Bavarian Nordic Enters Conditional Agreement for the Acquisition of Shares and Buy Back of Stock Options in its Subsidiary BN ImmunoTherapeutics Inc. in Order to Obtain 100% Ownership of the Subsidiary

2009-11-11 09:22:05 -

London, November , 11, 2009

Kvistgaard, Denmark, November 11, 2009 - Bavarian Nordic A/S (OMX:

BAVA) announced today that the company has entered into a conditional

agreement for the purchase of 400,521 shares in the US subsidiary, BN

ImmunoTherapeutics Inc., from the CEO and President Reiner Laus and

two former employees in the subsidiary with the purpose of obtaining

full ownership of the subsidiary. Further, stock options issued to

employees in the subsidiary are repurchased. This transaction forms

part of Bavarian Nordic's strategy to strengthen the cancer business

area and will give the company full control over the group's

activities in this field.



Overall, the agreement is value neutral for Bavarian Nordic and it

does not affect the company's previously announced expectations for

the 2009 full year results.



The agreement will have no consequences for the future strategy,

organisation and operation of BN ImmunoTherapeutics Inc.



Anders Hedegaard, President & CEO of Bavarian Nordic said: "With the

current positive developments in our cancer research, it is essential

for us to gain the full operational control and thus we want the full

ownership of BN ImmunoTherapeutics. Furthermore, it also strengthens

our position in the ongoing discussions with potential partners on

the out-licensing and continued development of PROSTVAC(TM)."



Terms for the transaction

The transaction will be carried out in connection with a merger

between BN ImmunoTherapeutics Inc. and Bavarian Nordic Holding Inc.

As part hereof, 400,521 shares in BN ImmunoTherapeutics Inc. will be

acquired whereby the company owns 100% of the share capital in the

subsidiary.



The consideration to Reiner Laus and the two former employees will be

paid in part with 136,177 new shares of DKK 10 each in Bavarian

Nordic A/S and in part with a number of future milestone payments

that are triggered upon the successful completion of a number of

pre-defined development milestones. The total consideration including

milestone payments amount to a maximum of DKK 52 million. The

risk-adjusted net present value amounts to DKK 33 million. In

addition to this a separate agreement regarding cancellation of

certain contractual rights, including anti-dilution rights, regarding

BN ImmunoTherapeutics Inc., has been entered into with Reiner Laus.

As compensation Reiner Laus has the right to a number of future

milestone payments which are triggered upon successful completion of

pre-defined development milestones. These milestone payments amount

to a maximum of DKK 26 million. The risk-adjusted net present value

amounts to DKK 3 million.



Furthermore, as part of the transaction, Bavarian Nordic has offered

cash payments to buy back stock options from current and former

employees in BN ImmunoTherapeutics Inc. The company expects that the

stock option holders will accept this offer.



The acquisition of shares in the subsidiary and the above mentioned

terms for the transaction are among others conditioned upon the

acceptance by the stock option holders of the above mentioned offer

no later than 20 business days from this date.

Background for issue of new shares

As partial consideration, Bavarian Nordic A/S will increase its share

capital and issue a total of 136,177 new shares, each with a nominal

value of DKK 10. The offering of new shares will be made to the above

mentioned holders of shares in BN ImmunoTherapeutics Inc. Existing

shareholders will not have pre-emption rights.



The issue of shares will be made through a non-cash contribution of

shares in BN ImmunoTherapeutics Inc.



The issue of shares is made in accordance with Article 5a of the

company's Articles of Association, whereby the Board of Directors is

authorized to increase the company's share capital in one or more

issues with a total of nominally DKK 20,000,000 (20,000,000 shares of

DKK 1).



The subscription price is determined as the closing price of the

company's share on NASDAQ OMX Copenhagen on 10 November 2009 added a

5 % premium.



With regard to the new shares issued in this transaction to CEO &

President of BN ImmunoTherapeutics, Reiner Laus, these are covered by

a lock-up period for one year, but otherwise carry the same rights as

the company's existing shares. The new shares will be admitted to

trading and officially listed on NASDAQ OMX Copenhagen, expectedly by

the end of December 2009.



The company's share capital will after the issue of new shares be

nominally DKK 79,517,450 divided into 7,951,745 shares each with a

nominal value of DKK 10.



Asger Aamund

Chairman of the Board



Contact

Anders Hedegaard, President & CEO. Phone +45 23 20 30 64




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