v3.26.1
Long-Term Debt
 3 Months Ended
Mar. 31, 2026
Debt Disclosure [Abstract]  
Long-Term Debt Long-Term Debt
Total Long-term debt consisted of the following (in thousands):
March 31, 2026December 31, 2025
5.00% Convertible Senior Notes due 2027
$26,485 $26,485 
4.625% Convertible Senior Notes due 2031
225,000 225,000 
Credit Agreement due 2031
50,000 — 
Unamortized debt issuance costs(10,464)(7,272)
Accrued Credit Agreement exit fee
18 — 
Total long-term debt$291,039 $244,213 
    As of March 31, 2026 and December 31, 2025, the effective interest rate on the Convertible Senior Notes due 2027 and the Convertible Senior Notes due 2031 were 6.2% and 5.3%, respectively. As of March 31, 2026, the effective interest rate on the Credit Agreement was 11.0%.
The interest expense incurred in connection with Long-term debt consisted of the following (in thousands):
Three Months Ended
March 31,
20262025
Coupon interest on Convertible Senior Notes$2,933 $2,192 
Interest on Credit Agreement
422 — 
Amortization of debt issuance costs for Convertible Senior Notes321 442 
Amortization and accretion of debt issuance and exit costs for Credit Agreement
66 — 
Total interest expense on long-term debt$3,742 $2,634 
Credit Agreement
In February 2026, the Company entered into the Credit Agreement with MidCap Financial Trust, as administrative agent (“Agent”), and the lenders from time to time party thereto (the “Lenders”). The Credit Agreement provides for a senior secured term loan facility of up to $330.0 million, consisting of (i) a $130.0 million Term Loan Tranche 1, $50.0 million of which was funded at closing with the remainder available to be drawn, subject to customary conditions, through February 29, 2028; (ii) a $50.0 million Term Loan Tranche 2, available through June 30, 2028, subject to satisfaction of specified royalty revenue-based conditions; (iii) a $50.0 million Term Loan Tranche 3, available beginning January 1, 2027 through June 30, 2029, subject to satisfaction of specified royalty revenue-based conditions; and (iv) a $100.0 million Term Loan Tranche 4, the availability of which is subject to activation and funding approvals in the sole discretion of the Agent and participating Lenders through June 30, 2029.
Borrowings under the Credit Agreement bear interest, payable monthly in arrears, at a rate per annum equal to the one-month Secured Overnight Financing Rate (“Term SOFR”) plus 5.00%, subject to a Term SOFR floor of 2.00%. As of March 31, 2026, the Credit Agreement interest rate was 8.7%. The term loans mature on March 1, 2031, at which time all outstanding principal and accrued interest are due and payable in full. The Credit Agreement permits voluntary prepayments at any time subject to a prepayment premium equal to 3.00% of the principal prepaid during the first year after closing, 2.00% during the second year, and 1.00% thereafter. The Credit Agreement also requires mandatory prepayments from certain casualty and asset disposition proceeds, in each case subject to customary thresholds and reinvestment provisions. Any repayment of the term loan is subject to a 2.75% exit fee payable on the maturity date or earlier date through voluntary or mandatory prepayment, which is being accrued for over the term of the Credit Agreement.
The Company’s obligations under the Credit Agreement are secured by a first-priority lien on substantially all of the Company’s assets, subject to certain customary exceptions and limitations, and will be guaranteed by Novavax NL B.V., a wholly owned subsidiary of the Company organized under the laws of the Netherlands (“Novavax Netherlands”), on a post-closing basis, which guarantee will be secured by a first-priority lien on the equity interests of Novavax AB, a wholly owned subsidiary of Novavax Netherlands organized under the laws of Sweden. The Credit Agreement contains customary affirmative and negative covenants, including covenants that, among other things, limit the Company’s ability and the ability of its subsidiaries to incur additional indebtedness or liens, make certain investments or acquisitions, make certain restricted payments, enter into affiliate transactions, and dispose of assets, in each case subject to customary exceptions and limitations. The Credit Agreement also includes a financial covenant requiring the Company and its subsidiaries to maintain unrestricted cash of at least $100.0 million at all times. In addition, if the Company borrows any term loans under Term Loan Tranche 2, Term Loan Tranche 3 or Term Loan Tranche 4, then, commencing on the fiscal quarter in which the Company’s unrestricted cash falls below $225.0 million (if any), the Company will be required to maintain minimum trailing twelve month royalty revenue for each fiscal quarter as detailed in the Credit Agreement filed herein. As of March 31, 2026, the Company was in compliance with all covenants under the Credit Agreement.
The initial Agent, Lenders, and other issuance costs related to Credit Agreement and the funded amount at closing were recorded as a reduction to the term loan on the consolidated balance sheet. The $3.6 million of debt issuance costs incurred is being amortized and recognized as additional interest expense over the five-year contractual term of the Credit Agreement using an effective interest rate of 11.0%.