock Splits and Combinations. If the
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Corporation shall at any time or from time to time after the Original Issue Date
of the Series B Preferred Stock effect a subdivision of the outstanding Common
Stock, the Series B Conversion Price then in effect with respect to the Series B
Preferred Stock immediately before that subdivision shall be proportionately
decreased. If the Corporation shall at any time or from time to time after the
Original Issue Date of the Series B Preferred Stock combine the outstanding
shares of Common Stock, the Series B Conversion Price then in effect immediately
before the combination with respect to the Series B Preferred Stock shall be
proportionately increased. Any adjustment under this paragraph shall become
effective at the close of business on the date the subdivision or combination
becomes effective.
e. Adjustment for Certain Dividends and Distributions. In
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the event the Corporation at any time, or from time to time after the Original
Issue Date of the Series B Preferred Stock shall make or issue, or fix a record
date for the determination of holders of Common Stock entitled to receive, a
dividend or other distribution payable in additional shares of Common Stock,
then and in each such event the Series B Conversion Price with respect to the
Series B Preferred Stock then in effect shall be decreased as of the time of
such issuance or, in the event such a record date shall have been fixed, as of
the close of business on such record date, by multiplying the Series B
Conversion Price for the Series B Preferred Stock then in effect by a fraction:
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(1) the numerator of which shall be the total number of shares of
Common Stock issued and outstanding immediately prior to the time of such
issuance or the close of business on such record date, and
(2) the denominator of which shall be the total number of shares of
Common Stock issued and outstanding immediately prior to the time of such
issuance or the close of business on such record date plus the number of
shares of Common Stock issuable in payment of such dividend or
distribution;
provided, however, that if such record date shall have been fixed and such
dividend is not fully paid or if such distribution is not fully made on the date
fixed therefor, the Series B Conversion Price for the Series B Preferred Stock
shall be recomputed accordingly as of the close of business on such record date
and thereafter the Series B Conversion Price for the Series B Preferred Stock
shall be adjusted pursuant to this paragraph as of the time of actual payment of
such dividends or distributions.
f. Adjustments for Other Dividends and Distributions. In the event
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the Corporation at any time or from time to time after the Original Issue Date
of the Series B Preferred Stock shall make or issue, or fix a record date for
the determination of holders of Common Stock entitled to receive, a dividend or
other distribution payable in securities of the Corporation other than shares of
Common Stock, then and in each such event provision shall be made so that the
holders of Series B Preferred Stock shall receive upon conversion thereof in
addition to the number of shares of Common Stock receivable thereupon, the
amount of securities of the Corporation that they would have received had the
Series B Preferred Stock been converted into Common Stock on the date of such
event and had thereafter, during the period from the date of such event to and
including the conversion date, retained such securities receivable by them as
aforesaid during such period, giving application to all adjustments called for
during such period under this paragraph with respect to the rights of the
holders of the Series B Preferred Stock.
g. Adjustment for Reclassification, Exchange or Substitution. If
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the Common Stock issuable upon the conversion of the Series B Preferred Stock
shall be changed into the same or a different number of shares of any class or
classes of stock, whether by capital reorganization, reclassification, or
otherwise (other than a subdivision or combination of shares or stock dividend
provided for above, or a reorganization, merger, consolidation, or sale of
assets provided for below), then and in each such event the holders of the
Series B Preferred Stock shall have the right thereafter to convert such share
into the kind and amount of shares of stock and other securities and property
receivable upon such reorganization, reclassification, or other change, by
holders of the number of shares of Common Stock into which such shares of Series
B Preferred Stock might have been converted immediately prior to such
reorganization, reclassification, or change, all subject to further adjustment
as provided herein.
h. Adjustment for Merger or Reorganization, etc. In case of any
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consolidation or merger of the Corporation with or into another corporation or
the sale of all or substantially all of the assets of the Corporation to another
corporation (other than a consolidation, merger or sale which is covered by
Subsection 3(c)), each share of Series
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B Preferred Stock shall thereafter be convertible (or shall be converted into a
security which shall be convertible) into the kind and amount of shares of stock
or other securities or property to which a holder of the number of shares of
Common Stock of the Corporation deliverable upon conversion of such Series B
Preferred Stock would have been entitled upon such consolidation, merger or
sale; and, in such case, appropriate adjustment (as determined in good faith by
the Board of Directors) shall be made in the application of the provisions in
this Section 5 set forth with respect to the rights and interest thereafter of
the holders of the Series B Preferred Stock, to the end that the provisions set
forth in this Section 5 (including provisions with respect to changes in and
other adjustments of the Series B Conversion Price) shall thereafter be
applicable, as nearly as reasonably may be, in relation to any shares of stock
or other property thereafter deliverable upon the conversion of the Series B
Preferred Stock.
i. No Impairment. The Corporation will not, by amendment of its
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Articles of Incorporation, or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed hereunder by the Corporation, but will at
all times in good faith assist in the carrying out of all the provisions of this
Section 5 and in the taking of all such action as may be necessary or
appropriate in order to protect the respective Conversion Rights of the holders
of the Series B Preferred Stock against impairment.
j. Certificate as to Adjustments. Upon the occurrence of each
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or readjustment of the Series B Conversion Price pursuant to this Section 5, the
Corporation at its expense shall promptly compute such adjustment or
readjustment in accordance with the terms hereof and furnish to each holder of
Series B Preferred Stock a certificate setting forth such adjustment or
readjustment and showing in detail the facts upon which such adjustment or
readjustment is based. The Corporation shall, upon the written request at any
time of any holder of Series B Preferred Stock, furnish or cause to be furnished
to such holder a similar certificate setting forth (i) such adjustments and
readjustments, (ii) the Series C Conversion Price then in effect, and (iii) the
number of shares of Common Stock and the amount, if any, of other property which
then would be received upon the conversion of such Series B Preferred Stock.
k. Notice of Record Date. In the event:
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(a) that the Corporation declares a dividend (or any other
distribution) on its Common Stock payable in Common Stock or
other securities of the corporation;
(b) that the Corporation subdivides or combines its outstanding
shares of Common Stock;
(c) of any reclassification of the Common Stock of the
Corporation (other than a subdivision or combination of its
outstanding shares of Common Stock or a stock dividend or
stock distribution thereon), or of any consolidation or
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merger of the Corporation into or with another corporation,
or of the sale of all or substantially all of the assets of
the Corporation; or
(d) of the involuntary or voluntary dissolution, liquidation or
winding up of the Corporation;
then the Corporation shall cause to be filed at its principal office, and shall
cause to be mailed to the holders of the Series B Preferred Stock at their last
addresses as shown on the records of the Corporation or its transfer agent, at
least ten (10) days prior to the date specified in (i) below or twenty (20) days
before the date specified in (ii) below, a notice stating
(i) the record date of such dividend, distribution, subdivision or
combination, or, if a record is not to be taken, the date as of
which the holders of Common Stock of record to be entitled to
such dividend, distribution, subdivision or combination are to be
determined, or
(ii) the date on which such reclassification, consolidation, merger,
sale, dissolution, liquidation or winding up is expected to
become effective, and the date as of which it is expected that
holders of Common Stock of record shall be entitled to exchange
their shares of Common Stock for securities or other property
deliverable upon such reclassification, consolidation, merger,
sale, dissolution or winding up.
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IN WITNESS WHEREOF, this Designation of Rights, Terms and Preferences
is executed on behalf of the Corporation by its President and attested by its
Assistant Secretary this 14th day of October, 1999.
SPACEHAB, INCORPORATED
By: /s/ Shelley A. Harrison
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Name: Shelley A. Harrison
Title Chairman and CEO
Attest: /s/ Mark A. Kissman
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Name: Mark A. Kissman
Title: Secretary
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