Item 1.01 Entry into a Material Definitive Agreement.
On October 9, 2026, Vaxcyte, Inc. (“Vaxcyte”) consummated the sale and issuance of $575,000,000 aggregate principal amount of its 1.50% Convertible Senior Notes due 2032 (the “Notes”) to certain underwriters (the “Debt Offering”). The Notes were issued pursuant to, and are governed by, an indenture (the “Base Indenture”), dated as of October 9, 2026, between Vaxcyte and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”), as supplemented by a First Supplemental Indenture (the “Supplemental Indenture,” and the Base Indenture, as supplemented by the Supplemental Indenture, the “Indenture”), dated as of October 9, 2026, between Vaxcyte and the Trustee.
The Notes are senior, unsecured obligations and will accrue interest at a rate of 1.50% per annum, payable semi-annually in arrears on April 15 and October 15 of each year, beginning on April 15, 2027. The Notes will mature on October 15, 2032 unless earlier repurchased, redeemed or converted. Before July 15, 2032, noteholders will have the right to convert their Notes only upon the occurrence of certain events. From and after July 15, 2032, noteholders may convert their Notes at any time at their election until the close of business on the second scheduled trading day immediately before the maturity date. Vaxcyte will settle conversions by paying or delivering, as applicable, cash, shares of its common stock, par value $0.001 per share (“Common Stock”) or a combination of cash and shares of Common Stock, at its election. The initial conversion rate is 11.1607 shares of Common Stock per $1,000 principal amount of Notes, which represents an initial conversion price of approximately $89.60 per share of Common Stock. The conversion rate and conversion price will be subject to customary adjustments upon the occurrence of certain events. In addition, if certain corporate events that constitute a “Make-Whole Fundamental Change” (as defined in the Indenture) occur, then the conversion rate will, in certain circumstances, be increased for a specified period of time.
The Notes will be redeemable (a “provisional redemption”), in whole or in part (subject to certain limitations described below), at Vaxcyte’s option at any time, and from time to time, on or after October 22, 2029 and on or before the 20th scheduled trading day immediately before the maturity date, at a cash redemption price equal to the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, but only if the last reported sale price per share of Common Stock exceeds 130% of the conversion price on (x) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date Vaxcyte sends the related redemption notice; and (y) the trading day immediately before the date Vaxcyte sends such notice. However, Vaxcyte may not redeem less than all of the outstanding Notes pursuant to a provisional redemption unless at least $75.0 million aggregate principal amount of Notes are outstanding and not called for redemption as of the time Vaxcyte sends the related redemption notice. In addition, calling any Note for provisional redemption will constitute a Make-Whole Fundamental Change with respect to that Note, in which case the conversion rate applicable to the conversion of that Note will be increased in certain circumstances if it is converted after it is called for provisional redemption.
In addition, Vaxcyte will also have the right to redeem (a “cleanup redemption”) all, but not less than all, of the Notes, at any time, at a cash redemption price equal to the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, but only if the principal amount of the Notes outstanding at the time Vaxcyte sends the related redemption notice is less than 10% of the aggregate principal amount of the Notes issued in the Debt Offering. Calling the Notes for cleanup redemption will constitute a Make-Whole Fundamental Change, which will require Vaxcyte to increase the conversion rate in certain circumstances for a specified period of time.
If certain corporate events that constitute a “Fundamental Change” (as defined in the Indenture) occur, then, subject to a limited exception for certain cash mergers, noteholders may require Vaxcyte to repurchase their Notes at a cash repurchase price equal to the principal amount of the Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date. The definition of Fundamental Change includes certain business combination transactions involving Vaxcyte and certain de-listing events with respect to the Common Stock.
The Notes have customary provisions relating to the occurrence of “Events of Default” (as defined in the Indenture). If an Event of Default involving bankruptcy, insolvency or reorganization events with respect to Vaxcyte (and not solely with respect to a significant subsidiary of Vaxcyte) occurs, then the principal amount of, and all accrued and unpaid interest on, all of the Notes then outstanding will immediately become due and payable without any further action or notice by any person. If any other Event of Default occurs and is continuing, then the Trustee, by notice to Vaxcyte, or noteholders of at least 25% of the aggregate principal amount of Notes then outstanding, by notice to Vaxcyte and the Trustee, may declare the principal amount of, and all accrued and unpaid interest on, all of the Notes then outstanding to become due and payable immediately.
