Item 8.01. Other Events.
Amended
and Restated UK Supply Agreement
Reference is made to that certain Amended and
Restated SARS-CoV-2 Vaccine Supply Agreement, dated as of July 1, 2022, by and between the Company
and The Secretary of State for Business, Energy, and Industrial Strategy (as assigned to the UK Health Security Agency), acting on behalf
of the government of the United Kingdom of Great Britain and Northern Ireland (the “Authority”), as amended on September
26, 2022 (the “Amended and Restated UK Supply Agreement”), which amended and restated in its entirety the SARS-CoV-2
Vaccine Supply Agreement, dated October 22, 2020, between the parties (the “Original UK Supply Agreement”). Under the
Original UK Supply Agreement, the Authority agreed to purchase 60 million doses of the Company’s vaccine candidate for the SARS-CoV-2
virus (the “Vaccine”) and made an upfront payment to the Company.
As previously reported, under the terms of the
Amended and Restated UK Supply Agreement, the Authority agreed to purchase a minimum of 1 million doses of Vaccine and up to an additional
15 million doses of Vaccine (the “Conditional Doses”) contingent on, and subject to reduction based on, the Company’s
timely achievement of a supportive recommendation from the Joint Committee on Vaccination and Immunisation (the “JCVI”)
that is approved by the UK Secretary of State for Health, with respect to use of Vaccine for (a) the general adult population as part
of a SARS-CoV-2 vaccine booster campaign in the United Kingdom or (b) the general adolescent population as part of a SARS-CoV-2 vaccine
booster campaign in the United Kingdom or as a primary series SARS-CoV-2 vaccination, excluding where that recommendation relates only
to one or more population groups comprising less than one million members in the United Kingdom; and if the Authority does not purchase
the Conditional Doses or the number of such Conditional Doses is reduced below 15 million doses of Vaccine, the Company would have to
repay up to $225.0 million related to the upfront payment previously received from the Authority under the Original UK Supply Agreement.
As of November 30, 2022, the JCVI had not yet
made a supportive recommendation with respect to the Vaccine, thereby triggering, under the terms of the Amended and Restated UK Supply
Agreement, (i) a reduction of the number of Conditional Doses from 15 million doses of Vaccine to 7.5 million doses of Vaccine, which
reduced number of Conditional Doses are contingent on, and subject to further reduction based on, the Company’s timely achievement
by November 30, 2023 of a supportive recommendation from JCVI that is approved by the UK Secretary of State for Health as described in
the paragraph above, and (ii) an obligation of the Company to repay $112.5 million related to the upfront payment previously received
from the Authority under the Original UK Supply Agreement.
A summary of the material terms of the Amended
and Restated UK Supply Agreement was included in the Company’s Quarterly Report on Form 10-Q filed on August 9, 2022, which is qualified
in its entirety by reference to the full text of the Amended and Restated UK Supply Agreement (filed as Exhibit 10.1 to the Company’s
Quarterly Report on Form 10-Q filed on November 9, 2022 and incorporated herein by reference).
Stockholder Litigation
On November 12, 2021, Sothinathan Sinnathurai
filed a purported securities class action in the U.S. District Court for the District of Maryland (the “Maryland Court”)
against the Company and certain members of senior management, captioned Sothinathan Sinnathurai v. Novavax, Inc., et al., No. 8:21-cv-02910-TDC
(the “Sinnathurai Action”). On January 26, 2022, the Maryland Court entered an order designating David Truong, Nuggehalli
Balmukund Nandkumar, and Jeffrey Gabbert as co-lead plaintiffs in the Sinnathurai Action. The co-lead plaintiffs filed a consolidated
amended complaint on March 11, 2022, alleging that the defendants made certain purportedly false and misleading statements concerning
the Company’s ability to manufacture NVX-CoV2373 on a commercial scale and to secure NVX-CoV2373’s regulatory approval. The
amended complaint defines the purported class as those stockholders who purchased Company securities between February 24, 2021 and October
19, 2021. On April 25, 2022, defendants filed a motion to dismiss the consolidated amended complaint. On December 12, 2022, the Maryland
Court issued a ruling granting in part and denying in part defendants’ motion to dismiss. The Maryland Court dismissed all claims
against two individual defendants and claims based on certain public statements challenged in the consolidated amended complaint. The
Maryland Court denied the motion to dismiss as to the remaining claims and defendants, and directed the Company and other remaining defendants
to answer within fourteen days.
After the Sinnathurai Action was filed, seven
derivative lawsuits were filed: (i) Robert E. Meyer v. Stanley C. Erck, et al., No. 8:21-cv-02996-TDC (the “Meyer Action”),
(ii) Shui Shing Yung v. Stanley C. Erck, et al., No. 8:21-cv-03248-TDC (the “Yung Action”), (iii) William
Kirst, et al. v. Stanley C. Erck, et al., No. 8:22-cv-00024-TDC (the “Kirst Action”), (iv) Amy Snyder v. Stanley
C. Erck, et al., No. 8:22-cv-01415-TDC (the “Snyder Action”), (v) Charles R. Blackburn, et al. v. Stanley C.
Erck, et al., No. 1:22-cv-01417-TDC (the “Blackburn Action”), (vi) Diego J. Mesa v. Stanley C. Erck, et al.
(the “Mesa Action”); and (vii) Sean Acosta v. Stanley C. Erck, et al. (the “Acosta Action”).
The Meyer, Yung, Snyder, and Blackburn Actions were filed in the Maryland Court. The Kirst Action was filed in the Circuit Court for Montgomery
County, Maryland, and shortly thereafter removed to the Maryland Court by the defendants. The Mesa and Acosta Actions were filed in the
Delaware Court of Chancery (the “Delaware Court”). The derivative lawsuits name members of the Company’s board
of directors and certain members of senior management as defendants. The Company is deemed a nominal defendant. The plaintiffs assert
derivative claims arising out of substantially the same alleged facts and circumstances as the Sinnathurai Action. Collectively, the derivative
complaints assert claims for breach of fiduciary duty, insider selling, unjust enrichment, violation of federal securities law, abuse
of control, waste, and mismanagement. Plaintiffs seek declaratory and injunctive relief, as well as an award of monetary damages and attorneys’
fees.
On February 4, 2022, the Maryland Court entered
an order consolidating the Meyer and Yung Actions (the “First Consolidated Derivative Action”). The plaintiffs in the
First Consolidated Derivative Action filed their consolidated derivative complaint on April 25, 2022. On May 10, 2022, the Maryland Court
entered an order granting the parties’ request to stay all proceedings and deadlines pending the earlier of dismissal or the filing
of an answer in the Sinnathurai Action. On June 10, 2022, the Snyder and Blackburn Actions were filed. On October 5, 2022, the Maryland
Court entered an order granting a request by the plaintiffs in the First Consolidated Derivative Action and the Snyder and Blackburn Actions
to consolidate all three actions and appoint co-lead plaintiffs and co-lead and liaison counsel (the “Second Consolidated Derivative
Action”). The co-lead plaintiffs in the Second Consolidated Derivative Action filed a consolidated amended complaint on November
21, 2022. On December 12, 2022, the parties to the Second Consolidated Derivative Action submitted to the Maryland Court a proposed briefing
schedule for defendants’ anticipated motion to dismiss the consolidated amended complaint in that action. If approved, that proposed
schedule would require defendants to file their anticipated motion to dismiss by February 10, 2023.
On July 21, 2022, the Maryland Court issued a
memorandum opinion and order remanding the Kirst Action to state court. On December 6, 2022, the parties to the Kirst Action filed a stipulated
schedule pursuant to which the plaintiffs are expected to file an amended complaint on December 22, 2022, and either of the parties will
file a stipulated stay of the Kirst Action or the defendants will file a motion to stay the case by January 23, 2023.
On August 30, 2022, the Mesa Action was filed.
On October 3, 2022, the Delaware Court entered an order granting the parties’ request to stay all proceedings and deadlines in the
Mesa Action pending the earlier of dismissal of the Sinnathurai Action or the filing of an answer to the operative complaint in the Sinnathurai
Action.
On December 7, 2022, the Acosta Action was filed.
The plaintiff in the Acosta Action has not yet served the defendants with the complaint and summons.
On February 26, 2021, a Company stockholder named
Thomas Golubinski filed a derivative complaint against members of the Company’s board of directors and members of senior management
in the Delaware Court, captioned Thomas Golubinski v. Richard H. Douglas, et al., No. 2021-0172-JRS. The Company is deemed a nominal
defendant. Golubinski challenged equity awards made in April 2020 and in June 2020 on the ground that they were “spring-loaded,”
that is, made at a time when such board members or members of senior management allegedly possessed undisclosed positive material information
concerning the Company. The complaint asserted claims for breach of fiduciary duty, waste, and unjust enrichment. The plaintiff sought
an award of damages to the Company, an order rescinding both awards or requiring disgorgement, and an award of attorneys’ fees incurred
in connection with the litigation. On May 10, 2021, the defendants moved to dismiss the complaint in its entirety. On June 17, 2021, the
Company’s stockholders voted FOR ratification of the April 2020 awards and ratification of the June 2020 awards. Details of the
ratification proposals are set forth in the Company’s Definitive Proxy Statement filed on May 3, 2021. The results of the vote were
disclosed in the Company’s Current Report on Form 8-K filed on June 24, 2021. Thereafter, the plaintiff stipulated that, as a result
of the outcome of the June 17, 2021 vote, the plaintiff no longer intends to pursue the lawsuit or any claim arising from the April 2020
and June 2020 awards. On August 23, 2021, the plaintiff filed a motion seeking an award of attorneys’ fees and expenses, to which
the defendants filed an opposition. On October 18, 2022, the Delaware Court denied the plaintiff’s fee application in its entirety.
Under a prior Delaware Court order, the case was automatically dismissed with prejudice upon denial of the plaintiff’s fee application.
On November 14, 2022, Golubinski filed a Notice of Appeal in the Supreme Court of the State of Delaware, and the appeal is expected to
be fully briefed by February 14, 2023.
Cautionary Note Regarding Forward-Looking Statements.
This Current Report on Form 8-K contains
forward-looking statements about financial guidance, the Amended and Restated UK Supply Agreement and the Company’s legal
proceedings. Forward-looking statements include all statements that are not solely historical facts and can be identified by terms
such as “contingent,” “if,” “would,” “will,” “expect” or similar
expressions. Investors are cautioned not to place undue reliance on these forward-looking statements, which are subject to numerous
risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements,
including, without limitation, challenges satisfying, alone or together with partners, various safety, efficacy, and product characterization requirements,
including those related to process qualification and assay validation, necessary to satisfy applicable regulatory authorities; unanticipated
challenges or delays in conducting clinical trials; difficulty obtaining scarce raw materials and supplies; resource constraints, including
human capital and manufacturing capacity, on the ability of the Company to pursue planned regulatory pathways; challenges meeting contractual
requirements under agreements with multiple commercial, governmental, and other entities, including, without limitation, risks related to the Company’s ability to timely achieve conditions under the Amended and Restated UK Supply
Agreement to trigger a purchase by the Authority of any Conditional Doses; the inherent uncertainty in predicting the outcome of any
disagreement between the Company and the Authority with respect to the Amended and Restated UK Supply Agreement; the
unpredictability of expectations related to the Company’s legal proceedings; and those other risks listed under the heading
“Risk Factors” and elsewhere in Novavax’ Annual Report on Form 10-K for the year ended December 31, 2021, in
addition to the risk factors that are listed from time to time in Novavax’ Quarterly Reports on Form 10-Q and any subsequent
filings with the U.S. Securities and Exchange Commission. These forward-looking statements speak only as of the date of this Current
Report on Form 8-K and the Company undertakes no obligation to update these forward-looking statements to reflect events or
circumstances occurring after this Current Report on Form 8-K.