Document:

exv4w7

 

Exhibit 4.7

REGISTRATION RIGHTS AGREEMENT

     REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of July 16,
2004, by and among Novavax, Inc. a Delaware corporation, with headquarters
located at 8320 Guilford Road, Columbia Maryland 21046 (the “Company”), and the
undersigned buyers (each, a “Buyer” and collectively, the “Buyers”).

     WHEREAS:

     A. In connection with the Securities Purchase Agreement by and among the
parties hereto of even date herewith (the “Securities Purchase Agreement”), the
Company has agreed, upon the terms and subject to the conditions of the
Securities Purchase Agreement, to issue and sell to the Buyers senior
convertible notes of the Company (the “Notes”), which will be convertible into
or redeemable for shares of the Company’s common stock, par value $.01 per
share (the “Common Stock”) (as converted or so redeemed, the “Conversion
Shares”), in each case in accordance with and subject to the terms of the
Notes.

     B. To induce the Buyers to execute and deliver the Securities Purchase
Agreement, the Company has agreed to provide certain registration rights under
the Securities Act of 1933, as amended, and the rules and regulations
thereunder, or any similar successor statute (collectively, the “1933 Act”),
and applicable state securities laws.

     NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and each of the
Buyers hereby agree as follows:

     1. Definitions.

     As used in this Agreement, the following terms shall have the following
meanings:

        a. “Business Day” means any day other than Saturday, Sunday or any other
day on which commercial banks in The City of New York are authorized or
required by law to remain closed.

        b. “Closing Date” shall have the meaning set forth in the Securities
Purchase Agreement.

        c. “Effective Date” means the date the Registration Statement has been
declared effective by the SEC.

        d. “Effectiveness Deadline” means the date which is (i) in the event that
the Registration Statement is not subject to a full review by the SEC, 90 days
after the Closing Date or (ii) in the event that the Registration Statement is
subject to a review by the SEC, 120 days after the Closing Date.

 

 

        e. “Filing Deadline” means 30 days after the Closing Date.

        f. “Investor” means a Buyer, any permitted transferee or assignee thereof
to whom a Buyer assigns its rights under this Agreement and who agrees to
become bound by the provisions of this Agreement in accordance with Section 9
and any transferee or assignee thereof to whom a transferee or assignee assigns
its rights under this Agreement and who agrees to become bound by the
provisions of this Agreement in accordance with Section 9.

        g. “Person” means an individual, a limited liability company, a
partnership, a joint venture, a corporation, a trust, an unincorporated
organization and governmental or any department or agency thereof.

        h. “register,” “registered,” and “registration” refer to a registration
effected by preparing and filing one or more Registration Statements in
compliance with the 1933 Act and pursuant to Rule 415 and the declaration or
ordering of effectiveness of such Registration Statement(s) by the SEC.

        i. “Registrable Securities” means (i) the Conversion Shares issued or
issuable upon conversion or redemption of the Notes and (ii) any shares of
capital stock issued or issuable with respect to the Conversion Shares or the
Notes as a result of any stock split, stock dividend, recapitalization,
exchange or similar event or otherwise, without regard to any limitations on
conversions of the Notes.

        j. “Registration Statement” means a registration statement or registration
statements of the Company filed under the 1933 Act covering the Registrable
Securities.

        k. “Required Holders” means the holders of at least a majority of the
Registrable Securities.

        l. “Required Registration Amount” means 130% of the number of Conversion
Shares issued and issuable as of the trading day immediately preceding the
applicable date of determination, subject to adjustment as provided in Section
2(e).

        m. “Rule 415” means Rule 415 under the 1933 Act or any successor rule
providing for offering securities on a continuous or delayed basis.

        n. “SEC” means the United States Securities and Exchange Commission.

     Capitalized terms used herein and not otherwise defined herein shall have
the respective meanings set forth in the Securities Purchase Agreement.

     2. Registration.

        a. Mandatory Registration. The Company shall prepare, and, as soon
as practicable but in no event later than the Filing Deadline, file with the
SEC the Registration Statement on Form S-3 covering the resale of all of the
Registrable Securities. In the event that Form S-3 is unavailable for such a
registration, the Company shall use such other
form as is

 

 

available for such a registration, subject to the provisions of
Section 2(d). The Registration Statement prepared pursuant hereto shall
register for resale at least the number of shares of Common Stock equal to the
Required Registration Amount as of the date the Registration Statement is
initially filed with the SEC. The Registration Statement shall contain (except
if otherwise directed by the Required Holders) the “Selling
Shareholders” and “Plan of Distribution” sections in substantially
the form attached hereto as Exhibit B. The Company shall use its
reasonable best efforts to have the Registration Statement declared effective
by the SEC as soon as practicable, but in no event later than the Effectiveness
Deadline.

        b. Allocation of Registrable Securities. The initial number of
Registrable Securities included in any Registration Statement and each increase
in the number of Registrable Securities included therein shall be allocated pro
rata among the Investors based on the number of Registrable Securities held by
each Investor at the time the Registration Statement covering such initial
number of Registrable Securities or increase thereof is declared effective by
the SEC. In the event that an Investor sells or otherwise transfers any of
such Investor’s Registrable Securities, each transferee shall be allocated a
pro rata portion of the then remaining number of Registrable Securities
included in such Registration Statement for such transferor. Any shares of
Common Stock included in a Registration Statement and which remain allocated to
any Person which ceases to hold any Registrable Securities covered by such
Registration Statement shall be allocated to the remaining Investors, pro rata
based on the number of Registrable Securities then held by such Investors which
are covered by such Registration Statement. In no event shall the Company
include any securities other than Registrable Securities on any Registration
Statement without the prior written consent of the Required Holders.

        c. Legal Counsel. Subject to Section 5 hereof, the Required
Holders shall have the right to select one legal counsel to review any
registration pursuant to this Section 2 (“Legal Counsel”), which shall be
Schulte Roth & Zabel LLP or such other counsel as thereafter designated by the
Required Holders. The Company and Legal Counsel shall reasonably cooperate
with each other in performing the Company’s obligations under this Agreement.

        d. Ineligibility for Form S-3. In the event that Form S-3 is not
available for the registration of the resale of Registrable Securities
hereunder, the Company shall (i) register the resale of the Registrable
Securities on another appropriate form reasonably acceptable to the Required
Holders and (ii) undertake to register the Registrable Securities on Form S-3
as soon as such form is available, provided that the Company shall maintain the
effectiveness of the Registration Statement then in effect until such time as a
Registration Statement on Form S-3 covering the Registrable Securities has been
declared effective by the SEC.

        e. Sufficient Number of Shares Registered. In the event the number
of shares available under a Registration Statement filed pursuant to Section
2(a) is insufficient to cover all of the Registrable Securities required to be
covered by such Registration Statement or an Investor’s allocated portion of
the Registrable Securities pursuant to Section 2(b), the Company shall amend
the Registration Statement, or file a new Registration Statement
(on the short form available therefor, if applicable), or both, so as to
cover at least the Required Registration Amount as of the trading day
immediately preceding the date of the filing of such

 

 

amendment or new
Registration Statement, in each case, as soon as practicable, but in any event
not later than thirty (30) days after the necessity therefor arises. The
Company shall use it reasonable best efforts to cause such amendment and/or new
Registration Statement to become effective as soon as practicable following the
filing thereof. For purposes of the foregoing provision, the number of shares
available under a Registration Statement shall be deemed “insufficient to cover
all of the Registrable Securities” if at any time the number of shares of
Common Stock available for resale under the Registration Statement is less than
the product determined by multiplying (i) the Required Registration Amount as
of such time by (ii) 0.90. The calculation set forth in the foregoing sentence
shall be made without regard to any limitations on the conversion of the Notes
and such calculation shall assume that the Notes are then convertible or
exercisable into shares of Common Stock and assuming the maximum number of
Conversion Shares will be issued at the then prevailing Conversion Price (as
defined in the Notes).

        f. Effect of Failure to File and Obtain and Maintain Effectiveness of
Registration Statement. If (i) a Registration Statement covering all of
the Registrable Securities required to be covered thereby and required to be
filed by the Company pursuant to this Agreement is (A) not filed with the SEC
on or before the respective Filing Deadline (a “Filing Failure”) or (B) not
declared effective by the SEC on or before the respective Effectiveness
Deadline (an “Effectiveness Failure”) or (ii) on any day after the Effective
Date sales of all of the Registrable Securities required to be included on such
Registration Statement cannot be made (other than during an Allowable Grace
Period (as defined in Section 3(r)) pursuant to such Registration Statement
(including, without limitation, because of a failure to keep such Registration
Statement effective during the Registration Period (as defined below), to
disclose such information as is necessary for sales to be made pursuant to such
Registration Statement or to register a sufficient number of shares of Common
Stock) (a “Maintenance Failure”) then, as partial relief for the damages to any
holder by reason of any such delay in or reduction of its ability to sell the
Registrable Securities (which remedy shall not be exclusive of any other
remedies available at law or in equity), the Company shall pay to each holder
of Registrable Securities relating to such Registration Statement an amount in
cash equal to (A) 1.0% of the aggregate principal amount of the Notes held by
such holder on each of the following dates: (i) the day of a Filing Failure;
(ii) the day of an Effectiveness Failure; and (iii) the day of a Maintenance
Failure and (B) 1.5% of the aggregate principal amount of the Notes held by
such holder on each of the following dates: (i) on every thirtieth day (pro
rated for periods totaling less than thirty days) after the day of a Filing
Failure until such Filing Failure is cured; (ii) on every thirtieth day (pro
rated for periods totaling less than thirty days) after the day of a
Effectiveness Failure until such Effectiveness Failure is cured and (iii) on
every thirtieth day (pro rated for periods totaling less than thirty days)
after the day of a Maintenance Failure until such Maintenance Failure is cured.
The payments to which a holder shall be entitled pursuant to this Section 2(f)
are referred to herein as “Registration Delay Payments.” Registration Delay
Payments shall be paid on the earlier of (I) the last day of the calendar month
during which such Registration Delay Payments are incurred and (II) the third
Business Day after the event or failure giving rise to the Registration Delay
Payments is cured. In the event the Company fails to make Registration Delay
Payments in a timely manner, such Registration Delay Payments shall bear
interest at the rate of 1.5% per month (prorated for partial months) until paid
in full.

 

 

     3. Related Obligations.

     At such time as the Company is obligated to file a Registration Statement
with the SEC pursuant to Section 2(a) or 2(e), the Company will use its
reasonable best efforts to effect the registration of the Registrable
Securities in accordance with the intended method of disposition thereof and,
pursuant thereto, the Company shall have the following obligations:

        a. The Company shall promptly prepare and file with the SEC a Registration
Statement with respect to the Registrable Securities (but in no event later
than the applicable Filing Deadline) and use its reasonable best efforts to
cause such Registration Statement relating to the Registrable Securities to
become effective as soon as practicable after such filing (but in no event
later than the Effectiveness Deadline). The Company shall keep each
Registration Statement effective pursuant to Rule 415 at all times until the
earlier of (i) the date as of which each Investor may sell all of the
Registrable Securities covered by such Registration Statement without
restriction pursuant to Rule 144(k) (or successor thereto) promulgated under
the 1933 Act or (ii) the date on which the Investors shall have sold all the
Registrable Securities covered by such Registration Statement (the
“Registration Period”), which Registration Statement (including any amendments
or supplements thereto and prospectuses contained therein) shall not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein, or necessary to make the statements therein, in
the light of the circumstances in which they were made, not misleading. The
term “ reasonable best efforts” shall mean, among other things, that the
Company shall submit to the SEC, within two (2) Business Days after the Company
learns that no review of a particular Registration Statement will be made by
the staff of the SEC or that the staff has no further comments on the
Registration Statement, as the case may be, a request for acceleration of
effectiveness of such Registration Statement to a time and date not later than
three (3) Business Days after the submission of such request.

        b. The Company shall prepare and file with the SEC such amendments
(including post-effective amendments) and supplements to a Registration
Statement and the prospectus used in connection with such Registration
Statement, which prospectus is to be filed pursuant to Rule 424 promulgated
under the 1933 Act, as may be necessary to keep such Registration Statement
effective at all times during the Registration Period, and, during such period,
comply with the provisions of the 1933 Act with respect to the disposition of
all Registrable Securities of the Company covered by such Registration
Statement until such time as all of such Registrable Securities shall have been
disposed of in accordance with the intended methods of disposition by the
seller or sellers thereof as set forth in such Registration Statement. In the
case of amendments and supplements to a Registration Statement which are
required to be filed pursuant to this Agreement (including pursuant to this
Section 3(b)) by reason of the Company filing a report on Form 10-K, Form 10-Q
or Form 8-K or any analogous report under the Securities Exchange Act of 1934,
as amended (the “1934 Act”), the Company shall have incorporated such report by
reference into the Registration Statement, if applicable, or shall file such
amendments or supplements with the SEC on the same day on which the 1934 Act
report is filed which created the requirement for the Company to amend or
supplement the Registration Statement.

        c. The Company shall (A) permit Legal Counsel to review and comment upon
(i) the Registration Statement a reasonable period of time prior to its filing
with the SEC and (ii) all amendments and supplements to all Registration
Statements (except for reports

 

 

incorporated by reference therein) within a
reasonable number of days prior to their filing with the SEC, and (B) not file
any Registration Statement or amendment or supplement thereto in a form to
which Legal Counsel reasonably objects. The Company shall inform Legal Counsel
of a request for acceleration of the effectiveness of a Registration Statement
or any amendment or supplement thereto and not unreasonably reject any request
by Legal Counsel to delay such acceleration request. The Company shall furnish
to Legal Counsel, without charge, (i) copies of any correspondence from the SEC
or the staff of the SEC to the Company or its representatives relating to any
Registration Statement, (ii) promptly after the same is prepared and filed with
the SEC, one copy of any Registration Statement and any amendment(s) thereto,
including financial statements and schedules, all documents incorporated
therein by reference, if requested by an Investor, and all exhibits and (iii)
upon the effectiveness of any Registration Statement, one copy of the
prospectus included in such Registration Statement and all amendments and
supplements thereto. The Company shall reasonably cooperate with Legal Counsel
in performing the Company’s obligations pursuant to this Section 3.

        d. The Company shall furnish to each Investor whose Registrable Securities
are included in any Registration Statement, without charge, (i) promptly after
the same is prepared and filed with the SEC, at least one copy of such
Registration Statement and any amendment(s) thereto, including financial
statements and schedules, all documents incorporated therein by reference, if
requested by an Investor, all exhibits and each preliminary prospectus, (ii)
upon the effectiveness of any Registration Statement, and ten (10) copies of
the prospectus included in such Registration Statement and all amendments and
supplements thereto (or such other number of copies as such Investor may
reasonably request).

        e. The Company shall use its reasonable best efforts to (i) register and
qualify, unless an exemption from registration and qualification applies, the
resale by Investors of the Registrable Securities covered by a Registration
Statement under such other securities or “blue sky” laws of all applicable
jurisdictions in the United States, (ii) prepare and file in those
jurisdictions, such amendments (including post-effective amendments) and
supplements to such registrations and qualifications as may be necessary to
maintain the effectiveness thereof during the Registration Period, (iii) take
such other actions as may be necessary to maintain such registrations and
qualifications in effect at all times during the Registration Period, and (iv)
take all other actions reasonably necessary or advisable to qualify the
Registrable Securities for sale in such jurisdictions; provided, however, that
the Company shall not be required in connection therewith or as a condition
thereto to (x) qualify to do business in any jurisdiction where it would not
otherwise be required to qualify but for this Section 3(e), (y) subject itself
to general taxation in any such jurisdiction, or (z) file a general consent to
service of process in any such jurisdiction. The Company shall promptly notify
Legal Counsel and each Investor who holds Registrable Securities of the receipt
by the Company of any notification with respect to the suspension of the
registration or qualification of any of the Registrable Securities for sale
under the securities or “blue sky” laws of any jurisdiction in the United
States or its receipt of actual notice of the initiation or threatening of any
proceeding for such purpose.

        f. The Company shall notify each Investor in writing, including via
facsimile or e-mail followed by overnight courier, of the happening of any
event, as promptly as practicable after becoming aware of such event, as a
result of which the prospectus included in a Registration Statement, as then in
effect, includes an untrue statement of a material fact or

 

 

omission to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading (provided that in no event shall such notice contain any material,
nonpublic information), and, subject to Section 3(r), promptly prepare a
supplement or amendment to such Registration Statement to correct such untrue
statement or omission, and deliver ten (10) copies of such supplement or
amendment to each Investor. The Company shall also promptly notify each
Investor in writing, including via facsimile or e-mail followed by overnight
courier, (i) promptly after a prospectus or any prospectus supplement or
post-effective amendment has been filed, and when a Registration Statement or
any post-effective amendment has become effective (notification of such
effectiveness shall be delivered to each Investor by facsimile or e-mail on the
same day of such effectiveness and by overnight mail), (ii) of any request by
the SEC for amendments or supplements to a Registration Statement or related
prospectus or related information, and (iii) of the Company’s reasonable
determination that a post-effective amendment to a Registration Statement would
be appropriate.

        g. The Company shall use its reasonable best efforts to prevent the
issuance of any stop order or other suspension of effectiveness of a
Registration Statement, or the suspension of the qualification of any of the
Registrable Securities for sale in any jurisdiction and, if such an order or
suspension is issued, to obtain the withdrawal of such order or suspension at
the earliest possible moment and to notify each Investor who holds Registrable
Securities being sold of the issuance of such order and the resolution thereof
or its receipt of actual notice of the initiation or threat of any proceeding
for such purpose.

        h. For the purposes of establishing a due diligence defense under
applicable law, at the reasonable request of any Investor, the Company shall
furnish to such Investor, at such times as an Investor may reasonably require
(i) letter, dated such date, from the Company’s independent certified public
accountants in form and substance as is customarily given by independent
certified public accountants to underwriters in an underwritten public
offering, addressed to the Investors, and (ii) an opinion, dated as of such
date, of counsel representing the Company for purposes of such Registration
Statement, in form, scope and substance as is customarily given in an
underwritten public offering, addressed to the Investors.

        i. The Company shall make available for inspection by (i) any Investor,
(ii) Legal Counsel and (iii) one firm of accountants or other agents retained
by the Investors (collectively, the “Inspectors”), all pertinent financial and
other records, and pertinent corporate documents and properties of the Company
(collectively, the “Records”), as shall be reasonably deemed necessary by each
Inspector in order to enable it to exercise its due diligence responsibility
under applicable law, and cause the Company’s officers, directors, employees,
counsel and the Company’s independent certified public accountants to supply
all information which any Inspector may reasonably request for the purpose of
such due diligence; provided, however, that each Inspector shall agree to hold
in strict confidence and shall not make any disclosure (except to an Investor)
or use of any Record or other information which the Company determines in good
faith to be confidential, and of which determination the Inspectors are so
notified, unless (a) the disclosure of such Records is, in the reasonable
judgment of such Investor and the Company, necessary to avoid or correct a
misstatement or omission in any Registration Statement or is otherwise required
under the 1933 Act, (b) the release of such Records is ordered pursuant to a
final, non-appealable subpoena or order from a court or government body of

 

 

competent jurisdiction, or (c) the information in such Records has been made
generally available to the public other than by disclosure in violation of this
or any other agreement of which the Inspector has knowledge. Each Investor
agrees that it shall, upon learning that disclosure of such Records is sought
in or by a court or governmental body of competent jurisdiction or through
other means, give prompt notice to the Company and allow the Company, at its
expense, to undertake appropriate action to prevent disclosure of, or to obtain
a protective order for, the Records deemed confidential. Nothing herein (or in
any other confidentiality agreement between the Company and any Investor) shall
be deemed to limit the Investors’ ability to sell Registrable Securities in a
manner which is otherwise consistent with applicable laws and regulations.

        j. The Company shall hold in confidence and not make any disclosure of
information concerning an Investor provided to the Company unless (i)
disclosure of such information is, in the reasonable judgment of such Investor
and the Company, necessary to comply with federal or state securities laws,
(ii) the disclosure of such information is necessary to avoid or correct a
misstatement or omission in any Registration Statement, (iii) the release of
such information is ordered pursuant to a subpoena or other final,
non-appealable order from a court or governmental body of competent
jurisdiction, or (iv) such information has been made generally available to the
public other than by disclosure in violation of this Agreement or any other
agreement. The Company agrees that it shall, upon learning that disclosure of
such information concerning an Investor is sought in or by a court or
governmental body of competent jurisdiction or through other means, give prompt
written notice to such Investor and allow such Investor, at the Investor’s
expense, to undertake appropriate action to prevent disclosure of, or to obtain
a protective order for, such information.

        k. The Company shall use its reasonable best efforts either to (i) cause
all the Registrable Securities covered by a Registration Statement to be listed
on each securities exchange on which securities of the same class or series
issued by the Company are then listed, if any, if the listing of such
Registrable Securities is then permitted under the rules of such exchange, or
(ii) secure designation and quotation of all the Registrable Securities covered
by the Registration Statement on the Nasdaq National Market, or (iii) if,
despite the Company’s best efforts to satisfy the preceding clause (i) or (ii),
the Company is unsuccessful in satisfying the preceding clause (i) or (ii), to
secure the inclusion for quotation on The Nasdaq SmallCap Market for such
Registrable Securities and, without limiting the generality of the foregoing,
to use its best efforts to arrange for at least two market makers to register
with the National Association of Securities Dealers, Inc. (“NASD”) as such with
respect to such Registrable Securities. The Company shall pay all fees and
expenses in connection with satisfying its obligation under this Section 3(k).

        l. The Company shall cooperate with the Investors who hold Registrable
Securities being offered and, to the extent applicable, facilitate the timely
preparation and delivery of certificates (not bearing any restrictive legend)
representing the Registrable Securities to be offered pursuant to a
Registration Statement and enable such certificates to be in such
denominations or amounts, as the case may be, as the Investors may
reasonably request and registered in such names as the Investors may request.

        m. If requested by an Investor, the Company shall within five days of
receipt of notice from such Investor (i) incorporate in a prospectus supplement
or post-effective

 

 

amendment such information as an Investor reasonably requests
to be included therein relating to the sale and distribution of Registrable
Securities, including, without limitation, information with respect to the
number of Registrable Securities being offered or sold, the purchase price
being paid therefor and any other terms of the offering of the Registrable
Securities to be sold in such offering (to the extent contemplated in
Exhibit B); and (ii) make all required filings of such prospectus
supplement or post-effective amendment after being notified of the matters to
be incorporated in such prospectus supplement or post-effective amendment.

        n. The Company shall use its reasonable best efforts to cause the
Registrable Securities covered by the Registration Statement to be registered
with or approved by such other governmental agencies or authorities as may be
necessary to consummate the disposition of such Registrable Securities.

        o. The Company shall make generally available to its security holders as
soon as practical, but not later than 90 days after the close of the period
covered thereby, an earnings statement (in form complying with the provisions
of Rule 158 under the 1933 Act) covering a twelve-month period beginning not
later than the first day of the Company’s fiscal quarter next following the
effective date of the Registration Statement.

        p. The Company shall otherwise use its reasonable best efforts to comply
with all applicable rules and regulations of the SEC in connection with any
registration hereunder.

        q. Within two (2) Business Days after a Registration Statement which
covers Registrable Securities is ordered effective by the SEC, the Company
shall deliver, and shall cause legal counsel for the Company to deliver, to the
transfer agent for such Registrable Securities (with copies to the Investors
whose Registrable Securities are included in such Registration Statement)
confirmation that such Registration Statement has been declared effective by
the SEC to the effect set forth in Exhibit A.

        r. Notwithstanding anything to the contrary herein, at any time after the
Registration Statement has been declared effective by the SEC, the Company may
delay the disclosure of material, non-public information concerning the Company
the disclosure of which at the time is not, in the good faith opinion of the
Board of Directors of the Company and its counsel, in the best interest of the
Company and, in the opinion of counsel to the Company, otherwise required (a
“Grace Period”); provided, that the Company shall promptly (i) notify the
Investors in writing of the existence of material, non-public information
giving rise to a Grace Period (provided that in each notice the Company will
not disclose the content of such material, non-public information to the
Investors) and the date on which the Grace Period will begin, and (ii) notify
the Investors in writing of the date on which the Grace Period ends; and,
provided further, that no Grace Period shall exceed ten (10) consecutive days
and during any 365 day period such Grace Periods shall not exceed an aggregate
of thirty (30) days and the first day of
any Grace Period must be at least 2 Trading Days (as defined in the Notes)
after the last day of any prior Grace Period (an “Allowable Grace Period”).
For purposes of determining the length of a Grace Period above, the Grace
Period shall begin on and include the date the Investors receive the notice
referred to in clause (i) and shall end on and include the later of the date
the Investors receive the notice referred to in clause (ii) and the date
referred to in such notice. Upon

 

 

expiration of the Grace Period, the Company
shall again be bound by the first sentence of Section 3(f) with respect to the
information giving rise thereto unless such material non-public information is
no longer applicable. Notwithstanding anything to the contrary, the Company
shall cause its transfer agent to deliver unlegended shares of Common Stock to
a transferee of an Investor in accordance with the terms of the Securities
Purchase Agreement in connection with any sale of Registrable Securities with
respect to which an Investor has entered into a contract for sale, and
delivered a copy of the prospectus included as part of the applicable
Registration Statement, prior to the Investor’s receipt of the notice of a
Grace Period and for which the Investor has not yet settled.

     4. Obligations Of The Investors.

        a. At least five (5) Business Days prior to the first anticipated filing
date of a Registration Statement, the Company shall notify each Investor in
writing of the information the Company requires from each such Investor if such
Investor elects to have any of such Investor’s Registrable Securities included
in such Registration Statement. It shall be a condition precedent to the
obligations of the Company to complete the registration pursuant to this
Agreement with respect to the Registrable Securities of a particular Investor
that such Investor shall furnish to the Company such information regarding
itself, the Registrable Securities held by it and the intended method of
disposition of the Registrable Securities held by it, as shall be reasonably
required to effect and maintain the effectiveness of the registration of such
Registrable Securities and shall execute such documents in connection with such
registration as the Company may reasonably request.

        b. Each Investor, by such Investor’s acceptance of the Registrable
Securities, agrees to cooperate with the Company as reasonably requested by the
Company in connection with the preparation and filing of any Registration
Statement hereunder, unless such Investor has notified the Company in writing
of such Investor’s election to exclude all of such Investor’s Registrable
Securities from such Registration Statement.

        c. Each Investor agrees that, upon receipt of any notice from the Company
of the happening of any event of the kind described in Section 3(g) or the
first sentence of 3(f), such Investor will immediately discontinue disposition
of Registrable Securities pursuant to any Registration Statement(s) covering
such Registrable Securities until such Investor’s receipt of the copies of the
supplemented or amended prospectus contemplated by Section 3(g) or the first
sentence of 3(f) or receipt of notice that no supplement or amendment is
required. Notwithstanding anything to the contrary, the Company shall cause
its transfer agent to deliver unlegended shares of Common Stock to a transferee
of an Investor in accordance with the terms of the Securities Purchase
Agreement in connection with any sale of Registrable Securities with respect to
which an Investor has entered into a contract for sale prior to the Investor’s
receipt of a notice from the Company of the happening of any event of the kind
described in Section 3(g) or the first sentence of 3(f) and for which the
Investor has not yet settled.

     5. Expenses of Registration.

     All reasonable expenses, other than underwriting discounts and commissions
incurred in connection with registrations, filings or qualifications pursuant
to Sections 2 and 3,

 

 

including, without limitation, all registration, listing
and qualifications fees, printers and accounting fees, and fees and
disbursements of counsel for the Company shall be paid by the Company. The
Company shall also reimburse Smithfield Fiduciary LLC for the fees and
disbursements of Legal Counsel incurred in connection with registrations,
filings or qualifications pursuant to Sections 2 and 3 of this Agreement which
amount shall be limited to $5,000.

     6. Indemnification.

     In the event any Registrable Securities are included in a Registration
Statement under this Agreement:

        a. To the fullest extent permitted by law, the Company will, and hereby
does, indemnify, hold harmless and defend each Investor, the directors,
officers, partners, employees, agents, representatives of, and each Person, if
any, who controls any Investor within the meaning of the 1933 Act or the 1934
Act (each, an “Indemnified Person”), against any losses, claims, damages,
liabilities, judgments, fines, penalties, charges, costs, reasonable attorneys’
fees, amounts paid in settlement or expenses, joint or several, (collectively,
“Claims”) incurred in investigating, preparing or defending any action, claim,
suit, inquiry, proceeding, investigation or appeal taken from the foregoing by
or before any court or governmental, administrative or other regulatory agency,
body or the SEC, whether pending or threatened, whether or not an indemnified
party is or may be a party thereto (“Indemnified Damages”), to which any of
them may become subject insofar as such Claims (or actions or proceedings,
whether commenced or threatened, in respect thereof) arise out of or are based
upon: (i) any untrue statement or alleged untrue statement of a material fact
in a Registration Statement or any post-effective amendment thereto or in any
filing made in connection with the qualification of the offering under the
securities or other “blue sky” laws of any jurisdiction in which Registrable
Securities are offered (“Blue Sky Filing”), or the omission or alleged omission
to state a material fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus if used
prior to the effective date of such Registration Statement, or contained in the
final prospectus (as amended or supplemented, if the Company files any
amendment thereof or supplement thereto with the SEC) or the omission or
alleged omission to state therein any material fact necessary to make the
statements made therein, in light of the circumstances under which the
statements therein were made, not misleading, (iii) any violation or alleged
violation by the Company of the 1933 Act, the 1934 Act, any other law,
including, without limitation, any state securities law, or any rule or
regulation thereunder relating to the offer or sale of the Registrable
Securities pursuant to a Registration Statement or (iv) any violation of this
Agreement (the matters in the foregoing clauses (i) through (iv) being,
collectively, “Violations”). Subject to Section 6(c), the Company shall
reimburse the Indemnified Persons, promptly as such expenses are incurred and
are due and payable, for any legal fees or other reasonable expenses incurred
by them in connection with investigating or defending any such Claim.
Notwithstanding anything to the contrary contained herein, the indemnification
agreement contained in this Section 6(a): (i) shall not apply to a Claim
by an Indemnified Person arising out of or based upon a Violation which occurs
in reliance upon and in conformity with information furnished in writing to the
Company by such Indemnified Person for such Indemnified Person expressly for
use in connection with the preparation of the Registration

 

 

Statement or any
such amendment thereof or supplement thereto, if such prospectus was timely
made available by the Company pursuant to Section 3(d); (ii) with respect to
any preliminary prospectus, shall not inure to the benefit of any such person
from whom the person asserting any such Claim purchased the Registrable
Securities that are the subject thereof (or to the benefit of any person
controlling such person) if the untrue statement or omission of material fact
contained in the preliminary prospectus was corrected in the prospectus, as
then amended or supplemented, if such prospectus was timely made available by
the Company pursuant to Section 3(d), and the Indemnified Person was promptly
advised in writing not to use the incorrect prospectus prior to the use giving
rise to a Violation and such Indemnified Person, notwithstanding such advice,
used it or failed to deliver the correct prospectus as required by the 1933 Act
and such correct prospectus was timely made available pursuant to Section 3(d);
(iii) shall not be available to the extent such Claim is based on a failure of
the Investor to deliver or to cause to be delivered the prospectus made
available by the Company, including a corrected prospectus, if such prospectus
or corrected prospectus was timely made available by the Company pursuant to
Section 3(d); and (iv) shall not apply to amounts paid in settlement of any
Claim if such settlement is effected without the prior written consent of the
Company, which consent shall not be unreasonably withheld or delayed. Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of the Indemnified Person and shall survive the transfer
of the Registrable Securities by the Investors pursuant to Section 9.

        b. In connection with any Registration Statement in which an Investor is
participating, each such Investor agrees to severally and not jointly
indemnify, hold harmless and defend, to the same extent and in the same manner
as is set forth in Section 6(a), the Company, each of its directors, each of
its officers who signs the Registration Statement each Person, if any, who
controls the Company within the meaning of the 1933 Act or the 1934 Act (each,
an “Indemnified Party”), against any Claim or Indemnified Damages to which any
of them may become subject, under the 1933 Act, the 1934 Act or otherwise,
insofar as such Claim or Indemnified Damages arise out of or are based upon any
Violation, in each case to the extent, and only to the extent, that such
Violation occurs in reliance upon and in conformity with written information
furnished to the Company by such Investor expressly for use in connection with
such Registration Statement; and, subject to Section 6(c), such Investor will
reimburse any legal or other expenses reasonably incurred by an Indemnified
Party in connection with investigating or defending any such Claim; provided,
however, that the indemnity agreement contained in this Section 6(b) and the
agreement with respect to contribution contained in Section 7 shall not apply
to amounts paid in settlement of any Claim if such settlement is effected
without the prior written consent of such Investor, which consent shall not be
unreasonably withheld or delayed; provided, further, however, that the Investor
shall be liable under this Section 6(b) for only that amount of a Claim or
Indemnified Damages as does not exceed the net proceeds to such Investor as a
result of the sale of Registrable Securities pursuant to such Registration
Statement. Such indemnity shall remain in full force and effect regardless of
any investigation made by or on behalf of such Indemnified Party and shall
survive the transfer of the Registrable Securities by the Investors pursuant to
Section 9. Notwithstanding anything to the contrary contained herein, the
indemnification agreement contained in this Section 6(b) with respect to any
preliminary
prospectus shall not inure to the benefit of any Indemnified Party if the
untrue statement or omission of material fact contained in the preliminary
prospectus was corrected on a timely basis in the prospectus, as then amended
or supplemented.

 

 

        c. Promptly after receipt by an Indemnified Person or Indemnified Party
under this Section 6 of notice of the commencement of any action or proceeding
(including any governmental action or proceeding) involving a Claim, such
Indemnified Person or Indemnified Party shall, if a Claim in respect thereof is
to be made against any indemnifying party under this Section 6, deliver to the
indemnifying party a written notice of the commencement thereof, and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume control of the defense thereof with counsel
mutually satisfactory to the indemnifying party and the Indemnified Person or
the Indemnified Party, as the case may be; provided, however, that an
Indemnified Person or Indemnified Party shall have the right to retain its own
counsel with the fees and expenses of not more than one counsel for such
Indemnified Person or Indemnified Party to be paid by the indemnifying party,
if, in the reasonable opinion of counsel retained by the indemnifying party,
the representation by such counsel of the Indemnified Person or Indemnified
Party and the indemnifying party would be inappropriate due to actual or
potential differing interests between such Indemnified Person or Indemnified
Party and any other party represented by such counsel in such proceeding. In
the case of an Indemnified Person, legal counsel referred to in the immediately
preceding sentence shall be selected by the Required Holders to which the Claim
relates. The Indemnified Party or Indemnified Person shall cooperate fully
with the indemnifying party in connection with any negotiation or defense of
any such action or Claim by the indemnifying party and shall furnish to the
indemnifying party all information reasonably available to the Indemnified
Party or Indemnified Person which relates to such action or Claim. The
indemnifying party shall keep the Indemnified Party or Indemnified Person fully
apprised at all times as to the status of the defense or any settlement
negotiations with respect thereto. No indemnifying party shall be liable for
any settlement of any action, claim or proceeding effected without its prior
written consent, provided, however, that the indemnifying party shall not
unreasonably withhold, delay or condition its consent. No indemnifying party
shall, without the prior written consent of the Indemnified Party or
Indemnified Person, consent to entry of any judgment or enter into any
settlement or other compromise which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such Indemnified Party or
Indemnified Person of a release from all liability in respect to such Claim or
litigation. Following indemnification as provided for hereunder, the
indemnifying party shall be subrogated to all rights of the Indemnified Party
or Indemnified Person with respect to all third parties, firms or corporations
relating to the matter for which indemnification has been made. The failure to
deliver written notice to the indemnifying party within a reasonable time of
the commencement of any such action shall not relieve such indemnifying party
of any liability to the Indemnified Person or Indemnified Party under this
Section 6, except to the extent that the indemnifying party is prejudiced in
its ability to defend such action.

        d. The indemnification required by this Section 6 shall be made by
periodic payments of the amount thereof during the course of the investigation
or defense, as and when bills are received or Indemnified Damages are incurred.

        e. The indemnity agreements contained herein shall be in addition to (i)
any cause of action or similar right of the Indemnified Party or Indemnified
Person against the indemnifying party or others, and (ii) any liabilities the
indemnifying party may be subject to pursuant to the law.

 

 

     7. Contribution.

     To the extent any indemnification by an indemnifying party is prohibited
or limited by law, the indemnifying party agrees to make the maximum
contribution with respect to any amounts for which it would otherwise be liable
under Section 6 to the fullest extent permitted by law; provided, however,
that: (i) no person involved in the sale of Registrable Securities which
person is guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the 1933 Act) in connection with such sale shall be entitled to
contribution from any person involved in such sale of Registrable Securities
who was not guilty of fraudulent misrepresentation; and (ii) contribution by
any seller of Registrable Securities shall be limited in amount to the net
amount of proceeds received by such seller from the sale of such Registrable
Securities pursuant to such Registration Statement.

     8. Reports Under the 1934 Act.

     Until the date on which (A) the Investors shall have sold all the
Conversion Shares and (B) none of the Notes is outstanding, with a view to
making available to the Investors the benefits of Rule 144 promulgated under
the 1933 Act or any other similar rule or regulation of the SEC that may at any
time permit the Investors to sell securities of the Company to the public
without registration (“Rule 144”), the Company agrees to:

        a. make and keep public information available, as those terms are
understood and defined in Rule 144;

        b. file with the SEC in a timely manner all reports and other documents
required of the Company under the 1933 Act and the 1934 Act so long as the
Company remains subject to such requirements (it being understood that nothing
herein shall limit the Company’s obligations under Section 4(c) of the
Securities Purchase Agreement) and the filing of such reports and other
documents is required for the applicable provisions of Rule 144.; and

        c. furnish to each Investor so long as such Investor owns Registrable
Securities, promptly upon request, (i) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so filed
by the Company, and (ii) such other information as may be reasonably requested
to permit the Investors to sell such securities pursuant to Rule 144 without
registration.

     9. Assignment of Registration Rights.

     The rights under this Agreement shall be automatically assignable by the
Investors to any transferee of Registrable Securities if: (i) the Investor
agrees in writing with the transferee or assignee to assign such rights, and a
copy of such agreement is furnished to the Company within a reasonable time
after such assignment; (ii) the Company is, promptly after such transfer or
assignment, furnished with written notice of (a) the name and address of such
transferee or assignee, and (b) the securities with respect to which such
registration rights are being transferred or assigned; (iii) immediately
following such transfer or assignment the further disposition of such
securities by the transferee or assignee is restricted under the 1933 Act and
applicable state securities laws; and (iv) at or before the time the Company
receives the written notice contemplated by clause (ii) of this sentence the
transferee or assignee agrees in writing with the Company to be bound by all of
the provisions contained herein.

 

 

     10. Amendment of Registration Rights.

     Provisions of this Agreement may be amended and the observance thereof may
be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of the Company
and the Required Holders. Any amendment or waiver effected in accordance with
this Section 10 shall be binding upon each Investor and the Company. No such
amendment shall be effective to the extent that it applies to less than all of
the holders of the Registrable Securities. No consideration shall be offered
or paid to any Person to amend or consent to a waiver or modification of any
provision of any of this Agreement unless the same consideration also is
offered to all of the parties to this Agreement.

     11. Miscellaneous.

        a. A Person is deemed to be a holder of Registrable Securities whenever
such Person owns or is deemed to own of record such Registrable Securities. If
the Company receives conflicting instructions, notices or elections from two or
more Persons with respect to the same Registrable Securities, the Company shall
act upon the basis of instructions, notice or election received from such
record owner of such Registrable Securities.

        b. Any notices, consents, waivers or other communications required or
permitted to be given under the terms of this Agreement must be in writing and
will be deemed to have been delivered: (i) upon receipt, when delivered
personally; (ii) upon receipt, when sent by facsimile (provided confirmation of
transmission is mechanically or electronically generated and kept on file by
the sending party); or (iii) one Business Day after deposit with a nationally
recognized overnight delivery service, in each case properly addressed to the
party to receive the same. The addresses and facsimile numbers for such
communications shall be:

     If to the Company:

	 	 	 	 	 	 	 
	 	 	Novavax, Inc.
	 	 	8320 Guilford Road
	 	 	Columbia, Maryland 21046
	

	 	Telephone:
	 	(301) 854-3900	 	 
	

	 	Facsimile:
	 	(301) 854-3900	 	 
	

	 	Attention:	 	 	 	 
	 
	 	 	 	 	 	 

     With a copy to:

	 	 	 	 	 	 	 
	 	 	Ropes & Gray LLP
	 	 	45 Rockefeller Plaza
	 	 	New York, New York 10111
	

	 	Telephone:
	 	(212) 841-5764	 	 
	

	 	Facsimile:
	 	(212) 841-5725	 	 
	

	 	Attention:
	 	Sanford B. Kaynor, Jr., Esq.	 	 

 

 

     If to Legal Counsel:

	 	 	 	 	 	 	 
	 	 	Schulte Roth & Zabel LLP
	 	 	919 Third Avenue
	 	 	New York, New York 10022
	

	 	Telephone:
	 	(212) 756-2000	 	 
	

	 	Facsimile:
	 	(212) 593-5955	 	 
	

	 	Attention:
	 	Eleazer Klein, Esq.	 	 

If to a Buyer, to its address and facsimile number set forth on the Schedule of
Buyers attached hereto, with copies to such Buyer’s representatives as set
forth on the Schedule of Buyers, or to such other address and/or facsimile
number and/or to the attention of such other person as the recipient party has
specified by written notice given to each other party five (5) days prior to
the effectiveness of such change. Written confirmation of receipt (A) given by
the recipient of such notice, consent, waiver or other communication, (B)
mechanically or electronically generated by the sender’s facsimile machine
containing the time, date, recipient facsimile number and an image of the first
page of such transmission or (C) provided by a courier or overnight courier
service shall be rebuttable evidence of personal service, receipt by facsimile
or receipt from a nationally recognized overnight delivery service in
accordance with clause (i), (ii) or (iii) above, respectively.

        c. Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.

        d. All questions concerning the construction, validity, enforcement and
interpretation of this Agreement shall be governed by the internal laws of the
State of New York, without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of New York or any other
jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York. Each party hereby irrevocably
submits to the exclusive jurisdiction of the state and federal courts sitting
in the City of New York, borough of Manhattan, for the adjudication of any
dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and
agrees not to assert in any suit, action or proceeding, any claim that it is
not personally subject to the jurisdiction of any such court, that such suit,
action or proceeding is brought in an inconvenient forum or that the venue of
such suit, action or proceeding is improper. Each party hereby irrevocably
waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof to such party at the
address for such notices to it under this Agreement and agrees that such
service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any
right to serve process in any manner permitted by law. If any provision of
this Agreement shall be invalid or unenforceable in any jurisdiction, such
invalidity or unenforceability shall not affect the validity or enforceability
of the remainder of this Agreement
in that jurisdiction or the validity or enforceability of any provision of
this Agreement in any other jurisdiction. EACH PARTY HEREBY IRREVOCABLY WAIVES
ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE

 

 

ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT
OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

        e. This Agreement and the other Transaction Documents (as defined in the
Securities Purchase Agreement) constitute the entire agreement among the
parties hereto with respect to the subject matter hereof and thereof. There
are no restrictions, promises, warranties or undertakings, other than those set
forth or referred to herein and therein. This Agreement and the other
Transaction Documents supersede all prior agreements and understandings among
the parties hereto with respect to the subject matter hereof and thereof.

        f. Subject to the requirements of Section 9, this Agreement shall inure to
the benefit of and be binding upon the permitted successors and assigns of each
of the parties hereto.

        g. The headings in this Agreement are for convenience of reference only
and shall not limit or otherwise affect the meaning hereof.

        h. This Agreement may be executed in identical counterparts, each of which
shall be deemed an original but all of which shall constitute one and the same
agreement. This Agreement, once executed by a party, may be delivered to the
other party hereto by facsimile transmission of a copy of this Agreement
bearing the signature of the party so delivering this Agreement.

        i. Each party shall do and perform, or cause to be done and performed, all
such further acts and things, and shall execute and deliver all such other
agreements, certificates, instruments and documents, as the other party may
reasonably request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions contemplated hereby.

        j. All consents and other determinations required to be made by the
Investors pursuant to this Agreement shall be made, unless otherwise specified
in this Agreement, by the Required Holders, determined as if all of the Notes
held by Investors then outstanding have been converted into Registrable
Securities without regard to any limitations on conversion of the Notes.

        k. The language used in this Agreement will be deemed to be the language
chosen by the parties to express their mutual intent and no rules of strict
construction will be applied against any party.

        l. This Agreement is intended for the benefit of the parties hereto and
their respective permitted successors and assigns, and is not for the benefit
of, nor may any provision hereof be enforced by, any other Person.

        m. The obligations of each Buyer hereunder are several and not joint with
the obligations of any other Buyer, and no provision of this Agreement is
intended to confer any obligations on any Buyer vis-à-vis any other Buyer.
Nothing contained herein, and no action taken by any Buyer pursuant hereto,
shall be deemed to constitute the Buyers as a partnership, an association, a
joint venture or any other kind of entity, or create a presumption that the
Buyers are in any way acting in concert or as a group with respect to such
obligations or the transactions contemplated herein.

* * * * * *

 

 

     IN WITNESS WHEREOF, each Buyer and the Company have caused their
respective signature page to this Registration Rights Agreement to be duly
executed as of the date first written above.

	 	 	 	 	 
	 	 	COMPANY:
	 
	 	 	 	 
	 	 	NOVAVAX, INC.
	 
	 	 	 	 
	

	 	By:
	 	/s/ Nelson M. Sims
	

	 	 	 	
 
	

	 	 	 	Name: Nelson M. Sims
	

	 	 	 	Title: President and Chief Executive Officer

 

 

     IN WITNESS WHEREOF, each Buyer and the Company have caused their
respective signature page to this Registration Rights Agreement to be duly
executed as of the date first written above.

	 	 	 	 	 
	 	 	BUYERS:
	 
	 	 	 	 
	 	 	SMITHFIELD FIDUCIARY LLC
	 
	 	 	 	 
	

	 	By:
	 	/s/ Adam J. Chill
	

	 	 	 	
 
	

	 	 	 	Name: Adam J. Chill
	

	 	 	 	Title: Authorized Signatory

 

 

     IN WITNESS WHEREOF, each Buyer and the Company have caused their
respective signature page to this Registration Rights Agreement to be duly
executed as of the date first written above.

	 	 	 	 	 
	 	 	SF CAPITAL PARTNERS LTD.
	 
	 	 	 	 
	

	 	By:
	 	/s/ Brian H. Davidson
	

	 	 	 	
 
	

	 	 	 	Name: Brian H. Davidson
	

	 	 	 	Title: Authorized Signatory

 

 

     IN WITNESS WHEREOF, each Buyer and the Company have caused their
respective signature page to this Registration Rights Agreement to be duly
executed as of the date first written above.

	 	 	 	 	 
	 	 	PORTSIDE GROWTH AND OPPORTUNITY FUND
	 
	 	 	 	 
	

	 	By:
	 	/s/ Jeffrey Smith
	

	 	 	 	
 
	

	 	 	 	Name: Jeffrey Smith
	

	 	 	 	Title: Authorized Signatory

 

 

     IN WITNESS WHEREOF, each Buyer and the Company have caused their
respective signature page to this Registration Rights Agreement to be duly
executed as of the date first written above.

	 	 	 	 	 
	 	 	WINCHESTER GLOBAL TRUST

COMPANY LIMITED AS TRUSTEE FOR

CADUCEUS CAPITAL TRUST
	 
	 	 	 	 
	

	 	By:
	 	/s/ Samuel D. Isaly
	

	 	 	 	
 
	

	 	 	 	Name: Samuel D. Isaly
	

	 	 	 	Title: Investment Advisor

 

 

     IN WITNESS WHEREOF, each Buyer and the Company have caused their
respective signature page to this Registration Rights Agreement to be duly
executed as of the date first written above.

	 	 	 	 	 
	 	 	CADUCEUS CAPITAL II, L.P.
	 
	 	 	 	 
	

	 	By:
	 	/s/ Samuel D. Isaly
	

	 	 	 	
 
	

	 	 	 	Name: Samuel D. Isaly
	

	 	 	 	Title: General Partner

 

 

     IN WITNESS WHEREOF, each Buyer and the Company have caused their
respective signature page to this Registration Rights Agreement to be duly
executed as of the date first written above.

	 	 	 	 	 
	 	 	UBS EUCALYPTUS FUND, L.L.C.
	 
	 	 	 	 
	

	 	By:
	 	/s/ Samuel D. Isaly
	

	 	 	 	
 
	

	 	 	 	Name: Samuel D. Isaly
	

	 	 	 	Title: JV Partner

 

 

     IN WITNESS WHEREOF, each Buyer and the Company have caused their
respective signature page to this Registration Rights Agreement to be duly
executed as of the date first written above.

	 	 	 	 	 
	 	 	PW EUCALYPTUS FUND, LTD.
	 
	 	 	 	 
	

	 	By:
	 	/s/ Samuel D. Isaly
	

	 	 	 	
 
	

	 	 	 	Name: Samuel D. Isaly
	

	 	 	 	Title: JV Partner

 

 

     IN WITNESS WHEREOF, each Buyer and the Company have caused their
respective signature page to this Registration Rights Agreement to be duly
executed as of the date first written above.

	 	 	 	 	 
	 	 	HFR SHC AGGRESSIVE FUND
	 
	 	 	 	 
	

	 	By:
	 	/s/ Dora Hines
	

	 	 	 	
 
	

	 	 	 	Name: Dora Hines
	

	 	 	 	Title: For and on behalf of HFR Asset
	

	 	 	 	          Management as Attorney-in-Fact

 

 

     IN WITNESS WHEREOF, each Buyer and the Company have caused their
respective signature page to this Registration Rights Agreement to be duly
executed as of the date first written above.

	 	 	 	 	 
	 	 	FINSBURY WORLDWIDE PHARMACEUTICAL TRUST
	 
	 	 	 	 
	

	 	By:
	 	/s/ Samuel D. Isaly
	

	 	 	 	
 
	

	 	 	 	Name: Samuel D. Isaly
	

	 	 	 	Title: Director

 

 

     IN WITNESS WHEREOF, each Buyer and the Company have caused their
respective signature page to this Registration Rights Agreement to be duly
executed as of the date first written above.

	 	 	 	 	 
	 	 	DEUTSCHE BANK AG LONDON
	 
	 	 	 	 
	 	 	By: DB ADVISORS, L. L.C.
	 
	 	 	 	 
	

	 	By:
	 	/s/ Paul Bigler
	

	 	 	 	
 
	

	 	 	 	Name: Paul Bigler
	

	 	 	 	Title: Managing Director
	 
	 	 	 	 
	

	 	By:
	 	/s/ Shams Butt
	

	 	 	 	
 
	

	 	 	 	Name: Shams Butt
	

	 	 	 	Title: Directorexv10w33

 

EXHIBIT 10.33

AMENDMENT NO. 3

to

CREDIT AGREEMENT

          THIS
AMENDMENT NO. 3 TO CREDIT AGREEMENT (the “Amendment”) is made as of
May 28, 2004 by and among ALION SCIENCE AND TECHNOLOGY CORPORATION (the
“Borrower”), the institutions listed on the signature pages hereof (the
“Lenders”), and LASALLE BANK NATIONAL ASSOCIATION, in its individual capacity
as a Lender and in its capacity as contractual representative (the
“Administrative Agent”) under that certain Credit Agreement dated as of
December 20, 2002 by and among the Borrower, the institutions from time to time
parties thereto as lenders, and the Administrative Agent (as amended by an
Amendment No. 1 dated as of February 6, 2004, and by an Amendment No. 2 dated
as of March 31, 2004, and as further amended, restated, supplemented or
otherwise modified from time to time, the “Credit Agreement”). Defined terms
used herein and not otherwise defined herein shall have the meaning given to
them in the Credit Agreement.

WITNESSETH

           
    WHEREAS, the Borrower, the Lenders, and the Administrative Agent are
parties to the Credit Agreement; and

     
          WHEREAS, the
Borrower has requested that the Administrative Agent and the
Request Lenders amend the Credit Agreement and grant a consent, in each case,
on the terms and conditions set forth herein; and

         
      WHEREAS, the Borrower, the Request Lenders, and the Administrative Agent
have agreed to amend the Credit Agreement and grant the consent, in each case,
on the terms and conditions set forth herein;

           
    NOW, THEREFORE, in consideration of the premises set forth above, the
terms and conditions contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto have agreed to the following amendments to the Credit
Agreement:

           
    1. Amendments to the Credit Agreement. Effective as of February 11, 2004,
notwithstanding that certain Amendment No. 2, dated as of March 31, 2004, by
and among the Borrower, the Lenders and the Administrative Agent, and subject
to the satisfaction of the conditions precedent set forth in Section 4 below,
the Credit Agreement is hereby amended as follows:

	 	1.1.	 	Section 1.01 of the Credit Agreement is hereby amended by
adding the following term to such Section in proper alphabetical
order:

 

 

	 	 	 	“Amstutz Note” means that certain note due 2009, issued by the
Borrower in the aggregate principal amount of $750,000.00 and
purchased by Gary Amstutz, as amended, supplemented or modified in
accordance with Section 7.3(BB) hereof.
	 
	 	1.2.	 	Section 1.01 of the Credit Agreement is hereby amended by
deleting the defined term “Subordinated Notes” thereof in its
entirety and replacing it with the following:
	 
	 	 	 	“Subordinated Notes” means, collectively, the
Senior Subordinated
Notes, the Junior Subordinated Notes and the Amstutz Note.
	 
	 	1.3.	 	Section 1.01 of the Credit Agreement is hereby amended by
deleting the defined term “Transaction Documents” thereof in its
entirety and replacing it with the following:
	 
	 	 	 	“Transaction Documents” means the Loan Documents and the documents
executed and delivered, or adopted, by the Borrower or any of its
Subsidiaries or the ESOT Trustee or the ESOP Fiduciary in
connection with the IITRI Acquisition, the ESOT Transaction and the
issuance of the Senior Subordinated Notes, the Junior Subordinated
Notes and, from and after February 11, 2004 as executed on such
date, the Amstutz Note, including, without limitation, the Asset
Purchase Agreement, the Seller Warrants, the Rights Agreement, the
ESOT Transaction Documents, the Senior Subordinated Notes, the
Junior Subordinated Notes, the Securities Purchase Agreements, and,
from and after February 11, 2004 as executed on such date, the
Amstutz Note, but excluding the ESOP Plan Documents.
	 
	 	1.4.	 	Section 7.3(F) is amended by adding the following subclause
(viii) to such Section:
	 
	 	 	 	(viii) Restricted payments that constitute mandatory payments of
interest due on the Amstutz Note, unless such payments are
prohibited by the terms of such Indebtedness (or any subordination
agreement applicable thereto);
	 
	 	1.5.	 	Section 7.3(F) is amended by deleting the last paragraph
thereof in its entirety and replacing it with the following:
	 
	 	 	 	provided, however, that in no event shall any Restricted Payments
(other than (1) to the Borrower, (2) as permitted by clause (ii)
above, and (3) Restricted Payments resulting from distributions by
the ESOT to participants in the ESOP pursuant to the ESOP Plan
Documents (x) subsequent to the termination by participants in the
ESOP of employment with the Borrower or any Controlled Group member
or (y) as required by Section 401(a)(28) of the Code or any
substantially similar Requirement of Law, and (4) Restricted
Payments resulting from contributions to the ESOT as required under
the ESOP Plan Documents) be declared or made if either a Default or
an Unmatured Default shall have occurred and be continuing at the
date of declaration or payment thereof or would result therefrom;
provided, further, that in no event shall any Restricted

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	 	 	 	Payment be permitted under clauses (v) and (viii) above unless the
Borrower shall have delivered to the Administrative Agent a
compliance certificate in substantially the form of Exhibit H
hereto for the most recently completed fiscal quarter calculated
giving effect to such Restricted Payment as of the last day of such
prior fiscal quarter and certifying that the Borrower is in
compliance with the financial covenants in Section 7.4 as of the
last day of such prior fiscal quarter.

           
    2. Consent. Effective as of the date of this Amendment and subject to
the satisfaction of the conditions precedent set forth in Section 4 below, the
Request Lenders hereby consent to permit the Borrower to suspend its efforts to
enter into Collection Account Agreements with respect to each deposit account
described in Attachment B attached hereto.

           
    3. Conditions of Effectiveness. The effectiveness of this Amendment is
subject to the conditions precedent that the Administrative Agent shall have
received the following:

	 	(a)	 	duly executed originals of this Amendment from each of the
Borrower, the Request Lenders and the Administrative Agent;
	 
	 	(b)	 	duly executed originals of a Reaffirmation in the form of
Attachment A attached hereto from each of the Borrower’s
Subsidiaries identified thereon;
	 
	 	(c)	 	duly executed copy of the Amstutz Note and duly executed
original of that certain Subordination Agreement, executed as of
February 11, 2004, by and between Gary Amstutz and the
Administrative Agent;
	 
	 	(d)	 	duly executed original opinion of Baker & McKenzie, as
counsel to the Borrower, addressed to the Borrower and to the
Administrative Agent and the Lenders;
	 
	 	(e)	 	duly executed copy of an amendment to the Senior Subordinated
Securities Purchase Agreement consenting to the issuance of the
Amstutz Note;
	 
	 	(f)	 	such other documents, instruments and agreements as the
Administrative Agent may reasonably request.

           
    4. Representations and Warranties of the Borrower.

	 	(a)	 	The Borrower hereby represents and warrants that this
Amendment, the attached Reaffirmation and the Credit Agreement, as
previously executed and as amended hereby, constitute legal, valid
and binding obligations of the Borrower and its Subsidiaries parties
thereto and are enforceable against the Borrower and its
Subsidiaries parties thereto in accordance with their terms (except
as enforceability may be limited by bankruptcy, insolvency, or
similar laws affecting the enforcement of creditors’ rights
generally).
	 
	 	(b)	 	Upon the effectiveness of this Amendment and after giving
effect hereto, (i) the Borrower hereby reaffirms all covenants,
representations and warranties made in the Credit Agreement as
amended hereby, and agrees that all such covenants, representations
and warranties shall be true and correct as of the effective date of
this Amendment (unless such representation and warranty is made as
of a specific

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	 	 	 	date, in which case such representation and warranty shall be true
and correct as of such date) and (ii) no Default or Unmatured
Default has occurred and is continuing.

           
    5. References to the Credit Agreement.

	 	(a)	 	Upon the effectiveness of Section 1 hereof, on and after the
date hereof, each reference in the Credit Agreement (including any
reference therein to “this Credit Agreement,” “hereunder,” “hereof,”
“herein” or words of like import referring thereto) or in any other
Loan Document shall mean and be a reference to the Credit Agreement
as amended hereby.
	 
	 	(b)	 	Except as specifically amended above, the Credit Agreement
and all other documents, instruments and agreements executed and/or
delivered in connection therewith, shall remain in full force and
effect, and are hereby ratified and confirmed.
	 
	 	(c)	 	The execution, delivery and effectiveness of this Amendment
shall not, except as expressly provided herein, operate as a waiver
of any right, power or remedy of the Administrative Agent or the
Lenders, nor, except as expressly provided herein in respect of the
Collection Account Agreements, constitute a waiver of any provision
of the Credit Agreement or any other documents, instruments and
agreements executed and/or delivered in connection therewith.

          
     6. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS (INCLUDING 735 ILCS 105/5-1 ET SEQ., BUT
OTHERWISE WITHOUT REGARD TO THE CONFLICT OF LAW PROVISIONS) OF THE STATE OF
ILLINOIS.

           
    7. Headings. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.

           
    8. Counterparts. This Amendment may be executed by one or more of the
parties to this Amendment on any number of separate counterparts and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument.

[REMAINDER OF PAGE INTENTIONALLY BLANK]

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               IN WITNESS WHEREOF, this Amendment has been duly executed as of the day
and year first above written.

	 	 	 	 	 
	 	ALION SCIENCE AND TECHNOLOGY

CORPORATION, as Borrower

 	 
	 	By:  	/s/ John M. Hughes
 	 
	 	 	Name:  	John M. Hughes 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	LASALLE BANK NATIONAL ASSOCIATION, as

Administrative Agent and as a Lender

 	 
	 	By:  	/s/ Scott D. Parsons
 	 
	 	 	Name:  	Scott D. Parsons 	 
	 	 	Title:  	Vice President 	 
	 
	 	NCB CAPITAL CORPORATION, as a Lender

 	 
	 	By:  	/s/ Meg Shrum
 	 
	 	 	Name:  	Meg Shrum 	 
	 	 	Title:  	Vice President 	 
	 
	 	BRANCH BANKING & TRUST COMPANY, as a

Lender

 	 
	 	By:  	/s/ Gregg E. Dougherty
 	 
	 	 	Name:  	Gregg E. Dougherty 	 
	 	 	Title:  	Senior Vice President 	 
	 

SIGNATURE PAGE TO AMENDMENT NO. 3

 

 

	 	 	 	 	 
	 	U.S. BANK NATIONAL ASSOCIATION, as a

Lender

 	 
	 	By:  	/s/ Tim Fossa
 	 
	 	 	Name:  	Tim Fossa 	 
	 	 	Title:  	Vice President 	 
	 
	 	ORIX FINANCIAL SERVICES, INC., as a

Lender

 	 
	 	By:  	/s/ Christopher L. Smith
 	 
	 	 	Name:  	Christopher L. Smith 	 
	 	 	Title:  	Authorized Representative 	 
	 

SIGNATURE PAGE TO AMENDMENT NO. 3

 

 

ATTACHMENT A

REAFFIRMATION

               The undersigned hereby acknowledges receipt of a copy of the foregoing
Amendment No. 3 to the Credit Agreement dated as of December 20, 2002 by and
among ALION SCIENCE AND TECHNOLOGY CORPORATION (the “Borrower”), the
institutions from time to time parties thereto (the “Lenders”), and LASALLE
BANK NATIONAL ASSOCIATION, a national banking association, in its individual
capacity as a Lender and in its capacity as contractual representative (the
“Administrative Agent”)(as amended by an Amendment No. 1 dated as of February
6, 2004, and by Amendment No. 2 dated as of March 31, 2004 and as further
amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), which Amendment No. 3 is dated as of May 28, 2004 (the
“Amendment”). Capitalized terms used in this Reaffirmation and not defined
herein shall have the meanings given to them in the Credit Agreement. Without
in any way establishing a course of dealing by the Administrative Agent or any
Lender, the undersigned reaffirms the terms and conditions of the Guaranty, the
Security Agreement and any other Loan Document executed by it and acknowledges
and agrees that such agreement and each and every such Loan Document executed
by the undersigned in connection with the Credit Agreement remains in full
force and effect and is hereby reaffirmed, ratified and confirmed. All
references to the Credit Agreement contained in the above-referenced documents
shall be a reference to the Credit Agreement as so modified by the Amendment
and as the same may from time to time hereafter be amended, modified or
restated.

Dated: May 28, 2004

	 	 	 	 	 
	HUMAN FACTORS APPLICATIONS, INC.

 	 
	By /s/ John M. Hughes
 	 
	Name:  	John M. Hughes 	 
	Title:  	Treasurer 	 
	 

REAFFIRMATION SIGNATURE PAGE TO AMENDMENT NO. 3

 

 

ATTACHMENT B

DEPOSIT ACCOUNTS

	 	 	 	 	 	 	 
	 	 	Account
	 	Balance
	 	 
	Bank Name
	 	Number
	 	04/30/04
	 	Contact

	Compass Bank-Alabama

	 	046-9598-4
	 	GENERALLY
	 	256-532-6240
	Cashier’s Account

	 	 	 	BELOW 20K	 	 
	P.O. Box 10566
	 	 	 	 	 	 
	Birmingham, AL 35296
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	First Hawaiian Bank

	 	 	 	GENERALLY
	 	Evelyn Ferrera
	Payroll

	 	 	 	BELOW 100K
	 	003eve@fhwn.com
	Maite Branch 03-067513

	 	 	 	 	 	671-475-7855
	400 Route 8

	 	 	 	 	 	Note: Guam is approx 15-16 hours
	Mongmong, Guam 96927

	 	 	 	 	 	          later than our time zone
	 
	 	 	 	 	 	 
	First Hawaiian Bank

	 	 	 	GENERALLY
	 	SAME
	Cashier’s Account

	 	 	 	BELOW 40K	 	 
	Maite Branch 03-074250
	 	 	 	 	 	 
	400 Route 8
	 	 	 	 	 	 

 

 

REAFFIRMATION

               The undersigned hereby acknowledges receipt of a copy of the foregoing
Amendment No. 3 to the Credit Agreement dated as of December 20, 2002 by and
among ALION SCIENCE AND TECHNOLOGY CORPORATION (the “Borrower”), the
institutions from time to time parties thereto (the “Lenders”), and LASALLE
BANK NATIONAL ASSOCIATION, a national banking association, in its individual
capacity as a Lender and in its capacity as contractual representative (the
“Administrative Agent”)(as amended by an Amendment No. 1 dated as of February
6, 2004, and by an Amendment No. 2 on March 31, 2004, and as further amended,
restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”), which Amendment No. 3 is dated as of
May     , 2004 (the
“Amendment”). Capitalized terms used in this Reaffirmation and not defined
herein shall have the meanings given to them in the Credit Agreement. Without
in any way establishing a course of dealing by the Administrative Agent or any
Lender, the undersigned reaffirms the terms and conditions of the Guaranty, the
Security Agreement and any other Loan Document executed by it and acknowledges
and agrees that such agreement and each and every such Loan Document executed
by the undersigned in connection with the Credit Agreement remains in full
force and effect and is hereby reaffirmed, ratified and confirmed. All
references to the Credit Agreement contained in the above-referenced documents
shall be a reference to the Credit Agreement as so modified by the Amendment
and as the same may from time to time hereafter be amended, modified or
restated.

	 	 	 	 	 
	 	Dated: May    , 2004

HUMAN FACTORS APPLICATIONS, INC.

 	 
	 	By   /s/ John M. Hughes
 	 
	 	Name:  	John M. Hughes 	 
	 	Title:  	Treasurer 	 
	 

REAFFIRMATION SIGNATURE PAGE TO AMENDMENT NO. 3

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