Related Party Transactions

12 Months Ended

Dec. 31, 2011

Related Party Transactions

Note 16 — Related Party Transactions

Dr. Rajiv Modi, a director of Novavax, is also a managing director of Cadila. The Company and Cadila have formed a joint venture called CPL Biologicals Private Limited, of which the Company owns 20% and Cadila owns 80%. The Company and Cadila also have entered into a master services agreement, pursuant to which Cadila may perform certain research, development and manufacturing services for the Company up to $7.5 million. A subsidiary of Cadila owns 12.5 million shares of the Company’s outstanding common stock. Since entering into the master services agreement and through December 31, 2011, the Company has incurred $0.2 million under the agreement. During 2010, the Company was reimbursed by the JV for travel and administrative costs and services provided to the JV totaling $0.2 million. The reimbursement of these costs and services was recorded as a reduction to operating expenses. In addition, in 2010, the Company purchased from the JV laboratory equipment for $0.2 million. At December 31, 2011, the Company recorded $0.1 million as a payable to Cadila.

In September 2011, the Company executed agreements with Mr. Mitchell Kelly and Dr. Denis O’Donnell, two of the Company’s former directors, to settle litigation initiated by the Company in 2010 to collect on outstanding notes to the Company, and in each case the lawsuit was dismissed with prejudice and the pledged shares of Common Stock were surrendered to the Company. As reflected on the Company’s balance sheet, the remaining notes receivable were eliminated with a corresponding reduction in common stock and additional paid-in capital as of December 31, 2011.