Valneva SE (VALN) Prices 4.5M ADS Offering at $39.42/ADS

Valneva SE (Nasdaq: VALN), a specialty vaccine company, announced today the pricing of 4,500,000 ordinary shares in a global offering to specified categories of investors comprised of a public offering of 16,560 American Depositary Shares (“ADSs”), each representing two ordinary shares, in the United States (the “U.S. Offering”), and a concurrent private placement of 4,466,880 ordinary shares in certain jurisdictions outside of the United States (the “European Private Placement”, and, together with the U.S. Offering, the “Global Offering”). The Company granted the underwriters an option to purchase (the “Option”) for a 30-day period up to 337,500 additional ADSs, each representing two ordinary shares. The aggregate gross proceeds are expected to be approximately $88.7 million, equivalent to approximately €76.5 million, before deducting underwriting commissions and estimated expenses payable by the Company.

Goldman Sachs, Jefferies, Guggenheim Securities and Bryan, Garnier & Co. are acting as joint bookrunners for the Global Offering (together, the “Underwriters”).

Pricing of the Global Offering and Discount

The offering price was set at €17.00 per ordinary share and at $39.42 per ADS.

The offering price per ADS corresponds to the offering price of €17.00 per ordinary share based on the October 28, 2021 exchange rate of €1.00 = $1.1593, as reported by the European Central Bank, and the two to one ratio of ordinary shares to ADS.

The offering price per ordinary share in euros (€17.00) represents a discount of 1.8% from the reference price determined by the Company pursuant to the 17th resolution of the Company's annual combined general meeting held on June 23, 2021.1

Type of Global Offering - Capital increase without shareholders' preferential subscription rights reserved to a category of purchasers

The ADSs and the ordinary shares will be issued through a capital increase without shareholders’ preferential subscription rights and for the benefit of a specified category of persons within the meaning of Article L.225-138 of the French Commercial Code (Code de commerce) and pursuant to the 17th and 18th resolutions of the Company’s annual combined general meeting held on June 23, 2021. Under the authority granted by the shareholders in the 17th resolution, the ordinary shares and ADSs could only be purchased initially by (i) natural persons and legal entities, including companies, trusts or investment funds, organized under French or foreign law, that routinely invest in the pharmaceutical, biotechnological or medical technology sector; and/or (ii) companies, institutions or entities of any type, French or foreign, that do a significant part of their business in the pharmaceutical, cosmetic, chemical or medical devices and/or technologies or research in these sectors. In order to purchase ordinary shares and/or ADSs in the Global Offering, potential investors were required to execute and provide to the Underwriters an investor letter representing that they satisfy the foregoing investor criteria.

The European Private Placement was open only to qualified investors as such term is defined in article 2(e) of Regulation (EU) 2017/1129 of the European Parliament and of the Council of June 14, 2017.

Option to Purchase Additional Shares

The Company granted the Underwriters an option to purchase for a 30-day period (until November 26, 2021) up to 337,500 additional ADSs, each representing two ordinary shares, i.e. up to 15% of the aggregate amount of ordinary shares to be issued in the Global Offering.

In connection with the Global Offering, Goldman Sachs, acting as stabilizing manager, may over-allot the securities or effect transactions with a view to supporting, stabilizing, or maintaining the market price of the securities at a level higher than which might otherwise prevail in the open market. However, there is no assurance that the stabilizing manager will take any stabilization action and, if begun, may be ended at any time without prior notice. Any stabilization action or over-allotment shall be carried out in accordance with all applicable rules and regulations and may be undertaken on the Nasdaq Global Select Market.

Dilution

The 4,500,000 ordinary shares issued in the Global Offering (including ordinary shares in the form of ADSs) will represent a dilution of approximately 4% of the share capital of the Company. If the Underwriters exercise their Option in full, the dilution would increase to 5%. On an illustrative basis, a shareholder holding 1% of Valneva’s capital before the Global Offering will now hold a stake of 0.96%.

Terms and Conditions of the Securities to be Issued - Closing and delivery

The closing and delivery of the U.S. Offering and the European Private Placement are conditioned on each other and will occur simultaneously, on or about November 2, 2021.

All securities to be sold in the Global Offering will be offered by the Company. The ADSs are listed on the Nasdaq Global Select Market under the ticker symbol “VALN” and the ordinary shares are listed on the regulated market of Euronext Paris ("Euronext Paris") under the symbol “VLA.”

The ordinary shares offered in the Global Offering, including those underlying ADSs, will be subject to an application for admission to trading on Euronext Paris (Compartment B) on the same trading line as the existing shares under the same ISIN code FR0004056851 and under the ticker “VLA” and are expected to be admitted to trading on November 2, 2021.

Estimated Proceeds from the Global Offering - Reasons for the offering - Use of proceeds

The gross proceeds of the sale of 4,500,000 ordinary shares, including in the form of ADSs, in the Global Offering are expected to be approximately $88.7 million (€76.5 million), assuming no exercise of the Underwriters’ Option to purchase additional ordinary shares. The Company estimates that the net proceeds of the Global Offering will be approximately $80.7 million (€69.6 million), after deducting approximately $5.3 million (€4.6 million) in underwriting commissions and approximately $2.6 million (€2.3 million) in offering expenses.

The principal purposes of the Global Offering are to increase the Company’s financial flexibility in order to advance the development of its portfolio of vaccine candidates as listed below.

The Company expects to use the net proceeds from the Global Offering, together with its existing cash and cash equivalents, as follows (assuming an exchange rate of €1.00 = $1.1593, the exchange rate on October 28, 2021, as reported by the European Central Bank):

• Approximately $50 million to fund further development of its Lyme VLA15 vaccine candidate through completion of Phase 2 clinical trials including handover to Pfizer;
• Approximately $60 million to complete development of its chikungunya VLA1553 vaccine candidate through BLA approval;
• Approximately $100 million to fund further development of its COVID-19 VLA2001 vaccine candidate through conditional licensure and commercial launch, including capital expenditure into production facilities;
• Approximately $20 million to fund advancement of preclinical vaccine candidates towards clinical development; and
• The remainder, if any, for working capital and general corporate purposes.

As of June 30, 2021, the Company had cash and cash equivalents of €329.8 million. The Company believes its cash and cash equivalents, together with the net proceeds of the global offering of approximately $80.7 million (€69.6 million), will be sufficient to fund its operations through at least September 2023.

Underwriting

The Global Offering is subject to an underwriting agreement covering the entirety of the Global Offering. The underwriting agreement was entered into on October 28, 2021 in connection with the determination of the Global Offering Price.

The underwriting agreement does not constitute a "garantie de bonne fin" within the meaning of Article L. 225-145 of the French Commercial Code (Code de commerce).

Documentation

The Company has filed a registration statement on Form F-1, including a prospectus, relating to these securities with the U.S. Securities and Exchange Commission (“SEC”), which was declared effective by the SEC on October 28, 2021. The offering is being made only by means of a prospectus and copies of the prospectus relating to and describing the terms of the Global Offering may be obtained from Goldman Sachs & Co. LLC, Attn: Prospectus Department, 200 West Street, New York, New York 10282, telephone: 866-471-2526, facsimile: 212-902-9316, e-mail: [email protected] or Jefferies LLC, Attention: Equity Syndicate Prospectus Department, 520 Madison Avenue, 2nd Floor, New York, NY 10022, or by telephone at +1 877 821 7388 or by email at [email protected].

No prospectus subject to approval by the French Autorité des Marchés Financiers has been filed in France in connection with the Global Offering.

Application will be made to list the new ordinary shares to be issued pursuant to the Global Offering on Euronext Paris.

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