Falcon Launch Services Agreement

EXHIBIT 10.1


SPACE EXPLORATION TECHNOLOGIES CORPORATION
FALCON LAUNCH SERVICES AGREEMENT


This Launch Services Agreement ("Agreement") is entered into as of November 15, 2005 ("Effective Date") by and between Space Exploration Technologies Corporation, a Delaware corporation with headquarters at 1310 East Grand Avenue, El Segundo, CA 90245 ("SpaceX") and SpaceDev, Inc., with headquarters at 13855 Stowe Drive, Poway California, 92064 ("Customer"). SpaceX and Customer may hereinafter be referred to individually as "Party" and collectively as "Parties."


WHEREAS, Customer desires to purchase launch services for its spacecraft and its customers' spacecraft with the parameters set forth in Appendix 1, Statement of Work ("Payload") into Earth orbit; and


WHEREAS, SpaceX provides launch services using the Falcon 1 Launch Vehicle ("Falcon");


NOW THEREFORE, the Parties hereby agree as follows:


1. Services to be Provided. SpaceX shall furnish launch services on the Falcon in accordance with Appendix 1, Statement of Work, ("Basic Launch Services"), subject to the terms and conditions of this Agreement. Additional services may be provided by SpaceX on a time and material basis, subject to negotiations, mutual agreement of the Parties, and a separate statement of work ("Additional Services").


2. Contract Price.


The Contract Price is the sum of: - - [***. . .***] - - [***. . .***] - - [***. . .***]


- - Purchase with pricing set forth in this section 2 is guaranteed to Customer for up to two additional missions (at the option of Customer); however, a [***. . .***] annual increase in the overall Contract Price will be added to adjust for inflation, starting on Jan 1, 2008.


3. Date of Launch. The expected launch date for contractual and planning purposes is May 15, 2008 ("Estimated Launch Date"). By mutual agreement of the Parties, the Estimated Launch Date may be adjusted up to 18 months in advance of the Estimated Launch date. It is mutually understood that the date when the launch actually occurs ("Actual Launch Date") is dependent upon weather, range availability, government approvals, Falcon readiness, Payload readiness and similar factors.


4. Payment Terms


4.1. Payment Schedule. Customer shall pay to SpaceX the Contract Price in five installments in accordance with the following schedule


- - [***. . .***] - - [***. . .***] - - [***. . .***]


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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED HEREWITH OMITS THE INFORMATION SUBJECT TO A CONFIDENTIALITY REQUEST. OMISSIONS ARE DESIGNATED [***. . .***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.


- - [***. . .***] - - [***. . .***]


4.2. Invoices. SpaceX shall submit invoices to Customer at least thirty (30) days prior to the payment due date for each scheduled payment event set forth in Section 4.1, provided, however, that the executed Agreement shall serve as the invoice for the first scheduled payment. Any payments delayed beyond the payment due date shall be subject to interest at a rate of [***. . .***] per day of delay.


4.3. Invoice Address. SpaceX shall invoice Customer at the following address:


SpaceDev, Incorporated
Accounts Payable
13855 Stowe Drive
Poway, CA 92064


5. Taxes. To the best knowledge of SpaceX on the Effective Date of this Contract, no taxes are due for the activities and transactions contemplated by this Agreement. However, should taxes be levied, Customer alone shall bear any and all national, federal, state or local sales, use, value added or other taxes, customs duties, or similar tariffs and fees that may levied or collected upon the transactions contemplated by this Agreement ("Taxes"). Such Taxes are not included in the Contract Price as defined in Section 2, Contract Price, and shall be borne by Customer in addition to the Contract Price. Where SpaceX is required by law to collect Taxes, SpaceX shall notify Customer of such a requirement, provide evidence of requirement and Customer shall pay SpaceX the appropriate amount in addition to the Contract Price.


6. Best Price Assurance. SpaceX intends that the Customer never pay more than the standard price for Basic Launch Services at the time of the Estimated Launch Date. If SpaceX reduces the single flight, standard price of Basic Launch Services prior to the Estimated Launch Date, the Customer will be entitled to reduce their next payment to SpaceX accordingly by the difference. If all payments for launch have been made or the reduction in price exceeds payments due from the Customer, SpaceX will wire the appropriate rebate to the Customer no later than thirty (30) days in advance of the Actual Launch Date.


7. Reflight Launch Option


7.1. [***. . .***]


7.2. Qualifying Condition. The Parties agree that the Reflight Launch Option is exercisable only in the event of a Launch Failure due to the Falcon launch vehicle. Such a Launch Failure must constitute either delivery of the Payload to an orbit where it cannot reasonably be used for the intended mission, destruction of the Payload as a result of Falcon breakup, or substantial damage to the Payload due to launch loads that materially exceed those defined in the Interface Control Document.


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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED HEREWITH OMITS THE INFORMATION SUBJECT TO A CONFIDENTIALITY REQUEST. OMISSIONS ARE DESIGNATED [***. . .***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.


7.3. Sole Remedy. The reflight launch shall be the sole and exclusive remedy available to customer for any launch failure or payload failure whatsoever, including any inability to use the payload for all or part of its intended mission, howsoever caused, and regardless of the theory of liability (with the exception of gross negligence), whether based in contract or tort, including negligence, product liability, and strict liability, or any other theory of liability, provided, however, that this remedy shall be available only when customer has purchased a reflight launch option and customer has made all of the payments and reasonably complied with all of the other conditions of this agreement


8. Third Party Liability


8.1. Insurance. SpaceX shall procure and maintain third party launch liability insurance as prescribed by the Federal Aviation Administration's Associate Administrator for Commercial Space Transportation pursuant to the Commercial Space Launch Act, as amended, 49 U.S.C. Sec.Sec. 70101-70121. SpaceX shall name as additional insureds Customer and its Payload customer, contractors and subcontractors involved in launch services, the U.S. government and its contractors and subcontractors involved in launch services, and SpaceX's contractors and subcontractors involved in launch services. Such insurance will comply with the terms of the Federal launch license.


9. Cross Waivers of Liability


9.1 Third party Liability. SpaceX shall be exclusively liable to third parties for any injury, loss or damage to any third party caused solely by SpaceX or its equipment, including the Falcon or parts thereof. Customer shall be exclusively liable to third parties for any injury, loss or damage to any third party caused solely by Customer or its equipment, including the Payload or parts thereof.


9.2. Waivers. SpaceX and Customer agree to a reciprocal waiver of liability pursuant to which each Party agrees to assume the risk and agrees not to sue or otherwise bring a claim against the other Party or that Party's Related Third Parties or against the U.S. government and its contractors and subcontractors, for any property loss or damage, including loss of or damage to the Payload, or other financial loss it sustains, or for any injury, death, property loss or damage or other financial loss sustained by its employees, officers, directors or agents, arising in any manner out of or in connection with activities relating to the performance of this Agreement.


9.3. Extension of Waivers. SpaceX and Customer agree to extend the waiver of liability to their respective contractors and subcontractors requiring them to waive the right to sue or otherwise bring a claim against the other Party or that Party's Related Third Parties or the U.S. government and its contractors and subcontractors, for any property loss or damage, including loss of or damage to the Payload or Falcon, or other financial loss they may sustain, or for any injury, death, property loss or damage or other financial loss sustained by their employees, officers, directors or agents, arising in any manner out of or in connection with activities relating to the performance of this Agreement.


9.4. Indemnification. SpaceX and Customer agree that each Party shall indemnify and hold harmless the other Party from and against liability or expense, including attorneys' fees, resulting from any suit or claim by the indemnifying Party's Related Third Parties for any property loss or damage, including loss of or damage to the Payload, or other financial loss it sustains or for any injury, death, property loss or damage or other financial loss sustained by its employees, officers, directors or agents, arising in any manner out of or in connection with activities relating to the performance of this Agreement.


9.5. Applicability. When applicable to the Parties' contractors and subcontractors, the waivers shall apply to contractors and subcontractors at every tier that are involved in activities relating to the performance of this Agreement. The waivers shall apply regardless of the theory of liability, whether based in contract or tort, including negligence, product liability, and strict liability, or any other theory of liability. Each Party agrees to obtain insurance as it deems necessary to cover death, injury, loss or damage for which it has waived the right to sue or bring a claim aga ...