This Stock
Purchase Agreement (this “ Agreement ”) is dated
March 31, 2009, by and between Satellite Overseas (Holdings)
Limited (the “ Investor ”) and Novavax, Inc., a
Delaware corporation (the “ Company ”), whereby
the parties agree as set forth herein. Certain terms are defined in
Section 10 of this Agreement.
WHEREAS ,
the Company and the Investor have entered into an agreement (the
“JV Agreement”) to form a joint venture to develop and
commercialize vaccines, including vaccines that leverage the
Company’s VLP technology and vaccines based on
Investor’s technology, for sale within the Indian market and
to establish local manufacturing capability in India based on the
Company’s novel disposable vaccine production system under
licensing rights to be obtained from the Company;
WHEREAS,
the Company and the Investor have entered into a Master Services
Agreement under which Investor and/or its affiliates will perform
certain services for the Company; and
WHEREAS ,
in connection with the anticipated joint venture, Investor has
agreed to make an equity investment in the Company, in accordance
with the terms and conditions set forth in this
Agreement.
NOW,
THEREFORE , in consideration of the premises and the mutual
promises herein made, and in consideration of the representations,
warranties, and covenants herein contained, the Parties agree as
follows.
(a) Investor
agrees to buy and the Company agrees to sell and issue to Investor
12,500,000 shares (the “ Shares ”) of the
Company’s common stock, $0.01 par value per share (the
“ Common Stock ”), for an aggregate purchase
price of $11,000,000, at a per share purchase price of $0.88 (the
“ Purchase Price ”).
(b) The
Shares have been registered on a Registration Statement on Form
S-3, Registration No. 333-138893 (the “ Registration
Statement ”), which registration statement has been
declared effective by the Securities and Exchange Commission and is
effective on the date hereof (together with any registration
statement filed by the Company pursuant to Rule 462(b) under the
Securities Act of 1933, as amended (the “ Securities
Act ”)). A final prospectus supplement will be delivered
to the Investor as required by law.
(c) On
the closing date, which, in accordance with Rule 15c6-1
promulgated under the Securities Exchange Act of 1934, as amended,
is expected to occur on or about March 31, 2009 (the “
Closing Date ”), upon satisfaction or waiver of all
the conditions to closing set forth in this Agreement, (i) the
Purchase Price for the Shares purchased by the Investor will be
delivered by or on behalf of the Investor to the Company against
delivery of the Shares, and (ii) the Company shall cause its
transfer agent to release to the Investor the number of Shares
being purchased by the Investor (such release shall be made through
the facilities of The Depository Trust Company’s DWAC
system). The provisions set forth in Exhibit B hereto
shall be incorporated herein by reference as if set forth fully
herein.
2.
Representations, Warranties and Agreements of the Company .
The Company represents and warrants to and agrees with Investor as
of the date hereof and as of the Closing Date and any other date
specified below, that:
(a) The
Company has been duly incorporated and has a valid existence and
the authorization to transact business as a corporation under the
laws of the State of Delaware, with corporate power and authority
to own its properties and conduct its business as described in the
Prospectus, and has been duly qualified as a foreign corporation
for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such
qualification, except for such jurisdictions wherein the failure to
be so qualified and in good standing would not individually or in
the aggregate have a Material Adverse Effect.
(b) Each
subsidiary of the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, with corporate power and authority
to own its properties and conduct its business as described in the
Prospectus, and has been duly qualified as a foreign corporation
for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such
qualification, except for such jurisdictions wherein the failure to
be so qualified and in good standing would not individually or in
the aggregate have a Material Adverse Effect. All subsidiaries and
their respective jurisdictions of incorporation are identified on
Schedule I hereto. Except as disclosed in
Schedule I , all of the outstanding capital stock or
other voting securities of each subsidiary is owned by the Company,
directly or indirectly, free and clear of any lien and free of any
other limitation or restriction (including any restriction on the
right to vote, sell or otherwise dispose of such capital stock or
other voting securities). Other than the Company’s 4.75%
senior convertible notes (the “ Convertible Notes
”) and warrants to purchase 3,343,325 of Company Common Stock
(the “ 2008 Warrants ”), there are no
outstanding (i) securities of the Company or any subsidiary of
the Company which are convertible into or exchangeable for shares
of capital stock or voting securities of any subsidiary of the
Company or (ii) options or other rights to acquire from the
Company or any subsidiary of the Company, or other obligation of
the Company or any subsidiary of the Company to issue, any capital
stock, voting securities or securities convertible into or
exchangeable for capital stock or voting securities of any
subsidiary of the Company (collectively, the “ Subsidiary
Securities ”). There are no outstanding obligations of
the Company or any subsidiary of the Company to repurchase, redeem
or otherwise acquire any outstanding Subsidiary
Securities.
(c) The
execution, delivery and performance of this Agreement by the
Company and the consummation of the transactions contemplated
hereby are within the corporate powers of the Company and have been
duly authorized by all necessary corporate action on the part of
the Company, and the Agreement, when duly executed and delivered by
the Company, will constitute a valid and legally binding instrument
of the Company enforceable in accordance with its terms, except as
enforcement hereof may be limited by the effect of any applicable
bankruptcy, insolvency, reorganization or similar laws or court
decisions affecting enforcement of creditors’ rights
generally and except as enforcement hereof is subject to general
principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law).
(d) The
Shares have been duly authorized by the Company, and when issued
and delivered by the Company against payment therefor as
contemplated by this Agreement, the Shares will (i) be validly
issued, fully paid and nonassessable, (ii) not be
subject
2
to any
statutory or contractual preemptive rights or other rights to
subscribe for or purchase or acquire any shares of Common Stock,
which have not been waived or complied with, and (iii) conform to
the description of the Common Stock contained in the Prospectus.
The capital stock of the Company, including the Common Stock,
conforms as to the legal matters to the description thereof, if
any, contained in the Registration Statement and the Prospectus,
and as of the date thereof, the Company had authorized capital
stock as set forth therein. The Shares are in due and proper form
and the holders of Shares will not be subject to personal liability
by reason of being such holders.
(e) The
execution and delivery of the Agreement does not, and the
compliance by the Company with the terms hereof will not,
(i) violate the Certificate of Incorporation (as amended to
date) of the Company or the By-Laws (as amended to date) of the
Company, (ii) result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or its subsidiary is
bound, or (iii) result in a violation of, or failure to be in
compliance with, any applicable statute or any order, judgment,
decree, rule or regulation of any court or governmental, regulatory
or self-regulatory agency or body having jurisdiction over the
Company or its subsidiary, except in the case of (ii) and
(iii) where such breach, violation, default or the failure to
be in compliance would not have a Material Adverse Effect; and no
consent, approval, authorization, order, registration, filing or
qualification of or with any such court or governmental, regulatory
or self-regulatory agency or body is required for the valid
authorization, execution, delivery and performance by the Company
of the Agreement or the issuance of the Shares, except for such
consents, approvals, authorizations, registrations, filings or
qualifications as may be required under the Securities Act or state
securities or “blue sky” laws and have been or will be
obtained and which have been or will be made in connection with the
listing of the Shares on the Nasdaq Global Market.
(f) The
Company meets the requirements for the use of Form S-3 under the
Securities Act for the primary issuance of securities. The
Registration Statement has been declared effective by the
Commission and at the time it became effective, and as of the date
hereof, the Registration Statement complied and complies with
Rule 415 under the Securities Act. No stop order suspending
the effectiveness of the Registration Statement has been issued and
no proceeding for that purpose has been initiated or, to the
Company’s knowledge, threatened by the Commission. On the
effective date of the Registration Statement, the Registration
Statement complied, on the date of the Prospectus, the Prospectus
will comply, and at the date of the Closing, the Registration
Statement and the Prospectus will comply, in all material respects
with the applicable provisions of the Securities Act and the
applicable rules and regulations of the Commission thereunder; on
the effective date of the Registration Statement, the Registration
Statement and the additional information disclosed by the Company
to the Investor in a document titled “Investor
Information” (the “Investor Information”) did
not, on the date of the Prospectus, the Prospectus did not, and at
the date of the Closing, the Registration Statement and the
Prospectus and the Investor Information, will not, contain an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to make
the statements therein, in light of the circumstances under which
they were made (with respect to the Prospectus), not misleading;
and when filed with the Commission, the documents incorporated by
reference in the Registration Statement and the Prospectus,
complied or will comply in all material respects with the
applicable provisions of the Securities Exchange Act of 1934, as
amended (the “ Exchange Act ”), and the
applicable rules and regulations of the Commission thereunder.
There is no material document of a character required to be
described in the Registration Statement or the Prospectus or to be
filed as an exhibit to the Registration Statement
3
that is not
described or filed as required. The Company’s form 10-K for
year ended 2008 will not contain any material information that is
not included in the Investor Information.
(g) The
consolidated financial statements of the Company included or
incorporated by reference in the Registration Statement, the
Prospectus and the Investor Information comply as to form with the
applicable accounting requirements of the Securities Act and have
been prepared in conformity with generally accepted accounting
principles (except, with respect to the unaudited consolidated
financial statements and the accompanying footnotes which are
subject to customary audit adjustments) applied on a consistent
basis, are consistent in all material respects with the books and
records of the Company, and accurately present in all material
respects the consolidated financial position, results of operations
and cash flow of the Company and its subsidiary as of and for the
periods covered thereby. There are no other financial statements
(historical or pro forma) that are required to be included in the
Registration Statement and the Prospectus.
(h) There
are no material liabilities of the Company or any subsidiary of the
Company of any kind whatsoever, whether accrued, contingent,
absolute, determined, determinable or otherwise, and there is no
existing condition, situation or set of circumstances which could
reasonably be expected to result in such a liability, other than
liabilities disclosed in the consolidated financial statements and
financial schedules of the Company included or incorporated by
reference in the Registration Statement and the Prospectus, and
other undisclosed liabilities which, individually or in the
aggregate, are not material to the Company and its subsidiary,
taken as a whole.
(i) Neither
the Company nor its subsidiary has sustained, since the respective
dates of the latest audited financial statements included or
incorporated by reference in the Registration Statement and
Prospectus, any material loss or interference with its business
from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as disclosed
in or contemplated by the Registration Statement and Prospectus;
and, since the respective dates as of which information is given in
the Registration Statement and Prospectus, there has not been any
material change in the capital stock or long-term debt of the
Company or its subsidiary, the Company and its subsidiary have not
incurred any material liabilities or obligations, direct or
contingent, nor entered into any material transactions, except for
entering into purchase orders in the ordinary course of business,
and there has not been any material adverse change in or affecting
the general affairs, assets, business, management, financial
position or condition, stockholders’ equity or results of
operations of the Company and its subsidiary considered as a whole,
otherwise than as disclosed in the Registration Statement and
Prospectus.
(j) Other
than as disclosed in the Prospectus, there are no legal,
governmental or regulatory proceedings pending to which the Company
or its subsidiary is a party or of which any material property of
the Company or its subsidiary is the subject which, taking into
account the likelihood of the outcome, the damages or other relief
sought and other relevant factors, would individually or in the
aggregate reasonably be expected to have a Material Adverse Effect
or adversely affect the ability of the Company to issue and sell
the Shares; to the best of the Company’s knowledge, no such
proceedings are threatened or contemplated by governmental or
regulatory authorities or threatened by others.
(k) The
Company and its subsidiary have good and marketable title to all
the real property and owns all other properties and assets,
reflected as owned in the financial statements included or
incorporated by reference in the Registration Statement, the
Prospectus
4
and the
Investor Information, subject to no lien, mortgage, pledge, charge
or encumbrance of any kind except those, if any, reflected in such
financial statements or which are not material to the Company and
its subsidiary taken as a whole. The Company and its subsidiary
hold their respective leased real and personal properties under
valid and binding leases, except where the failure to do so would
not reasonably be expected to individually or in the aggregate have
a Material Adverse Effect.
(l) The
Company has filed all necessary federal and state income and
franchise tax returns and has paid all taxes shown as due thereon
or has filed all necessary extensions, and there is no tax
deficiency that has been, or to the knowledge of the Company might
be, asserted against the Company or any of its properties or assets
that would in the aggregate or individually reasonably be expected
to have a Material Adverse Affect.
(m) There
are no authorized options, warrants, preemptive rights, rights of
first refusal or other rights to purchase, or equity or debt
securities convertible into or exchangeable or exercisable for, any
capital stock of the Company or its subsidiary other than the 2008
Warrants and those accurately described in the Registration
Statement and the Prospectus. There are no holders or beneficial
owners of securities of the Company having rights to registration
thereof whose securities have not been previously registered or who
have not waived such rights with respect to the registration of the
Company’s securities on the Registration Statement, except
where the failure to obtain such waiver would not individually or
in the aggregate reasonably be expected to have a Material Adverse
Effect.
(n) Other
than as disclosed in the Prospectus, the Company together with its
subsidiary owns and possesses all right, title and interest in and
to, or, to the Company’s knowledge, has duly licensed from
third parties, all patents, patent rights, trade secrets,
inventions, know-how, trademarks, trade names, copyrights, service
marks and other proprietary rights (“ Intellectual
Property ”) material to the business of the Company and
its subsidiary taken as a whole as currently conducted and as
described in the Prospectus. To the Company’s knowledge and
except as would not individually or in the aggregate have a
Material Adverse Effect, there is no infringement or other
violation by third parties of any of the Intellectual Property of
the Company. Neither the Company nor its subsidiary has received
any notice of infringement or misappropriation from any third party
that has not been resolved or disposed of. Further, there is no
pending or, to the Company’s knowledge and except as would
not individually or in the aggregate have a Material Adverse
Effect, threatened action, suit, proceeding or claim by
governmental authorities or others that the Company is infringing a
patent, and there is no pending or, to the Company’s
knowledge and except as would not individually or in the aggregate
have a Material Adverse Effect, threatened legal or administrative
proceeding relating to patents and patent applications of the
Company, other than proceedings initiated by the Company before the
United States Patent and Trademark Office and the patent offices of
certain foreign jurisdictions which are in the ordinary course of
patent prosecution. To the Company’s knowledge, the patent
applications of the Company presently on file disclose patentable
subject matter, and the Company is not aware of any inventorship
challenges, any interference which has been declared or provoked,
or any other material fact that (i) would preclude the
issuance of patents with respect to such applications, or
(ii) would lead outside patent counsel for the Company to
reasonably conclude that such patents, when issued, would not be
valid and enforceable in accordance with applicable
regulations.
(o) The
Company conducts its business in compliance in all respects with
applicable laws, rules and regulations of governmental and
regulatory bodies to which it is subject, except where the failure
to be in compliance would not have a Material Adverse
Effect.
5
(p) All
offers and sales of the Company’s capital stock prior to the
date hereof were at all relevant times registered pursuant to the
Securities Act or exempt from the registration requirements of the
Securities Act and were issued in compliance in all material
respects with applicable state securities or blue sky
laws.
(q) The
Company has filed with the Nasdaq Global Market a Notification of
Listing of Additional Shares with respect to the Shares required by
the rules of the Nasdaq Global Market and has not received a notice
from the Nasdaq Global Market that such notification is
insufficient. The offer and sale of the Shares does not require
stockholder approval under Rule 4350 of the Nasdaq Stock
Market Rules.
(r) Neither
the Company nor its subsidiary nor, to the best of the
Company’s knowledge, any employee or agent of the Company or
its subsidiary, has (i) used any corporate funds for unlawful
contributions, gifts, entertainment or other unlawful expenses
relating to political activity, (ii) made any unlawful payment to
foreign or domestic government officials or employees or to foreign
or domestic political parties or campaigns from corporate funds,
(iii) violated any provision of the Foreign Corrupt Practices
Act of 1977, as amended, or (iv) made any other unlawful
payment.
(s) There
is no broker, finder or other party that is entitled to receive
from the Company any brokerage or finder’s fee or other fee
or commission as a result of any transactions contemplated by this
Agreement.
(t) The
Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with
management’s general or specific authorization;
(ii) transactions are recorded as necessary to permit
preparation of consolidated financial statements in conformity with
generally accepted accounting principles and to maintain
accountability for assets; (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 existing assets at reasonable intervals and
appropriate action is taken with respect to any differences. Except
as described in the Registration Statement and the Prospectus,
since the most recent audit of the effectiveness of the
Company’s internal control over financial reporting, 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 affected, or
is reasonably likely to materially affect, the Company’s
internal control over financial reporting.
(u) The
Company has established, maintains and evaluates “disclosure
controls and procedures” (as such term is defined in
Rule 13a-15(e) and 15d-15(e) under the Exchange Act), which
(i) are designed to ensure that material information relating
to the Company is made known to the Company’s principal
executive officer and its principal financial officer by others
within those entities, particularly during the periods in which the
periodic reports required under the Exchange Act are being
prepared, (ii) have been evaluated for effectiveness as of the
end of the last fiscal period covered by the Registration
Statement; and (iii) such disclosure controls and procedures
are effective to perform the functions for which they were
established. There are no significant deficiencies and material
weaknesses in the design or operation of internal controls which
could adversely affect the Company’s ability to record,
process, summarize, and report financial data to management and the
board of directors of the Company. The Company is not aware of any
fraud, whether or not material, that involves management or other
employees who have a role in the Company’s internal controls;
and since the date of the most recent evaluation of such disclosure
controls and procedures, there have been
6
no significant
changes in internal controls or in other factors that could
significantly affect internal controls, including any corrective
actions with regard to significant deficiencies and material
weaknesses.
(v) The
Company and, to its knowledge, all of the Company’s directors
or officers, in their capacities as such, is in compliance in all
material respects with all applicable effective provisions of the
Sarbanes-Oxley Act and any related rules and regulations
promulgated by the Commission.
(w) The
Company is not, nor after giving effect to the offering and sale of
the Securities and the application of the proceeds thereof as
described in the Prospectus, will be, (i) required to register
as an “investment company” as defined in the Investment
Company Act of 1940, as amended (the “ Investment Company
Act ”), and the rules and regulations of the Commission
thereunder or (ii) a “business development
company” (as defined in Section 2(a)(48) of the
Investment Company Act).
(x) The
Company maintains insurance in such amounts and covering such risks
as it reasonably considers to be adequate for the conduct of its
business and the value of its properties and as is customary for
companies engaged in similar businesses in similar industries. All
such insurance is fully in force on the date hereof and will be
fully in force as of the Closing Date. The Company has no 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 have a Material Adverse
Effect.
(y) The
Company has not sold or issued any securities that would be
integrated with the offering of the Securities contemplated by this
Agreement pursuant to the Securities Act, the published rules and
regulations thereunder, or the interpretations thereof by the
Commission.
(z) The
section entitled “Management’s Discussion and Analysis
of Financial Condition and Results of Operations—Critical
Accounting Policies and Estimates” and
“Management’s Discussion and Analysis of Financial
Condition and Results of Operations—Critical Accounting
Policies and Estimates for Discontinued Operations” in the
Company’s most recent Annual Report on Form 10-K,
Quarterly
|
