Exhibit 10.33
THE REGISTRANT HAS APPLIED FOR CONFIDENTIAL TREATMENT OF CERTAIN PROVISIONS OF
THIS EXHIBIT WITH THE SECURITIES AND EXCHANGE COMMISSION. THE CONFIDENTIAL
PORTIONS OF
THIS EXHIBIT ARE MARKED WITH ASTERISKS (*****) AND HAVE BEEN OMITTED. THE
OMITTED PORTIONS OF
THIS EXHIBIT WILL BE FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO
A REQUEST FOR CONFIDENTIAL TREATMENT.
LICENSE AGREEMENT
     This agreement (“Agreement”) entered into this 18th day of October, 2005 by
and between NOVAVAX, INC., a Delaware corporation having an address at 508 Lapp
Road Malvern, Pennsylvania 19355 (hereinafter referred to as “NOVAVAX” or
“Party”) and ESPRIT Pharma, Inc, having an address at 2 Tower Center Boulevard,
East Brunswick, NJ 08816, (hereinafter referred to as “ESPRIT” or “Party”).
Capitalized terms used herein and not otherwise defined shall have the meanings
ascribed in Article 1.
W I T N E S S E T H
     WHEREAS, NOVAVAX currently markets an estradiol-containing drug product
called ESTRASORB and is the owner of a New Drug Application relating to
ESTRASORB as well as U.S. Patent No. 5,629,021, Canadian Patent No. 2,211,262,
and other patents and patent applications relating to micellar nanoparticle
technology.
     WHEREAS, ESPRIT wishes to acquire an exclusive license under such patents
and patent applications from NOVAVAX, and NOVAVAX is willing to grant such
license to ESPRIT under the terms and conditions of this Agreement.
     WHEREAS, concurrently with the execution and delivery of this Agreement,
the parties have entered into the Supply Agreement relating to the manufacture
of Licensed Product and the provision of related services and technology by
NOVAVAX to ESPRIT.
     WHEREAS, concurrently with the execution and delivery of this Agreement and
the Supply Agreement, ESPRIT has executed and delivered to NOVAVAX the
Promissory Note relating to $8.0 million of the consideration for this
Agreement.
     WHEREAS, concurrently with the execution and delivery of this Agreement,
the Supply Agreement and the Promissory Note, *****.
     WHEREAS, the parties intend that this Agreement, other than Sections 3(a),
3(b), and 3(c) hereof which will be effective on the date of this Agreement,
will not be effective until the Business Day immediately following the
satisfaction in full of ESPRIT’s obligations to pay principal and interest under
the Promissory Note on the Maturity Date (as defined therein).
     NOW, THEREFORE, in consideration of the above premises and the covenants
contained herein, the parties agree as follows:
 

*   Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request.

 

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ARTICLE 1 — DEFINITIONS
     As used in this Agreement, the following terms, when used with initial
capital letters, shall have the following meanings, the singular shall include
the plural and vice-versa:
          “Affiliate” means any entity that directly or indirectly controls, is
controlled by, or is under common control with a Party, and for such purpose
“control” shall mean (i) directly or indirectly owning, controlling or holding
more than fifty percent (50%) of the securities or other ownership interests
representing the equity, the voting stock or general partnership interest in an
entity or (ii) the possession, direct or indirect, of the power to direct or
cause the direction of the management or the policies of the entity, whether
through the ownership of voting securities, by contract or otherwise. Any such
corporation, entity or business structure shall only be considered an Affiliate
for so long as such ownership or control exists.
          “Business Day” means any day other than Saturday, Sunday, holiday or
any other day on which banks in New York, New York are permitted or required to
be closed. Unless otherwise specified herein, “day” will mean calendar day.
          “Calendar Quarter” means each of the periods of time between January
and March, April and June, July and September, and October and December.
          “Calendar Year” means the period of time commencing on 1 January and
ending on the following December 31.
          “Commercial Sale” and words of similar import means, an arm’s length
transaction and shipment by ESPRIT, its Affiliates or each of its sublicensees
of a Licensed Product to an independent third party in a country of the
Territory.
          “Commitment to Fund” means the agreement by each of the Private Equity
Investors to fund ESPRIT with the principal amount due under the Promissory Note
within ten (10) Business Days of such default for the express purpose of
satisfying ESPRIT’s obligations under the Promissory Note.
          “Confidential Information” has the meaning set forth in Section 6.1.
          “Dollar” means the legal currency of the U.S.
          “Effective Date” means, (a) with respect to ESPRIT’s obligations under
Section 3.1(a), 3.1(b), and 3.1(c), the date of this Agreement and (b) with
respect to all other terms and conditions of this Agreement, the Business Day
immediately following the satisfaction in full of ESPRIT’s obligations to pay
principal and interest under the Promissory Note on the Maturity Date (as
defined therein).
          “ESPRIT Improvement” means any and all Improvements created, conceived
or first reduced to practice by ESPRIT, or its Affiliates, agents,
subcontractors or sublicensees, alone or with others (excluding NOVAVAX).
          “ESPRIT Improvement Intellectual Property” means Intellectual Property
included in ESPRIT Improvements.

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          “ESPRIT Improvement Patents” means patents and patent applications
that describe and claim ESPRIT Improvements.
          “ESPRIT Sole Technology” means Intellectual Property that is first
conceived and first reduced to practice during the term of this Agreement solely
by personnel employed by or on behalf of ESPRIT.
          “FDA” means the United States Food and Drug Administration and
successor bodies or corresponding foreign administrative bodies.
          “Field” means the use, manufacture or sale of topically- or
transdermally-administered products containing no active ingredient other
than17ß estradiol (excluding contraceptive products, Selective Estrogen Receptor
Modulators and products administered vaginally, orally, nasally, through the gum
or by injection) which utilize NOVAVAX’s micellar nanoparticle technology in the
field of women’s health in products that are marketed under NOVAVAX’s NDA
#21-371.
          “First Commercial Sale” means, with respect to any Licensed Product,
the first Commercial Sale.
          “Fiscal Year” means the period of time commencing on the Monday
following the Sunday closest to the end of the calendar month of December and
terminating on the Sunday closest to the end of the immediately succeeding
December.
          “GAAP” means U.S. generally accepted accounting principles,
consistently applied.
          “Improvement” means any change, improvement, development, or
modification of a Licensed Product with respect to formulation technology, any
component/material utilized in the formulation technology, or the method or
process of making or using a Licensed Product utilizing the formulation
technology, that (a) is made, conceived of or reduced to practice by either
Party or their Affiliates, agents, subcontractors or sublicensees, alone or with
others, or as a result of work performed on a Licensed Product during the term
of this Agreement and (b) is covered by or derived or resulting from the
practice of Licensed Patents, patents, patent applications and other
Intellectual Property rights in or that cover any of the foregoing.
          “Improvement Patent” means patents and patent applications that
describe and claim Improvements.
          “IND” has the meaning set forth in Section 10.3(c).
          “Intellectual Property” has the meaning set forth in Section 5.1.
          “Joint Improvement” means any and all Improvements created, conceived
or first reduced to practice during the term of this Agreement by NOVAVAX, or
its Affiliates, agents, subcontractors or sublicensees, and ESPRIT, or its
Affiliates, agents, subcontractors or sublicensees. Joint Improvement shall not
include any Improvement that is a NOVAVAX Improvement or an ESPRIT Improvement.

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          “Joint Improvement Intellectual Property” means Intellectual Property
included in Joint Improvements.
          “Joint Improvement Patents” means patents and patent applications that
describe and claim Joint Improvements.
          “Launch” means the date of the First Commercial Sale of any Licensed
Product.
          “Licensed Know-How” means, to the extent relating and necessary to the
manufacture of a Licensed Product, all information or special knowledge on the
part of NOVAVAX as of the Effective Date not generally known to the public,
including but not limited to inventions, discoveries, reports, protocols,
processes, apparati, techniques, methods, models, screens, assays, products,
regulatory submissions, and technical information, together with all experience,
data, formulas, procedures and results, and including all chemical,
pharmacological, toxicological, clinical, analytical, quality control, and
safety data (including but not limited to data from use of the Licensed
Product), and any other materials or compositions relating to the manufacture of
a Licensed Product or being useful in the manufacture, use, sale or Registration
of a Licensed Product as reasonably determined by NOVAVAX; except to the extent
that the disclosure of such information or special ability is prohibited by law,
rule, regulation, order, treaty, contract, agreement or other obligation.
Licensed Know-How also includes the NOVAVAX Improvement Intellectual Property as
set forth in section 5.2.4 hereof to the extent not disclosed in any patent or
patent application of the Licensed Patents. Licensed Know-How shall constitute
Confidential Information of NOVAVAX in accordance with Section 6.
          “Licensed Patent” means U.S. Patent No. 5,629,021, Canadian Patent
No. 2,211,262, including any other of their respective counterparts in the
Territory, as well as all continuations, continuations-in-part, divisions,
renewals, reissues, reexaminations, extensions, and patents of addition and
patents of importation of the foregoing containing a Valid Claim that would be
infringed by the use or sale of a Licensed Product by ESPRIT, its affiliates or
its permitted sublicensees, in the Territory but for the licenses granted
herein. In addition, Licensed Patents shall include NOVAVAX Improvement Patents,
NOVAVAX’s interests in Joint Improvement Patents and any other patents owned by
NOVAVAX that are necessary for ESPRIT to practice the patents described in the
preceding sentence.
          “Licensed Product” means any topically- or transdermally-administered
product containing no other active ingredient other than 17ß estradiol which is
marketed under NOVAVAX’s NDA #21-371, the use, sale or manufacture of which
would, but for a license, infringe a Valid Claim of a Licensed Patent or an
Improvement Patent in the country in which it is sold. Licensed Products include
Improvements made by NOVAVAX related to formulation and for Licensed Product
packaging.
          “Licensed Technology” means Licensed Patents and Licensed Know-how.
          “NDA” has the meaning set forth in Section 10.3(c).

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          “Net Sales” means, on a country-by-country basis (a) for any bona fide
arm’s length transaction in which Licensed Products are Commercially Sold
separately by ESPRIT, its Affiliates, and its permitted sub-licensees to
independent third parties (rather than bundled with any other products or
services), the amount invoiced for the sale of Licensed Products in finished
packaged form, and (b) for all other transactions in which Licensed Products are
sold, used or otherwise disposed of by ESPRIT, its Affiliates and its permitted
sublicensees (including in barter or similar transactions, or transactions that
are not at arm’s length to a third party, or transactions in which Licensed
Products are not sold separately), the total sales price for Products in such
transactions; less, in the case of clause (a) and (b) above (i) all normal and
customary trade and quantity discounts, (ii) allowances, chargebacks, wholesaler
fees and deductions, retailer fees and deductions, rebates, including government
and managed care rebates, and credits determined in accordance with GAAP, and
returns and replacements determined in accordance with GAAP, less any freight
charges paid by third parties for delivery and less excise, value added and
other taxes and or/duties applicable to sales of Licensed Products which the
selling party has to pay or absorb on such sales. Further, Net Sales shall not
include normal and customary promotional samples, including, subject to the
foregoing, any samples affixed to or accompanying other products of ESPRIT or
any of its Affiliates, coupons or other promotional incentives.
          “NOVAVAX Improvement” means any and all Improvements created,
conceived or first reduced to practice by NOVAVAX, or its Affiliates, agents,
subcontractors or sublicensees, alone or with others (excluding ESPRIT).
          “NOVAVAX Improvement Intellectual Property” means Intellectual
Property included in NOVAVAX Improvements.
          “NOVAVAX Improvement Patents” means patents and patent applications
that describe and claim NOVAVAX Improvements.
          “Promissory Note” means that certain $8.0 million promissory note due
December 30, 2005 issued and delivered on the date hereof by ESPRIT to NOVAVAX.
          “Registration” means a filing with a governmental authority for the
purpose of obtaining legal and regulatory approval to conduct clinical trials
for a product or to commence making, using, and/or selling a product, including
an NDA filing or its equivalent in the Territory.
          “Supply Agreement” means a separate agreement to be executed and
delivered concurrently with this Agreement under which NOVAVAX shall supply
Licensed Product to ESPRIT.
          “Territory” means the United States (including Puerto Rico), Mexico
and Canada.
          “Trademarks” means all registered and unregistered trademarks listed
on Schedule 1 attached hereto.
          “Valid Claim” means a claim or pending claim in any unexpired,
enforceable, issued patent within the Licensed Patent or Improvement Patent
which has not been held invalid by a non-appealed or unappealable decision by a
court or other appropriate body of competent jurisdiction, and which is not
admitted to be invalid through disclaimer or dedication to the public.

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          “Year” shall mean the period of time commencing on the calendar day of
the First Commercial Sale of a Licensed Product and ending three hundred and
sixty four (364) days thereafter.
ARTICLE 2 — GRANT OF RIGHTS
     2.1 Subject to the terms and conditions hereof, NOVAVAX hereby grants to
ESPRIT, commencing on the Effective Date, an exclusive license under the
Licensed Patents and Licensed Know-how to make and have made, import, use, sell,
offer for sale, and have sold Licensed Product (including under the Trademark)
in the Territory in the Field.
     2.2 Subject to the terms and conditions hereof, NOVAVAX hereby grants to
ESPRIT, commencing on the Effective Date, an exclusive license to the NOVAVAX
Improvement Intellectual Property to make and have made, import, sell, offer to
sell, and have sold Licensed Product in the Territory in the Field.
     2.3 ESPRIT shall have the right to sublicense commencing on the Effective
Date the rights granted under Sections 2.1 and Section 2.2 of this Agreement on
terms substantially similar to those contained herein to a controlled Affiliate
of ESPRIT and to non-Affiliated third parties, provided that any such sublicense
to non-Affiliated third parties would require the prior written approval of
NOVAVAX which will not be unreasonably withheld or delayed; and provided,
further that ESPRIT shall require its permitted sublicensees to comply with all
of the obligations of ESPRIT contained in this Agreement and ESPRIT shall be
responsible for the performance by such sublicensees of such obligations.
     2.4 ESPRIT hereby grants to NOVAVAX an exclusive, perpetual, worldwide paid
up royalty-free license, with rights to sublicense, under ESPRIT Improvement
Intellectual Property and ESPRIT’s interests in Joint Improvement Intellectual
Property for use outside the Field.
     2.5. Except as otherwise expressly provided in this Agreement, under no
circumstances shall a Party hereto, as a result of this Agreement, obtain any
ownership interest or license in or other right to any technology, know-how,
patents, patent applications, products, or biological materials of the other
Party, including, but not limited to, items owned, controlled or developed by
the other Party, at any time pursuant to this Agreement. This Agreement does not
create, and shall under no circumstances be construed or interpreted as
creating, an obligation on the part of either Party to grant any license to the
other Party other than as expressly set forth herein. Any further contract or
license agreement between the Parties shall be in writing.
     2.6 All rights and interests not expressly granted to ESPRIT are reserved
by NOVAVAX (the “Reserved Interests”) for itself, its Affiliates and partners
(other than ESPRIT) and other licensees and sublicensees, including, but not
limited to, the rights to use and grant licenses under the Licensed Technology
or any other technology owned or controlled by NOVAVAX to make, have made, use,
offer to sell, sell, have sold and import products

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(other than a license under Licensed Technology for Licensed Products in the
Field, for so long as ESPRIT has an exclusive license under Licensed Technology
for Licensed Products in the Field). It shall not be a breach of this Agreement
for NOVAVAX, acting directly or indirectly, to exploit its Reserved Interests in
any manner anywhere in the Territory, provided, however, that under no
circumstances shall NOVAVAX utilize its Reserved Interests to make, have made,
use, offer to sell, sell, have sold or import Licensed Products or related
Improvements in the Territory in the Field.
ARTICLE 3 — PAYMENTS
     3.1 In consideration of the license granted hereunder, ESPRIT shall make
the following payments in Dollars to NOVAVAX as follows:
     (a) Upon the Business Day immediately following the date of this Agreement,
ESPRIT shall pay NOVAVAX an amount equal to Two Million Dollars ($2,000,000) in
cash by wire transfer.
     (b) Upon the Business Day immediately following the date of this Agreement,
ESPRIT shall pay NOVAVAX an amount equal to Eight Million Dollars ($8,000,000)
in the form of the Promissory Note.
     (c) Upon the first anniversary of the date of this Agreement, ESPRIT shall
pay NOVAVAX an amount equal to Two Million Five Hundred Thousand Dollars
($2,500,000) in cash by wire transfer.
     (d) ESPRIT will, or will cause its designated Affiliates to, pay NOVAVAX
the following one-time sales milestone payments (each a “Milestone Payment”)
within ***** ( ***** ) days after the first satisfaction of the following sales
milestones (each a “Milestone”):

              Milestone   Milestone   Payment  
1. Upon reaching an annual Net Sales level of ***** Dollars ($*****), a one-time
payment during the period in which this
  ***** Dollars
sales level is first reached
    ($***** )
2. Upon reaching an annual Net Sales level of ***** Dollars ($*****), a one-time
payment during the period in which this
  ***** Dollars
sales level is first reached
    ($***** )
3. Upon reaching an annual Net Sales level of ***** Dollars ($*****), a one-time
payment payable during the period in
  ***** Dollars
which this sales level is first reached
    ($***** )
4. Upon reaching an annual Net Sales level of ***** Dollars ($*****), a one-time
payment payable during the period in
  ***** Dollars
which this sales level is first reached
    ($***** )
5. Upon reaching an annual Net Sales level of ***** Dollars ($*****), a one-time
payment payable during the period in
  ***** Dollars
which this sales level is first reached
    ($***** )

 

*   Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request.

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The Net Sales levels shall not be cumulative from annual Net Sales period to
annual Net Sales period. The parties understand that more than one payment may
be made during any single annual Net Sales period. The annual Net Sales shall be
calculated in the following two ways: (1) on December 31st of each Calendar Year
(commencing with the first Calendar Year following Launch) for the previous
twelve (12) months; and (2) on July 1 of each Calendar Year (commencing with the
first Calendar Year following Launch) for the previous twelve (12) months. If,
according to at least one of the foregoing calculations, the annual Net Sales
level reaches a Milestone as specified in the above table, ESPRIT or its
Affiliates shall pay NOVAVAX a specified Milestone Payment during the period in
which the Milestone is first reached. For example, if the Net Sales in calendar
year 2006 is $ *****, then no Milestone Payment would be made. If by July 1,
2007, the Net Sales for the twelve months prior to July 1, 2007 equals or
exceeds $ *****, ESPRIT or its Affiliates would pay NOVAVAX a $ ***** in
Payments with respect to such Period.
ARTICLE 4 — ROYALTIES
     4.1 ESPRIT will, or will cause its designated Affiliates to, pay NOVAVAX
quarterly royalties on the sales of Licensed Products in the Territory in an
amount equal to ***** percent (*****%) of the Net Sales in any Calendar Quarter
commencing in the first Calendar Year following Launch.
     4.2 No royalties due under this Article shall be payable on sales
transactions as among ESPRIT, any of its Affiliates and sublicensees. The final
vendee sale to a third party alone shall be used for the purposes of determining
the royalty payments due hereunder. Only one royalty payment shall be payable on
the sale of each Licensed Product, and the amount of such royalty will be
provided in accordance with this Article 4 and the sales date of the Licensed
Product to an independent third party. Licensed Products shall be sold only for
cash consideration and there shall be no discounting of price to the
disadvantage of the price of Licensed Products that are included in or made part
of any bundling of Licensed Products with any existing or future ESPRIT or
Affiliate product(s) as part of a sale to independent third parties.
     4.3 ESPRIT shall not be obligated to pay any royalty payments based upon
sales of a given Licensed Product in a country of the Territory after the
expiration of the last to expire Licensed Patent or Improvement Patent having at
least one (1) Valid Claim that would be infringed by the sale of that Licensed
Product by ESPRIT, its Affiliates or its sublicensees in that country but for
the licenses granted herein.
     4.4 All royalties shall be calculated and payable on a Calendar Quarter
basis as of the end of the each Calendar Quarter, and royalties shall be paid
within ***** (*****) days following the end of such Calendar Quarter. All
royalties shall be calculated on a Licensed Product by Licensed Product basis.
Each royalty payment and Milestone Payment shall be accompanied by a written
report indicating the amount of Net Sales during such Calendar quarter or
applicable period together with a calculation of the royalties and Sales
Milestone Payments due. ESPRIT shall deliver the written report for each such
Calendar Quarter or applicable period, regardless of whether when any royalty
payments or Milestone Payments are required to be paid in that Calendar Quarter
or applicable period, commencing in the first Calendar Year following Launch.
 

*   Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request.

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     4.5 NOVAVAX shall have the right, at its own expense, for the period during
which a royalty or Milestone Payment is due to NOVAVAX, to have a firm of
independent certified public accountants, to whom ESPRIT has no reasonable
objection and subject to customary confidentiality restrictions, solely to
examine the relevant books and records of account of ESPRIT relating to the
Licensed Product during reasonable business hours and no more than ***** during
each Fiscal Year, to determine whether appropriate payment (including, without
limitation, payment pursuant to Sections 3.1(c), 4.1 and 5.1) has been made by
ESPRIT hereunder. The accountant shall disclose to NOVAVAX only information
relating to the accuracy of the royalty and Sales Milestone Payment reports and
the royalty payments and Milestone Payments made according to this Agreement.
The information received by the accountant, except for information necessary for
disclosure to NOVAVAX to establish the accuracy of such reports, shall be held
confidential. If such accounting firm correctly concludes that additional
royalties or Milestone Payments were owed during such period, ESPRIT shall pay
the additional royalties within thirty (30) days of the date NOVAVAX delivers to
ESPRIT such accounting firm’s written report so correctly concluding. If the
amount of such additional royalties or Milestone Payments owed exceeds *****
percent (*****%) of the amount of royalty payments or Sales Milestone Payments
actually made by ESPRIT for such period, ESPRIT shall reimburse NOVAVAX for the
commercially reasonable fees and expenses of the accounting firm incurred in the
conduct of the applicable audit.
     4.6 The remittance of Milestone Payments or royalties payable on sales
outside the U.S. will be payable to NOVAVAX in Dollars according to the official
rate of exchange of the currency of the country from which the royalties are
payable as quoted by The Wall Street Journal, New York edition, for the last day
of the Fiscal Quarter or other applicable period for which the royalty payment
is made. If the transfer or the conversion into U.S. Dollars in any such
instance is not lawful or possible, the payment of such part of the Milestone
Payment of royalties as is necessary shall be made by the deposit thereof, in
whatever currency is allowable and acceptable by NOVAVAX, to the credit and
account of NOVAVAX or its nominees in any commercial bank or trust company of
its choice located in that country. ESPRIT shall give prompt notice of such
deposit to NOVAVAX.
     4.7 All royalties, Milestone Payments and other payments required hereunder
shall be paid in accordance with the instructions provided by NOVAVAX in
immediately available funds by wire transfer to a bank or other institution
designated in writing by NOVAVAX from time to time.
ARTICLE 5 — LICENSED PRODUCT MANUFACTURE; INTELLECTUAL PROPERTY; REGULATORY
MATTERS
     5.1 Intellectual Property. Any intellectual property rights, including
without limitation, patents, patent applications, inventions, and know-how
(hereinafter referred to as “Intellectual Property”) owned or controlled by
either Party prior to the parties entering into this Agreement shall remain the
property of such Party, subject only to the rights and licenses granted herein.
 

*   Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request.

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5.1.1 Any Intellectual Property that is first conceived and first reduced to
practice during the term of this Agreement solely by personnel employed by or on
behalf of NOVAVAX shall remain the property of NOVAVAX, subject to the rights
and licenses granted herein.
5.1.2 Any Intellectual Property that is first conceived and first reduced to
practice during the term of this Agreement solely by personnel employed by or on
behalf of ESPRIT shall remain the property of ESPRIT, subject to the rights and
licenses granted herein (“ESPRIT Sole Technology”).
5.1.3 Any Intellectual Property that is first conceived or first reduced to
practice during the term of this Agreement by personnel employed by or on behalf
of ESPRIT and personnel employed by or on behalf of NOVAVAX (other than the
Intellectual Property described in Section 5.1.1 and Section 5.1.2) shall be and
shall remain the joint property of NOVAVAX and ESPRIT, subject to the rights and
licenses granted herein (“Joint Intellectual Property”). The parties agree to
keep the Joint Intellectual Property in confidence on a basis consistent with
Article 6 and not to publicly disclose the same except in accordance with
Article 6.
5.1.4 NOVAVAX Improvement Intellectual Property shall constitute Licensed
Technology throughout the term of this Agreement to the extent that such
Intellectual Property is relevant to the use, sale or Registration of a Licensed
Product and to the extent that the licensing of such Intellectual Property by
NOVAVAX to ESPRIT pursuant to the terms of this Agreement would not be
prohibited by law, rule, regulation, order, treaty, contract, agreement, or
other obligation.
     5.2 Transfer of NDA and IND. The Parties agree and acknowledge that within
20 days after the Effective Date and receipt of ESPRIT’s written request,
NOVAVAX shall provide ESPRIT with a letter addressed to the FDA authorizing and
requesting that each NDA and IND owned by NOVAVAX and pertaining to the Licensed
Product in the Territory, as the case maybe, be transferred, in its entirety, to
the name of ESPRIT. NOVAVAX shall provide ESPRIT with a copy of the letter and
ESPRIT shall promptly send a letter to the FDA accepting the NDA and IND.
NOVAVAX will be entitled to copy and reference the NDA and IND, and any safety
database or other safety information related to the Licensed Product, outside
the Territory freely as it determines. Each party will notify the other
immediately by telephone (with prompt written follow-up) of any inquiry, contact
or communication received from any governmental regulatory agency or other
official body (within or outside of the Territory) which relates to the Licensed
Product or any component or ingredient thereof, and will promptly furnish the
other party with copies of all written communications relating thereto sent to
or received from such regulatory agency. ESPRIT shall consult with NOVAVAX prior
to making a material modification to the NDA or IND pertaining to the Licensed
Product, and shall consider in good faith NOVAVAX’s views with respect to the
impact any such modification may have on the marketing and commercialization of
the Licensed Product outside of the Territory. ESPRIT shall provide, at
NOVAVAX’s expense, such cooperation as may be reasonably to assist NOVAVAX in
referencing the NDA or IND pertaining to Licensed Product or safety information
related to Licensed Product in connection with regulatory applications and
approvals for Licensed Product outside of the Territory made by NOVAVAX or
NOVAVAX’s licensees; provided that, in ESPRIT’s reasonable judgment, such
assistance is not unduly burdensome to ESPRIT’s senior management. NOVAVAX
hereby retains and

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ESPRIT hereby grants to NOVAVAX the perpetual exclusive, fully paid up right to
use with the right to sublicense ((i) outside the Field and (ii) in the Field
but outside the Territory) all data created by under or in connection with the
NDA and the IND.
     5.3 Maintenance of NDA. ESPRIT shall bear responsibility for, and shall
bear all costs related thereto, to take such actions as may be necessary, in
accordance with accepted business practices and legal requirements, to obtain
and maintain the authorization and/or ability to market the Licensed Product in
the Territory. Without limiting the generality of effect of the foregoing,
ESPRIT shall be responsible for all of the PDUFA fees, including, without
limitation, establishment fees and product fees, associated with NDA. The
establishment fees will be allocated on a pro rata basis agreed upon by the
parties in the event other FDA approved product(s) are manufactured by Novavax
at the Cardinal facility.
     5.4 Communications with Regulatory Authorities. ESPRIT shall have the
responsibility, and shall bear all costs related to, communications with any
government agencies to satisfy its requirements regarding the authorization
and/or continued authorization to market the Licensed Product in commercial
quantities in the Territory. NOVAVAX shall promptly notify ESPRIT of any inquiry
or other communication that it receives from the FDA concerning the Licensed
Product. ESPRIT shall handle all communications with the FDA concerning the
Licensed Product (other than with respect to the manufacture thereof which will
be handled by NOVAVAX), including but not limited to reporting adverse reactions
and responding to any inquiries concerning advertising or promotional materials,
and shall provide copies of all such communication to NOVAVAX. NOVAVAX, however,
shall be able to communicate with such governmental agency regarding the
Licensed Product if:
          (a) Such communication is necessary to comply with the terms of this
Agreement or the requirements of any law, governmental order or regulation; or
          (b) NOVAVAX, if practical, made a request of such agency to
communicate with ESPRIT instead, and such agency refused such request;
          (c) Such communication relates to the CMC Section of the NDA for the
Licensed Product, manufacturing specifications related to the Licensed Product;
          (d) provided, however, that before making any communication under (a),
(b) or (c) of this Section, NOVAVAX shall give ESPRIT notice as soon as possible
of NOVAVAX’s intention to make such communication, and ESPRIT shall be permitted
to accompany NOVAVAX, take part in any such communications and receive copies of
all such communications.
     5.5 Medical Inquiries. ESPRIT shall respond to medical questions or
inquiries relating to the Licensed Product and shall instruct its sales force to
direct medical inquiries either to its own medical personnel or to the ESPRIT
toll-free number referred to in Section 5.6, within a reasonable time from the
Effective Date. ESPRIT shall designate an individual to serve as medical liaison
in order to ensure consistency in the handling of medical inquiries. The medical
liaison will regularly review Licensed Product inquiries and responses and will
also be available for responding to non-routine inquiries should these arise.
     5.6 Toll-Free Number. ESPRIT shall maintain a toll-free telephone number to
provide information in response to inquiries from health care professionals and
consumers. This number shall be noted in all appropriate advertising and
promotional materials, except that NOVAVAX may, at its own option, use a
different number in advertising and promotional materials that it develops for
use outside of the Territory.

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     5.7 Adverse Reactions; Recalls. Except as otherwise set forth in the Supply
Agreement, ESPRIT shall be responsible for handling all complaints from
customers in the Territory relating to adverse reaction reports, adverse events,
and recall activities with respect to the Licensed Product. NOVAVAX shall
promptly transfer and notify ESPRIT of any such complaints, and shall cooperate
with ESPRIT as necessary to resolve or address the situation, including, without
limitation, by providing detailed distribution records to ESPRIT.
     5.8 NDC Number. The Parties acknowledge and agree that (a) the Licensed
Product may be distributed initially for up to 90 days under the National Drug
Code number for the Licensed Product assigned to NOVAVAX and (b) ESPRIT shall be
responsible, at its expense, for complying with on NOVAVAX’s behalf, or
assisting NOVAVAX in its compliance, with all FDA and other obligations or
requirements (including without limitation adverse reaction reports, adverse
events, and recall activities) applicable to NOVAVAX as a result of any and all
distribution of the Licensed Product under the National Drug Code number for the
Licensed Product assigned to NOVAVAX.
     5.9 Withdrawal of NDA. ESPRIT will not take any action or omit to take any
action that could reasonably be expected to result in withdrawal of the NDA.
     5.10 Recall. In the event that either Party determines that an event,
incident or circumstance has occurred which may result in the need for a recall
or other removal of any Licensed Product, or any lot or lots thereof, from the
market, it shall promptly advise and consult with the other Party with respect
thereto. The parties shall jointly make the final determination to recall or
otherwise remove a Licensed Product or any lot or lots thereof from the market.
ESPRIT shall be responsible for the costs of any recall except if such recall is
solely the result of any failure of NOVAVAX to manufacture Licensed Product in
accordance with written specifications agreed upon by the parties under the
Supply Agreement.
     5.11 Commercially Reasonable Efforts. ESPRIT agrees that it will and will
cause its sublicensees and Affiliates to use commercially reasonable efforts to
market and sell the Licensed Product.
     5.12 LED Studies. The costs and expenses of any lowest effective dose study
relevant to Licensed Product (an “LED Study”) will be borne as follows: (a) the
first $***** by ESPRIT and (b) any amount in excess of $***** by ESPRIT subject
to reimbursement by NOVAVAX of *****% of such excess (such reimbursement not to
exceed $***** in any single Calendar Year) if and only to the extent that
Milestone Payments have been made in accordance with this Agreement. Without
limiting the generality or effect of the foregoing, NOVAVAX will be entitled to
review and approve protocols relating to any LED Study.
ARTICLE 6 — CONFIDENTIALITY AND PUBLICITY
     6.1 All information disclosed by one Party to the other(s) or developed by
the parties pursuant to the terms of this Agreement (the “Confidential
Information”) shall be maintained strictly confidential and used only for the
purposes of this Agreement in accordance with this Article 6 (“Purposes”). Each
Party may also disclose the other’s information to an Affiliate,
 

*   Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request.

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agent or consultant, who is under a written obligation of confidentiality and
non-use at least substantially equivalent to the obligations of this Article 6,
with the exceptions that (i) ESPRIT may disclose such information to its
Affiliates who agree to maintain such information in confidence and to use such
information only for the Purposes and (ii) the Parties shall each be free to
disclose the existence of this Agreement and the nature of the licenses granted
hereunder to its Affiliates and other prospective licensees and sub-licensees,
investors or prospective investors, lenders and other potential funding sources,
or to a third party in connection with a merger or acquisition or proposed
merger or acquisition, subject to an obligation of confidentiality and non-use,
provided that such Party shall have used commercially reasonable efforts to
obtain a written confidentiality agreement from such third party contemplated by
this sentence. Each Party shall guard any confidential information of the other
Party with the same level of diligence as it normally guards any of its own
internal confidential, proprietary information. Each Party shall be responsible
for the breach of any of the provisions of this Article 6 by a person or entity
to whom such Party discloses information contemplated hereby. Notwithstanding
the foregoing, each Party shall be relieved of the confidentiality and limited
use obligations of this Agreement if:
          (a) the information was previously known to the receiving Party as
evidenced by the prior written records of such Party without disclosure by the
disclosing Party;
          (b) the information is or becomes generally available to the public
through no fault of the receiving Party;
          (c) the information is acquired in good faith in the future by the
receiving Party from a third party not under an obligation of confidence to the
disclosing Party with respect to such information; or
          (d) the information is independently developed by the receiving Party
without reliance on, reference to, or knowledge of, the information disclosed by
the disclosing Party.
The parties understand and agree that it shall be the receiving Party’s burden
of proof to show the applicability of any of the exceptions set forth in clauses
(a), (b) (c) or (d) above.
     6.2 Notwithstanding the above obligations of confidentiality and non-use a
Party may:
          (a) disclose information to a regulatory agency that is necessary to
obtain regulatory approval in a particular jurisdiction; or
          (b) disclose information to a government agency if the disclosure is
necessary to protect the health and safety of the Party’s workers or the public
or as required by law; or
          (c) disclose information as and to the extent required to comply with
applicable laws and regulations, including the rules and regulations of the U.S.
Securities and Exchange Commission.
     In making such disclosures as set forth in this Section 6.2, the disclosing
Party shall use reasonable efforts to promptly first notify the owner of the
confidential information so as to allow the owner of the confidential
information an opportunity to seek a protective order or otherwise limit any
such disclosure. In any event, the disclosing Party shall use reasonable efforts
to only disclose such information as is required to be disclosed pursuant to the
law, regulation, rule or order, and shall use its reasonable efforts to obligate
the recipient to secrecy on the same terms as set forth herein. Each Party shall
restrict the disclosure of confidential information of the other so that only
the persons that need to know it shall be informed and the disclosure be limited
to only such portions as necessary for the purposes of this Agreement.

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     6.3 Each Party shall not state or imply, in any publication, advertisement,
sales promotional material, or other medium:
     a) the name of the other Party or the name(s) of any employee(s) of the
other Party; or

     b) the name of any Affiliate of the other Party or the name(s) of any
employee(s) of such Affiliate
without the prior written consent of the other Party.
     6.4 Except for the filing of a copy of this Agreement with the Securities
and Exchange Commission or other securities commission of such other
jurisdictions whose laws may apply to either Party to the extent required by law
and such other public announcements as may hereafter become required by law,
regulation or rule due to changes from the facts and circumstances in existence
as of the Effective Date, no Party hereunder shall disclose this Agreement or
make any public announcement or filing concerning this Agreement or the subject
matter hereof without the prior written consent of the other. In the event that
pursuant to the foregoing a Party shall file a copy of this Agreement with the
Securities and Exchange Commission or other securities commission of such other
jurisdictions whose laws may apply to either Party, it shall use reasonable
efforts seek confidential treatment for all portions thereof reasonably
requested by the other Party. Any proposed announcement or filing by a Party
shall be made available to the other Party in advance of publication or filing,
as the case may be, for review and comment. If a Party decides to make an
announcement or disclosure required by law or as otherwise permitted under this
section of this Agreement, it will provide the other Party with at least ten
(10) Business Days, where possible, advance written notice of the text of any
such written announcement or disclosure or content of any non-written disclosure
or announcement, except to the extent applicable law requiring disclosure would
not permit such advance notice (such as in the case of certain securities
filings), in which case the disclosing Party will give the maximum notice
possible under the circumstances, so that the other Party will have an
opportunity to comment upon the announcement or disclosure.
     6.5 Except for permissible publications under this Article 6, neither Party
will publish any information based upon or derived from the work performed under
this Agreement without the prior review and consent of the Parties pursuant to
this Section 6.5.
     6.6 With respect to information disclosed on or after the Effective Date
between ESPRIT and NOVAVAX under the provisions of this Agreement, the
provisions of this Agreement shall govern and prevail. In the event of any
conflict between this Agreement and any other pending confidentiality agreement
between ESPRIT and NOVAVAX, with respect to information disclosed on or after
the Effective Date, the terms of this Agreement shall govern and prevail.
ARTICLE 7 — PATENT PROSECUTION AND MAINTENANCE
     7.1 Subject to Section 7.4 of this Agreement, NOVAVAX shall have sole
authority and agrees to prosecute or cause to be prosecuted to allowance or
final rejection the patent applications (including any reissue patent
applications or reexamination patent applications) included in the Licensed
Patents that are owned or controlled by NOVAVAX, in whole or in part, including
the Joint Improvement Intellectual Property (hereinafter collectively “Patent
Applications”), in the countries in which the Licensed Patents are being
prosecuted or maintained as of the Effective Date. NOVAVAX shall issue as a
patent each such Patent Application prosecuted to allowance at NOVAVAX’s sole
expense. NOVAVAX shall pay all attorneys fees and other costs associated with
the preparation, filing, and prosecution of such Patent Applications in the
Territory included in the Licensed Patents.

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     7.2 NOVAVAX agrees to promptly provide (if not already provided and on an
ongoing basis, as the case may be) ESPRIT with copies of:
     (a) All Patent Applications included in the Licensed Patents;
     (b) All prior art searches it has performed (or has had performed) related
to such Patent Applications; and
     (c) All correspondence to and from the U. S. Patent and Trademark Office
and foreign patent offices relating to such Patent Applications.
     7.3 ESPRIT shall have the right to consult with NOVAVAX from time to time
and on a reasonable basis regarding the content of the Patent Applications
included in the Licensed Patents, as well as the prior art searches and
correspondence related thereto, and to comment thereon. NOVAVAX shall consider
all such comments offered by ESPRIT, it being agreed, however, that all final
decisions respecting conduct of the prosecution of said patent applications
shall rest solely in the discretion of NOVAVAX.
     7.4 NOVAVAX shall promptly notify ESPRIT in the event NOVAVAX decides at
any time to abandon or discontinue prosecution of any one or more of the Patent
Applications included in the Licensed Patents. Such notification will be given
as early as possible which in no event will be less than forty-five (45) days
prior to the date on which such Patent Application(s) will become abandoned.
ESPRIT shall have the option, exercisable upon written notification to NOVAVAX,
to assume full responsibility for the prosecution of the affected Patent
Application(s), in which event such affected Patent Application(s) shall, at
ESPRIT’s option, be promptly exclusively licensed royalty-free to ESPRIT and its
sublicensees to make and have made, import, sell, offer to sell, and have sold
Licensed Product in the Territory in the Field.
     7.5 NOVAVAX shall pay all official taxes, annuities and fees required to
keep in force all Patent Applications and patents, which are included in the
Licensed Patents, and shall submit evidence, upon written request, to ESPRIT
that said government fees have been timely paid. In the event NOVAVAX decides
not to pay the maintenance fee due on any one or more of said patents or Patent
Applications, NOVAVAX will give ESPRIT written notice of such decision at least
sixty (60) days in advance of the payment date. ESPRIT shall thereupon have the
option to pay the maintenance fees due on the affected patents or Patent
Applications, in which case the affected Patent(s) or Patent Application(s)
shall, at ESPRIT’s option, be promptly exclusively licensed on an exclusive,
royalty free, perpetual and fully paid up basis to ESPRIT to make and have made,
import, sell, offer to sell, and have sold Licensed Product in the Territory in
the Field.
     7.6 Each Party shall promptly disclose to the other any Improvements made,
conceived or reduced to practice by the disclosing Party or its Affiliates,
agents, subcontractors or sublicensees.
ARTICLE 8 — COMPETING PRODUCTS AND INFRINGEMENT
     8.1.1 If, during the term of this Agreement, NOVAVAX or ESPRIT becomes
aware of infringing sales of product competitive with Licensed Products by a
third party in a given

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Calendar Quarter in a country of the Territory that are greater than *****
percent (*****%) of ESPRIT’s Commercial Sales of such Licensed Products, by
Dollar or equivalent legal currency of the given country in the Territory, of
Licensed Products in the Field in the same country of the Territory and in the
same Calendar Quarter that constitute infringement by a third party of any
issued patent (except for a patent relating to ESPRIT Sole Technology) included
in the Licensed Patents, that Party shall promptly notify the other Party in
writing to that effect. ESPRIT shall have the right, but not the obligation, to
bring suit against any infringer of a patent relating to ESPRIT Sole Technology
at its own cost and expense.
     8.1.2 NOVAVAX shall have the initial right, but not the obligation, to
initiate or prosecute an infringement or other appropriate suit or action
against any third party infringer of a Licensed Patent at its own expense.
ESPRIT has the right to join such suit or action at its own expense. If,
(a) after the expiration of ninety (90) days from said notice, NOVAVAX has not
obtained a discontinuance of such infringement or brought suit against the third
party infringer, and (b) the infringing product is competitive with Licensed
Products, ESPRIT shall have the right, but not the obligation, to bring suit (at
ESPRIT’s sole expense) against such third party infringer, provided that if
NOVAVAX is joined to the suit, NOVAVAX will pay for its own litigation expenses.
     8.1.3 If, prior to the expiration of ninety (90) days from given notice
under Section 8.1.1, NOVAVAX obtains a discontinuance of such infringement or
brings suit against the third party infringer, and ESPRIT does not join the
suit, then NOVAVAX shall retain all damages or other monies awarded or received
in settlement of such suit. ESPRIT will cooperate with NOVAVAX in any such suit
and shall have the right to consult with NOVAVAX and be represented by its own
counsel at its own expense.
     8.1.4 If, prior to the expiration of ninety (90) days from given notice
under Section 8.1.1, NOVAVAX brings suit against the third party infringer, and
ESPRIT exercises its right to join the suit, then each Party shall have the
right to be represented by independent counsel in such litigation at its own
expense and neither Party shall incur any liability to the other Party as a
consequence of such litigation or any unfavorable decision resulting therefrom,
including any decision holding the patent invalid or unenforceable. Furthermore,
any amounts recovered as a result of any infringement action taken by the
Parties hereunder shall be split equally.
     8.1.5 If, after the expiration of said ninety (90) days from the date of
given notice under Section 8.1.1, NOVAVAX has not obtained a discontinuance of
such infringement or brought suit against the third party infringer, and ESPRIT
decides to exercise its right, after such ninety (90) notice period, to bring
suit against such infringer and join NOVAVAX as a party plaintiff, then NOVAVAX
will reasonably cooperate with ESPRIT in any suit for infringement of a patent
of the Licensed Patents brought by ESPRIT against a third party, and shall have
the right to consult with ESPRIT and to participate in and be represented by
independent counsel in such litigation at its own expense. Neither Party shall
incur any liability to the other as a consequence of such litigation or any
unfavorable decision resulting therefrom, including any decision holding the
patent invalid or unenforceable. Furthermore, any amounts recovered as a result
of any infringement action taken by the Parties hereunder shall be split
equally.
     8.1.6 Neither NOVAVAX nor ESPRIT may agree to settle pursuant to
Section 8.1.4 or Section 8.1.5 without the prior written consent of the other
Party, which shall not be unreasonably withheld or delayed.
 

*   Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request.

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     8.1.7 Notwithstanding anything to the contrary contained herein, royalties,
Milestone Payments and all other payments hereunder shall continue unabated in
accordance with the terms and conditions of this Agreements during the pendancy
(including all appeals) of any action contemplated by Section 8. 1. 1 through
and including Section 8.1.7.
     8.2.1 In the event NOVAVAX or ESPRIT receive notice or otherwise become
actually aware of any facts that that ESPRIT’s making, using or selling of a
Licensed Product in the Field infringes, will infringe or is alleged by a third
party to infringe a third party patent, the Party becoming aware of same shall
promptly notify the other. NOVAVAX and ESPRIT shall thereafter attempt to agree
upon a course of action, which may include: (a) modifying of a Licensed Product
or its use and manufacture so as to be non-infringing; or (b) obtaining a
license or assignment from said third party.
     8.2.2 ESPRIT and NOVAVAX shall have the right to negotiate with said third
party for such license or assignment to the third party patent. In the event
that such negotiation results in a consummated agreement, then ESPRIT shall pay
any lump sum payment and/or royalties to be paid thereunder provided NOVAVAX has
had an opportunity to review and consent to such license agreement, which shall
not be unreasonably withheld or delayed. Any of such lump sum payments or
royalties to be paid by ESPRIT and its sublicensees under such ESPRIT negotiated
agreement shall be creditable against royalties then due NOVAVAX hereunder. In
no event shall ESPRIT be entitled to credit against any royalty payments owed to
the extent that any infringement claim by a third party is not based solely upon
a Licensed Product described in the above-mentioned NDA (#21-371) or where the
infringement claim is not based solely on ESPRIT’s use of the Licensed
Technology.
     8.2.3. In the event that ESPRIT is charged with patent infringement by a
third party as a result of ESPRIT’s making, using, and/or selling a Licensed
Product and it cannot settle or has not settled such infringement pursuant to
the terms above, ESPRIT shall have the right to defend against such charge of
infringement. NOVAVAX shall have the opportunity to fully participate in such
defense at its own expense. If as a result of a final unappealable judgment in
the litigation or settlement thereof with the third party as described in the
immediately preceding two sentences, ESPRIT is required to pay royalties or
other monies to such third party (“Third Party Payment”), ESPRIT may thereafter
offset such Third Party Payment (including running royalties and any and all
lump sum payments) against any royalties due but not yet paid hereunder to
NOVAVAX, unless such infringement claim by a third party is not based solely
upon a Licensed Product described in the above-mentioned NDA or where the
infringement claim is not based solely on ESPRIT’s use of the Licensed
Technology. Any damages or other monies awarded or received in settlement of
such litigation against such adverse party shall be shared in accordance with
Sections 8.1.4 and 8.1.5.
     8.2.4. Other than as expressly set forth to the contrary in Section 8.2.3,
royalties and all other payments hereunder shall continue unabated in accordance
with the terms and conditions of this Agreements during the pendancy (including
all appeals) of any action contemplated by Section 8.2.1. through and including
Section 8.2.4.

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ARTICLE 9 — WARRANTIES, REPRESENTATIONS AND ACKNOWLEDGEMENTS
     9.1.1 NOVAVAX expressly warrants and represents that (a) it exclusively
owns all of the rights, title and interest in and to the Licensed Patents as
defined herein existing as of the date hereof and (b) it has the full corporate
right and authority to enter into this Agreement and to carry out the
transactions contemplated herein. NOVAVAX further represents and warrants that
no academic institution, member of an academic institution, corporation, local,
state or federal government, or any other third party holds any property rights
in the Licensed Patents, or to its knowledge other Licensed Technology, that
pertains to a Licensed Product existing as of the date hereof. Further, NOVAVAX
represents that the patent applications and patents of Schedule A are all the
current existing Licensed Patents reasonably relevant to the Licensed Product In
the Territory having the formulation described on Schedule B attached hereto
(the “Formulation”).
     9.1.2 NOVAVAX expressly warrants and represents that, there are no
outstanding encumbrances or agreements, either written, or to its knowledge if
oral or implied, on the Licensed Technology that are inconsistent with the
obligations undertaken by NOVAVAX herein, and that it has not granted and will
not grant during the term of this Agreement or any renewal hereof, any license
or other privilege under the Licensed Technology with respect to the exclusive
rights granted hereunder for a Licensed Product in the Territory in the Field
which conflicts, or which could reasonably be expected to conflict, with the
terms and conditions of this Agreement.
     9.1.3 NOVAVAX expressly warrants and represents that, to its knowledge, it
has disclosed to ESPRIT all reasonably relevant and material regarding
pre-clinical and clinical studies and the Licensed Product in its possession or
control which NOVAVAX is not otherwise prohibited from disclosing pursuant to
law, regulation, order, treaty, agreement, contract or other obligation. NOVAVAX
expressly warrants and represents that, at the time of execution of this
Agreement, to its knowledge, it does not know of any third party patents or
pending applications that would prohibit NOVAVAX’s ability to obtain and enforce
its patent protection for Licensed Patents existing as of the date hereof in the
Territory to the extent necessary for a Licensed Product having the Formula
which has not otherwise been cited in any patent filings by NOVAVAX with the
relevant patent offices. NOVAVAX further represents and warrants that as of the
date hereof, to NOVAVAX’s knowledge as of the Effective Date, there have been no
public uses or public disclosures of the inventions claimed in the patents and
patent applications of the Licensed Patents prior to the earliest filing date of
each such respective patent or patent application.
     9.1.4 NOVAVAX expressly warrants and represents that it is not required to
obtain the consent of any third party to grant the rights granted herein to
ESPRIT. NOVAVAX further expressly warrants and represents that the rights
granted herein do not conflict with any existing or pending written agreement
(or to its knowledge, any existing or pending oral or implied agreement) of
NOVAVAX with a third party pertaining to use of the Licensed Technology for a
Licensed Product in the Territory.
     9.1.5 NOVAVAX expressly warrants and represents that: a) it has not been
notified in writing of any claims of infringement from any third party with
respect a Licensed Products as they currently exist, and, to its knowledge, no
third party has threatened to make any such claim; and b) that, to its
knowledge, it solely owns all of the data and results from any and all
preclinical and clinical development and testing of Licensed Products that it
conducted or

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authorized to have conducted prior to the Effective Date of this Agreement, and
that NOVAVAX has used reasonable efforts to disclose all of the data from such
preclinical and clinical development and testing to ESPRIT in connection with
this Agreement. NOVAVAX represents that it has not received written notice of
any issued patent owned by a third party which would be infringed by the making,
using, and selling of a Licensed Product having the Formula in the countries of
the Territory utilizing the Licensed Patents of NOVAVAX as currently in
existence as of the date hereof in any in those countries of the Territory.
     9.1.6 NOVAVAX represents and warrants that, to its knowledge, it has
undertaken all necessary legal and factual steps to ensure that NOVAVAX is able
to license the Licensed Technology to ESPRIT in accordance with this Agreement
to ESPRIT.
     9.1.7 NOVAVAX represents and warrants that (i) Schedule 9.1.7 attached
hereto represents a true, complete and accurate report of its sales of the
Product into each distribution channel and the Product returns it has received
for the 12 month period ending September 30, 2005 broken out by month;
(ii) March 31, 2005 , NOVAVAX has conducted its manufacturing and sales
activities to third parties regarding the Product in the ordinary course of
business consistent with past practice, and (iii) since March 31, 2005 through
the date of hereof, NOVAVAX has not offered any extraordinary rebates,
extraordinary discounts, or any other extraordinary promotional or marketing
incentives relating to the Product and has not had sales or returns at levels
higher than those historically obtained in accordance with its ordinary course
of business consistent with past practice.
     9.2 ESPRIT expressly warrants and represents that (a) it has the full
corporate right and authority to enter into this Agreement and to carry out the
transactions contemplated herein; (b) it is not required to obtain the consent
of any third party to enter into and perform its obligations under this
Agreement; (c) its entry into and performance of this Agreement do not conflict
with any existing or pending written agreement (or to its knowledge, any
existing or pending oral or implied agreement) of ESPRIT with a third party
pertaining the subject matter contained herein; (d) it is not aware of any fact
or circumstance which would indicate that NOVAVAX is in breach of any of the
representations in Sections 9.1.1 through and including 9.1.2; and (e) that the
voting equity of ESPRIT is owned by each of the Private Equity Investors as set
forth in Schedule 9.2(e) attached hereto.
     9.3. THE FOREGOING WARRANTIES OF EACH PARTY ARE IN LIEU OF ANY OTHER
WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES OF
MERCHANTABILITY OR ANY WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE, VALIDITY,
OR NON-INFRINGEMENT, ALL OF WHICH ARE HEREBY SPECIFICALLY EXCLUDED AND
DISCLAIMED.
     9.4. EXCEPT FOR THEIR RESPECTIVE OBLIGATIONS UNDER ARTICLE 11 ARISING OUT
OF THIRD PARTY CLAIMS, SUITS OR DEMANDS, NEITHER PARTY SHALL BE LIABLE TO THE
OTHER FOR ANY PUNITIVE, SPECIAL, INCIDENTAL, OR INDIRECT DAMAGES UNDER ANY
CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL OR EQUITABLE THEORY
ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ITS SUBJECT MATTER.

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ARTICLE 10 — TERM AND TERMINATION
     10.1 The term of this Agreement shall commence on the Effective Date and
shall expire upon the expiration of the last-to-expire Licensed Patent or when
terminated in accordance with any of the provisions herein. Upon expiration of
the term of this License Agreement, ESPRIT shall have a fully paid-up license to
make, have made, use and sell Licensed Products under the Licensed Technology in
the Territory.
     10.2 Termination for Breach: Upon any breach of, or default under, any
material provision of this Agreement by a Party, including, without limitation,
nonpayment of amounts owed hereunder by ESPRIT for any reason whatsoever except
as specifically provided for in this Agreement, the other Party may terminate
this Agreement in whole or in part by giving ninety (90) days’ written notice
(the “Notice Period”) to the breaching Party; provided however, that the
breaching Party shall have seventy-five (75) days to cure any such breach prior
to the commencement of the Notice Period. Said notice shall become effective at
the end of such Notice Period, unless during said Notice Period the breaching
Party shall cure such breach or default within the applicable cure period.
Notwithstanding anything to the contrary contained herein, payment defaults will
have a notice and cure period of five (5) days. Notwithstanding anything to the
contrary contained herein, this Agreement will terminate at the option of
NOVAVAX (without notice to ESPRIT or any other precondition on the part of
NOVAVAX) upon breach by ESPRIT of any of its obligations under the Promissory
Note.
     10.3 Effect of Termination for Breach by ESPRIT: Except as otherwise
expressly set forth herein, upon termination by NOVAVAX under Section 10.2:
a) all licenses granted to ESPRIT hereunder shall cease and all such licensed
rights shall revert to NOVAVAX;
b) ESPRIT shall, and it hereby does effective only upon termination by NOVAVAX
as set forth above in 10.2, grant to NOVAVAX an exclusive (even as to ESPRIT),
worldwide, irrevocable, perpetual, fully-paid up license, under ESPRIT
Improvements and ESPRIT’s interest in the Joint Improvements, with the right to
grant sublicenses, to make and have made, import, use, sell, offer for sale, and
have sold Licensed Product in the Field.
c) ESPRIT shall promptly deliver to NOVAVAX all of the following documents:
(1) all confidential information and materials related to any Licensed Product
provided by NOVAVAX pursuant to this Agreement, and (2) any New Drug Application
(as defined in 21 C.F.R. Part 314) (“NDA”), any other filing with any
governmental or regulatory authority worldwide in connection with any Licensed
Product, and all related data, documents, reports, files (including the related
drug master file), filings and correspondence with any governmental or
regulatory authority, adverse event reports, clinical trial results, any
investigative new drug applications and supporting data and information (“IND”),
and all other documents or information, in whatever form, relating to the
manufacture, use and sale of the Licensed Products;
d) if ESPRIT has applied for or obtained any regulatory approvals in any country
for any Licensed Product, then ESPRIT shall, to the extent legally permissible,
take all additional action reasonably necessary to assign all of its right,
title and interest in and transfer possession and control to NOVAVAX of such
applications or regulatory approvals; and
e) any regulatory filings for any Licensed Product which have been submitted in
ESPRIT’s name, subject to FDA approval, will be transferred to NOVAVAX’s name;
and

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     10.4 Effect of Termination for Breach by NOVAVAX: Except as otherwise
expressly set forth herein, upon termination by ESPRIT under Section 10.2:
a) ESPRIT shall be free of any obligation to make any further, unaccrued
payments to NOVAVAX relating to the terminated license pursuant to Articles 3, 4
or 5; and
b) NOVAVAX shall promptly deliver to ESPRIT all confidential information of
ESPRIT, including, confidential information relating to ESPRIT Improvements,
then in NOVAVAX’s possession and materials related to any Licensed Product
provided by ESPRIT to NOVAVAX pursuant to this Agreement.
     10.5 Termination for Bankruptcy: NOVAVAX or ESPRIT may terminate this
Agreement should the other Party commit an act of bankruptcy, be declared
bankrupt, voluntarily file or have filed against it a petition for bankruptcy or
reorganization unless such petition is dismissed within sixty (60) days of
filing, enter into a procedure of winding up to dissolution or should a trustee
or receiver be appointed for its business assets or operations. All rights and
licenses granted under or pursuant to this Agreement are, and shall otherwise be
deemed to be, for the purposes of Section 365(n) of Title 11, U.S. Code
(“Bankruptcy Code”) license rights to “intellectual property” as defined under
Section 101 (35A) of the Bankruptcy Code. The parties agree that ESPRIT, as a
licensee of such right, under this Agreement, shall retain and may fully
exercise all of its rights and elections under the Bankruptcy Code.
     10.6 Certain Effects of Termination; Payments and Dispute Resolution: In
the event of termination of this Agreement by NOVAVAX under Section 10.2, ESPRIT
shall not be relieved of the duty and obligation to pay in full, payments due,
accrued, and unpaid at the effective date of such termination, nor shall any
such termination relieve either Party of any obligation arising hereunder prior
to such termination. Notwithstanding the foregoing, from the date either Party
notifies the other Party that it wishes to commence a proceeding in accordance
with the dispute resolution procedures set forth in Article 12 until the date
such proceeding has been concluded, the running of the time period referred to
in this paragraph for curing a breach shall be suspended with respect to the
subject matter of the dispute, claim or controversy.
     10.7 Upon termination of any license granted herein, in part or in whole as
to any Licensed Product, ESPRIT shall have the right to sell off any of such
Licensed Product in its inventory provided ESPRIT pays to NOVAVAX any royalties
otherwise calculated in accordance with this Agreement.
     10.8. Survival of Provisions Upon Termination. (a) In the event of
termination of this Agreement by NOVAVAX under Section 10.2, the provisions of
Section 2.4 and the provisions listed in subsection (b) below shall survive the
termination of this Agreement to the extent provided for herein, and (b) the
following provisions shall survive the termination or expiration of this
Agreement to the extent of any claims thereunder arising out of facts or
circumstances arising or existing prior to the date of such termination of
expiration : Articles 6, 11, 12 and 13, and Sections 9.3, 9.4, 10.6, 10.7 and
10.8.

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ARTICLE 11 — INDEMNIFICATION
     11.1 NOVAVAX and ESPRIT will each defend as the case maybe (each an
“Indemnifying Party”) , at its own expense, indemnify and hold harmless the
other Party and its Affiliates from and against any and all damages,
liabilities, losses, costs, and expenses, including attorneys fees, arising out
of any claim, suit or proceeding brought against the other Party to the extent
such claim, suit, or proceeding is based upon a claim arising out of or relating
to (i) any breach or violation of, or failure to perform, any covenant or
agreement made by such indemnifying Party in this Agreement, unless waived in
writing by the indemnified Party; (ii) any breach of the representations or
warranties made by such indemnifying Party in this Agreement; or (iii) the
negligence or willful misconduct of the indemnifying Party, except, under clause
(ii), to the extent arising out of the breach, violation, failure, negligence or
willful misconduct of the indemnified Party. Each Party agrees that it shall
promptly notify the other in writing of any such claim or action and give the
indemnifying Party full information and assistance in connection therewith. The
indemnifying Party shall have the sole right to control the defense of any such
claim or action and the sole right to settle or compromise any such claim or
action, except that the prior written consent of the other Party shall be
required in connection with any settlement or compromise which could (i) place
any obligation on or require any action of such other Party; (ii) admit or imply
any liability or wrongdoing of such other Party; or (iii) adversely affect the
goodwill or public image of such other Party. Notwithstanding the foregoing, the
indemnified Party may participate therein through counsel of its choice, but the
cost of such counsel shall be borne solely by the indemnified Party. Except as
otherwise provided herein, NOVAVAX will defend, at its own expense, indemnify
and hold harmless the other ESPRIT and its Affiliates from and against any and
all damages, liabilities, losses, costs, and expenses, including attorneys fees,
arising out of any claim, suit or proceeding brought against the ESPRIT or any
such Affiliate to the extent such claim, suit, or proceeding is based upon a
claim arises out of a third party claim or suit or demand based on bodily injury
or property damage resulting from the manufacture, use or sale of Licensed
Product in the Field by NOVAVAX or its Affiliates or sublicensees pursuant to
this Agreement other than in accordance with specifications as provided in the
Supply Agreement, unless such claim is due to the negligent, grossly negligent
or intentional act or omission of ESPRIT.
     11.2 In the event that any Party hereunder seeks indemnification under this
Article 11, such Party shall: (a) promptly inform the Indemnifying Party of any
claim, suit or demand threatened or filed, and (b) cooperate as requested (at
the expense of the Indemnifying Party) in the defense of such claims.
     11.3 An Indemnifying Party’s (including sublicensees) obligations under
this Article 11 shall not extend to any claims, suits or demands for liability,
damages, losses, costs and expenses arising from the Indemnified Party’s failure
to comply with the terms and conditions of this Agreement or arising from the
negligence, gross negligence, intentional wrongful act or omission of the
Indemnified Party, its agents or employees.
ARTICLE 12 — ARBITRATION
     12.1 Any controversy or claim arising out of or relating to this Agreement
shall be resolved by arbitration before a panel of three arbitrators in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association (“AAA”) then pertaining (available at www.adr.org), except where
those rules conflict with this provision, in which case this provision controls.
Any court with jurisdiction shall enforce this clause and enter judgment on any
award. The arbitrators shall be selected within twenty Business Days from filing
of a

22

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demand for arbitration from the AAA’s National Roster of Arbitrators pursuant to
agreement or through selection procedures administered by the AAA. Within
45 days of filing of a demand for arbitration, the parties shall reach agreement
upon and thereafter follow procedures, including limits on discovery, assuring
that the arbitration will be concluded and the award rendered within no more
than eight months from selection of the arbitrators or, failing agreement,
procedures meeting such time limits will be designed by the AAA and adhered to
by the parties. The arbitration shall be held in New York, New York, Borough of
Manhattan and the arbitrators shall apply the substantive law of New York,
except that the interpretation and enforcement of this arbitration provision
shall be governed by the Federal Arbitration Act. Prior to commencement of
arbitration, emergency relief is available from any court to avoid irreparable
harm. THE ARBITRATOR SHALL NOT AWARD EITHER PARTY PUNITIVE, EXEMPLARY,
MULTIPLIED OR CONSEQUENTIAL DAMAGES, OR ATTORNEYS FEES OR COSTS. Prior to
commencement of arbitration, the parties must attempt to mediate their dispute
using a professional mediator from AAA, the CPR Institute for Dispute
Resolution, or like organization selected by agreement or, absent agreement,
through selection procedures administered by the AAA. Within a period of 45 days
after the request for mediation, the parties agree to convene with the mediator,
with business representatives present, for at least one session to attempt to
resolve the matter. In no event will mediation delay commencement of the
arbitration for more than 45 days absent agreement of the parties or interfere
with the availability of emergency relief.
ARTICLE 13 — MISCELLANEOUS
     13.1 Any delays in or failures of performance by a Party under this
Agreement shall not be considered a breach of this Agreement if and to the
extent caused by acts of God; acts, regulations or laws of any government;
strikes or other concerted acts of workers; fires; floods; explosions; riots;
wars; rebellions; and sabotage (a “Force Majeure Event”); and any time for
performance hereunder shall be extended by the actual time of delay caused by
such occurrence. In the event that a Party’s performance of payment obligations
is suspended for more than one hundred and twenty (120) days because of a Force
Majeure Event, the other Party has the right to terminate this Agreement upon
written notice to the non-performing Party.
     13.2 This Agreement, or any of the rights and obligations created herein
,including but not limited to the licenses granted under Article 2, shall not be
assigned or transferred, in whole or in part, by either Party hereto without the
prior written consent of the other Party which will not be unreasonably withheld
or delayed; provided, however, that either Party may, without such consent,
assign the Agreement and its rights and obligations hereunder (A) to a wholly
owned operating Affiliate of such Party or (B) in connection with the transfer
or sale of all or substantially all of its assets to a third party so long as:
(i) each Party will provide the other Party with at least ten (10) days prior
written notice thereof; and (ii) in the event of such a transfer by NOVAVAX, any
permitted assignee shall assume all obligations of its assignor under the
Agreement in a writing delivered to the other Party. Any attempted assignment or
transfer of such rights or obligations without such consent, except as provided
herein, shall be void. This Agreement shall binding upon any purchaser of all or
substantially all of the assets of the either Party, as the case may be. This
Section 13.2 shall not be deemed to otherwise prohibit or otherwise apply to a
change in control of NOVAVAX (whether by merger of sale of capital stock or
otherwise) at the shareholder or Board of Director levels or otherwise.

23

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     13.3 The waiver by a Party, whether express or implied, of any provisions
of this Agreement, or of any breach or default of a Party, shall not be
construed to be a continuing waiver of such provision, or of any succeeding
breach or default or of a waiver of any other provisions of this Agreement.
     13.4 All matters affecting the interpretation, validity, and performance of
this Agreement shall be governed by the laws of the State of New York, U.S.A.,
without regard to its choice or conflict of law principles.
     13.5 Any provision hereof which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective only to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction. The parties shall replace such ineffective provision
for such jurisdiction with a valid and enforceable provision which most closely
approaches the NOVAVAX, intent, and purpose of this Agreement, and in
particular, the provision to be replaced.
     13.6 ESPRIT and NOVAVAX are independent contractors and shall not be deemed
to be partners, joint venturers or each other’s agents, and neither shall have
the right to act on behalf of the other except as expressly provided hereunder
or otherwise expressly agreed to in writing.
     13.7 It is the mutual desire and intent of the parties to provide certainty
as to their future rights and remedies against each other by defining the extent
of their mutual undertakings as provided herein. The parties have in this
Agreement incorporated all representations, warranties, covenants, commitments
and understandings on which they have relied in entering into this Agreement
and, except as provided for herein, neither Party has made any covenant or other
commitment to the other concerning its future action. Accordingly, this
Agreement (together with the schedules attached hereto (i) constitute the entire
agreement and understanding between the parties with respect to the matters
contained herein, and there are no promises, representations, conditions,
provisions or terms related thereto other than those set forth in this
Agreement, and (ii) supersede all previous understandings, agreements and
representations between the parties, written or oral relating to the subject
matter hereof. The parties hereto may from time to time during the continuance
of this Agreement modify, vary or alter any of the provisions of this Agreement,
but only by written agreement of all parties hereto.
     13.8 All communications, reports, payments and notices required by this
Agreement shall be addressed to the Partied(s) at their respective address(s)
set forth below or to such other address as requested by a Party by notice in
writing to the other parties.

          If to NOVAVAX:   Attention: Chief Executive Officer
 
      NOVAVAX, Inc.
 
      508 Lapp Road
 
      Malvern, PA 19355
 
       
 
  With a copy to:   Ropes & Gray LLP
 
      45 Rockefeller Plaza
 
      New York, NY 10111
 
      Attention: Sanford B. Kaynor, Jr.

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          If to ESPRIT:   Attention: Chief Executive Officer
 
      Esprit Pharma, Inc.
 
      Two Tower Blvd.
 
      East Brunswick, NJ 08816
 
       
 
  With a copy to:   Steven M. Bosacki, General Counsel
 
      Esprit Pharma, Inc.
 
      Two Tower Blvd.
 
      East Brunswick, NJ 08816

     All such notices, reports, payments and communications shall be made by
First Class mail; postage prepaid, and shall be considered made as of the date
of deposit with the United States Post Office.
     13.9 This Agreement may not be amended or modified unless in writing
executed by both parties hereto. Except as otherwise expressly set forth herein,
neither party will have any rights of setoff or to withhold the performance of
any obligation (including with respect to any payment otherwise required to be
made) hereunder.
     13.10. Unless otherwise expressly provided for herein (i) financial and
accounting terms will have the meaning ascribed to such terms in accordance with
GAAP, (ii) the word, “including”, will mean “including but not limited to” and
the word “day” will mean “calendar day”, (iii) references to the singular will
include the plural and vice versa, (iv) the use of any pronoun will include the
neuter and both genders, and (v) references to Sections, Articles, Schedules and
Exhibits will be references to Sections, Articles, Schedules and Exhibits to
this Agreement and the word, “herein” and words of similar import will be
construed to refer to this Agreement, (vi) the word “knowledge” will mean actual
knowledge after reasonably diligent inquiry of executive officers of the
relevant entity, and (vii) headings and titles of Sections and Articles herein
will be construed to be descriptive only and without any substantive or
interpretive effect.
     13.11 If at any time during the term of this Agreement and prior to *****,
NOVAVAX receives a bona fide proposal from a third party to enter into an
exclusive license agreement to market a product containing ***** in NOVAVAX’s
***** for the treatment of *****. NOVAVAX shall promptly notify ESPRIT in
writing. ESPRIT may, but shall not be obligated to deliver to NOVAVAX within in
***** (*****) days of receipt of such notice, a letter stating that ESPRIT
wishes to enter into an exclusive license for any of the products herein as the
case may be, on substantially the same terms and conditions received in its most
favorable third party proposal. The parties hereto agree to diligently negotiate
in good faith to complete the transaction contemplated herein. In the event the
parties are not able to consummate an agreement ***** (*****) days of receipt of
such notice, NOVAVAX shall be entitled to negotiate a transaction with respect
to the foregoing product on terms acceptable to NOVAVAX
 

*   Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request.

25

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ARTICLE 14 — TAXES
     14.1 ESPRIT will make all payments to NOVAVAX under this Agreement without
deduction or withholding for taxes except to the extent that any such deduction
or withholding is required by law in effect at the time of payment.
     14.2 Any tax required to be withheld on amounts payable under this
Agreement will promptly be paid by ESPRIT on behalf of NOVAVAX to the
appropriate governmental authority, and ESPRIT will furnish NOVAVAX with proof
of payment of such tax.
     14.3 ESPRIT and NOVAVAX will cooperate with respect to all documentation
required by any taxing authority or reasonably requested by ESPRIT to secure a
reduction in the rate of applicable withholding taxes.

26

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                  NOVAVAX, INC.       ESPRIT PHARMA, INC.
 
               
By:
          By:    
 
               
 
  Name:           Name:     Title: President and Chief Executive Officer      
Title:
Date:
          Date:    
 
               

27

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LICENSE AGREEMENT
Schedule A — Patents and Patent Applications

                      Country   Status   Application No.   Patent No.   Issue
Date   Expiration
United States
  Granted   08/380942   5629021   05/13/1997   01/31/2015
Mexico
  Granted   975663   198438   09/04/2000   01/29/2016
Canada
  Granted   2211262   2211262   08/30/2005   01/29/2016

28

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LICENSE AGREEMENT
Schedule B — Formulation For Existing Estrasorb®Licensed Product
Formulation (NOVAVAX-033/2)

      Ingredient Description   Percent w/w
17 b -Estradiol USP/Ph. Eur.
  *****
Soybean Oil USP
  *****
Polysorbate 80 NF
  *****
190 Proof Ethyl Alcohol USP
  *****
Purified Water USP
  *****

 

*   Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request.

29

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LICENSE AGREEMENT
Schedule 1 — Trademarks

                          Application No.   Registration   Status /   Date
ESTRASORB
  75/833622     2784534     Registered   18-Nov-2003

         
 
  Class 5         Goods: pharmaceuticals, namely topical hormone preparations
 
      International Class: 005
 
      First Use Date: 2003-03-03
 
      First Use in Commerce Date: 2003-03-03
 
       
 
      Basis: 1(a)

www.estrasorb.com

30

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LICENSE AGREEMENT
Schedule 9.1.7 — Product Sales and Returns
Novavax, Inc.
Estrasorb Sales by Month

                          Gross Sales   Returns       Units   Dollars   Units  
Dollars           $        
 
Oct-04   *****   *****   *****   *****
 
Nov-04   *****   *****        
 
Dec-05   *****   *****        
 
Jan-05   *****   *****        
 
Feb-05   *****   *****        
 
Mar-05   *****   *****        
 
Apr-05   *****   *****   *****   *****
 
May-05   *****   *****   *****   *****
 
Jun-05   *****   *****        
 
Jul-05   *****   *****        
 
Aug-05   *****   *****   *****   *****
 
Sep-05   *****   *****        
 
                 
Totals
    *****   *****       *****

 

*   Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request.

31

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LICENSE AGREEMENT
Schedule 9.2(e) — Voting Equity of ESPRIT

          Fully Diluted     Voting     Equity Private Equity Investor  
Percentage
*****
  *****%
*****
  *****%
*****
  *****%

 

*   Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request.

32