EXHIBIT 10
JUNE 2002 NOTE PURCHASE AGREEMENT
BY AND BETWEEN
NOVAVAX, INC.
AND
KING PHARMACEUTICALS, INC.
DATED AS OF JUNE 26, 2002
TABLE OF CONTENTS
Page
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SECTION 1. PURCHASE AND SALE OF THE CONVERTIBLE NOTE; USE OF PROCEEDS...................................3
1.1 Sale and Issuance of the Convertible Note.......................................................3
1.2 Closing.........................................................................................3
1.3 Use of Proceeds.................................................................................3
SECTION 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY................................................3
2.1 Organization, Good Standing and Qualification...................................................3
2.2 Authorization...................................................................................4
2.3 Valid Issuance of the Note Shares and Listing...................................................4
2.4 Capitalization; Indebtedness....................................................................5
2.5 SEC Reports and Certain Changes.................................................................7
2.6 Financial Statements and Title to Assets........................................................7
2.7 Contracts.......................................................................................8
2.8 Compliance and Permits..........................................................................8
2.9 Compliance with Other Instruments...............................................................9
2.10 Governmental Consents...........................................................................9
2.11 Litigation......................................................................................9
2.12 Taxes..........................................................................................10
2.13 Intellectual Property..........................................................................10
2.14 Brokerage......................................................................................10
SECTION 3. REPRESENTATIONS AND WARRANTIES OF KING......................................................11
3.1 Organization, Good Standing and Qualification..................................................11
3.2 Authorization..................................................................................11
3.3 Governmental Consents..........................................................................11
3.4 Accredited Investor............................................................................11
3.5 Brokerage......................................................................................11
SECTION 4. FILINGS AND AUTHORIZATIONS..................................................................12
SECTION 5. CONDITIONS TO OBLIGATION OF EACH PARTY TO EFFECT THE TRANSACTIONS CONTEMPLATED BY
THIS AGREEMENT..............................................................................12
SECTION 6. CONDITIONS OF KING'S OBLIGATIONS AT THE
CLOSING.....................................................................................13
SECTION 7. CONDITIONS OF THE COMPANY'S OBLIGATIONS AT
THE CLOSING.................................................................................14
SECTION 8. MISCELLANEOUS...............................................................................16
8.1 Survival.......................................................................................16
8.2 Assignment; Successors and Assigns.............................................................16
8.3 Governing Law..................................................................................16
8.4 Counterparts...................................................................................16
8.5 Titles and Subtitles...........................................................................17
8.6 Notices........................................................................................17
8.7 Expenses.......................................................................................18
8.8 Publicity......................................................................................18
8.9 Amendments and Waivers.........................................................................18
8.10 Severability...................................................................................19
8.11 Entire Agreement...............................................................................19
8.12 Jurisdiction; Venue............................................................................19
8.13 Specific Performance...........................................................................21
8.14. No Right of Setoff.............................................................................21
Schedules
Schedule 2.4(b)...................................... Registration Rights
Schedule 2.4(c)...................................... Preemptive and Antidilution Rights
Schedule 2.4(d)...................................... Indebtedness
Schedule 2.14........................................ Brokerage
Index of Defined Terms
Section
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1995 Plan.................................................................................... 2.4(a)
2001 10-K.................................................................................... 2.5(a)
Agreement.................................................................................... PREAMBLE
Amended and Restated Investor Rights Agreement............................................... RECITALS
Amendment to AVC(TM) Asset Purchase Agreement................................................ RECITALS
AVC Asset Purchase Agreement................................................................. RECITALS
Closing...................................................................................... 1.2(a)
Closing Date................................................................................. 1.2(a)
Common Stock................................................................................. RECITALS
Company...................................................................................... PREAMBLE
Company Stock Option Plans................................................................... 2.4(a)
Convertible Note............................................................................. RECITALS
December 2000 Note Purchase Agreement........................................................ RECITALS
Director Plan................................................................................ 2.4(a)
Exchange..................................................................................... 2.3
Exchange Act................................................................................. 2.4(b)
Existing Warrants............................................................................ 2.4(a)
First December 2000 Note..................................................................... RECITALS
HSR Act...................................................................................... 2.10
King......................................................................................... PREAMBLE
Maryland Process Agent....................................................................... 8.12(c)
Material Adverse Effect...................................................................... 2.1
Material Contracts........................................................................... 2.7
Nasdaq....................................................................................... 2.3
Note Shares.................................................................................. 2.2
Preferred Stock.............................................................................. 2.4(a)
Related Agreements........................................................................... RECITALS
SEC.......................................................................................... 2.5(a)
SEC Filings.................................................................................. 2.5(a)
Second Amended and Restated Registration Rights Agreement.................................... RECITALS
Second December 2000 Note.................................................................... RECITALS
Securities Act............................................................................... 2.4(b)
September 2001 Note.......................................................................... RECITALS
September 2001 Note Purchase Agreement....................................................... RECITALS
Tennessee Process Agent...................................................................... 8.12(b)
Third Amendment to the Copromotion Agreement ................................................ RECITALS
JUNE 2002 NOTE PURCHASE AGREEMENT
THIS JUNE 2002 NOTE PURCHASE AGREEMENT (this "Agreement") is made as of
the 26th day of June, 2002 by and between NOVAVAX, INC., a Delaware corporation
(the "Company"), and KING PHARMACEUTICALS, INC., a Tennessee corporation
("King").
WHEREAS, King wishes to purchase from the Company, and the Company
wishes to sell to King, a 4% Convertible Senior Note in the aggregate principal
amount of Ten Million Dollars ($10,000,000) (the "Convertible Note"), all
subject to and in accordance with the terms and conditions of this Agreement;
WHEREAS, shares of common stock, par value $.01 per share, of the
Company (the "Common Stock") shall be issuable upon the conversion of, and as
interest payments on, the Convertible Note;
WHEREAS, in connection with that certain Note Purchase Agreement dated
as of December 19, 2000 between King and the Company (the "December 2000 Note
Purchase Agreement"), the Company issued to King a 4% Convertible Senior Note in
the aggregate principal amount of $20,000,000 (the "First December 2000 Note");
WHEREAS, in connection with the December 2000 Note Purchase Agreement,
the Company issued to King a 4% Convertible Senior Note in the aggregate
principal amount of $5,000,000 (the "Second December 2000 Note");
WHEREAS, in connection with that certain September 2001 Note Purchase
Agreement dated as of September 7, 2001 between King and the Company (the
"September 2001 Note Purchase Agreement"), the Company issued to King a 4%
Convertible Senior Note in the aggregate principal amount of $5,000,000 (the
"September 2001 Note");
WHEREAS, in connection with the December 2000 Note Purchase Agreement,
the Company and King entered into that certain Investor Rights Agreement dated
as of December 19, 2000, which was amended in connection with the September 2001
Note Purchase Agreement by that certain First Amendment to Investor Rights
Agreement dated September 7, 2001;
WHEREAS, as a condition to the consummation of the Closing of this
Agreement, King and the Company have agreed to enter into an Amended
and Restated Investor Rights Agreement (the "Amended and Restated Investor
Rights Agreement");
WHEREAS, in connection with the September 2001 Note Purchase Agreement,
the Company and King entered into that certain Amended and Restated Registration
Rights Agreement dated as of September 7, 2001;
WHEREAS, as a condition to the consummation of the Closing of this
Agreement, King and the Company have agreed to enter into a Second Amended and
Restated Registration Rights Agreement (the "Second Amended and Restated
Registration Rights Agreement");
WHEREAS, King and the Company are parties to that certain Agreement for
Purchase and Sale of Assets Relating to AVC Product Line dated as of January 8,
2001 (the "AVC Asset Purchase Agreement");
WHEREAS, as a condition to the consummation of the Closing of this
Agreement, King and the Company have agreed to enter into a First Amendment to
AVC Asset Purchase Agreement (the "Amendment to AVC Asset Purchase Agreement");
WHEREAS, King and the Company are parties to that certain Copromotion
Agreement dated as of January 8, 2001, as amended by that certain First
Amendment to the Copromotion Agreement dated as of June 29, 2001, as further
amended by that certain Second Amendment to the Copromotion Agreement dated as
of June 29, 2001; and
WHEREAS, as a condition to the consummation of the Closing of this
Agreement, King and the Company have agreed to enter into a Third Amendment to
the Copromotion Agreement (the "Third Amendment to the Copromotion Agreement"
and together with the Amended and Restated Investor Rights Agreement, the Second
Amended and Restated Registration Rights Agreement and the Amendment to AVC
Asset Purchase Agreement, as the same may be amended, restated, supplemented or
otherwise modified from time to time, the "Related Agreements").
NOW THEREFORE, in consideration of the foregoing premises and the
representations, warranties, covenants and agreements herein contained, the
parties hereto, intending to be legally bound, agree as follows:
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SECTION 1. PURCHASE AND SALE OF THE CONVERTIBLE NOTE; USE OF PROCEEDS.
1.1 SALE AND ISSUANCE OF THE CONVERTIBLE NOTE.
Subject to the terms and conditions of this Agreement, the
Company agrees to sell and issue to King, and King agrees to purchase from the
Company, the Convertible Note.
1.2 CLOSING.
(a) The closing for the purchase and sale of the
Convertible Note pursuant to this Agreement (the "Closing"), shall, subject to
the satisfaction or waiver of the applicable conditions set forth in Sections 5,
6 and 7 hereof, take place at the offices of Xxxxx & Xxxxxxx L.L.P., 0000
Xxxxxxxxxx Xxxxx, XxXxxx, Xxxxxxxx 00000, on the date of this Agreement, or on
such other date, and at such other place, as the parties mutually agree in
writing (the date on which the Closing shall occur, the "Closing Date").
(b) At the Closing, among other things, the Company shall
deliver to King the fully executed Convertible Note. In consideration of such
delivery, King shall deliver to the Company the amount of the principal of the
Convertible Note in immediately available funds by wire transfer of funds to the
Company's designated bank account.
1.3 USE OF PROCEEDS.
All of the proceeds received from King pursuant to
Section 1.2(b) hereof shall be used by the Company solely for general working
capital purposes, capital expenditures and in the operation of the Company's
business.
SECTION 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company hereby represents and warrants to King that:
2.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION.
The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and has all requisite
corporate power and authority to carry on its business as now conducted and as
proposed to be conducted. The Company is duly qualified to transact business and
is in good standing in each jurisdiction in which the failure so to qualify
would have a material adverse effect on the business,
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operations, properties, assets, prospects or condition (financial or otherwise)
of the Company and its subsidiaries taken as a whole (a "Material Adverse
Effect"). Except as disclosed in the 2001 10-K (as defined below), the Company
has no subsidiaries.
2.2 AUTHORIZATION.
The Company has all requisite corporate power and authority
(a) to execute, deliver and perform its obligations under this Agreement, the
Convertible Note and the Related Agreements, (b) to issue the Convertible Note
and the shares of Common Stock issuable upon the conversion of, and as interest
payments on, the Convertible Note (the "Note Shares"), in the manner and for the
purpose contemplated by this Agreement, the Convertible Note and the Related
Agreements, and (c) to execute, deliver and perform its obligations under all
other agreements and instruments executed and delivered by it pursuant to or in
connection with this Agreement and the Related Agreements. All corporate action
on the part of the Company, its officers, directors and stockholders for the
authorization, execution and delivery of this Agreement and the Related
Agreements and the performance of all obligations of the Company hereunder and
thereunder and the authorization, issuance (or reservation for issuance) and
delivery of the Convertible Note and the Note Shares (when issued) has been
taken or will be taken prior to the Closing. This Agreement constitutes and the
Convertible Note and the Related Agreements when executed by the Company will
constitute, valid and legally binding obligations of the Company, enforceable in
accordance with their respective terms, except (x) as limited by applicable
bankruptcy, insolvency, reorganization, moratorium, and other laws of general
application affecting enforcement of creditors' rights generally and (y) as
limited by laws relating to the availability of specific performance, injunctive
relief, or other equitable remedies.
2.3 VALID ISSUANCE OF THE NOTE SHARES AND LISTING.
The Note Shares will be duly and validly issued, fully paid
and nonassessable and not subject to preemptive or similar rights, and such Note
Shares will be issued in compliance with all applicable federal and state
securities laws, when issued, sold and delivered in accordance with the terms of
the Convertible Note and the Amended and Restated Investor Rights Agreement for
the consideration expressed therein. The Note Shares will be listed on the
principal U.S. national securities exchange on which the Common Stock is listed
or, if the Common Stock is listed on the Nasdaq National Market ("Nasdaq"), then
the Note Shares will be listed on Nasdaq (such place of listing of the Note
Shares, the "Exchange"), subject only to official notice of issuance. No
approval of the stockholders of the Company is required to issue the
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Convertible Note or the Note Shares.
2.4 CAPITALIZATION; INDEBTEDNESS.
(a) The authorized capital stock of the Company consists
of fifty million (50,000,000) shares of Common Stock and two million (2,000,000)
shares of preferred stock, $.01 par value per share (the "Preferred Stock"). As
of June 24, 2002: (i) twenty-four million six hundred sixty thousand nine
hundred fifty-seven (24,660,957) shares of Common Stock were issued and
outstanding; (ii) four million three hundred twenty-one thousand nine hundred
sixteen (4,321,916) shares of Common Stock were reserved for issuance upon the
exercise of outstanding stock options or other rights to purchase or receive the
Common Stock granted under the Company's 1995 Stock Option Plan, as amended (the
"1995 Plan"); (iii) two hundred sixty thousand (260,000) shares of Common Stock
were reserved for issuance upon the exercise of outstanding stock options or
other rights to receive the Common Stock granted under the Company's Director
Stock Option Plan (the "Director Plan" and together with the 1995 Plan, the
"Company Stock Option Plans"); (iv) two million (2,000,000) shares of Common
Stock were reserved for issuance upon the conversion of the First December 2000
Note; (v) five hundred thousand (500,000) shares of Common Stock were reserved
for issuance upon the conversion of the Second December 2000 Note; (vi) three
hundred sixty thousand four hundred ninety (360,490) shares of Common Stock were
reserved for issuance upon the conversion of the September 2001 Note; (vii) one
million seven hundred ninety-eight thousand five hundred sixty-one (1,798,561)
shares of Common Stock were reserved for issuance upon conversion of the
Convertible Note; (viii) five hundred fifty-nine thousand five hundred
thirty-two (559,532) shares of Common Stock were held by the Company in the
Company's treasury; (ix) no shares of Preferred Stock were issued or
outstanding; and (x) warrants to purchase two hundred seventy thousand five
hundred sixty-two (270,562) shares of Common Stock were issued and outstanding
(the "Existing Warrants").
(b) All outstanding shares of capital stock of the
Company are duly authorized, validly issued, fully paid and nonassessable and
not subject to preemptive or similar rights. Except as set forth in this Section
2.4 and except for changes resulting from the issuance of shares of Common Stock
pursuant to the Company Stock Option Plans and the Existing Warrants, or as
expressly permitted by this Agreement or the Related Agreements, (i) there are
not issued, reserved for issuance or outstanding (A) any shares of capital stock
or other voting securities of the Company, (B) any securities of the Company or
any Company subsidiary convertible into or exchangeable or exercisable for
shares of capital stock or voting securities of or ownership interests in the
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Company or any Company subsidiary, or (C) any warrants, calls, options or other
rights to acquire from the Company or any Company subsidiary, or any obligation
of the Company or any Company subsidiary to issue, any capital stock, voting
securities or other ownership interests in, or securities convertible into or
exchangeable or exercisable for capital stock or voting securities of or other
ownership interests in, the Company or any Company subsidiary, (ii) there are no
outstanding obligations of the Company or any Company subsidiary to repurchase,
redeem or otherwise acquire any such securities or to issue, deliver or sell, or
cause to be issued, delivered or sold, any such securities, and (iii) except as
contemplated in this Agreement or the Related Agreements or as set forth on
Schedule 2.4(b), the Company is not presently under any obligation, has not
agreed or committed, and has not granted rights, to register under the
Securities Act of 1933, as amended (the "Securities Act"), or the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise file any
registration statement under the Securities Act or the Exchange Act covering,
any of its currently outstanding capital stock or other securities or any of its
capital stock or other securities that may be subsequently issued.
(c) Except as provided for in this Agreement or the
Related Agreements and except as set forth on Schedule 2.4(c), neither the
Company nor any Company subsidiary is a party to any agreement granting any
preemptive or antidilutive rights with respect to any securities of the Company
or any Company subsidiary that are outstanding as of the date hereof, or with
respect to any securities of the Company or any Company subsidiary that may be
subsequently issued upon the conversion or exercise of any instrument
outstanding as of the date hereof. Except as set forth on Schedule 2.4(c)
hereto, the execution, delivery and performance of this Agreement and the
Related Agreements and the issuance of the Convertible Note and the Note Shares
will not trigger any of the preemptive or antidilutive rights under any of the
agreements set forth on such Schedule 2.4(c). Other than the Fielding
Pharmaceutical Company, the Company does not directly or indirectly beneficially
own any securities or other beneficial ownership interests in any other person.
(d) Except for the Convertible Note to be issued
hereunder, the First December 2000 Note, the Second December 2000 Note and the
September 2001 Note and except as set forth on Schedule 2.4(d) hereto, the
Company has no Indebtedness (as defined in the Amended and Restated Investor
Rights Agreement).
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2.5 SEC REPORTS AND CERTAIN CHANGES.
(a) The Company has heretofore filed with the United
States Securities and Exchange Commission (the "SEC") all forms, statements,
reports and documents (together with all exhibits, amendments and supplements
thereto, the "SEC Filings") required to be filed by the Company under each of
the Securities Act and the Exchange Act and the SEC rules and regulations
thereunder, including an Annual Report on Form 10-K for the year ended December
31, 2001 (the "2001 10-K"). As of their respective filing dates, none of the SEC
Filings, at the time they were filed, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements made, in the light of the
circumstances under which they were made, not misleading. Since September 7,
2001, the Company has timely filed with the SEC all SEC Filings required to be
filed since such date, and all such SEC Filings complied with all applicable
requirements of the Securities Act and the Exchange Act, as applicable, and the
rules and regulations thereunder. The Company has previously made available or
delivered to King copies of the SEC Filings.
(b) Since December 31, 2001, and except as set forth in
SEC Filings or otherwise previously disclosed to King in writing, there has been
no change in the business, assets, liabilities, financial condition or operating
results of the Company from that reflected in the 2001 10-K, except changes in
the ordinary course of business that have not, individually or in the aggregate,
resulted in and are not reasonably expected to result in a Material Adverse
Effect.
2.6 FINANCIAL STATEMENTS AND TITLE TO ASSETS.
The audited consolidated financial statements of the Company
included or incorporated by reference in the 2001 10-K and the unaudited interim
financial statements contained in the quarterly report on Form 10-Q for the
first quarter in the year ending December 31, 2002 have been prepared in
accordance with the published rules and regulations of the SEC and with U.S.
generally accepted accounting principles applied on a consistent basis
throughout the periods indicated therein and with each other, except as may be
indicated therein or in the notes thereto, and fairly present in all material
respects the financial condition of the Company and its subsidiaries as of the
respective dates thereof and the results of their operations and statements of
cash flows for the respective periods then ended. Except as reflected in such
financial statements, the Company and its subsidiaries have no material
liabilities, absolute or contingent, other than ordinary course liabilities
incurred since the date of the last such financial statements in connection with
the conduct of the business of the Company and
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its subsidiaries. Except as otherwise set forth in the SEC Filings, the Company
and its subsidiaries have (a) good and marketable title to all material property
and assets reflected as owned by the Company or its subsidiaries in the
financial statements to the 2001 10-K (or as disclosed in the SEC Filings), and
(b) valid and enforceable leasehold interests in all material property and
assets reflected as leased by the Company or its subsidiaries in the financial
statements to the 2001 10-K (or as disclosed in the SEC Filings).
2.7 CONTRACTS.
With respect to each of the material contracts, commitments
and agreements of the Company and its subsidiaries ("Material Contracts"),
neither the Company nor any of its subsidiaries is, or has actual knowledge that
any other party is, in default under or in respect of any Material Contract, the
result of which default would have a Material Adverse Effect.
2.8 COMPLIANCE AND PERMITS.
(a) Except as disclosed in the SEC Filings, each of the
Company and its subsidiaries has complied with, and is not in default under or
in violation of, (i) its Certificate of Incorporation, By-laws or other
organizational document or (ii) any laws, ordinances and regulations or other
governmental restrictions, orders, judgments or decrees applicable to the
Company or any of its subsidiaries, except, in the case of clause (ii), for any
such default or violation which would not have a Material Adverse Effect. Except
as disclosed in the SEC Filings, neither the Company nor any of its subsidiaries
has received notice of any possible or actual violation of any applicable law,
ordinance, regulation, or order, the result of which violation would be
reasonably expected to have a Material Adverse Effect. Neither the execution and
delivery of this Agreement, the Convertible Note or the Related Agreements, nor
the consummation of the transactions contemplated hereby or thereby will
violate, conflict with or result in a breach or result in the acceleration or
termination of, or the creation in any third party of the right to accelerate,
terminate, modify or cancel, any material indenture, contract, lease, sublease,
loan agreement, note or other material obligation or liability to which the
Company or any of its subsidiaries is a party or is bound or to which any of its
assets are subject.
(b) Except as disclosed in SEC Filings, each of the
Company and its subsidiaries has, and is not in default in any material respect
under, all governmental franchises, permits, licenses, and any similar authority
necessary for the conduct of its business as now being conducted by it, the lack
of which would be reasonably expected to have a Material Adverse Effect.
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2.9 COMPLIANCE WITH OTHER INSTRUMENTS.
The execution, delivery and performance of this Agreement or
any of the Related Agreements and the transactions contemplated hereby and
thereby will not result in any violation of or constitute, with or without the
passage of time and the giving of notice, a default under any provision of (a)
the Certificate of Incorporation, By-laws or other organizational document of
the Company or any of its subsidiaries or (b) any material provision of any
material indenture, agreement or other instrument by which the Company or any of
its subsidiaries or any of their properties or assets are bound, or result in
the creation or imposition of any lien, or encumbrance upon any of the material
properties or assets of the Company or any of its subsidiaries, except, in the
case of clause (b), for any such default or violation which would not have in
any such event a Material Adverse Effect.
2.10 GOVERNMENTAL CONSENTS.
Except for (a) any notification required to be filed or
supplied pursuant to the Xxxx-Xxxxx Xxxxxx Antitrust Improvements Act of 1976,
as amended, and the rules promulgated thereunder (the "HSR Act") in connection
with the conversion of the Convertible Note, (b) registration of the Note Shares
under the Securities Act pursuant to the Second Amended and Restated
Registration Rights Agreement, (c) listing of the Note Shares on the Exchange,
and (d) any filings required under federal and state securities laws in
connection with the issuance of the Convertible Note or the Note Shares, no
consent, approval, order or authorization of, or registration, qualification,
designation, declaration or filing with, any federal, state or local
governmental authority is required on the part of the Company in connection with
the Company's valid execution, delivery and performance of this Agreement, the
Convertible Note or any of the Related Agreements. The filings under federal and
state securities laws, if any, will be effected by the Company at its cost
within the applicable stipulated statutory period.
2.11 LITIGATION.
There is no action, suit, proceeding or investigation pending
or, to the knowledge of the Company, currently threatened against the Company or
any of its subsidiaries which questions the validity of this Agreement, the
Convertible Note or the Related Agreements, or the right of the Company to enter
into such agreements and instruments or to consummate the transactions
contemplated hereby or thereby. Except as disclosed in SEC Filings, there is no
action, suit, proceeding or investigation pending or, to the knowledge of the
Company, currently threatened against the Company, which
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singly or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would have or would reasonably be expected to have a Material Adverse
Effect.
2.12 TAXES.
Each of the Company and its subsidiaries has filed all
federal, state, foreign and other tax returns which are required to be filed and
has heretofore paid all taxes which have become due and payable, except where
the failure to file or pay would not be reasonably expected to have a Material
Adverse Effect.
2.13 INTELLECTUAL PROPERTY.
Except as disclosed in the SEC Filings, to the knowledge of
the Company, each of the Company and its subsidiaries owns, or possesses
adequate rights to use, all of the patents, patent rights, trade secrets,
know-how, proprietary techniques, including processes and substances,
trademarks, service marks, trade names and copyrights described or referred to
in the SEC Filings or owned or used by it or which is necessary for the conduct
of its business as presently conducted, except where the failure to own or
possess such patents, patent rights, trade secrets, know-how, proprietary
techniques, including processes and substances, trademarks, service marks, trade
names and copyrights would not have a Material Adverse Effect. Except as
disclosed in the SEC Filings, neither the Company nor any of its subsidiaries
has received any notice of infringement of or conflict with asserted rights of
others with respect to any patents, patent rights, trade secrets, know-how,
proprietary techniques, including processes and substances, trademarks, service
marks, trade names and copyrights which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would be reasonably
expected to have a Material Adverse Effect.
2.14 BROKERAGE.
Except as set forth on Schedule 2.14 hereto, there are no
claims, agreements, or commitments for brokerage commissions or finder's fees or
similar compensation in connection with the transactions contemplated by this
Agreement or otherwise, based on any arrangement made by or on behalf of the
Company or any of its subsidiaries, and the Company agrees to indemnify and hold
King harmless against any damages incurred as a result of any such claim,
agreement, or commitment.
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SECTION 3. REPRESENTATIONS AND WARRANTIES OF KING.
King hereby represents and warrants that:
3.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION.
King is a corporation duly organized, validly existing and in
good standing under the laws of the State of Tennessee and has all requisite
corporate power and authority to carry on its business as now conducted and as
proposed to be conducted.
3.2 AUTHORIZATION.
All corporate action on the part of King, its officers and
directors necessary for the authorization, execution and delivery of this
Agreement and each of the Related Agreements and the performance of all
obligations of King hereunder and thereunder has been taken or will be taken
prior to the Closing, and this Agreement constitutes, and each of the Related
Agreements when executed by King will constitute, valid and legally binding
obligations of King enforceable in accordance with its terms, except (a) as
limited by applicable bankruptcy, insolvency, reorganization, moratorium, and
other laws of general application affecting the enforcement of creditors' rights
generally, and (b) as limited by laws relating to the availability of specific
performance, injunctive relief, or other equitable remedies.
3.3 GOVERNMENTAL CONSENTS.
Other than matters contemplated by this Agreement and any
filings required to be made or supplied pursuant to Section 13 or 16 of the
Exchange Act or the HSR Act, in connection with the issuance or conversion of
the Convertible Note, or the issuance of Note Shares in payment of interest on
the Convertible Note, no consent, approval, order or authorization of, or
registration, qualification, designation, declaration or filing with, any
federal, state or local governmental authority is required on the part of King
in connection with King's valid execution, delivery and performance of this
Agreement and the Related Agreements.
3.4 ACCREDITED INVESTOR.
King is an "accredited investor" as such term is defined in
Rule 501(a) of the Securities Act and is purchasing the Convertible Note and the
underlying Note Shares for its own account for investment purpose. King has
sufficient knowledge and experience in financial and business matters so as to
be capable of evaluating the merits and risks of its investment in the
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Convertible Note (and the underlying Note Shares) and is capable of bearing the
economic risks of such investment.
3.5 BROKERAGE.
There are no claims, agreements, or commitments for brokerage
commissions or finder's fees or similar compensation in connection with the
transactions contemplated by this Agreement or otherwise, based on any
arrangement made by or on behalf of King or any of its subsidiaries or
affiliates, and King agrees to indemnify and hold the Company harmless against
any damages incurred as a result of any such claim, agreement, or commitment.
SECTION 4. FILINGS AND AUTHORIZATIONS.
The Company and King, as promptly as practicable, (a) will make, or
cause to be made, all such other filings and submissions under laws, rules and
regulations applicable to them as may be required for them to consummate the
transactions contemplated hereby in accordance with the terms of this Agreement
and the Related Agreements and (b) will use reasonable efforts to obtain, or
cause to be obtained, all authorizations, approvals, consents and waivers from
all governmental authorities necessary to be obtained by them in order for them
to consummate such transactions.
SECTION 5. CONDITIONS TO OBLIGATION OF EACH PARTY TO EFFECT THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
The obligation of each party to effect the transactions
contemplated by this Agreement shall be subject to the fulfillment at or prior
to the date of the Closing of the following conditions:
(a) all governmental and other consents and approvals, if
any, necessary to permit the consummation of the transactions contemplated by
this Agreement and the Related Agreement shall have been obtained; and
(b) no stop order or other order enjoining the sale of
the Convertible Note at the Closing shall have been issued and no proceedings
for such purpose shall be pending or, to the knowledge of the Company,
threatened by the SEC or any commissioner of corporations or similar officer of
any state having jurisdiction over the transactions contemplated by this
Agreement or any of the Related Agreements and no preliminary or permanent
injunction or other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency or
commission nor any statute, rule, regulation or executive order promulgated or
12
enacted by any governmental authority shall be in effect that would restrain or
otherwise prevent the consummation of the transactions contemplated by this
Agreement or any of the Related Agreements.
SECTION 6. CONDITIONS OF KING'S OBLIGATIONS AT THE CLOSING.
The obligations of King to consummate the Closing under this Agreement
are subject to the fulfillment on or before the Closing Date of the following
conditions, the waiver of which shall not be effective without the written
consent of King thereto:
(a) Representations and Warranties. The representations and
warranties of the Company contained in Section 2 shall be true in all material
respects on and as of the Closing Date with the same effect as though such
representations and warranties had been made on and as of the date of such
Closing (except for representations and warranties that speak as of a specific
time, which need only be true and correct in all material respects as of such
date or time).
(b) Performance. The Company shall have performed and complied in
all material respects with all agreements, obligations and conditions contained
in this Agreement that are required to be performed or complied with by it on or
before the Closing.
(c) Compliance Certificate. An authorized executive officer of the
Company shall have delivered to King a certificate certifying that the
conditions specified in Section 6(a) and Section 6(b) have been fulfilled.
(d) Proceedings and Documents. All corporate and other proceedings
in connection with the transactions contemplated at the Closing and all
documents incident thereto shall be reasonably satisfactory in form and
substance to King, and King shall have received all such counterpart original
and certified or other copies of such documents as King may reasonably request.
(e) Certificate. At the Closing, the Company shall have furnished
to King a certificate, signed by an authorized executive officer of the Company,
certifying: (i) the due organization and good standing of the Company; (ii) the
corporate resolutions of the Company authorizing the transactions contemplated
by this Agreement and the Related Agreements; and (iii) the incumbency of
officers of the Company executing this Agreement and the other instruments or
certificates delivered at the Closing.
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(f) Opinion of Counsel. At the Closing, the Company shall have
furnished to King an opinion of White & XxXxxxxx, P.C. in a form reasonably
acceptable to King.
(g) Delivery of the Convertible Note. At the Closing, the Company
shall have delivered the fully executed Convertible Note.
(h) Listing. The Note Shares shall have been approved for listing
on the Exchange.
(i) Second Amended and Restated Registration Rights Agreement. At
the Closing, the Company shall have entered into the Second Amended and Restated
Registration Rights Agreement and such Second Amended and Restated Registration
Rights Agreement shall be in full force and effect.
(j) Amended and Restated Investor Rights Agreement. At the
Closing, the Company shall have entered into the Amended and Restated Investor
Rights Agreement and such Amended and Restated Investor Rights Agreement shall
be in full force and effect.
(k) Amendment to AVC Asset Purchase Agreement. At the Closing, the
Company shall have entered into the Amendment to AVC Asset Purchase Agreement
and such Amendment to AVC Asset Purchase Agreement shall be in full force and
effect.
(l) Third Amendment to the Copromotion Agreement. At the Closing,
the Company shall have entered into the Third Amendment to the Copromotion
Agreement and such Third Amendment to the Copromotion Agreement shall be in full
force and effect.
(m) Other Documentation. The Company shall have furnished to King
such other instruments and documents, in form and substance reasonably
acceptable to King, as may be necessary to effect the Closing.
SECTION 7. CONDITIONS OF THE COMPANY'S OBLIGATIONS AT THE CLOSING.
The obligations of the Company to consummate the Closing under this
Agreement are subject to the fulfillment on or before the Closing of the
following conditions, the waiver of which shall not be effective without the
written consent of the Company thereto:
(a) Representations and Warranties. The representations and
14
warranties of King contained in Section 3 shall be true in all material respects
on and as of the Closing with the same effect as though such representations and
warranties had been made on and as of such Closing (except for representations
and warranties that speak as of a specific time, which need only be true and
correct in all material respects as of such date or time).
(b) Performance. King shall have performed and complied in all
material respects with all agreements, obligations and conditions contained in
this Agreement that are required to be performed or complied with by it on or
before the Closing, and all corporate or other proceedings in connection with
the transactions contemplated at the Closing and all documents incident thereto
shall be reasonably satisfactory in form and in substance to the Company.
(c) Compliance Certificate. An officer of King shall have
delivered to the Company a certificate certifying that the conditions specified
in Section 7(a) and Section 7(b) have been fulfilled.
(d) Payment of Purchase Price. At the Closing, King shall have
delivered to the Company the amount of the principal of the Convertible Note in
immediately available funds by wire transfer of funds to the Company's
designated bank account.
(e) Second Amended and Restated Registration Rights Agreement. At
the Closing, King shall have entered into the Second Amended and Restated
Registration Rights Agreement and such Second Amended and Restated Registration
Rights Agreement shall be in full force and effect.
(f) Amended and Restated Investor Rights Agreement. At the
Closing, King shall have entered into the Amended and Restated Investor Rights
Agreement and such Amended and Restated Investor Rights Agreement shall be in
full force and effect.
(g) Amendment to AVC Asset Purchase Agreement. At the Closing,
King shall have entered into the Amendment to AVC Asset Purchase Agreement and
such Amendment to AVC Asset Purchase Agreement shall be in full force and
effect.
(h) Third Amendment to the Copromotion Agreement. At the Closing,
King shall have entered into the Third Amendment to the Copromotion Agreement
and such Third Amendment to the Copromotion Agreement shall be in full force and
effect.
15
(i) Other Documentation. King shall have furnished to the Company
such other instruments and documents, in form and substance reasonably
acceptable to the Company, as may be necessary to effect the Closing.
SECTION 8. MISCELLANEOUS.
8.1 SURVIVAL.
All representations, warranties and covenants contained herein
or made in writing by or on behalf of the Company in connection herewith shall
survive the execution and delivery of this Agreement and the Convertible Note,
the transfer by King of the Convertible Note or Note Shares or portion thereof
or interest therein and the payment or conversion of the Convertible Note, and
may be relied upon by any transferee of the Convertible Note or Note Shares,
regardless of any investigation made at any time by or on behalf of King or any
transferee. All representations, warranties and covenants contained herein made
by King or any holder of the Convertible Note shall survive the execution and
delivery of this Agreement and the Convertible Note, and may be relied upon by
the Company and its successors and assigns.
8.2 ASSIGNMENT; SUCCESSORS AND ASSIGNS.
Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by the parties hereto without the prior
written consent of the other party. Except as otherwise provided herein, the
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties. Nothing in
this Agreement, express or implied, is intended to confer upon any party other
than the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
8.3 GOVERNING LAW.
This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, without giving effect to any
choice of law or conflict of law rules or provisions (whether of the State of
Delaware or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of Delaware.
8.4 COUNTERPARTS.
This Agreement may be executed in two or more
16
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
8.5 TITLES AND SUBTITLES.
The titles and subtitles used in this Agreement are used for
convenience only and are not to be considered in construing or interpreting this
Agreement.
8.6 NOTICES.
All notices, demands or other communications to be given or
delivered under or by reason of the provisions of this Agreement shall be in
writing and shall be deemed to have been given when (a) delivered personally to
the recipient, (b) telecopied to the recipient (with hard copy sent to the
recipient by reputable overnight courier service (charges prepaid) that same
day) if telecopied before 5:00 p.m. Eastern time on a business day, and
otherwise on the next business day, or (c) one business day after being sent to
the recipient by reputable overnight courier service (charges prepaid). Such
notices, demands and other communications shall be sent to the following persons
at the following addresses:
To the Company:
Novavax, Inc.
0000 Xxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: Chief Executive Officer
Telecopy: (000) 000-0000
with a copy (which shall not constitute notice) to:
Novavax, Inc.
0000 Xxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: Xxx X. XxXxxxxx, Esq.
Vice President and General Counsel
Telecopy: (000) 000-0000
17
To King:
King Pharmaceuticals, Inc.
000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxx 00000
Attn: Executive Vice President of Legal Affairs
and General Counsel
Telecopy: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxx & Xxxxxxx L.L.P.
0000 Xxxxxxxxxx Xxxxx
XxXxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxx, Xx.
Xxxxxx X. Xxxxx
Telecopy: (000) 000-0000
or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party.
8.7 EXPENSES.
Irrespective of whether the Closing is effected, each party
shall pay all costs and expenses that it incurs with respect to the negotiation,
execution, delivery and performance of this Agreement. Notwithstanding the
foregoing, the Company shall pay any and all stamp, transfer and other similar
taxes payable or determined to be payable in connection with the execution and
delivery of this Agreement or any securities purchased from the Company
hereunder, and shall save and hold King harmless from and against any and all
liabilities with respect to or resulting from any delay in paying, or omission
to pay, such taxes.
8.8 PUBLICITY.
Except for information which is required to be disclosed by
applicable law, neither party hereto shall issue any press releases or public
statements with regard to this Agreement or the Convertible Note without first
seeking the approval of the other party, which shall not be unreasonably
withheld or delayed.
8.9 AMENDMENTS AND WAIVERS.
Any term of this Agreement may be amended and the
18
observance of any term of this Agreement may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of the Company and King. Any amendment or waiver effected in
accordance with this Section 8.9 shall be binding upon each holder of any
securities purchased under this Agreement at the time outstanding, each future
holder of all such securities, and the Company.
8.10 SEVERABILITY.
If one or more provisions of this Agreement are held to be
unenforceable under applicable law, such provision shall be excluded from this
Agreement and the balance of the Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its
terms.
8.11 ENTIRE AGREEMENT.
This Agreement and the Related Agreements constitute the
entire agreement between the parties with respect to the subject matter hereof,
and supersede all prior written agreements and negotiations and oral
understandings, if any, with respect to such subject matter, and no party shall
be liable or bound to any other party in any manner by any warranties,
representations, or covenants with respect to the subject matter hereof, except
as specifically set forth herein or therein.
8.12 JURISDICTION; VENUE.
(a) Each of the Company and King hereby waives personal
service of any process upon it in connection with any suit, action or proceeding
arising out of or relating to this Agreement or the transactions contemplated
hereby, and hereby covenants and agrees that all such service of process may be
made in the manner set forth in Section 8.6 with the same effect as though
served on it personally.
19
(b) The Company hereby covenants and agrees that any
suit, action or proceeding initiated by the Company against King, its
affiliates, subsidiaries, successors and/or assigns arising out of or relating
to this Agreement or the transactions contemplated hereby shall be brought
exclusively in the federal courts located in and/or state courts of the State of
Tennessee. In the event of any such suit, action or proceeding initiated by the
Company, each of the Company and King hereby submits to the exclusive
jurisdiction and venue of the federal courts located in and state courts of the
State of Tennessee and hereby waives any and all objections based on
jurisdiction or venue that such party may have under applicable law or the
Federal Rules of Civil Procedure. The Company hereby irrevocably designates CT
Corporation in the State of Tennessee (the "Tennessee Process Agent") as its
designee, appointee and agent to receive, for and on its behalf, service of
process in the State of Tennessee in any such suit, action or proceedings with
respect to this Agreement and the transactions contemplated hereby. Service on
the Tennessee Process Agent shall be deemed complete upon delivery thereof to
the Tennessee Process Agent, provided that, in the case of any such service upon
the Tennessee Process Agent, King shall also deliver a copy thereof to the
Company in accordance with the notice provision set forth in Section 8.6. The
Company shall take all such action as may be necessary to continue the
appointment of the Tennessee Process Agent in full force and effect or to
appoint another agent, who shall thereafter be referred to herein as the
"Tennessee Process Agent", so that the Company shall at all times have an agent
for service for the foregoing purposes in the State of Tennessee.
(c) King hereby covenants and agrees that any suit,
action or proceeding initiated by King against the Company, its affiliates,
subsidiaries, successors and/or assigns arising out of or relating to this
Agreement or the transactions contemplated hereby shall be brought exclusively
in the federal courts located in and/or state courts of the State of Maryland.
In the event of any such suit, action or proceeding initiated by King, each of
the Company and King hereby submits to the exclusive jurisdiction and venue of
the federal courts located in and state courts of the State of Maryland and
hereby waives any and all objections based on jurisdiction or venue that such
party may have under applicable law or the, Federal Rules of Civil Procedure.
King hereby irrevocably designates CT Corporation in the State of Maryland (the
"Maryland Process Agent"), as its designee, appointee and agent to receive, for
and on its behalf, service of process in the State of Maryland in any such suit,
action or proceedings with respect to this Agreement and the transactions
contemplated hereby. Service on the Maryland Process Agent shall be deemed
complete upon delivery thereof to the Maryland Process Agent, provided that in
the case of any such service upon the Maryland Process Agent, the Company shall
also deliver a copy thereof to King in accordance with the notice provision set
forth in
20
Section 8.6. King shall take all such action as may be necessary to continue the
appointment of the Maryland Process Agent in full force and effect or to appoint
another agent, who shall thereafter be referred to herein as the "Maryland
Process Agent", so that King shall at all times have an agent for service for
the foregoing purposes in the State of Maryland.
8.13 SPECIFIC PERFORMANCE.
The parties agree that irreparable damage would occur in the
event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the parties shall be entitled, in addition to any other
remedy provided by this Agreement or in law or at equity, to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions hereof.
8.14 NO RIGHT OF SETOFF.
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY,
THE COMPANY HEREBY EXPRESSLY WAIVES, AND SHALL BE PROHIBITED FROM ENFORCING OR
SEEKING TO ENFORCE, ANY RIGHT OR REMEDY (INCLUDING, WITHOUT LIMITATION, ANY
COMMON LAW RIGHT OR REMEDY) TO SET OFF, COUNTERCLAIM, DEDUCT OR OTHERWISE REDUCE
ANY AMOUNT WHICH THE COMPANY MAY BE ENTITLED TO RECEIVE FROM KING OR ITS
AFFILIATES AGAINST ANY AMOUNTS PAYABLE UNDER THE CONVERTIBLE NOTE OR THE OTHER
NOTES (AS THAT TERM IS DEFINED IN THE CONVERTIBLE NOTE).
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]
21
IN WITNESS WHEREOF, the parties have executed this June 2002 Note
Purchase Agreement as of the date first above written.
NOVAVAX, INC.
By: /s/ Xxxx Xxxxxx
-----------------------------
Name: Xxxx Xxxxxx
-----------------------------
Title: President & CEO
-----------------------------
KING PHARMACEUTICALS, INC.
By: /s/ Xxxx X. X. Xxxxxxx
-----------------------------
Name: Xxxx X. X. Xxxxxxx
-----------------------------
Title: Executive Vice President and
-----------------------------
General Counsel
-----------------------------
