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Exhibit 4.1
FACE OF SECURITY
THE NOTE EVIDENCED HEREBY AND THE SHARES OF COMMON STOCK
ISSUABLE
UPON THE CONVERSION HEREOF HAVE NOT BEEN REGISTERED UNDER THE
U.S. SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR OTHER
SECURITIES LAWS. NONE
OF THIS NOTE, THE SHARES OF COMMON STOCK ISSUABLE UPON
CONVERSION HEREOF OR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE RE-OFFERED, SOLD,
ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION
OR UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE
REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY
BY ITS
ACCEPTANCE HEREOF (1) REPRESENTS THAT IT IS AN "ACCREDITED
INVESTOR" (AS DEFINED
IN REGULATION D UNDER SECURITIES ACT), (2) AGREES THAT IT WILL
NOT PRIOR TO (X)
THE DATE WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS
PERMITTED BY RULE
144(K) UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION
THEREUNDER) AFTER THE
LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR
OF THIS NOTE) OR
THE LAST DAY ON WHICH VAXGEN, INC. (THE "COMPANY") OR ANY
AFFILIATE OF THE
COMPANY WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS
NOTE) AND (Y)
SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW
(THE "RESALE
RESTRICTION TERMINATION DATE"), OFFER, SELL OR OTHERWISE
TRANSFER THIS NOTE OR
THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION HEREOF
EXCEPT (A) TO THE
COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, (C) WHEN AND FOR SO LONG AS
THE SECURITIES
ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT, TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL
BUYER" AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN
ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (D) PURSUANT
TO ANY OTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND
(3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE OR
THE SHARES OF
COMMON STOCK ISSUABLE UPON CONVERSION HEREOF ARE TRANSFERRED A
NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED THAT THE
COMPANY, THE
TRUSTEE AND THE REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY SUCH
OFFER, SALE OR
TRANSFER (I) PURSUANT TO CLAUSE (D) TO REQUIRE THE DELIVERY OF
AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO
EACH OF THEM AND
(II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A
CERTIFICATION OF TRANSFER
IN THE FORM APPEARING ON THE OTHER SIDE OF THE NOTE IS COMPLETED
AND DELIVERED
BY THIS TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED
UPON THE REQUEST
OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
<PAGE>
THIS NOTE, ANY SHARES OF COMMON STOCK ISSUABLE UPON THE
CONVERSION
HEREOF AND ANY RELATED DOCUMENTATION MAY BE AMENDED OR
SUPPLEMENTED FROM TIME TO
TIME TO MODIFY THE RESTRICTIONS ON RESALES AND OTHER TRANSFERS
OF THIS NOTE AND
ANY SUCH SHARES TO REFLECT ANY CHANGE IN APPLICABLE LAW OR
REGULATION (OR THE
INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO THE RESALE
OR TRANSFER OF
RESTRICTED SECURITIES GENERALLY. THE HOLDER OF THIS NOTE AND
SUCH SHARES SHALL
BE DEEMED BY THE ACCEPTANCE OF THIS NOTE AND ANY SUCH SHARES TO
HAVE AGREED TO
ANY SUCH AMENDMENT OR SUPPLEMENT.
<PAGE>
VAXGEN, INC.
5 1/2% CONVERTIBLE SENIOR SUBORDINATED NOTE DUE APRIL 1,
2010
No. 1 U.S.$ 300,000.00
CUSIP No. 922390 AA 7
ISIN NUMBER : US922390AA76
VaxGen, Inc., a corporation duly organized and existing under
the laws of the
State of Delaware (herein called the "Company," which term
includes any
successor Person under the Indenture referred to on the reverse
hereof), for
value received, hereby promises to pay to ___________., or
registered assigns,
the principal sum of THREE HUNDRED THOUSAND UNITED STATES
DOLLARS (U.S.$
300,000.00) (which principal amount may from time to time be
increased or
decreased to such other principal amounts (which, taken together
with the
principal amounts of all other Outstanding Securities, shall not
exceed U.S.
$31,500,000 in the aggregate at any time, on April 1, 2010,
unless redeemed,
repurchased or converted on an earlier date, and to pay interest
thereon, from
April 5, 2005, or from the most recent Interest Payment Date (as
defined below)
to which interest has been paid or duly provided for,
semiannually in arrears on
April 1 and October 1 in each year (each, an "Interest Payment
Date"),
commencing October 1, 2005, at the rate of 5 1/2% per annum,
until the principal
hereof is due, and at the rate then in effect on any overdue
principal and
premium, if any, and, to the extent permitted by law, on any
overdue interest.
The interest so payable, and punctually paid or duly provided
for, on any
Interest Payment Date will, as provided in the Indenture, be
paid to the Person
in whose name this Security (or one or more Predecessor
Securities) is
registered at the close of business on the Regular Record Date
for such
interest, which shall be the March 15 and September 15 (whether
or not a
Business Day), as the case may be, next preceding such Interest
Payment Date.
Except as otherwise provided in the Indenture, any such interest
not so
punctually paid or duly provided for will forthwith cease to be
payable to the
Holder on such Regular Record Date and may either be paid to the
Person in whose
name this Security (or one or more Predecessor Securities) is
registered at the
close of business on a Special Record Date for the payment of
such Defaulted
Interest to be fixed by the Company, notice whereof shall be
given to Holders of
Registered Securities not less than ten days prior to such
Special Record Date,
or be paid at any time in any other lawful manner not
inconsistent with the
requirements of any securities exchange on which the Securities
may be listed,
and upon such notice as may be required by such exchange, all as
more fully
provided in the Indenture. Payments of principal shall be made
upon the
surrender of this Security at the option of the Holder at the
Corporate Trust
Office or at such other office or agency of the Company as may
be designated by
it for such purpose in the Borough of Manhattan, The City of New
York, in such
coin or currency of the United States of America as at the time
of payment shall
be legal tender for t he payment of public and private debts, or
at such other
offices or agencies as the Company may designate, by United
States Dollar check
drawn on, or wire transfer to, a United States Dollar account
(such a wire
transfer to be made only to a Holder of an aggregate principal
amount of
Registered Securities in excess of U.S. $2,000,000 and only if
such Holder shall
have furnished wire instructions in writing to the Trustee no
later than 15 days
prior to the relevant payment date) maintained by the payee.
Payment of interest
on this Security may be made by United States Dollar check
mailed to the address
of the Person entitled thereto as such address shall appear in
the Security
Register or, upon written application
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<PAGE>
by the Holder to the Security Registrar setting forth wire
instructions not
later than the relevant Record Date, by wire transfer to a
United States dollar
account (such a wire transfer to be made only to a Holder of an
aggregate
principal amount of Registered Securities in excess of U.S.
$2,000,000 and only
if such Holder shall have furnished wire instructions in writing
to the Trustee
no later than 15 days prior to the relevant payment date)
maintained by the
payee.
Except as specifically provided herein and in the Indenture,
the
Company shall not be required to make any payment with respect
to any tax,
assessment or other governmental charge imposed by any
government or any
political subdivision or taxing authority thereof or
therein.
Reference is hereby made to the further provisions of this
Security
set forth on the reverse hereof, which further provisions shall
for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by
the Trustee referred to on the reverse hereof or an
Authenticating Agent by the
manual signature of one of their respective authorized
signatories, this
Security shall not be entitled to any benefit under the
Indenture or be valid or
obligatory for any purpose.
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<PAGE>
IN WITNESS WHEREOF, the Company has caused this Security to be
duly
executed.
VAXGEN, INC.
By: ____________________________________
Name: ______________________________
Title: _____________________________
Dated: April 5, 2005
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<PAGE>
This is one of the Securities referred to in the
within-mentioned
Indenture.
U.S. Bank National Association,
as Trustee
By: __________________________________
Authorized Signatory
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<PAGE>
REVERSE OF SECURITY
This Security is one of a duly authorized issue of securities of
the
Company designated as its "5 1/2% Convertible Senior
Subordinated Notes due
April 1, 2010" (herein called the "Securities"), limited in
aggregate principal
amount to U.S. $31,500,000, issued and to be issued under an
Indenture, dated as
of April 5, 2005 (herein called the "Indenture"), between the
Company and U.S.
Bank National Association, as Trustee (herein called the
"Trustee," which term
includes any successor trustee under the Indenture), to which
Indenture and all
indentures supplemental thereto reference is hereby made for a
statement of the
respective rights, limitations of rights, duties and immunities
thereunder of
the Company, the Trustee, the holders of Senior Debt and the
Holders of the
Securities and of the terms upon which the Securities are, and
are to be,
authenticated and delivered. As provided in the Indenture and
subject to certain
limitations set forth therein, Registered Securities are
exchangeable for a like
aggregate principal amount of Registered Securities of any
authorized
denominations as requested by the Holder surrendering the same
upon surrender of
the Registered Security or Registered Securities to be exchanged
at the
Corporate Trust Office. The Trustee upon such surrender by the
Holder will issue
the new Registered Securities in the requested
denominations.
No sinking fund is provided for the Securities.
The Securities are subject to redemption at the option of
the
Company at any time prior to April 1, 2010 ("Provisional
Redemption"), in whole
or in part, upon not less than 30 nor more than 60 days' notice
to the Holders
prior to the Redemption Date at a Redemption Price equal to 100%
of the
principal amount, together, in each case, with accrued and
unpaid interest
(including, Liquidated Damages, if any) to, but excluding, the
Redemption Date
plus the Interest Make-Whole Payment; provided, that (a) the
Closing Sale Price
of the Common Stock has exceeded 150% of the Conversion Price
then in effect for
at least 20 Trading Days within a period of 30 consecutive
Trading Days ending
on the Trading Date immediately before the date of mailing of
the Redemption
Notice and (2) the Registration Statement covering resale of the
Securities and
the Underlying Common Stock (as defined in the Purchase
Agreement) is effective
and available for use for the 30 days following the Redemption
Day, unless
registration thereof is not required. Upon any Provisional
Redemption, the
Company will pay to the Holders cash (except as set forth below)
with respect to
the Securities called for Provisional Redemption, including any
Security
converted after the date of the notice of Provisional Redemption
and before to
the date of the Provisional Redemption. Notwithstanding the
foregoing, the
Company may make the Interest Make-Whole Payment in (a) cash,
(b) subject to
certain conditions set forth below in the Indenture, Common
Stock or Successor
Common Stock or (c) a combination of cash and Common Stock or
Successor Common
Stock.
In the event of a redemption of the Securities, the Company will
not
be required (a) to register the transfer or exchange of
Registered Securities
for a period of 15 days immediately preceding the date notice is
given
identifying the serial numbers of the Securities called for such
redemption (it
being understood that the Company will not be required to
identify the serial
numbers of Outstanding Securities if all such Securities are
called for
redemption) or
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<PAGE>
(b) to register the transfer or exchange of any Registered
Security, or portion
thereof, called for redemption.
In any case where the due date for the payment of the principal
of,
premium, if any, or interest (including Liquidated Damages, if
any) on any
Security or the last day on which a Holder of a Security has a
right to convert
his Security shall be, at any Place of Payment or Place of
Conversion, as the
case may be, a day on which banking institutions at such Place
of Payment or
Place of Conversion are authorized or obligated by law or
executive order to
close, then payment of principal, premium, if any, or interest
(including
Liquidated Damages, if any) or delivery for conversion of such
Security need not
be made on or by such date at such place but may be made on or
by the next
succeeding day at such place which is not a day on which banking
institutions
are authorized or obligated by law or executive order to close,
with the same
force and effect as if made on the date for such payment or the
date fixed for
redemption or repurchase, or by such last day for conversion,
and no interest
shall accrue on the amount so payable for the period from and
after such due
date.
Subject to and upon compliance with the provisions of the
Indenture,
the Holder of this Security is entitled, at its option, at any
time following
the original issue date of the Securities and on or before the
close of business
on April 1, 2010, or in case this Security or a portion hereof
is called for
redemption or the Holder hereof has exercised his right to
require the Company
to repurchase this Security or such portion hereof, then in
respect of this
Security until and including, but (unless the Company defaults
in making the
payment due upon redemption or repurchase, as the case may be)
not after, the
close of business on th
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