Document:

ebs20191231exhibit1048

                                                                 Certain identified information has been excluded from the exhibit because it is both (i) not material and (ii) would likely              cause competitive harm to the Company, if publicly disclosed.  Double asterisks denote omissions.                                                                                                                    Exhibit 10.48          AWARD/CONTRACT                                       1.   THIS CONTRACT IS A RATED ORDER        RATING         PAGE OF                                                                                                                                                                                                                                                                           UNDER DPAS (15 CFR 700)                                              1       26  2. CONTRACT (Proc. Inst. Ident.) NO.                             3. EFFECTIVE DATE   4. REQUISITION/PURCHASE REQUEST/PROJECT NO.   75A50119C00071                                                   08/30/2019                           OS247977                                                                                                                 5. ISSUED BY              CODE     ASPR-BARDA               6. ADMINISTERED BY (If other than Item 5)     CODE ASPR-BARDA02  ASPR-BARDA                                                  US DEPT OF HEALTH & HUMAN SERVICES  200 Independence Ave., S.W. Room                            ASPR/ORM  640-G                                                       O’NEILL HOUSE OFFICE BUILDING  Washington DC 20201                                         Washington DC 20515                                                                               8. DELIVERY   7. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State and ZIP Code)                                             SCD-C.    EMERGENT PRODUCT DEVELOPMENT GAITHERSBURG INC. 1365869                                                                                                             OTHER (See below)  Attn: Mike Mann                                                                  FOB ORIGIN  300 PROFESSIONAL DRIVE                                                        9. DISCOUNT FOR PROMPT PAYMENT  SUITE 100  GAITHERSBURG MD 208793419                                                                                10. SUBMIT INVOICES                                                                                (4 copies unless otherwise specified) ITEM                                                                                TO THE ADDRESS SHOWN IN  CODE  1365869                          FACILITY CODE                                                            11. SHIP TO/MARK FOR           CODE                OS                 12. PAYMENT WILL BE MADE BY     CODE    ASPR-BARDA02  Office of the Secretary                                               ASPR-BARDA02  200 Independence Ave. S.W.                                            200 C St SW  Washington DC 20201                                                   Washington DC 20201  13. AUTHORITY FOR USING OTHER THAN FULL AND OPEN COMPETITION    14. ACCOUNTING AND APPROPRIATION DATA      10 U.S.C. 2304 (c)(       )    41 U.S.C. 3304(a)(          )                     2019.199SNS1.26088                                                                            15C.      15D.  15A. ITEM NO    15B. SUPPLIES/SERVICES                                                      15E. UNIT PRICE     15F. AMOUNT                                                                         QUANTITY     UNIT  (Base Year)     ACAM Doses                                            [**]                 $[**]              $169,988,000.00                                    Continued                                                                   15G. TOTAL AMOUNT OF CONTRAC                                                                                                          $2,007,468,366.00                                                      16. TABLE OF CONTENTS  (X)    SEC   DESCRIPTION                              PAGE(S)     (X)   SEC   DESCRIPTION                               PAGE(S)         PART I – THE SCHEDULE                                            PART II – CONTRACT CLAUSES    X     A    SOLICITATION/CONTRACT FORM               1            X     I    CONTRACT CLAUSES                          23    X     B    SUPPLIES OR SERVICES AND                 5                 PART III – LIST OF DOCUMENTS, EXHIBITS AND OTHER               PRICES/COSTS                                               ATTACH.    X     C    DESCRIPTION/SPECS./WORK                  9            X     J    LIST OF ATTACHMENTS                       26               STATEMENT    X     D    PACKAGING AND MARKING                    16                PART IV – REPRESENTATIONS AND INSTRUCTIONS    X     E    INSPECTION AND ACCEPTANCE                16                 K    REPRESENTATIONS, CERTIFICATIONS               X     F    DELIVERIES OR PERFORMANCE                17                      AND OTHER STATEMENTS OF                                                                                OFFERORS    X     G    CONTRACT ADMINISTRATION DATA             18                 L    INSTRS., CONDS., AND NOTICES TO                                                                                           OFFERORS    X     H    SPECIAL CONTRACT REQUIREMENTS            19                 M    EVALUATION FACTORS FOR AWARD                 CONTRACTING OFFICER WILL COMPLETE ITEM 17 (SEALED-BID OR NEGOTIATED PROCUREMENT) OR 18 (SEALED-BID PROCUREMENT) AS APPLICABLE  17.  Contractor’s Negotiated Agreement (Contractor is required to sign 18.  SEALED-BID AWARD (Contractor is not required to sign  this  this document and return one copy to issuing office.) Contractor agrees to document.) Your bid on Solicitation Number ________, including the  furnish and deliver all items or perform all the services set forth or additions or changes made by you which additions or changes are set  otherwise identified above and on any continuation sheets for the forth in full above, is hereby accepted as to the items listed above and on  consideration stated herein. The rights and obligations of the parties to any continuation sheets. This award consummates the contract which  this contract shall be subject to and governed by the following  consists of the following documents: (a) the Government’s solicitation and  documents: (a) this award/contract, (b) the solicitation, if any, and (c) your bid, and (b) this award/contract.                       

 

 such provisions, representation, certifications, and specifications, as are No further contractual document is necessary. (Block 18 should be   attached or incorporated by reference herein. (Attachments are listed checked only when awarding a sealed-bid contract.)   herein.)   19A. NAME AND TITLE OF SIGNER (Type or print)                    20A. NAME OF CONTRACTING OFFICER   Adam Havey, EVP Operations                                                         [**]   19B. NAME OF CONTRACTOR                     19C. DATE SIGNED     20B. UNITED STATES OF AMERICA               20C. DATE SIGNED                                                                                                                   16 Dec 19            BY /s/ [**]                                  BY /s/ Adam Havey                                                                           Digitally signed by      (Signature of person authorized to sign)                                                          [**] – S                                                                                  Date: 2019.12.17 09:22:47-05’00’                                                                        (Signature of the Contracting Officer)  AUTHORIZED FOR LOCAL REPRODUCTION  Previous edition is NOT usable      ACAM 10-Yr 75A50119C00071                        Page 2 of 33   

 

   CONTINUATION SHEET    REFERENCE NO. OF DOCUMENT BEING CONTINUED                       PAGE OF                          75A50119C00071                                                  2             26   NAME OF OFFEROR OR CONTRACTOR   EMERGENT PRODUCT DEVELOPMENT GAITHERSBURG INC. 1365869      ITEM No.                     SUPPLIES/SERVICES                   QUANTITY   UNIT    UNIT PRICE    AMOUNT        (A)                               (B)                             (C)      (D)       (E)           (F)                  Tax ID Number: [**]                                                                                    DUNS Number: [**]                  ACAM2000, Smallpox (Vaccinia) Vaccine, Live                  (ACAM) Delivery: 12/30/2019                  Appr. Yr.: 2019 CAN: 199SNS1 Object Class: 26402                  Period of Performance: 08/30/2019 to 08/29/2029 - All                  Dollar Amounts based on Target Amounts of Products                  CLINs X0001 through X0004 as stated on Page 3.                     1              Base Year ACAM2000, Smallpox (Vaccinia) Vaccine,                  Live (ACAM)                  See Section B below for further details.                  Obligated Amount: $169,988,000.00                     2              Option Year 1 ACAM2000, Smallpox (Vaccinia)                  Vaccine, Live (ACAM)                  See Section B below for further details.                  NTE: $[**]                     3              Option Year 2 ACAM2000, Smallpox (Vaccinia)                  Vaccine, Live (ACAM)                  See Section B below for further details.                  NTE: $[**]                     4              Option Year 3 ACAM2000, Smallpox (Vaccinia)                  Vaccine, Live (ACAM)                  See Section B below for further details.                  NTE: $[**]                     5              Option Year 4 ACAM2000, Smallpox (Vaccinia)                  Vaccine, Live (ACAM)                  See Section B below for further details.                  NTE: $[**]                     6              Option Year 5 ACAM2000, Smallpox (Vaccinia)                  Vaccine, Live (ACAM)                  See Section B below for further details.                  NTE: $[**]                     7              Option Year 6 ACAM2000, Smallpox (Vaccinia)                  Vaccine, Live (ACAM)                  See Section B below for further details.                  NTE: $[**]                     8              Option Year 7 ACAM2000, Smallpox (Vaccinia)                  Vaccine, Live (ACAM)                  See Section B below for further details.                  NTE: $[**]                     9              Option Year 8 ACAM2000, Smallpox (Vaccinia)                  Vaccine, Live (ACAM)     ACAM 10-Yr 75A50119C00071                 Page 3 of 33   

 

                  See Section B below for further details.                  NTE: $[**]                     10             Option Year 9 ACAM2000, Smallpox (Vaccinia)                  Vaccine, Live (ACAM)                  See Section B below for further details.                  NTE: $[**]                    This Contract award document finalizes the Notice of Award Letter issued by Contracting Officer [**] on August  30, 2019, which established an effective date of August 30, 2019.      AUTHORIZED FOR LOCAL REPR                                                               OPTIONAL FORM 336 (4-86)                                                                                          Sponsored by GSA                                                                                          FAR (48 CFR) 53.11      ACAM 10-Yr 75A50119C00071                 Page 4 of 33   

 

                                    Table of Contents   Section B - Supplies or Services and Cost/Price ..........................................................................8   Section C - Statement of Work (SOW) ......................................................................................12       C.1 – Background and Need ..................................................................................................12       C.2 – Purpose .........................................................................................................................12       C.3 – Scope of Work ..............................................................................................................12       C.4 – Task 1:  Manufacturing and Delivery of ACAM2000 Vaccine ...................................13         Manufacture of Bulk Vaccine ............................................................................................13         Vaccine Fill and Finish ......................................................................................................13         Requirements for Packaging & Delivery ...........................................................................13         SNS Locations ...................................................................................................................14         Warranties ..........................................................................................................................15         Historical Lots - Testing Program and Quarantine ............................................................15         Task 2: Diluent Replacement .............................................................................................17         Task 3: Syringe Replacement ............................................................................................17         Task 4:  ACAM2000 Vaccine Limited Re-Labeling Activities ........................................17       C-5 – Reporting Requirements (Emergent) ...........................................................................19       C.6 – Reporting Requirements (SNS) ....................................................................................19       C.7. – Delivery Notifications .................................................................................................20       C.8 – Quality Inspections .......................................................................................................20   Section D - Packaging And Marking ..........................................................................................20   Section E - Inspection And Acceptance .....................................................................................20       E.1.  – FAR 52.252-2 Clauses Incorporated by Reference (1998) .....................................20       E.2.  – Inspection and Acceptance .....................................................................................21       E.3.  – Shipment Acceptance..............................................................................................21   Section F - Deliveries Or Performance ......................................................................................22       F.1. – Period of Performance .................................................................................................22       F.2. – Delivery Locations.......................................................................................................22   Section G - Contract Administration Data ................................................................................22       G.1. – Electronic Subcontracting Reporting System (eSRS) .................................................22       G.2. – Invoice Submission .....................................................................................................23       G.3. – Contracting Officer .....................................................................................................23       G.4. – Contracting Officer’s Representative ..........................................................................24       G.5 – Contract Communications/Correspondence ................................................................24    ACAM 10-Yr 75A50119C00071        Page 5 of 33    

 

   Section H - Special Contract Requirements ..............................................................................24      H.1. – Evaluation of Contractor Performance Utilizing CPARS (April 2015) .....................24      H.2. – CDC37.0001 Non-Personal Services (April 2015) .....................................................25      H.3. – Restrictions on Disclosure of Information and Rights in Data ...................................26      H.4. – Liability Protection under the PREP Act ....................................................................26      H.5. – SNS Responsibilities ...................................................................................................27      H.6. – Rights of the Contractor to Market Smallpox Vaccine ...............................................27      H.7. – Expired Doses in the SNS ...........................................................................................27      H.8 – Testing of Quarantined Product ...................................................................................27  Section I - Contract Clauses ........................................................................................................29      I.1 - Clauses Incorporated By Reference ...............................................................................29      I.1 - Clauses Incorporated By Reference ...............................................................................30      FAR 52.217-9 Option to Extend the Term of the Contract (Mar 2000) .........................32  Section J - List Of Attachments ..................................................................................................33    Table 8:  Kit Reference (including Shelf Life) ..........................................................................33                                 ACAM 10-Yr 75A50119C00071        Page 6 of 33   

 

                                         Tables   Table 1:  Overall Price Summary .....................................................................................................5   Table 2:  Task 1 - ACAM2000 Vaccine Manufacture and Provision to the SNS ...........................6   Table 3:  Task 2 - Diluent Replacement and Provision to the SNS .................................................7   Table 4:  Task 3 - Transfer Syringe Replacement and Provision to the SNS1F ..............................7   Table 5:  Task 4 - Vaccine Limited Re-Labeling Program ..............................................................7   Table 6:  Strategy for managing expiring ACAM2000 vaccine ....................................................12   Table 7:  Re-labeling of Rockville MD Manufactured Lots with [**] expiry ...............................14   Table 8:  Kit Reference (including Shelf Life) ..............................................................................26                                ACAM 10-Yr 75A50119C00071        Page 7 of 33    

 

            Section B - Supplies or Services and Cost/Price   Table 1:  Overall Price Summary           ITEM                CLIN X001- Doses           CLIN X002- Diluent     CLIN X003- Syringe    CLIN X004-                                                            Replacement             Replacement       Re-labelling                                                                                                                      Grand Total       Contract Year      ACAM Doses    EXTENDED        Diluent   EXTENDED      Transfer EXTENDE         Target                                           PRICE         Vials      PRICE       Syringes  D PRICE   1          Base Year       [**]      $169,988,000                                                                  $169,988,000   100X     Option Year 1     [**]         [**]                                                          [**]            [**]   200X     Option Year 2     [**]         [**]                                                          [**]            [**]   300X     Option Year 3     [**]         [**]                                                                          [**]   400X     Option Year 4     [**]         [**]       [**]        [**]            [**]      [**]         [**]            [**]   500X     Option Year 5     [**]         [**]       [**]        [**]            [**]      [**]                         [**]   600X     Option Year 6     [**]         [**]       [**]        [**]            [**]      [**]         [**]            [**]   700X     Option Year 7     [**]         [**]       [**]        [**]            [**]      [**]                         [**]   800X     Option Year 8     [**]         [**]       [**]        [**]            [**]      [**]         [**]            [**]   900X     Option Year 9     [**]         [**]       [**]        [**]            [**]      [**]                         [**]          Overall             [**]         [**]       [**]        [**]            [**]      [**]         [**]        $2,007,468,366   Note:  Values based on delivery of target amounts of product and relabeling of inventory at the time of  contract preparation.                                                           ACAM 10-Yr 75A50119C00071                       Page 8 of 33            

 

            Price Summary with Tiered Pricing details   Table 2:  Task 1 - ACAM2000 Vaccine Manufacture and Provision to the SNS                             0001 (Base)         1001 (Option)         2001 (Option)         3001 (Option)         4001 (Option)   Contract Year         08/15/19-09/30/19     10/01/19-09/30/20    10/01/20-09/30/21     10/01/21-09/30/22     10/01/22-09/30/23   Target Exercise-By        8/15/2019               [**]                 [**]                  [**]                  [**]   Date   Delivery Target          12/30/2019               [**]                 [**]                  [**]                  [**]   [**] Doses                   [**]                 [**]                 [**]                  [**]                  [**]   Extended Price               [**]                 [**]                 [**]                  [**]                  [**]   [**] Doses                   [**]                 [**]                 [**]                  [**]                  [**]   Extended Price**        $169,988,000              [**]                 [**]                  [**]                  [**]   [**] Doses                   [**]                 [**]                 [**]                  [**]                  [**]   Extended Price               [**]                 [**]                 [**]                  [**]                  [**]   [**] Doses                   [**]                 [**]                 [**]                  [**]                  [**]   Extended Price               [**]                 [**]                 [**]                  [**]                  [**]                           5001 (Option)        6001 (Option)         7001 (Option)         8001 (Option)         9001 (Option)   Contract Year         10/01/23–09/30/24    10/01/24–09/30/25     10/01/25–09/30/26     10/01/26–09/30/27     10/01/27–09/30/28   Target Exercise-             [**]                 [**]                 [**]                  [**]                  [**]   By Date   Delivery Target              [**]                 [**]                 [**]                  [**]                  [**]   [**] Doses                   [**]                 [**]                 [**]                  [**]                  [**]   Extended Price               [**]                 [**]                 [**]                  [**]                  [**]   [**] Doses                   [**]                 [**]                 [**]                  [**]                  [**]   Extended Price               [**]                 [**]                 [**]                  [**]                  [**]   [**] Doses                   [**]                 [**]                 [**]                  [**]                  [**]   Extended Price               [**]                 [**]                 [**]                  [**]                  [**]   [**] Doses                   [**]                 [**]                 [**]                  [**]                  [**]   Extended Price               [**]                 [**]                 [**]                  [**]                  [**]   ** Extended Price on base period 0001 is for order quantity of [**] doses   Supplies, Services, and Requirements:      ACAM2000 doses supplied as part of a palletized kit. 1 Kit includes 1 ACAM2000 vial, 1 diluent vial, 1 transfer syringe and 100 bifurcated       needles. Package Insert and Medication Guide to be supplied as digital PDF and posted on Daily Med. (Electronic Medication Guide/Package       Insert is contingent upon FDA approval). The kit components are provided on separate pallets. Each kit supports [**] doses.      This is a firm-fixed price line item.      The unit price listed next to each quantity is a price per dose.      The exercise of each CLIN must be completed prior to any obligation to perform work under that CLIN.      The Delivery Target is expected to occur by [**] within the same contract year. Due to the variability in order quantities, long lead times for       certain raw materials, and uncertainties related to manufacturing and release, any expected changes to the delivery target date will be       negotiated and mutually agreed upon.      Guaranteed shelf life at time of delivery is [**] of the [**] from the date of manufacture for vaccine.      Target Exercise-By Date: Both parties agree that the U.S. Government will work to meet the date as closely as possible within allowable       confines of budget cycles. Emergent recognizes that in the event of a continuing resolution or other delayed U.S. Government budgeting       scenario that this may be delayed into the next calendar year. The U.S. Government and Emergent intend to work in good faith to clearly       articulate annual production planning expectations and the U.S. Government may provide a non-binding notice of intent to communicate its       intentions, in the event of a delayed annual budget.      The minimum order quantity per contract year is [**] doses.      For the nine option years, an order may be placed once per contract year in a quantity of [**] doses. For the base year of the contract, the       Government chooses to procure a quantity between the tiers at the tier below the determined amount. For example, in the base year the       Government is procuring [**] doses at the price of $[**].              ACAM 10-Yr 75A50119C00071                       Page 9 of 33            

 

            Table 3:  Task 2 - Diluent Replacement and Provision to the SNS                           4002 (Option)     5002 (Option)      6002 (Option)     7002 (Option)     8002 (Option)    9002 (Option)   Contract Year            10/01/22–         10/01/23–          10/01/24–         10/01/25–         10/01/26–        10/01/27–                            09/30/23          09/30/24          09/30/25          09/30/26          09/30/27         09/30/28   Target Exercise-By          [**]              [**]              [**]               [**]             [**]             [**]   Date   Delivery Target                                                         [**]   [**] Vials                  [**]              [**]              [**]               [**]             [**]             [**]   Extended Price              [**]              [**]              [**]               [**]             [**]             [**]   [**] Vials                  [**]              [**]              [**]               [**]             [**]             [**]   Extended Price              [**]              [**]              [**]               [**]             [**]             [**]   [**] Vials                  [**]              [**]              [**]               [**]             [**]             [**]   Extended Price              [**]              [**]              [**]               [**]             [**]             [**]   [**] Vials                  [**]              [**]              [**]               [**]             [**]             [**]   Extended Price              [**]              [**]              [**]               [**]             [**]             [**]   Supplies, Services, and Requirements:      Diluent replacement for ACAM2000 vaccine kits provided under this contract.      Expiry is [**] from date of manufacture.      This is a firm-fixed price line item.      Guaranteed shelf life from delivery is [**] from the date of manufacture for vials of diluent.      Provision of diluent replacement under prior contracts is available under separate contract.   Table 4:  Task 3 - Transfer Syringe Replacement and Provision to the SNS1                           4003 (Option)     5003 (Option)      6003 (Option)     7003 (Option)     8003 (Option)   9003 (Option)   Contract Year            10/01/22–         10/01/23–          10/01/24–         10/01/25–         10/01/26–       10/01/27–                            09/30/23          09/30/24          09/30/25          09/30/26          09/30/27         09/30/28   Target Exercise-By          [**]              [**]              [**]              [**]              [**]             [**]   Date   Delivery Target                                                         [**]   [**] Transfer               [**]              [**]              [**]               [**]             [**]             [**]   Syringes   Extended Price              [**]              [**]              [**]               [**]             [**]             [**]   [**] Transfer               [**]              [**]              [**]               [**]             [**]             [**]   Syringes   Extended Price              [**]              [**]              [**]               [**]             [**]             [**]   [**] Transfer               [**]              [**]              [**]               [**]             [**]             [**]   Syringes   Extended Price              [**]              [**]              [**]               [**]             [**]             [**]   [**] Transfer               [**]              [**]              [**]               [**]             [**]             [**]   Syringes   Extended Price              [**]              [**]              [**]               [**]             [**]             [**]   Supplies, Services, and Requirements:      Transfer syringe replacement for ACAM2000 vaccine kits.      Expiry is [**] from date of manufacture.      This is a firm-fixed price line item.      Guaranteed shelf life from delivery is [**] from the date of manufacture for transfer syringes.      Provision of transfer syringe replacement under prior contracts is available under separate contract.             ACAM 10-Yr 75A50119C00071                      Page 10 of 33            

 

         Table 5: Task 4 - Vaccine Limited Re-Labeling Program                    1004 (Option)  2004 (Option)  4004 (Option)  6004 (Option)   8004 (Option)  Contract Year  10/01/19–09/30/20 10/01/20–09/30/21 10/01/22–09/30/23 10/01/24–09/30/25 10/01/26–09/30/27  Target Exercise-By  [**]           [**]           [**]           [**]            [**]  Date  Delivery Target                                   [**]  Number of Vials     [**]           [**]           [**]            [**]           [**]                      [**]           [**]           [**]            [**]           [**]  Unit Price (per vial) [**]         [**]           [**]            [**]           [**]  Extended Price      [**]           [**]           [**]            [**]           [**]  Supplies, Services, and Requirements:    This is a firm-fixed price line item.    Complete prior to expiry at site; the number of vials is approximate.    Annual stability testing of representative lots is incorporated into the unit price for ACAM2000 vaccine.     Notes:   B.1   As shown in the chart above, the Government agrees to purchase at least [**] doses of product in  the base year for a total amount of $169,988,000, and to purchase a minimum of [**] doses (with a  target amount of [**] doses) in each option year, if exercised. The Government maintains the right to  purchase up to [**] doses per option year.   B.2   As shown in the chart above, the pricing accounts for both annual escalation and tiered pricing,  which is based on the quantity of the Government’s order.   B.3   Delivery of product shall be FOB Destination. An updated and detailed delivery schedule will be  provided to the SNS within [**] of annual award. Following delivery, SNS will provide Emergent  written notification that it either accepts or rejects the delivered lot(s) within [**] of receipt. If formal  acceptance or rejection is not received in the [**] period it shall be deemed to have been accepted.                                           ACAM 10-Yr 75A50119C00071        Page 11 of 33         

 

   Section C - Statement of Work (SOW)   Title: Warm based manufacturing and license maintenance for ACAM2000 Vaccine   C.1 – Background and Need   As a direct result of the September 11, 2001 tragedy and the increased perceived threat of bio-  terrorist activities against the United States, the Department of Health and Human Services  (DHHS) and the Assistant Secretary for Preparedness and Response (ASPR) have a need to  maintain a contract with the experienced manufacturer to supply its Food & Drug Administration  (FDA) licensed ACAM2000, Smallpox (Vaccinia) Vaccine, Live; the only domestically- produced such vaccine, to maintain its ability to manufacture and deliver the licensed vaccine up  to [**] doses annually.   C.2 – Purpose   The purpose of this project is to maintain the ability to manufacture and deliver licensed  ACAM2000, Smallpox (Vaccinia) Vaccine, Live. The ACAM2000 vaccine shall be  manufactured within the United States (US) in accordance with current Good Manufacturing  Practices (cGMP) guidelines and palletized kits of ACAM2000 Vaccine, diluent, bifurcated  needles and transfer syringes delivered to the ASPR Strategic National Stockpile (SNS).   C.3 – Scope of Work   The Contractor, as an independent organization and not as an agent of the Government, shall  furnish all labor, materials, supplies, facilities, equipment, transportation and travel necessary to  manufacture and deliver listed doses of licensed ACAM2000 vaccine, in accordance with C.10.  The contractor shall deliver an equivalent quantity of ancillaries (ACAM2000 diluent, bifurcated  needles and transfer syringes for use in the administration of the ACAM2000 vaccine. The  contractor shall comply with the following objectives:      •  (Task 1) Manufacture and deliver, Food & Drug Administration (FDA) licensed        ACAM2000 under Biologic License Application (BLA) Submission Tracking Number        (STN) 125158 from approved facilities with the timeframe and quantities in accordance        with Task 1.     •  (Task 1) Maintain the agency-approved Stability testing structure which assesses the        long-term safety and efficacy of the ACAM2000 Lyophilized Drug Product at the        Strategic National Stockpile and supports [**] of shelf life [**] from the time of product        manufacture.     •  (Task 1) Perform qualified vaccinia vaccine potency assay on ACAM2000.     •  (Task 2) Replace expiring ACAM2000 diluent as related to new doses supplied under        this contract     •  (Task 3) Replace expiring transfer syringes as related to new doses supplied under this        contract     •  (Task 4) Relabel vaccine to [**] shelf-life   ACAM 10-Yr 75A50119C00071        Page 12 of 33   

 

        •  (C.5.) Provide quarterly reports and update meetings by the [**] following the end of the         quarter.    C.4 – Task 1:  Manufacturing and Delivery of ACAM2000 Vaccine    The Contractor shall manufacture and deliver, in accordance with this Task 1, licensed   ACAM2000, including ancillary components which shall be delivered to the SNS [**], and   produced entirely in the US in accordance with this Statement of Work. The product shall meet   all requirements as specified in the approved FDA license and any approved supplements or   amendments thereto. Ancillary components include diluent, syringe and bifurcated needle for   reconstitution of vaccine. One vial of diluent will be provided for USP for each vial of vaccine;   one syringe for reconstitution of each vial of vaccine; and one bifurcated needle for each dose of   vaccine. The vaccine and diluent will be labeled and packaged as outlined in the BLA and   subsequently approved FDA license.    Manufacture of Bulk Vaccine    The contractor shall manufacture the cell cultures required for the domestic production of   ACAM2000 at its US bulk vaccine manufacturing facility at the [**] bioreactor scale.    The contractor shall perform all Installation Qualification (IQ), Operational Qualification (OQ),   and Performance Qualification (PQ) on any equipment required to produce the vaccine. The   domestic manufacturing of the ACAM2000 vaccine in Vero cells grown on micro carrier beads   at the [**] scale shall be in accordance with the approved ACAM2000 BLA on file with the   FDA.    Vaccine Fill and Finish    The Contractor shall maintain a validated filling, lyophilization, labeling and packaging of   ACAM2000 at its US fill and finish facility and shall perform all IQ, OQ, and PQ on any   additional equipment required at that facility and associated process development.    Requirements for Packaging & Delivery    The products shall be delivered as follows: ACAM2000, (Smallpox (Vaccinia) Vaccine, Live),   shall be provided in a multiple dose [**]. Each vial shall contain [**]. Each vaccine box shall   contain [**].  Each case shall contain [**].  The ACAM2000 vaccine shall have >[**] shelf life   remaining at the time of delivery.    ACAM2000 Diluent shall be provided as [**]. Each diluent box shall contain [**]. Each case   shall contain [**]. The diluent shall have a [**] shelf life. The diluent should have > [**] of shelf   life remaining at the time of delivery    Bifurcated needles shall be supplied in boxes containing [**] needles each. Each case shall  contain [**] bifurcated needles with an expiry date of [**] from date of manufacture. Transfer  Syringes shall be provided as [**]needles for vaccine reconstitution. Each box shall contain [**]  syringes and [**] syringes per case. Transfer syringes have an expiry date of [**] from the date    ACAM 10-Yr 75A50119C00071        Page 13 of 33    

 

     of manufacture.  The transfer syringes should have ≥[**] of shelf life remaining at the time of   delivery.    Complete, unopened cases of bifurcated needles and syringes will be provided.  The additional   quantity required to provide complete cases (rounded up quantity in excess of kit requirements)   will be provided at no additional cost to the Government). The provided kit summary should note   both the Emergent lot number and the manufacturer’s lot number for needles and syringes.    FDA-approved ACAM2000 Package Insert and Medication Guides shall be provided per the   license as a compact disk (CD). Emergent will work with the FDA to phase-out the CDs and  provide a suitable electronic solution. The contractor shall notify the Contracting Officer’s  Representative (COR) when the Package Insert or Medication Guide are revised and will ship the  current PDF version with each delivery order.   Boxes, cases and shelf cartons shall not contain mixed lot numbers. All pallets are to have the  identical TiHi stack pattern except for the last final pallet per lot number. All ACAM2000  vaccine product shall be delivered on standard 48" by 40" pallet, not to exceed 60” in height,  stretch wrapped and secured to pallet for safe transport.   Prior to an ACAM2000 vaccine and ancillary delivery, the Kit Component Inventory Summary  Sheet which provides the ACAM2000 Kit (vaccine, diluent, bifurcated needle and transfer  syringe) Inventory Summary, shall be provided outlining the products in each delivery; lot  numbers of each items; number of full and partial boxes, cases and pallets; and the total  quantities of each items in vials or each.   The contractor shall provide Certificates of Analysis and Certificates of Conformance for the  vaccine at least [**] prior to shipment arriving at the SNS facility.  The contractor shall also  provide Certificates of Analysis and Vendor Certificate of Manufacturing (or Conformance) for  the diluent prior to shipment arriving at the SNS facility.   Driver information for each delivery truck shall be provided as soon as available to the SNS site.   After the delivery, a documented review of the temperature data from the vaccine and diluent   shipments will be provided.    SNS Locations    Delivery location shall be in accordance with United States Government (USG) instructions   provided [**] prior to the shipment and are specific exclusively to Continental US (CONUS)  locations. Locations outside CONUS may incur additional shipping/validation charges which  will result in a contract modification to be performed prior to shipment.  No more than [**]  shipments [**]. Vaccine relabeling shall occur at current inventory locations unless otherwise  agreed upon.   Delivery shall also include ancillary items for reconstitution of each vial of vaccine (diluent,  transfer syringe) as well as a bifurcated needle for administration of each dose of vaccine.  Packaging, labeling and delivery shall be done according to the methodology and specifications    ACAM 10-Yr 75A50119C00071        Page 14 of 33    

 

   outlined in the current BLA filed with the FDA and as outlined in Section C.6, C.8. Section D,  Section E.   Warranties   A warranty shall be provided for vaccines, diluent, transfer syringes, and bifurcated needles  delivered to the USG during this 10-year contract.      •  Vaccine will have ≥ [**] of shelf-life remaining at time of delivery     •  Diluent will have >[**] of shelf-life remaining at time of delivery.     •  The transfer syringes should have ≥[**] of shelf life remaining at the time of delivery.     •  Transfer Syringes and Needles are commercial products. In the event of supplier and/or        delivery issues that result in shelf life not meeting minimum requirements, the parties will        develop suitable alternatives in delivery and pricing.   For ACAM2000 delivered during this contract, if it is determined that the ACAM2000 vials  delivered do not meet the shelf life standard of [**] expiry from the date of manufacture (with a  minimum of [**] of shelf life remaining at the time of delivery) and that USG has met its storage  and handling obligations for such products pursuant to a separate Quality Agreement, then the  Contractor will provide an equitable remedy based on the remaining shelf life of the non- conforming product(s), which will include one of the following: (a) replacement product (only  during the contract period), (b) a credit against future purchases under the contract, or (c)  reimbursement.   Historical Lots-Testing Program and Quarantine    Doses manufactured and distributed prior to 2018 had labeled expiry periods of less than the  current [**] expiry. As these lots approach their labeled expiry dates, Emergent will coordinate  with SNS and the SNS sites to re-label impacted lots with [**] expiry, per STN 103821/203  (approved 15 Dec 2017). Once lots have exceeded the FDA approved [**] expiry, they will be  quarantined by SNS and will not be distributed for any use.   Given the commitment for a long-term contract to replace the stockpile, Emergent will agree to  test representative lots of quarantined product on an [**] basis and provide the data as For  Information Only (FIO) to SNS until replenished stockpile inventory levels meet the desired  threat assessment level. This information will be provided as soon as it is available and following  the Government placing its annual optional CLIN order for at least [**] ACAM2000 doses.  Under this Vaccine Testing Program, Emergent understands that, in the event of an emergency,  the SNS would be responsible for seeking an appropriate regulatory mechanism to deploy for use  quarantined product.      •  Emergent would follow our procedures in the event of an OOS (out of specification)        result. Upon confirmation of an OOS, that information would be shared with the SNS;     •  Testing would continue only with the concurrent exercise of the option for product        delivery;   ACAM 10-Yr 75A50119C00071        Page 15 of 33   

 

      •  Testing would only continue until the stockpile reaches the threat assessment level ([**]        doses);     •  Based on the lots tested and the proposed delivery schedule, the maximum that lots        would be tested is anticipated to be no more than [**] from the date of manufacture;   The product expiration will remain at [**]. This testing will not be used to support any further  extension to the product expiry dating. Under this agreement, the product maintained in the SNS  stockpile beyond the shelf life of [**] is no longer considered to be under our license. Emergent  is not making any representation or guarantees that the testing will support extensions to the  shelf life and the testing data is not being provided to the SNS in support of expiry extensions.  As a result, Emergent will also no longer be performing any activities beyond the submission of  the data to the SNS. The testing data is not being provided to the SNS in support of expiry  extensions, and any discussions with the FDA regarding the use of the stockpile in an emergency  event or any use of this product will be captured under a different regulatory mechanism outside  of Emergent’ s license and will be the responsibility of the SNS.   The following table provides a summary detailing the strategy for managing expiring  ACAM2000 vaccine:   Table 6:  Strategy for managing expiring ACAM2000 vaccine   Category                      Proposed Strategy  Older lots with < [**] expiry All lots can be managed as having [**] expiry per STN  labeling and < [**] since date of 125158/203 (approved 15 Dec 2017). These lots will be  manufacture                   re-labeled with [**] expiry per the schedule in Section C                                below. Once these lots exceed [**], the lots will be                                quarantined by SNS, per below.  Older lots that have ≥ [**] since These lots have, or will have, exceeded the FDA approved  date of manufacture           expiry period and will be quarantined by SNS. The lots                                will not be distributed by ASPR for any purpose                                (vaccination, research, etc.) except under an approved                                appropriate regulatory mechanism. Once SNS has                                achieved its inventory goal for ACAM2000 vaccine, all                                quarantined expired doses should be destroyed.  New lots with [**] expiry*    All newly manufactured lots under this contract will be  *It is expected the U.S.      labeled with [**] expiry. Therefore, none of these lots will  Government will deploy in date expire during the 10- year period of this contract. When  vaccine first and quarantined the lots do expire in the future, the expired materials  vaccine would only be deployed should be destroyed.  after all in date product is  depleted (and with the  appropriate regulatory oversight).    ACAM 10-Yr 75A50119C00071        Page 16 of 33   

 

     Task 2: Diluent Replacement    The contractor shall replace expiring ACAM2000 diluent related this contract (see Task 2 table).   Government to provide forecast [**] to confirm the quantity to be delivered Options may be   exercised after the base year is awarded through year 10 at the quantities also outlined herein. If   the quantity of diluent requiring replacement changes from the quantity outlined in Section C.6,   both parties shall agree to the change.  Note timing listed in C.6 are approximations as   replacement timing is dependent of the manufacturing date of shipped quantities. The contractor   shall deliver [**].  The diluent shall be packaged in [**] per case.  The diluent shall have a [**]  shelf life. At the time of delivery to the SNS the diluent should have >[**] of shelf life   remaining.    Task 3: Syringe Replacement       •  Transfer Syringe quantities will be in increments of a full case box (divisible by [**]).      •  Replacement of transfer syringes sold prior to this contract are outside the scope of this         proposal and can be quoted separately upon request.    Task 4:  ACAM2000 Vaccine Limited Re-Labeling Activities    The ACAM2000 vaccine currently has an expiration date of [**]. Emergent will re-label vaccine  lots located at the Strategic National Stockpile (SNS) for lots produced by the [**] facility which  have less than an expiry of [**] as they approach their current labeled expiration. (See table  below).  Quantities are estimates and will be verified prior to relabeling efforts.                                ACAM 10-Yr 75A50119C00071        Page 17 of 33    

 

   Table 7:  Re-labeling of [**] Manufactured Lots with [**] expiry               Over-label   Expire        Lot                                                             Grand   Location                                          2020      2021       2023      2025       2027                Year        Date       Number                                                            Total                         [**]         [**]           [**]                                                 [**]                [**]     [**]         [**]           [**]                                                 [**]                         [**]         [**]           [**]                                                 [**]                [**]     [**]         [**]                      [**]                                      [**]                         [**]         [**]                      [**]                                      [**]     [**]                         [**]         [**]                      [**]                                      [**]                         [**]         [**]                      [**]                                      [**]                         [**]         [**]                      [**]                                      [**]                         [**]         [**]                      [**]                                      [**]                         [**]         [**]                      [**]                                      [**]     [**]       [**]                     [**]        [**]       [**]                                      [**]     [**]       [**]     [**]         [**]                      [**]                                      [**]                [**]     [**]         [**]                                [**]                            [**]                         [**]         [**]                                [**]                            [**]                         [**]         [**]                                [**]                            [**]                         [**]         [**]                                [**]                            [**]                         [**]         [**]                                [**]                            [**]                         [**]         [**]                                [**]                            [**]                         [**]         [**]                                [**]                            [**]                         [**]         [**]                                [**]                            [**]                         [**]         [**]                                [**]                            [**]                         [**]         [**]                                           [**]                 [**]                [**]     [**]         [**]                                           [**]                 [**]                         [**]         [**]                                           [**]                 [**]                         [**]         [**]                                           [**]                 [**]                         [**]         [**]                                           [**]                 [**]                         [**]         [**]                                           [**]                 [**]                         [**]         [**]                                           [**]                 [**]                         [**]         [**]                                           [**]                 [**]     [**]       [**]                     [**]                   [**]      [**]       [**]                 [**]     [**]       [**]     [**]         [**]                                                     [**]       [**]                         [**]         [**]                                                     [**]       [**]                         [**]         [**]                                                     [**]       [**]                         [**]         [**]                                                     [**]       [**]                         [**]         [**]                                                     [**]       [**]                         [**]         [**]                                                     [**]       [**]                         [**]         [**]                                                     [**]       [**]     [**]       [**]                     [**]                                                  [**]       [**]    Grand       [**]                     [**]        [**]       [**]      [**]       [**]      [**]       [**]     Total                                           ACAM 10-Yr 75A50119C00071                      Page 18 of 33   

 

   C-5 – Reporting Requirements (Emergent)   The contractor shall submit a Quarterly Progress Report, which shall include the information  listed below that is applicable for the performance period during the quarter being reported. The  contractor shall provide the Contracting Officer’s Representative (COR) with one electronic  copy of the Quarterly Progress Report via e-mail. Any attachments to the report shall be  submitted in Microsoft Word, Adobe Acrobat, or similar files. The contractor shall meet with the  COR quarterly to discuss the Quarterly Progress Report. The contractor shall submit the  Quarterly Reports and schedule the meetings by the [**] following the end of the quarter. The  following shall be included in the quarterly report.         1.    Quarterly Reporting Requirements Manufacturing and Delivery of ACAM2000®              Kits               a.    Procurement and Production               b.    Quality Control Testing and Potency               c.    Quality Manufacturing Deviations (major)         2.    FDA inspections, consultation results or recommendations and any files to the              FDA concerning the ACAM2000 BLA         3.    Security Assessment         4.    Stability Program Assessment (Provided [**])         5.    Overall Project Assessment               a.    Delivery Summary               b.    Projected Deliveries for next reporting period               c.    Plan vs. Actual and Specific problems to address   C.6 – Reporting Requirements (SNS)   SNS shall provide the following information to Emergent at the frequency described below:         1.    Doses delivered from SNS. This number is needed for safety reporting ([**])         2.    Destruction of expired lots of ACAM Vaccine.  ([**] for record retention)         3.    ACAM Vaccine lots in inventory, number of vials, and quantity in quarantine.              ([**] for over-labelling planning)         4.    ACAM Diluent lots in inventory, number of vials. ([**])    ACAM 10-Yr 75A50119C00071        Page 19 of 33   

 

         5.    Note: Updated inventory on specific lots may be required as part of investigations              throughout the contract.   C.7. – Delivery Notifications   Emergent shall notify the COR of the total quantity of product(s) and pallet count that will be  delivered utilizing the Kit Component Inventory Summary Sheet, which provides the  ACAM2000 Kit (vaccine, diluent, bifurcated needle and transfer syringe) Inventory Summary to  the SNS at least [**] prior to each delivery.   C.8 – Quality Inspections      •  Site Visits/Audits: The Government shall perform [**] site visits/security audits as        deemed necessary by the Government throughout the period of performance of the        contract.     •  Quality: The Government reserves the right to visit the contractor’s site for purposes of        assessing quality on an [**] basis or as deemed necessary by the Government throughout        the period of performance of the contract.     •  Notice: The Government will provide [**] advance notice prior to the Contractor of all        site visits and audits. The notice will include a statement concerning the intended scope        of the audit and a list of the required documents or access to personnel. Note: Facilities        with live vaccine is in use (core production/testing areas) require vaccinations or waivers        prior to entry.     •  All audits will be conducted between normal business hours i.e. 8 a.m. through 4 p.m.,        Monday through Friday.     •  Report to be provided by the Government as to any observations associated with site        visits/audits.   The government reserves the right to inspect any contractor or subcontractor facility used for the  manufacture, packaging, storage, transportation or any other handling of products ordered as a  result of this solicitation without prior notice. These inspections do not replace any required  inspections conducted by the FDA but are in addition to such inspections. The contractor will be  required to respond to any finding’s resultant from these inspections with remediation plans or an  explanation of why no remediation is required.   Section D - Packaging And Marking   Packaging shall be consistent with the FDA approved labeling and packaging for this product at  the time of manufacture.   Section E - Inspection And Acceptance   E.1.  – FAR 52.252-2 Clauses Incorporated by Reference (1998)    ACAM 10-Yr 75A50119C00071        Page 20 of 33   

 

     This contract incorporates one or more clauses by reference, with the same force and effect as if   they were given in full text. Upon request, the Contracting Officer will make their full text   available. Also, the full text of a clause may be accessed electronically at this/these address (es):    https://www.acquisition.gov    FAR SOURCE          TITLE AND DATE   52.246-1            Contractor Inspection Requirements (Apr 1984)   52.246-2            Inspection of Supplies – Fixed Price (Aug 1996)   52.246-4            Inspection of Services – Fixed Price (Aug 1996)   52.246-16           Responsibility for Supplies (Apr 1984)    E.2.  – Inspection and Acceptance    Inspection and acceptance of the articles, services, and documentation called for herein shall be   accomplished by the Contracting Officer, or his duly authorized representative (who for the   purposes of this contract shall be the Project Officer/COR) at the destination of the articles,   services or documentation.    The Contractor shall only tender for acceptance those items that conform to the requirements of  this contract. The Government reserves the right to inspect or test any supplies or services that  have been tendered for acceptance. The Government may require repair or replacement of  nonconforming supplies or re-performance of nonconforming services at no increase in contract  price. The Government must exercise its post-acceptance rights:       •  Within a reasonable time after the defect was discovered or should have been discovered;         and      •  Before any substantial change occurs in the condition of the item, unless the change is         due to the defect in the item.      •  Goods damaged by Government personnel during product receipt is not covered under         warranty.      •  Note: Needles and Syringes are provided as complete, unopened cases. As such, excess         quantities required due to rounding to the nearest whole case will be supplied as no cost         to the government.    E.3.  – Shipment Acceptance    Shipment Acceptance is defined by two activities:    1)    Signed review of delivered materials by SNS (FRM041013 or other written notification)       •  Confirmation of quantity of all kit components      •  Confirmation that the materials are labeled correctly (with lot #, date of manufacture         and/or expiration date)    ACAM 10-Yr 75A50119C00071        Page 21 of 33    

 

        •  Confirmation that CoAs are available for each lot      •  Confirmation there is no damage, leakage or moisture, or any other defects associated         with the pallets and boxes.    2)    Review of shipping temperature for the ACAM2000 vaccine and diluent by Emergent         Quality Assurance. (FRM044234)   Emergent may provide staff to assist in the delivery inspection at no additional cost to the  government.  This activity is not a requirement of delivery.   SNS will provide Emergent written notification (either by signed FRM041013 or other written  notification) that it either accepts or rejects the delivered lot(s) within [**] of receipt.   If formal acceptance or rejection is not received in the [**] period, it shall be deemed the  shipment is accepted.   Section F - Deliveries Or Performance    FAR SOURCE          TITLE AND DATE   52.211-17           Delivery of Excess Quantities (Sept 1989)   52.242-15           Stop-Work Order (Aug 1989)   52.242-17           Government Delay of Work (Apr 1984)   52.247-34           FOB Destination (Nov 1991)    F.1. – Period of Performance    The period of performance of this contract shall be a base period and nine 12-month option   periods as follows:   08/30/2019 – 08/29/2020 (Base)          08/30/2024 – 08/29/2025 (Option Year 5)  08/30/2020 – 08/29/2021 (Option Year 1) 08/30/2025 – 08/29/2026 (Option Year 6)  08/30/2021 – 08/29/2022 (Option Year 2) 08/30/2026 – 08/29/2027 (Option Year 7)  08/30/2022 – 08/29/2023 (Option Year 3) 08/30/2027 – 08/29/2028 (Option Year 8)  08/30/2023 – 08/29/2024 (Option Year 4) 08/30/2028 – 08/29/2029 (Option Year 9)    F.2. – Delivery Locations    Finished products shall be delivered by the Contractor to any one of the [**] current SNS sites.   Site Locations to be provided [**] in advance of delivery.   Section G - Contract Administration Data   G.1. – Electronic Subcontracting Reporting System (eSRS)   The Contractor shall register with the Electronic Subcontracts Reporting System (eSRS) for the  submission of its Individual Subcontract Report (SF 294) and the Annual Summary Reports (SF  295). Before registering in eSRS, the Contractor information must be correct in the System for    ACAM 10-Yr 75A50119C00071        Page 22 of 33    

 

     Award Management database. The eSRS is a world wide web-based application available at:  http://www.esrs.gov.  The eSRS website provides training and instruction for data submission.    G.2. – Invoice Submission    Invoices should be submitted electronically (.pdf) simultaneously to [**], Contracting Officer   (CO) at ([**]), [**], Contracting Officer’s Representative (COR) at ([**]), and the Program   Support Center (PSC) at psc_invoices@psc.hhs.gov.    Invoice requirements (from FAR 32.905)    (a)   General. Payment will be based on receipt of a proper invoice and satisfactory contract   performance.    (b)   content of invoices.          (1)   A proper invoice must include the following items:                (i)   Name and address of the contractor.                (ii)  invoice date and invoice number. (Contractors should date invoices as               close as possible to the date of mailing or transmission.)                (iii) Contract number or other authorization for supplies delivered or services               performed (including order number and line item number).                (iv)  Description, quantity, unit of measure, unit price, and extended price of               supplies delivered, or services performed.                (v)   Shipping and payment terms (e.g., shipment number and date of shipment,               discount for prompt payment terms). Bill of lading number and weight of               shipment will be shown for shipments on government bills of lading.                (vi)  Name and address of contractor official to whom payment is to be sent               (must be the same as that in the contract or in a proper notice of assignment).                (vii) Name (where practicable), title, phone number, and mailing address of               person to notify in the event of a defective invoice.                (viii) Taxpayer identification number (TIN). The contractor must include its tin               on the invoice.                (ix)  Electronic funds transfer (EFT) banking information.    G.3. – Contracting Officer    The Contracting Officer is the only individual who can legally commit the Government to the   expenditure of public funds. No person other than the Contracting Officer can make any changes   to the terms, conditions, general provisions, or other stipulations of this contract. No information,    ACAM 10-Yr 75A50119C00071        Page 23 of 33    

 

     other than that which may be contained in an authorized modification to this contract, duly   issued by the Contracting Officer, which may be received from any person employed by the   United States Government, or otherwise, shall be considered grounds for deviation from any   stipulation of this contract.    G.4. – Contracting Officer’s Representative    Performance of the work hereunder shall be subject to the technical directions of the designated   Contracting Officer’s Representative (COR) for this contract.    As used herein, technical directions are directions to the Contractor which fill in details, suggests   possible lines of inquiry, or otherwise completes the general scope of work set forth herein.   These technical directions must be within the general scope of work and may not alter the scope   of work or cause changes of such a nature as to justify an adjustment in the stated contract   price/cost, or any stated limitation thereof.    In the event that the Contractor feels that full implementation of any of these directions may   exceed the scope of the contract, he or she shall notify the originator of the technical direction   and the Contracting Officer in a letter separate of any required report(s) within [**] of the date of   receipt of the technical direction and no action shall be taken pursuant to the direction. If the   Contractor fails to provide the required notification within the said [**] period that any technical   direction exceeds the scope of the contract, then it shall be deemed for purposes of this contract   that the technical direction was within the scope. No technical direction, nor its fulfillment, shall   alter or abrogate the rights and obligations fixed in this contract.    The Government COR is not authorized to change any of the terms and conditions of this   contract. Changes shall be made only by the Contracting Officer by properly written   modification(s) to the contract. The Government will provide the Contractor with a copy of the   delegation memorandum for the COR. Any changes in COR delegation will be made by the   Contracting Officer in writing with a copy being furnished to the Contractor.    G.5 – Contract Communications/Correspondence    The Contractor shall identify all correspondence, reports, and other data pertinent to this contract   by imprinting thereon the contract number from Page 1 of the contract 75A50119C00071.    Section H - Special Contract Requirements   H.1. – Evaluation of Contractor Performance Utilizing CPARS (April 2015)    In accordance with FAR 42.15, the SNS will review and evaluate contract performance. FAR   42.1502 and 42.1503 requires agencies to prepare evaluations of contractor performance and   submit them to the Past Performance Information Retrieval System (PPIRS). The SNS utilizes   the Department of Defense (DOD) web-based Contractor Performance Assessment Reporting   System (CPARS) to prepare and report these contractor performance evaluations. All   information contained in these assessments may be used by the Government, within the   limitations of FAR 42.15, for future source selections in accordance with FAR 15.304 where past   performance is an evaluation factor.    ACAM 10-Yr 75A50119C00071        Page 24 of 33    

 

     The CPARS system requires a contractor representative to be assigned so that the contractor has   appropriate input into the performance evaluation process. The CPARS contractor representative   will be given access to CPARS and will be given the opportunity to concur or not-concur with   performance evaluations before the evaluations are complete. The CPARS contractor   representative will also have the opportunity to add comments to performance evaluations.    The assessment is not subject to the Disputes clause of the contract, nor is it subject to appeal   beyond the review and comment procedures described in the guides on the CPARS website.   Refer to: www.cpars.gov for details and additional information related to CPARS, CPARS user   access, how contract performance assessments are conducted, and how Contractors participate.   Access and training for all persons responsible for the preparation and review of performance   assessments is also available at the CPARS website.    The contractor must provide the SNS contracting office with the name, e-mail address, and   phone number of their designated CPARS representative who will be responsible for logging   into CPARS and reviewing and commenting on performance evaluations. The contractor must   maintain a current representative to serve as the contractor representative in CPARS. It is the   contractor’s responsibility to notify the SNS contracting office, in writing (letter or email), when   their CPARS representative information needs to be changed or updated. Failure to maintain   current CPARS contractor representative information will result in the loss of an opportunity to   review and comment on performance evaluations.    H.2. – CDC37.0001 Non-Personal Services (April 2015)    Personal services shall not be performed under this contract. Although the Government may   provide sporadic or occasional instructions within the scope of the contract, the Contractor is   responsible for control and supervision of its employees. If the Contractor (including its   employees) believes any Government action or communication has been given that would create   a personal services relationship between the Government and any Contractor employee, the   Contractor shall promptly notify the Contracting Officer of this communication or action.    The contractor shall comply with, and ensure their employees and subcontractors comply with,   SNS Policy titled “Identification of Contractors' Employees and Safeguarding Government   Information.” No Contractor employee shall hold him or herself out to be a Government   employee, agent, or representative. No Contractor employee shall state orally or in writing at any   time that he or she is acting on behalf of the Government. In all communications with third   parties in connection with this contract, Contractor employees shall identify themselves as   Contractor employees and specify the name of the company for which they work. The contractor   is limited to performing the services identified in the contract statement of work and shall not   interpret any communication with anyone as a permissible change in contract scope or as   authorization to perform work not described in the contract. All contract changes will be   incorporated by a modification signed by the Contracting Officer.    The Contractor shall ensure that all of its employees and subcontractor employees working on   this contract are informed of the substance of this clause. The Contractor agrees that this is a  non-personal services contract; and that for all the purposes of the contract, the Contractor is not,  nor shall it hold itself out to be an agent or partner of, or joint venture with, the Government. The    ACAM 10-Yr 75A50119C00071        Page 25 of 33    

 

     Contractor shall notify its employees that they shall neither supervise nor accept supervision   from Government employees. The substance of this clause shall be included in all subcontracts at   any tier.    Nothing in this clause shall limit the Government's rights in any way under any other provision   of the contract, including those related to the Government's right to inspect and accept or reject   the services performed under this contract.    H.3. – Restrictions on Disclosure of Information and Rights in Data    Information made available to the Contractor by the Government for the performance or   administration of this effort shall be used only for those purposes and shall not be used in any   other way without the written agreement of the Contracting Officer.    The Contractor agrees to assume responsibility for protecting the confidentiality of Government   records, which are not public information. Each Contractor or employee of the Contractor to   whom information may be made available or disclosed shall be notified in writing by the   Contractor that such information may be disclosed only for a purpose and to the extent   authorized herein.    Contractor and/or contractor personnel shall not divulge or release data or information developed   or obtained in performance of this effort, until made public by the Government, except to   authorize Government personnel or upon written approval of the Contracting Officer or COR.   The contractor shall not use, disclose, or reproduce proprietary data that bears a restrictive   legend, other than as required in the performance of this effort. Nothing herein shall preclude the   use of any data independently acquired by the contractor without such limitations or prohibit an   agreement at no cost to the Government between the contractor and the data owner which   provides for greater rights to the contractor.   H.4. – Liability Protection under the PREP Act   The Public Readiness & Emergency Preparedness Act (PREP Act), Pub. L. 109-148, Division C,  119 Stat. 2818 to 2832, amended the Public Health Service Act, 42, U.S.C. 243 et seq., to  provide targeted liability protections. The Government agrees that the medical countermeasure  delivered by the Contractor under this contract will be administered in humans, in accordance  with the declaration under the PREP Act issued by the Secretary of the Department of Health and  Human Services on December 9, 2015 pursuant to section 319F-3(b) of the Public Health  Service Act, 42, U.S.C 247-d-6d regarding Smallpox Medical Countermeasures- Amendment.  The declaration provides targeted liability protections for smallpox countermeasures based on a  credible risk that the threat of exposure to smallpox and the resulting disease constitutes a public  health emergency. For purposes of this provision, “Vaccine” means ACAM2000 vaccine with its  labeling, packaging, diluent, needles, and any other of their respective components as well as any  other deliverable under this contract. The Vaccine may not be used outside of the United States  until the Contractor and the Government agree to reasonable liability protections for outside the  United States and the Contract has been modified to reflect that agreement; such contract  modification will be a change for which the Contractor will be entitled to an equitable  adjustment in accordance with FAR 52.243-1. Additionally, the USG further agrees, in    ACAM 10-Yr 75A50119C00071        Page 26 of 33    

 

     accordance with Federal rules and regulations, to provide written notice to the Contractor of any   intended use of the Vaccine delivered under this contract. In the event that a claim or suit for   damages is brought against the Contractor by a third party arising out of its performance of this   contract, the USG will provide reasonable and timely access to documents and information   potentially relevant to the Contractor’s assertion of defenses to any dispute with a third party,   including, but not limited to, a claim for bodily injury or other damages allegedly arising out of   the use of the Vaccine delivered to the USG under this contract to the extent permitted by   Federal rules and regulations. The USG will consider any request from the Contractor to assist   the Contractor in litigation, including a request to support the Contractor’s assertion of   appropriate defenses. If and when appropriate, the USG will file papers in support of the   Contractor’s assertion of its defenses in such disputes.    H.5. – SNS Responsibilities    Please refer to QUAL40041 (Quality Agreement, SNS) for Emergent and USG responsibilities   regarding the availability of the most current FDA approved Package Insert and Medication   Guide. Emergent and SNS agree that this Quality Agreement is applicable to this contract. Note   that after contract award the Quality Agreement will be updated to reflect any changes in the   SNS organizational structure, COR and items no longer applicable to SNS.    H.6. – Rights of the Contractor to Market Smallpox Vaccine   The Contractor is not prohibited from marketing the Smallpox Vaccine being sold to SNS under  this Contract provided that such marketing does not interfere with performance under this  Contract.   H.7. – Expired Doses in the SNS   During the term of this contract, any and all expired doses will be held in quarantine by SNS and  will not be distributed for any purpose (e.g., vaccination, research, etc.) except under an  appropriate regulatory mechanism. SNS will be solely responsible for obtaining said appropriate   regulatory mechanism and maintaining it as may be required. Once SNS inventory needs are met   with non-expired doses, SNS will be responsible for the destruction of the expired doses under   the appropriate regulatory mechanism and any future expiring lots of ACAM2000 vaccine. This   Provision does not diminish any Contractor protection granted by Special Provision H.4 above   and is in addition to it.  Accordingly, all protections to Emergent granted by Special Provision   H.4 are fully applicable to any and all Government use of such expired doses held in quarantine   by SNS.    H.8 – Testing of Quarantined Product    Given the commitment for a long-term contract to replace the stockpile, Emergent will agree to   test representative lots of quarantined product on an [**] basis and provide the data as “For  Information Only” (FIO) to SNS until replenished stockpile inventory levels meet the desired  threat assessment level. Under this Vaccine Testing Program, Emergent understands that, in the  event of an emergency, the SNS would be responsible for seeking an appropriate regulatory  mechanism from the FDA to deploy for use Quarantined product.    ACAM 10-Yr 75A50119C00071        Page 27 of 33    

 

        •  Emergent would follow our procedures in the event of an OOS result. Upon confirmation         of an OOS, that information would be shared with the SNS.      •  Testing would continue only with the concurrent exercise of the option for product         delivery.      •  Testing would only continue until the stockpile reaches the threat assessment level.      •  Based on the lots tested and the proposed delivery schedule, the maximum that lots         would be tested is anticipated to be no more than [**] from the date of manufacture.     •  The product expiration will remain at [**]. This testing will not be used to support any        further extension to the product expiry dating.   Under this agreement, the product maintained in the SNS stockpile beyond the shelf life of [**]  is no longer considered to be under our license. Emergent is not making any representation or  guarantees that the testing will support extensions to the shelf life and the testing data is not  being provided to the SNS in support of expiry extensions. As a result, Emergent will also no  longer be performing any activities beyond the submission of the data to the SNS. Any  discussions with the FDA regarding the use of the stockpile in an emergency event or any use of  this product will be captured under a different regulatory mechanism outside of Emergent’ s  license and will be the responsibility of the SNS.                                ACAM 10-Yr 75A50119C00071        Page 28 of 33    

 

   Section I - Contract Clauses   I.1 - Clauses Incorporated By Reference    FAR REFERENCE                       TITLE                         DATE  52.202-1            Definitions                                Nov 2013  52.203-3            Gratuities                                 April 1984  52.203-5            Covenant Against Contingent Fees           May 2014  52.203-6            Restrictions on Subcontractor Sales to the Sep 2006                      Government  52.203-7            Anti-Kickback Procedures                   May 2014  52.203-8            Cancellation, Rescission, and Recovery of Funds May 2014                      for Illegal or Improper Activity  52.203-10           Price or Fee Adjustment for Illegal or Improper May 2014                      Activity  52.203-12           Limitation on Payments to Influence Certain Oct 2010                      Federal Transactions  52.203-17           Contractor Employee Whistleblower Rights and Apr 2014                      Requirements to Inform Employees of                      Whistleblower Rights  52.204-4            Printed or Copied Double-Sided on Recycled May 2011                      Paper  52.204-10           Reporting Executive Compensation and First-Tier Oct 2018                      Subcontract Awards  52.204-13           System for Award Management Maintenance    Oct 2018  52.209-6            Protecting the Government's Interests When Oct 2015                      Subcontracting With Contractors Debarred,                      Suspended, or Proposed for Debarment  52.211-5            Material Requirements                      Aug 2000  52.215-8            Order of Precedence - Uniform Contract Format Oct 1997  52.215-10           Price Reduction for Defective Certified Cost or Aug 2011                      Pricing Data  52.215-11           Price Reduction for Defective Certified Cost or Aug 2011                      Pricing Data Modifications  52.215-12           Subcontractor Cost or Pricing Data         Oct 2010  52.215-13           Subcontractor Cost or Pricing Data-Modifications Oct 2010  52.215-14, Alt 1    Integrity of Unit Prices                   Oct 2010  52.215-15           Pension Adjustments and Asset Reversions   Oct 2010  52.215-18           Reversion or Adjustment of Plans for Post- July 2005                      Retirement Benefits (PRB) other than Pensions  52.215-19           Notification of Ownership Changes          Oct 1997  52.215-21           Requirements for Certified Cost or Pricing Data Oct 2010                      and Data Other Than Certified Cost or Pricing                      Data - Modifications  52.222-3            Convict Labor                              Jun 2003     ACAM 10-Yr 75A50119C00071        Page 29 of 33   

 

   I.1 - Clauses Incorporated By Reference (continued)   FAR REFERENCE       TITLE                                      DATE  52.222-20           Contracts for Materials, Supplies, Articles, and May 2014                      Equipment Exceeding $15,000  52.222-21           Prohibition of Segregated Facilities       Apr 2015  52.222-50           Combating Trafficking in Persons           Jan 2019  52.222-54           Employment Eligibility Verification        Oct 2015  52.223-3            Hazardous Material Identification and Material Jan 1997                      Safety Data  52.223-18           Encouraging Contractor Policies to Ban Text Aug 2011                      Messaging While Driving  52.225-13           Restrictions on Certain Foreign Purchases  Jun 2008  52.227-1            Authorization and Consent                  Dec 2007  52.227-2            Notice and Assistance Regarding Patent and Dec 2007                      Copyright Infringement  52.229-3            Federal, State and Local Taxes             Feb 2013  52.232-1            Payments                                   Apr 1984  52.232-8            Discounts for Prompt Payment               Feb 2002  52.232-9            Limitation on Withholding of Payments      Apr 1984  52.232-11           Extras                                     Apr 1984  52.232-17           Interest                                   May 2014  52.232-23           Assignment of Claims                       May 2014  52.232-25           Prompt Payment                             Jan 2017  52.232-33           Payment by Electronic Funds Transfer—System Oct 2018                      for Award Management  52.232-39           Unenforceability of Unauthorized Obligations Jun 2013  52.232-40           Providing Accelerated Payments to Small Business Dec 2013                      Subcontractors  52.233-1            Disputes                                   May 2014  52.233-3            Protest After Award                        Aug 1996  52.233-4            Applicable Law for Breach of Contract Claim Oct 2004  52.242-13           Bankruptcy                                 Jul 1995  52.243-1            Changes - Fixed-Price                      Aug 1987  52.244-5            Competition in Subcontracting              Dec 1996  52.244-6            Subcontracts for Commercial Items          Aug 2019  52.246-25           Limitation of Liability - Services         Feb 1997  52.247-34           F.O.B. Destination                         Nov 1991  52.247-68           Report of Shipment (REPSHIP)               Feb 2006  52.249-2            Termination for the Convenience of the     Apr 2012                      Government (Fixed Price)  52.249-8            Default (Fixed-Price Supply and Service)   Apr 1984  52.253-1            Computer Generated Forms                   Jan 1991      ACAM 10-Yr 75A50119C00071        Page 30 of 33   

 

   HHSAR Reference       TITLE                                    DATE  HHSAR 352.203-70      Anti-Lobbying                            Dec 2015  HHSAR 352.208-70      Printing and Duplication                 Dec 2015  HHSAR 352.224-71      Confidential Information                 Dec 2015  HHSAR 352.239-74      Electronic and Information Technology    Dec 2015                        Accessibility                                 ACAM 10-Yr 75A50119C00071        Page 31 of 33   

 

     FAR 52.217-8 Option to Extend Services (NOV 1999)    The Government may require continued performance of any services within the limits and at the   rates specified in the contract. These rates may be adjusted only as a result of revisions to   prevailing labor rates provided by the Secretary of Labor. The option provision may be exercised   more than once, but the total extension of performance hereunder shall not exceed [**]. The   Contracting Officer may exercise the option by written notice to the Contractor within [**].    (End of Clause)    FAR 52.217-9 Option to Extend the Term of the Contract (Mar 2000)         (a)   The Government may extend the term of this contract by written notice to the  Contractor within [**] provided that the Government gives the Contractor a preliminary written  notice of its intent to extend at least [**] before the contract expires. The preliminary notice does  not commit the Government to an extension.         (b)   If the Government exercises this option, the extended contract shall be considered  to include this option clause.          (c)   The total duration of this contract, including the exercise of any options under this   clause, shall not exceed [**].    (End of Clause)                                 ACAM 10-Yr 75A50119C00071        Page 32 of 33    

 

   Section J - List Of Attachments   Table 8:  Kit Reference (including Shelf Life)      Component         Quantity     Expiry    Shelf life    Part#/       Box and Case     Pallet      Product                                              at time of   Supplier                                Location and                                              Delivery                                             Temperature                                                                                                   Requirements   ACAM2000          [**]          [**]       [**]       [**]           [**]             [**]      [**]   Vaccine [**]   ACAM2000          [**]          [**]       [**]       [**]           [**]             [**]      [**]   Diluent [**]   Bifurcated        [**]          [**]       [**]       [**]           [**]             [**]      [**]   Needle   Transfer          [**]          [**]       [**]       [**]           [**]             [**]      [**]   Syringe   [**]      ACAM 10-Yr 75A50119C00071                      Page 33 of 33prim_Ex4_2

		
			Exhibit 4.2
		

		
			 
		

		
			Description of the Registrant’s Securities
		

		
			Registered Pursuant to Section 12 of the
		

		
			Securities Exchange Act of 1934
		

		
			 
		

		
			Primoris Services Corporation (“the Company”, “we”, “our”, or “us”) currently has one class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended,   (“the Exchange Act”) our common stock, par value $0.0001 per share.
		

		
			 
		

		
			The following description is a summary and does not purport to be complete. It is subject to, and qualified in its entirety by reference to, the Company’s Amended and Restated Certificate of Incorporation (“the Certificate”) and the Company’s Amended and Restated Bylaws (the “Bylaws”), each of which is incorporated by reference as an exhibit to the Annual Report on Form 10-K of which this Exhibit is a part, and each of which may be amended from time to time. For additional information, please read the Certificate and Bylaws and the applicable provisions of the General Corporation Law of the State of Delaware (“DGCL”).
		

		
			 
		

		
			Description of Capital Stock
		

		
			 
		

		
			General
		

		
			 
		

		
			Our authorized capital stock consists of 90,000,000 shares of common stock, $0.0001 par value per share, and 1,000,000 shares of preferred stock, $0.0001 par value per share.  Pursuant to our Certificate, our board of directors has the authority, without further action by the stockholders (unless such stockholder action is required by applicable law or the rules of any stock exchange or market on which our securities are then traded), to designate and issue shares of preferred stock in one or more series, to establish from time to time the number of shares to be included in each such series, to fix the designations, voting powers, preferences and rights of the shares of each wholly unissued series, and any qualifications, limitations or restrictions thereof, of such series to the full extent permitted by our Certificate and the laws of the State of Delaware.
		

		
			 
		

		
			Voting Rights
		

		
			 
		

		
			Each holder of common stock is entitled to one vote for each share on all matters submitted to a vote of the stockholders, including the election of directors.  Our Certificate and Bylaws do not provide for cumulative voting rights. Except as otherwise provided by law, the Certificate or the Bylaws, in all matters other than the election of directors, the affirmative vote of the majority of the shares present in person or represented by proxy at a meeting at which a quorum is present and entitled to vote on the subject matter shall be the act of the stockholders. Directors shall be elected by a plurality of the shares present in person or represented by proxy at a meeting at which a quorum is present and entitled to vote on the election of directors.
		

		
			 
		

		
			Dividends
		

		
			 
		

		
			Subject to preferences that may be applicable to any then outstanding preferred stock, holders of common stock are entitled to receive dividends, if any, as may be declared from time to time by our board of directors.  The payment of dividends is contingent upon our  revenue and earnings, capital requirements, and general financial conditions, as well as contractual restrictions and other considerations deemed to be relevant by our board of directors.
		

		
			 
		

		
			Liquidation
		

		
			 
		

		
			In the event of our liquidation, dissolution or winding up, holders of common stock will be entitled to share ratably in the net assets legally available for distribution to stockholders after the payment of all of our debts and other liabilities and the satisfaction of any liquidation preference granted to the holders of any then outstanding shares of preferred stock.
		

		
			 
		

		
			
		

		
			

		 

		

			1

		

		

			 

		

		

		
			Rights and Preferences
		

		
			 
		

		
			Holders of common stock have no preemptive, conversion or subscription rights, and there are no redemption or sinking fund provisions applicable to the common stock.  The rights, preferences and privileges of the holders of common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of preferred stock which we may designate in the future.
		

		
			 
		

		
			Fully Paid and Nonassessable
		

		
			 
		

		
			All of our outstanding shares of common stock are fully paid and nonassessable.
		

		
			 
		

		
			Certain Anti-Takeover Provisions
		

		
			 
		

		
			Certain provisions of our Certificate and Bylaws may have the effect of making it more difficult for a third party to acquire, or of discouraging a third party from attempting to acquire, control of us.  Such provisions could limit the price that certain investors might be willing to pay in the future for shares of our common stock and may limit the ability of stockholders to remove current management or directors or approve transactions that stockholders may deem to be in their best interest and, therefore, could adversely affect the price of our common stock.
		

		
			 
		

		
			No Cumulative Voting.  The DGCL provides that stockholders are not entitled to the right to cumulate votes in the election of directors unless our Certificate provides otherwise.  Our Certificate does not provide for cumulative voting.
		

		
			 
		

		
			Classified Board.   Our Certificate and Bylaws provide for our board of directors to be divided into three classes, with staggered three-year terms.  In 2018, our Certificate was amended and restated to provide that commencing with our 2019 annual meeting of stockholders, the directors elected at each annual meeting of the stockholders shall hold office for a term expiring at the next annual meeting of stockholders and until their successors are duly elected and qualified, or until their earlier death, resignation, or removal; provided, however, that each director elected prior to the 2019 annual meeting of stockholders for a term expiring after the 2019 annual meeting of stockholders shall continue to serve for the remainder of the original term for which each such director was elected and until his or her successor is duly elected and qualified, or until his or her earlier death, resignation, or removal.  The division of directors into classes terminates at our 2021 annual meeting of stockholders.
		

		
			 
		

		
			Board Vacancies Filled Only by Majority of Directors Then in Office.  Vacancies and newly created seats on our board may be filled only by our board of directors.  Further, only our board of directors may determine the number of directors on our board.  The inability of stockholders to determine the number of directors or to fill vacancies or newly created seats on the board makes it more difficult to change the composition of our board of directors.
		

		
			 
		

		
			Requirements for Advance Notification of Stockholder Nominations and Proposals.  Our Bylaws establish advance notice procedures with respect to stockholder proposals and the nomination of candidates for election as directors, other than nominations made by or at the direction of the board of directors or a committee of the board of directors.  Our Bylaws provide that in order for a proposal to be properly brought before an annual meeting of stockholders, it must be either (1) specified in the notice of the meeting given by us, (2) otherwise brought before the meeting by or at the direction of our board, or (3) properly brought before the meeting by a stockholder entitled to vote at the meeting and who complies with the following notice procedures: (i) the stockholder must give timely notice thereof in writing of the business to be brought before such meeting to our Secretary, and (ii) such business must be a proper matter for  stockholder action under the DGCL.  Our Bylaws provide that to be timely, a stockholder’s notice must be delivered to our Secretary at our principal executive offices not less than 45 days prior to the first anniversary of the date on which we first mailed our proxy materials for the preceding year’s annual meeting.  If the date of the subsequent year’s annual meeting of stockholders is changed by more than 30 days from the date of the prior year’s meeting, notice by the stockholder for the subsequent year’s annual meeting must be delivered to our Secretary within a “reasonable time” prior to our mailing of the proxy materials for the subsequent year’s annual meeting of stockholders.  If a stockholder proposes to nominate for election or reelection a director, the stockholder’s notice must include all information relating to such director nominee that is required to be disclosed in solicitation of proxies for election of directors in an election contest, or otherwise required, in each case, pursuant to Regulation 14A and Rule 14a-11 under the Exchange Act.
		

		
			 
		

		
			

		 

		

			2

		

		

			 

		

		

		
			Our Bylaws may have the effect of precluding the conduct of certain business at a meeting if the proper procedures are not followed.  Any proposed business other than the nomination of persons for election to our board of directors must constitute a proper matter for stockholder action pursuant to the notice of meeting delivered to us. These provisions may also discourage or deter a potential acquiror from conducting a solicitation of proxies to elect the acquiror’s own slate of directors or otherwise attempting to obtain control of our company.
		

		
			 
		

		
			Undesignated Preferred Stock.  As discussed above, our board of directors has the ability to issue preferred stock with voting or other rights or preferences that could impede the success of any attempt to change control of our company.  These and other provisions may have the effect of deferring hostile takeovers or delaying changes in control or management of us.
		

		
			 
		

		
			 These provisions of Delaware law, our Certificate and our Bylaws may have the effect of deterring hostile takeovers or delaying changes in our control or in our management.  These provisions are intended to enhance the likelihood of continued stability in the composition of our board of directors and in the policies they implement, and to discourage certain types of transactions that may involve an actual or threatened change of our control.  These provisions are designed to reduce our vulnerability to an unsolicited acquisition proposal.  The provisions also are intended to discourage certain tactics that may be used in proxy fights.  However, such provisions could have the effect of discouraging others from making tender offers for our shares and, as a consequence, they also may inhibit fluctuations in the market price of our shares that could result from actual or rumored takeover attempts.
		

		
			 
		

		
			Section 203 of the DGCL
		

		
			 
		

		
			We are subject to Section 203 of the DGCL (“Section 203”), which prohibits a Delaware corporation from engaging in business combinations with an interested stockholder. An interested stockholder is generally defined as an entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation or any entity or person affiliated with or controlling or controlled by such entity or person (“interested stockholder”).  Section 203 provides that an interested stockholder may not engage in business combinations with the corporation for a period of three years after the date that such stockholder became an interested stockholder, with the following exceptions:
		

		
			 
		

			
	
			
				 ·
			

			
	
			
			before such date, the board of directors of the corporation approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder; 

			
	
			
				 ·
			

			
	
			
			upon completion of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction began, excluding for purposes of determining the voting stock outstanding (but not the outstanding voting stock owned by the interested stockholder) those shares owned (i) by persons who are directors and also officers and (ii) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or 

			
	
			
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			on or after such date, the business combination is approved by the board of directors and authorized at an annual or special meeting of the stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock that is not owned by the interested stockholder.

		
			 
		

		
			In general, Section 203 defines business combinations to include the following:
		

		
			 
		

			
	
			
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			any merger or consolidation involving the corporation and the interested stockholder;

			
	
			
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			any sale, lease, transfer, pledge or other disposition of 10% or more of the assets of the corporation to or with the interested stockholder;

			
	
			
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			subject to certain exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder;

			
	
			
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			any transaction involving the corporation that has the effect of increasing the proportionate share of the stock or any class or series of the corporation beneficially owned by the interested stockholder; or

			
	
			
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			the receipt by the interested stockholder of the benefit of any loss, advances, guarantees, pledges or other financial benefits by or through the corporation.

		
			 
		

		
			

		 

		

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			Limitations of Liability and Indemnification
		

		
			 
		

		
			Our Certificate contains provisions that limit the personal liability of each of our directors for monetary damages for breach of fiduciary duty as a director to the fullest extent permitted by the DGCL.  The inclusion of this provision in our Certificate may have the effect of reducing the likelihood of derivative litigation against directors, and may discourage or deter stockholders or management from bringing a lawsuit against directors for breach of their duty of care, even though such an action, if successful, might otherwise have benefited us and our stockholders.
		

		
			 
		

		
			Our Certificate further provides that we may indemnify and hold harmless each person who was or is made a party or is threatened to be made a party to or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he or she is or was a director or officer of our company to the fullest extent permitted by the DGCL.  Our Bylaws provide that we must indemnify any director or officer of the corporation, and may indemnify any other person, who (a) was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that he or she is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines, and amounts paid in settlement actually and reasonably incurred by that person in connection with such action, suit or proceeding if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful, and (b) was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he or she is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys’ fees) actually and reasonably incurred by that person in connection with the defense or settlement of such action or suit if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Delaware Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Delaware Court of Chancery or such other court shall deem proper.
		

		
			 
		

		
			Our Bylaws provide a right of indemnification that includes the right to have paid by us the expenses, including attorneys’ fees, incurred by any of our officers or directors in defending any such proceeding in advance of its final disposition.  If Delaware law so requires, however, the advancement of such expenses incurred by a director or officer in such person’s capacity as a director or officer (and not in any other capacity in which service was or is rendered by such person) will only be made upon the delivery to us of an  undertaking by or on behalf of such person to repay all amounts so advanced if it shall ultimately be determined by final judicial decision that such person is not entitled to be indemnified for such expenses by us.
		

		
			 
		

		
			We have entered into indemnity agreements with our directors and certain of our executive officers for the indemnification and advancement of expenses to these persons.  We believe that these provisions and agreements are necessary to attract and retain qualified directors and executive officers.  We also intend to enter into these agreements with our future directors and certain of our executive officers.  Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling our company pursuant to the foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
		

		
			 
		

		 

		

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