Exhibit 10.52







 





Morgan Stanley & Co. LLC


1585 Broadway, 5th Floor


New York, NY 10036


February 2, 2016


 





	To:	Novavax, Inc.
	 	20 Firstfield Road
	 	Gaithersburg, Maryland 20878
	 	Attention:	Chief Financial Officer
	 	Telephone No.:	(240) 268-2030
	 	Facsimile No.:	(240) 268-2100
	 	 	 
	 	 	 
	 	 	 
	Re:	Additional Call Option Transaction








 


The purpose of this
letter agreement (this “Confirmation”) is to confirm the terms and conditions of the call option transaction
entered into between Morgan Stanley & Co. LLC (“Dealer”) and Novavax, Inc. (“Counterparty”)
as of the Trade Date specified below (the “Transaction”). This letter agreement constitutes a “Confirmation”
as referred to in the ISDA Master Agreement specified below. This Confirmation shall replace any previous agreements and serve
as the final documentation for the Transaction.


 


The definitions and
provisions contained in the 2002 ISDA Equity Derivatives Definitions (the “Equity Definitions”), as published
by the International Swaps and Derivatives Association, Inc. (“ISDA”) are incorporated into this Confirmation.
In the event of any inconsistency between the Equity Definitions and this Confirmation, this Confirmation shall govern. Certain
defined terms used herein are based on terms that are defined in the Offering Memorandum dated January 25, 2016 (the “Offering
Memorandum”) relating to the Convertible Senior Notes due 2023 (as originally issued by Counterparty, the “Convertible
Notes” and each USD 1,000 principal amount of Convertible Notes, a “Convertible Note”) issued by Counterparty
in an aggregate initial principal amount of USD 300,000,000 (as increased by an aggregate principal amount of USD 25,000,000 pursuant
to the exercise by the Initial Purchasers (as defined herein) of their option to purchase additional Convertible Notes pursuant
to the Purchase Agreement (as defined herein)) pursuant to an Indenture dated January 29, 2016 between Counterparty and The Bank
of New York Mellon Trust Company, N.A., as trustee (the “Indenture”). In the event of any inconsistency between
the terms defined in the Offering Memorandum, the Indenture and this Confirmation, this Confirmation shall govern. The parties
acknowledge that this Confirmation is entered into on the date hereof with the understanding that (i) definitions set forth in
the Indenture that are also defined herein by reference to the Indenture and (ii) sections of the Indenture that are referred to
herein will conform to the descriptions thereof in the Offering Memorandum. If any such definitions in the Indenture or any such
sections of the Indenture differ from the descriptions thereof in the Offering Memorandum, the descriptions thereof in the Offering
Memorandum will govern for purposes of this Confirmation. The parties further acknowledge that the Indenture section numbers used
herein are based on the Indenture as executed. Subject to the foregoing, references to the Indenture herein are references to the
Indenture as in effect on the date of its execution, and if the Indenture is amended or supplemented following such date (other
than any amendment or supplement (x) pursuant to Section 10.01(h) of the Indenture that, as determined by the Calculation Agent,
conforms the Indenture to the description of Convertible Notes in the Offering Memorandum or (y) pursuant to Section 14.07 of the
Indenture, subject, in the case of this clause (y), to the second paragraph under “Method of Adjustment” in Section
‎3), any such amendment or supplement will be disregarded for purposes of this Confirmation unless the parties agree otherwise
in writing.


 


Each party is hereby
advised, and each such party acknowledges, that the other party has engaged in, or refrained from engaging in, substantial financial
transactions and has taken other material actions in reliance upon the parties’ entry into the Transaction to which this
Confirmation relates on the terms and conditions set forth below.


 






     


     


    

 


1.           This Confirmation
evidences a complete and binding agreement between Dealer and Counterparty as to the terms of the Transaction to which this Confirmation
relates. This Confirmation shall supplement, form a part of, and be subject to an agreement in the form of the 2002 ISDA Master
Agreement (the “Agreement”) as if Dealer and Counterparty had executed an agreement in such form (but without
any Schedule except for (i) the election of US Dollars (“USD”) as the Termination Currency, (ii) the election of the
laws of the State of New York as the governing law (without reference to choice of law doctrine), (iii) the election that the “Cross
Default” provisions of Section 5(a)(vi) of the Agreement shall apply to Dealer with a “Threshold Amount” of 3%
of Dealer’s shareholders’ equity (provided that (a) the phrase “, or becoming capable at such time of
being declared,” shall be deleted from clause (1) of such Section 5(a)(vi) of the Agreement, (b) “Specified Indebtedness”
shall have the meaning specified in Section 14 of the Agreement, except that such term shall not include obligations in respect
of deposits received in the ordinary course of Dealer’s banking business and (c) the following sentence shall be added to
the end of Section 5(a)(vi) of the Agreement: “Notwithstanding the foregoing, a default under subsection (2) hereof shall
not constitute an Event of Default if (x) the default was caused solely by error or omission of an administrative or operational
nature; (y) funds were available to enable the relevant party to make the payment when due; and (z) the payment is made within
two Local Business Days of such party’s receipt of written notice of its failure to pay.”) on the Trade Date. In the
event of any inconsistency between provisions of the Agreement and this Confirmation, this Confirmation will prevail for the purpose
of the Transaction to which this Confirmation relates. The parties hereby agree that no transaction other than the Transaction
to which this Confirmation relates shall be governed by the Agreement.


 


2.           The terms of the
particular Transaction to which this Confirmation relates are as follows:


 


General Terms.


 


		Trade Date:	February 2, 2016



 


		Effective Date:	Trade Date



 


		Option Style:	“Modified American”, as described under “Procedures for Exercise” below



 


		Option Type:	Call



 


		Buyer:	Counterparty



 


		Seller:	Dealer



 


		Shares:	The common stock of Counterparty, par value USD 0.01 per share (Exchange symbol “NVAX”).



 


		Number of Options:	25,000. For the avoidance of doubt, the Number of Options shall be reduced by any Options exercised
by Counterparty. In no event will the Number of Options be less than zero.



 


		Applicable Percentage:	40%



 


		Option Entitlement:	A number equal to the product of the Applicable Percentage and 146.8213



 


		Strike Price:	USD 6.8110



 


		Cap Price:	USD 9.7300



 


		Premium:	USD 1,156,000



 


		Premium Payment Date:	February 5, 2016



 


		Exchange:	The NASDAQ Global Select Market



 


		Related Exchange(s):	All Exchanges



 


		Excluded Provisions:	Section 14.04(g) and Section 14.03 of the Indenture.



 






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Procedures for Exercise.


 


		Conversion Date:	With respect to any conversion of a Convertible Note (other than any conversion of Convertible
Notes with a Conversion Date occurring prior to the Cut-Off Date (any such conversion, an “Early Conversion”),
to which the provisions of Section ‎9(i)(i) of this Confirmation shall apply), the date on which the “Holder” (as
such term is defined in the Indenture) of such Convertible Note satisfies all of the requirements for conversion thereof as set
forth in Section 14.02(b) of the Indenture.



 


		Cut-Off Date:	The 45th “Scheduled Trading Day” (as defined in the Indenture) immediately preceding
the “Maturity Date” (as defined in the Indenture).



 


		Expiration Time:	The Valuation Time



 


		Expiration Date:	February 1, 2023, subject to earlier exercise.



 


		Multiple Exercise:	Applicable, as described under “Automatic Exercise” below.



 


		Automatic Exercise:	Notwithstanding Section 3.4 of the Equity Definitions, on each Conversion Date occurring on or
after the Cut-Off Date in respect of which a “Notice of Conversion” (as defined in the Indenture) that is effective
as to Counterparty has been delivered by the relevant converting “Holder” (as such term is defined in the Indenture),
a number of Options equal to (i) the number of Convertible Notes in denominations of USD 1,000 as to which such Conversion Date
has occurred minus (ii) the number of Options that are or are deemed to be automatically exercised on such Conversion Date
under the Base Call Option Transaction Confirmation letter agreement dated January 25, 2016 between Dealer and Counterparty (the
“Base Call Option Confirmation”), shall be deemed to be automatically exercised; provided that such Options
shall be exercised or deemed exercised only if Counterparty has provided a Notice of Exercise to Dealer in accordance with “Notice
of Exercise” below.



 


Notwithstanding
the foregoing, in no event shall the number of Options that are exercised or deemed exercised hereunder exceed the Number of Options.


 


		Notice of Exercise:	Notwithstanding anything to the contrary in the Equity
Definitions or under “Automatic Exercise” above, in order to exercise any Options relating to Convertible Notes with
a Conversion Date occurring on or after the Cut-Off Date, Counterparty must notify Dealer in writing before 5:00 p.m. (New York
City time) on the second Scheduled Valid Day immediately preceding the Expiration Date of the number of such Options being exercised.



 


		Valuation Time:	At the close of trading of the regular trading session on the Exchange.



 






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		Market Disruption Event:	Section 6.3(a) of the Equity Definitions is hereby replaced
in its entirety by the following:



 


“‘Market
Disruption Event’ means, in respect of a Share, (i) a failure by the principal United States national or regional securities
exchange or market on which the Shares are listed for trading to open for trading or (ii) the occurrence or existence for more
than one half-hour period in the aggregate on any Scheduled Valid Day of any suspension or limitation imposed on trading (by reason
of movements in price exceeding limits permitted by the relevant stock exchange or otherwise) in the Shares or in any options contracts
or futures contracts relating to the Shares, and such suspension or limitation occurs or exists at any time before 1:00 p.m. (New
York City time) on such Scheduled Valid Day.”


 


Settlement Terms.


 


		Settlement Method:	Net Share Settlement.



 


		Net Share Settlement:	Dealer will deliver to Counterparty, on the relevant Settlement Date, a number of Shares equal
to the Net Shares in respect of any Option exercised or deemed exercised hereunder. In no event will the Net Shares be less than
zero.



 


		Net Shares:	In respect of any Option exercised or deemed exercised, a number of Shares equal to the sum of
the quotients, for each Valid Day during the Settlement Averaging Period for such Option, of (i) (A) the Option Entitlement on
such Valid Day multiplied by (B) (1) the amount by which the Cap Price exceeds the Strike Price, if the Relevant Price on
such Valid Day is equal to or greater than the Cap Price, (2) the amount by which such Relevant Price exceeds the Strike Price,
if such Relevant Price is greater than the Strike Price but less than the Cap Price or (3) zero, if such Relevant Price is less
than or equal to the Strike Price, divided by (C) such Relevant Price, divided by (ii) the number of Valid Days in
the Settlement Averaging Period; provided that in no event shall the Net Shares for any Option exceed a number of Shares
equal to the Applicable Limit for such Option divided by the Applicable Limit Price on the Settlement Date for such Option.



 


Dealer will
pay cash in lieu of delivering any fractional Shares to be delivered with respect to any Net Shares valued at the Relevant Price
for the last Valid Day of the Settlement Averaging Period.


 


		Applicable Limit:	For any Option, an amount of cash equal to the Applicable Percentage multiplied by the excess
of (i) the number of Shares delivered to the Holder of the related Convertible Note upon conversion of such Convertible Note multiplied
by the Applicable Limit Price on the Settlement Date for such Option, over (ii) USD 1,000.



 






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		Applicable Limit Price:	On any day, the opening price as displayed under the heading “Op” on Bloomberg page
NVAX <equity> (or any successor thereto).



 


		Valid Day:	A day on which (i) there is no Market Disruption Event and (ii) the principal U.S. national or
regional securities exchange on which the Shares are listed or admitted for trading is open for trading with a Scheduled Closing
Time of 4:00 p.m. (New York City time) or the then-standard closing time for regular trading on such exchange, or, if the Shares
are not listed on a U.S. national or regional securities exchange, any Business Day.



 


		Scheduled Valid Day:	A day that is scheduled to be a Valid Day on the principal U.S. national or regional securities
exchange on which the Shares are listed or admitted for trading. If the Shares are not so listed or admitted for trading, “Scheduled
Valid Day” means a Business Day.



 


		Business Day:	Any day other than a Saturday, a Sunday or a day on which state or federally chartered banking
institutions in New York, New York are not required to be open.



 


		Relevant Price:	On any Valid Day, the per Share volume-weighted average price as displayed under the heading “Bloomberg
VWAP” on Bloomberg page “NVAX Equity AQR” (or its equivalent successor if such page is not available) in respect
of the period from the scheduled open of trading until the Scheduled Closing Time of the Exchange on such Valid Day or, if such
volume-weighted average price is unavailable, the market value of one Share on such Valid Day, as determined by the Calculation
Agent using, if practicable, a volume-weighted average price method. The Relevant Price will be determined without regard to after-hours
trading or any other trading outside of the regular trading session trading hours.



 


		Settlement Averaging Period:	For any Option being exercised hereunder, the 40 consecutive Valid Days commencing on, and including,
the 42nd Scheduled Valid Day immediately prior to the Expiration Date.



 


		Settlement Date:	For any Option, the third Business Day immediately following the final Valid Day of the Settlement
Averaging Period for such Option.



 


		Settlement Currency:	USD



 


		Other Applicable Provisions:	The provisions of Sections 9.1(c), 9.8, 9.9 and 9.11 of the Equity Definitions will be applicable,
except that all references in such provisions to “Physically-settled” shall be read as references to “Net Share
Settled”. “Net Share Settled” in relation to any Option means that Net Share Settlement is applicable to that
Option.



 






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		Representation and Agreement:	Notwithstanding anything to the contrary in the Equity Definitions (including, but not limited
to, Section 9.11 thereof), the parties acknowledge that (i) any Shares delivered to Counterparty may be, upon delivery, subject
to restrictions and limitations arising from Counterparty’s status as issuer of the Shares under applicable securities laws,
(ii) Dealer may deliver any Shares required to be delivered hereunder in certificated form in lieu of delivery through the Clearance
System and (iii) any Shares delivered to Counterparty may be “restricted securities” (as defined in Rule 144 under
the Securities Act of 1933, as amended (the “Securities Act”)).



 


		3.	Additional Terms applicable to the Transaction.



 


Adjustments applicable to the
Transaction:


 


		Potential Adjustment Events:	Notwithstanding Section 11.2(e) of the Equity Definitions, a “Potential Adjustment Event”
means an occurrence of any event or condition, as set forth in any Dilution Adjustment Provision, that would result in an adjustment
under the Indenture to the “Conversion Rate” or the composition of a “unit of Reference Property” or to
any “Last Reported Sale Price” , “Daily VWAP,” “Daily Conversion Value” or “Daily
Settlement Amount” (each as defined in the Indenture). For the avoidance of doubt, Dealer shall not have any delivery or
payment obligation hereunder, and no adjustment shall be made to the terms of the Transaction, on account of (x) any distribution
of cash, property or securities by Counterparty to “Holders” (as such term is defined in the Indenture) of the Convertible
Notes (upon conversion or otherwise) or (y) any other transaction in which “Holders” (as such term is defined
in the Indenture) of the Convertible Notes are entitled to participate, in each case, in lieu of an adjustment under the Indenture
of the type referred to in the immediately preceding sentence (including, without limitation, pursuant to the fourth sentence of
the second paragraph of Section 14.04(c) of the Indenture or the fourth sentence of the second paragraph of Section 14.04(d) of
the Indenture). 



 


		Method of Adjustment:	Calculation Agent Adjustment, which means that, notwithstanding Section 11.2(c) of the Equity Definitions,
upon any Potential Adjustment Event, the Calculation Agent shall make (A) an adjustment corresponding to the adjustment to be made
pursuant to the Indenture (or, if no Convertible Notes are outstanding, that would have been made if Convertible Notes were outstanding)
to any one or more of the Strike Price, Number of Options, and/or Option Entitlement and (B) proportionate adjustment to the Cap
Price to the extent any adjustment is made to the Strike Price pursuant to clause (A) above (which adjustment, for the avoidance
of doubt, shall not prohibit Dealer from making any further adjustments to the Cap Price in accordance with, and subject in all
respects to, Section ‎9(x)); provided that in no event shall the Strike Price be adjusted to be greater than the Cap
Price.



 






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Notwithstanding
the foregoing and “Consequences of Merger Events / Tender Offers” below, if the Calculation Agent in good faith disagrees
with any adjustment to the Convertible Notes that involves an exercise of discretion by Counterparty or its board of directors
(including, without limitation, pursuant to Section 14.05 of the Indenture, Section 14.07 of the Indenture or any supplemental
indenture entered into thereunder or in connection with any proportional adjustment or the determination of the fair value of any
securities, property, rights or other assets), then in each such case, the Calculation Agent will determine (A) an adjustment to
be made to any one or more of the Strike Price, Number of Options, and/or Option Entitlement in a commercially reasonable manner
and (B) a proportionate adjustment to be made to the Cap Price to the extent any adjustment is made to the Strike Price pursuant
to clause (A) above (which adjustment, for the avoidance of doubt, shall not prohibit Dealer from making any further adjustments
to the Cap Price in accordance with, and subject in all respects to, Section ‎9(x)); provided that in no event shall
the Strike Price be adjusted to be greater than the Cap Price.


 


			For the avoidance of doubt, whenever the Calculation Agent or Determining Party, as the case may
be, is called upon to make an adjustment pursuant to the terms of this Confirmation or the Equity Definitions (other than any adjustment
required to be made by reference to the terms of the Convertible Notes or the Indenture) to take into account the effect of an
event, the Calculation Agent or Determining Party, as the case may be, shall make such adjustment by reference to the effect of
such event on the Hedging Party, assuming that the Hedging Party maintains a commercially reasonable hedge position.



 


		Dilution Adjustment Provisions:	Sections 14.04(a), (b), (c), (d) and (e) and Section 14.05 of the Indenture.



 


Extraordinary Events applicable
to the Transaction:


 


		Merger Events:	Applicable; provided that notwithstanding Section 12.1(b) of the Equity Definitions, a “Merger
Event” means the occurrence of any event or condition set forth in the definition of “Share Exchange Event” in
Section 14.07 of the Indenture.



 


		Tender Offers:	Applicable; provided that notwithstanding Section 12.1(d) of the Equity Definitions, a “Tender
Offer” means the occurrence of any event or condition set forth in Section 14.04(e) of the Indenture.



 






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Consequences
of Merger Events /


		Tender Offers:	Notwithstanding Section 12.2 and Section 12.3 of the Equity Definitions, upon the occurrence of
a Merger Event or a Tender Offer that is required under the terms of the Indenture to result in an adjustment to the terms of the
Convertible Notes, the Calculation Agent shall make (A) a corresponding adjustment to any one or more of the nature of the Shares,
Strike Price, Number of Options and Option Entitlement, in each case, to the extent an analogous adjustment would be made pursuant
to the Indenture in connection with such Merger Event or Tender Offer, or to the definitions of “Exchange”, “Relevant
Price”, and “Settlement Averaging Period” of this Confirmation and any other variable relevant to the exercise,
settlement or payment for the Transaction, subject to the second paragraph under “Method of Adjustment” and (B) a proportionate
adjustment to the Cap Price to the extent any adjustment is made to the Strike Price pursuant to clause (A) above (which adjustment,
for the avoidance of doubt, shall not prohibit Dealer from making any further adjustments to the Cap Price in accordance with,
and subject in all respects to, Section ‎9(x)); provided that in no event shall the Strike Price be adjusted to be greater
than the Cap Price; provided, however, that such adjustment shall be made without regard to any adjustment to the
Conversion Rate pursuant to any Excluded Provision. Notwithstanding the foregoing, if, with respect to a Merger Event or a Tender
Offer, (i) the consideration for the Shares includes (or, at the option of a holder of Shares, may include) shares of an entity
or person that is not a corporation or is not organized under the laws of the United States, any State thereof or the District
of Columbia or (ii) the Counterparty to the Transaction following such Merger Event or Tender Offer will not be a corporation or
will not be either (A) the Issuer following such Merger Event or Tender Offer or (B) a wholly owned subsidiary of the Issuer (1)
that is a corporation organized under the laws of the United States, any State thereof or the District of Columbia, (2) whose obligations
under the Transaction are fully and unconditionally guaranteed by the Issuer and (3) with respect to which the Calculation Agent
determines that treating such wholly owned subsidiary as the Counterparty will not have a material adverse effect on Dealer’s
rights or obligations hereunder, Dealer’s hedging activities, or the costs of engaging in any of the foregoing, then, in
either case, Cancellation and Payment (Calculation Agent Determination) may apply at Dealer’s sole reasonable election; provided
that Dealer shall consult with Counterparty prior to declaring an Early Termination Date with respect to the Transaction. For the
avoidance of doubt, the foregoing provisions will apply regardless of whether any Merger Event or Tender Offer gives rise to an
Early Conversion.



 


		Consequences of Announcement Events:	Modified Calculation Agent Adjustment as set forth in Section 12.3(d) of the Equity Definitions;
provided that, in respect of an Announcement Event, (v) references to “Tender Offer” shall be replaced
by references to “Announcement Event” and references to “Tender Offer Date” shall be replaced by references
to “date of such Announcement Event”, (w) the word “shall” in the second line shall be replaced with
“may”, (x) the phrase “exercise, settlement, payment or any other terms of the Transaction (including, without
limitation, the spread)” shall be replaced by the phrase “Cap Price (provided that in no event shall the Cap
Price be less than the Strike Price)”, (y) the fifth and sixth lines shall be deleted in their entirety and replaced with
the words “effect, taken cumulatively on the Option, of such Announcement Event solely to account for changes in volatility,
expected dividends, stock loan rate or liquidity relevant to the Shares or such Option”, and (z) for the avoidance of
doubt, the Calculation Agent may adjust the terms of the Transaction for a single Announcement Event on one or more occasions on
or after the date of such Announcement Event up to, and including, the Expiration Date, any Early Termination Date and/or any other
date of cancellation, it being understood that any adjustment in respect of an Announcement Event shall take into account any earlier
adjustment relating to the same Announcement Event and any adjustment in respect of an Announcement Event hereunder shall be without
duplication in respect of any other adjustment or cancellation valuation made pursuant to the Equity Definitions or hereunder.
An Announcement Event shall be an “Extraordinary Event” for purposes of the Equity Definitions, to which Article 12
of the Equity Definitions is applicable.



 






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		Announcement Event:	(i) The public announcement by any entity of any transaction or event that, if completed, would
constitute a Merger Event or Tender Offer, or (ii) any subsequent public announcement by any entity of a change to a transaction
that is the subject of an announcement of the type described in clause (i) of this sentence (including, without limitation, a new
announcement, whether or not by the same party, relating to such a transaction or the announcement of a withdrawal from, or the
abandonment or discontinuation of, such a transaction), as determined by the Calculation Agent. For the avoidance of doubt, the
occurrence of an Announcement Event with respect to any transaction shall not preclude the occurrence of a later Announcement Event
with respect to such transaction. For purposes of this definition of “Announcement Event,” (A) “Merger Event”
shall mean such term as defined under Section 12.1(b) of the Equity Definitions (but, for the avoidance of doubt, the remainder
of the definition of “Merger Event” in Section 12.1(b) of the Equity Definitions following the definition of “Reverse
Merger” therein shall be disregarded) and (B) “Tender Offer” shall mean such term as defined under Section 12.1(d)
of the Equity Definitions.



 


		Nationalization, Insolvency or Delisting:	Cancellation and Payment (Calculation Agent Determination); provided that, in addition to
the provisions of Section 12.6(a)(iii) of the Equity Definitions, it will also constitute a Delisting if the Exchange is located
in the United States and the Shares are not immediately re-listed, re-traded or re-quoted on any of the New York Stock Exchange,
The NASDAQ Global Select Market or The NASDAQ Global Market (or their respective successors); if the Shares are immediately re-listed,
re-traded or re-quoted on any of the New York Stock Exchange, The NASDAQ Global Select Market or The NASDAQ Global Market (or their
respective successors), such exchange or quotation system shall thereafter be deemed to be the Exchange.



 






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Additional
Disruption Events:


 


		Change in Law:	Applicable; provided that Section 12.9(a)(ii) of the Equity Definitions is hereby amended
by (i) replacing the word “Shares” with the phrase “Hedge Positions” in clause (X) thereof; (ii) inserting
the parenthetical “(including, for the avoidance of doubt and without limitation, adoption or promulgation of new regulations
authorized or mandated by existing statute)” at the end of clause (A) thereof; (iii) replacing the phrase “the interpretation”
in the third line thereof with the phrase “or announcement of the formal or informal interpretation”; and (iv) immediately
following the word “Transaction” in clause (X) thereof, adding the phrase “in the manner contemplated by the
Hedging Party on the Trade Date”.



 


		Failure to Deliver:	Applicable



 


		Insolvency Filing:	Applicable



 


		Hedging Disruption:	Applicable; provided that:



 


		(i)	Section 12.9(a)(v) of the Equity Definitions is hereby amended by (a) inserting the following
words at the end of clause (A) thereof: “in the manner contemplated by the Hedging Party on the Trade Date” and (b) inserting
the following language at the end of such Section:



 


			“, provided that any such inability that occurs solely due to the deterioration of
the creditworthiness of the Hedging Party shall not be deemed a Hedging Disruption. For the avoidance of doubt, the term “equity
price risk” shall be deemed to include, but shall not be limited to, stock price and volatility risk. And, for the further
avoidance of doubt, any such transactions or assets referred to in phrases (A) or (B) above must be available on commercially reasonable
pricing terms.”; and



 


		(ii)	Section 12.9(b)(iii) of the Equity Definitions is hereby amended by inserting in the third line
thereof, after the words “to terminate the Transaction”, the words “or a portion of the Transaction affected
by such Hedging Disruption”.



 


		Hedging Party:	For all applicable Additional Disruption Events, Dealer; provided that all calculations
and determinations by the Hedging Party shall be made in good faith and in a commercially reasonable manner; provided further
that nothing herein shall limit or alter, or be deemed to limit or alter, the ability of Dealer (whether acting as Dealer, the
Hedging Party, the Determining Party or the Calculation Agent) to hedge its obligations under the Transaction in a manner it deems
appropriate, as determined by Dealer in its sole discretion. The parties agree that they will comply with the provisions set forth
in the second paragraph under “Calculation Agent” below.



 






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		Determining Party:	For all applicable Extraordinary Events, Dealer; provided that all calculations and determinations
by the Determining Party shall be made in good faith and in a commercially reasonable manner. The parties agree that they will
comply with the provisions set forth in the second paragraph under “Calculation Agent” below.



 


		Non-Reliance:	Applicable



 


Agreements and Acknowledgments 


		Regarding Hedging Activities:	Applicable



 


		Additional Acknowledgments:	Applicable



 


	4.	Calculation Agent.	Dealer; provided that, following the occurrence and during the continuance of an Event of Default of the type described in Section 5(a)(vii) of the Agreement with respect to which Dealer is the sole Defaulting Party, Counterparty shall have the right to designate a nationally recognized independent equity derivatives dealer to replace Dealer as the Calculation Agent, and the parties shall work in good faith to execute any appropriate documentation required by such replacement Calculation Agent. All calculations, adjustments, specifications, choices and determinations by the Calculation Agent shall be made in good faith and in a commercially reasonable manner. The parties agree that they will comply with the provisions set forth in the immediately following paragraph.


 


 


In the case
of any calculation, adjustment or determination by the Determining Party or the Calculation Agent, as the case may be, following
any written request from Counterparty, the Determining Party or the Calculation Agent, as the case may be, shall promptly provide
to Counterparty a written explanation describing in reasonable detail the basis for such calculation, adjustment or determination
(including any quotation, market data or information from internal or external sources used in making such calculation, adjustment
or determination), but without disclosing any proprietary or confidential models used by it for such calculation, adjustment or
determination or any information that is subject to an obligation not to disclose such information.


 


		5.	Account Details.



 


		(a)	Account for payments to Counterparty:



 





 






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Bank:


ABA#:


Acct No.:


Acct Name:


For final credit

to account:


 


Account for delivery
of Shares to Counterparty:


 


To be advised.


 


		(b)	Account for payments to Dealer:



 


Bank:


SWIFT:


Bank Routing:


Acct No:


Acct Name:


 


Account for delivery of Shares from Dealer:


 


To be advised.


 


 


		6.	Offices.



 


		(a)	The Office of Counterparty for the Transaction is: Inapplicable, Counterparty is not a Multibranch
Party.



 


		(b)	The Office of Dealer for the Transaction is: New York



 


Morgan Stanley
& Co. LLC


1585 Broadway,
5th Floor


New York, NY 10036


 


		7.	Notices.



 


		(a)	Address for notices or communications to Counterparty:



 


Novavax, Inc.

20 Firstfield Road

Gaithersburg, Maryland 20878




  


	 	Attention:	Chief Financial Officer
	 	Telephone No.:	(240) 268-2030
	 	Facsimile No.:	(240) 268-2100
	 	Email:	bphillips@Novavax.com


 


With a copy to:


 


Ropes & Gray LLP


Attention: Isabel Dische, Esq. and Thomas Holden, Esq.


Telephone No: (212) 596-9000


Facsimile No: (212) 596-9090


Email: isabel.dische@ropesgray.com; thomas.holden@ropesgray.com


 


		(b)	Address for notices or communications to Dealer:



 


	 	To:	Morgan Stanley & Co. LLC
	 	 	1585 Broadway, 4th Floor
	 	 	New York, NY 10036



 


 



    12 


     


    




 


	 	Attention:	David Oakes
	 	Telephone:	(212) 761-5319
	 	Facsimile:	(212) 404-9480
	 	Email:	David.Oakes@morganstanley.com


 


	 	With a copy to:	Morgan Stanley & Co. LLC
	 	 	1221 Avenue of the Americas, 34th Floor
	 	 	New York, NY 10020
	 	Attention:	Anthony Cicia
	 	Telephone:	(212) 762-4828
	 	Facsimile:	(212) 507-4338
	 	Email:	Anthony.Cicia@morganstanley.com


 


		8.	Representations and Warranties of Counterparty.



 


Each of the representations and
warranties of Counterparty set forth in Section 1 of the Purchase Agreement (the “Purchase Agreement”)
dated as of January 25, 2016, among Counterparty, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC, as representatives
of the Initial Purchasers party thereto (the “Initial Purchasers”), are true and correct and are hereby deemed
to be repeated to Dealer as if set forth herein, except to the extent that such representations and warranties, if not true or
correct, would not have a material adverse effect on the power or ability of Company to execute and deliver this Confirmation or
to perform its obligations hereunder. Counterparty hereby further represents and warrants to Dealer on the date hereof and on and
as of the Premium Payment Date that:


 


		(a)	Counterparty has all necessary corporate power and authority to execute, deliver and perform its
obligations in respect of the Transaction; such execution, delivery and performance have been duly authorized by all necessary
corporate action on Counterparty’s part; and this Confirmation has been duly and validly executed and delivered by Counterparty
and constitutes its valid and binding obligation, enforceable against Counterparty in accordance with its terms, subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws affecting creditors’ rights and
remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness,
good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity) and except that rights
to indemnification and contribution hereunder may be limited by federal or state securities laws or public policy relating thereto.



 


		(b)	Neither the execution and delivery of this Confirmation nor the incurrence or performance of obligations
of Counterparty hereunder will conflict with or result in a breach of (i) the Certificate of Incorporation or the Amended and Restated
By-Laws of Counterparty (or any equivalent documents), (ii) any applicable law or regulation, or any order, writ, injunction or
decree of any court or governmental authority or agency, or (iii) any agreement or instrument filed as an exhibit to Company’s
Annual Report on Form 10-K for the fiscal year ended December 31, 2014 (as updated by any subsequent filings) to which Counterparty
or any of its subsidiaries is a party or by which Counterparty or any of its subsidiaries is bound or to which Counterparty or
any of its subsidiaries is subject, or constitute a default under, or result in the creation of any lien under, any such agreement
or instrument except, in the case of clause (iii) above, for any such conflict, breach, default or lien that would not, individually
or in the aggregate, have a material adverse effect on (x) Counterparty and its subsidiaries, taken as a whole, (y) Dealer’s
rights or obligations relating to the Transaction, or (z) the power or ability of Counterparty to execute and deliver this Confirmation
or perform its obligations hereunder.



 


		(c)	No consent, approval, authorization, or order of, or filing with, any governmental agency or body
or any court is required in connection with the execution, delivery or performance by Counterparty of this Confirmation, except
such as have been obtained or made and such as may be required under the Securities Act or state securities laws.



 






    13 


     


    

 


		(d)	Counterparty is not and, after consummation of the transactions contemplated hereby, will not be
required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.



 


		(e)	Counterparty is an “eligible contract participant” (as such term is defined in Section
1a(18) of the Commodity Exchange Act, as amended, other than a person that is an eligible contract participant under Section 1a(18)(C)
of the Commodity Exchange Act).



 


		(f)	Each of it and its affiliates is not, on the date hereof, in possession of any material non-public
information with respect to Counterparty or the Shares.



 


		(g)	The documents incorporated by reference in the Offering Memorandum, when they were filed with the
U.S. Securities Exchange Commission (the “Commission”) conformed in all material respects to the requirements
of the Exchange Act, and the Offering Memorandum does not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.



 


		(h)	To Counterparty’s knowledge, no state or local (including any non-U.S. jurisdiction’s)
law, rule, regulation or regulatory order applicable to the Shares would give rise to any reporting, consent, registration or other
requirement (including without limitation a requirement to obtain prior approval from any person or entity) by Dealer as a result
of Dealer owning or holding (however defined) Shares except for the reporting requirements of the Exchange Act and the rules promulgated
thereunder; provided that Counterparty makes no representation or warranty regarding any such requirement that is applicable
generally to the ownership of equity securities by Dealer solely as a result of it being a financial institution or broker-dealer.



 


		(i)	Counterparty understands that no obligations of Dealer to it hereunder will be entitled to the
benefit of deposit insurance and that such obligations as of the date hereof are not guaranteed by any Affiliate of Dealer or any
governmental agency.



 


		(j)	COUNTERPARTY UNDERSTANDS THAT THE TRANSACTION IS SUBJECT TO COMPLEX RISKS THAT MAY ARISE WITHOUT
WARNING AND MAY AT TIMES BE VOLATILE AND THAT LOSSES MAY OCCUR QUICKLY AND IN UNANTICIPATED MAGNITUDE AND IS WILLING TO ACCEPT
SUCH TERMS AND CONDITIONS AND ASSUME (FINANCIALLY AND OTHERWISE) SUCH RISKS.



 


		(k)	Counterparty (A) is capable of evaluating investment risks independently, both in general and with
regard to all transactions and investment strategies involving a security or securities; (B) will exercise independent judgment
in evaluating the recommendations of any broker-dealer or its associated persons, unless it has otherwise notified the broker-dealer
in writing; and (C) has total assets of at least USD 50 million.



 


		(l)	Counterparty is not as of the Trade Date, and Counterparty shall not be after giving effect to
the transactions contemplated hereby, “insolvent” (as such term is defined in Section 101(32) of the U.S. Bankruptcy
Code (Title 11 of the United States Code) (the “Bankruptcy Code”)) and Counterparty would be able to purchase
1,468,213 Shares in compliance with the laws of the jurisdiction of Counterparty’s incorporation or organization.



 


		(m)	Counterparty understands, agrees and acknowledges that Dealer has no obligation or intention to
register the Transaction under the Securities Act, any state securities law or other applicable federal securities law.



 


		(n)	Without limiting the generality of Section 3(a)(iii) of the Agreement, the Transaction will not
violate Rule 13e-1 or Rule 13e-4 under the Exchange Act.



 


9.           Other Provisions.


 


		(a)	[Reserved.]



 






    14 


     


    

 


		(b)	Repurchase Notices. Counterparty shall, on any day on which Counterparty effects
any repurchase of Shares, promptly give Dealer a written notice of such repurchase (a “Repurchase Notice”) on
such day if following such repurchase, the number of outstanding Shares as determined on such day is (i) less than 257.9 million
(in the case of the first such notice) or (ii) thereafter more than 11.0 million less than the number of Shares included in the
immediately preceding Repurchase Notice. Counterparty agrees to indemnify and hold harmless Dealer and its affiliates and their
respective officers, directors, employees, affiliates, advisors, agents and controlling persons (each, an “Indemnified
Person”) from and against any and all direct losses (including losses relating to Dealer’s commercially reasonable
hedging activities as a consequence of becoming, or of the risk of becoming, a Section 16 “insider”, including without
limitation, any forbearance from commercially reasonable hedging activities or cessation of commercially reasonable hedging activities
and any losses in connection therewith with respect to the Transaction), claims, damages, judgments, liabilities and reasonable
expenses (including commercially reasonable attorney’s fees of one outside counsel in each relevant jurisdiction), joint
or several, which an Indemnified Person may become subject to, as a result of Counterparty’s failure to provide Dealer with
a Repurchase Notice on the day and in the manner specified in this paragraph, and to reimburse, within 30 days, upon written request,
each of such Indemnified Persons for any reasonable legal or other expenses incurred in connection with investigating, preparing
for, providing testimony or other evidence in connection with or defending any of the foregoing. If any suit, action, proceeding
(including any governmental or regulatory investigation), claim or demand shall be brought or asserted against the Indemnified
Person as a result of Counterparty’s failure to provide Dealer with a Repurchase Notice in accordance with this paragraph,
such Indemnified Person shall promptly notify Counterparty in writing, and Counterparty, upon request of the Indemnified Person,
shall retain counsel reasonably satisfactory to the Indemnified Person to represent the Indemnified Person and any others Counterparty
may designate in such proceeding and shall pay the commercially reasonable fees and expenses of such counsel related to such proceeding.
Counterparty shall not be liable for any settlement of any proceeding contemplated by this paragraph that is effected without its
written consent, but if settled with such consent or if there be a final judgment for the plaintiff, Counterparty agrees to indemnify
any Indemnified Person from and against any loss or liability by reason of such settlement or judgment. Counterparty shall not,
without the prior written consent of the Indemnified Person (such consent not to be unreasonably withheld, conditioned or delayed),
effect any settlement of any pending or threatened proceeding contemplated by this paragraph that is in respect of which any Indemnified
Person is a party and indemnity could have been sought hereunder by such Indemnified Person, unless such settlement includes an
unconditional release of such Indemnified Person from all liability on claims that are the subject matter of such proceeding on
terms reasonably satisfactory to such Indemnified Person. If the indemnification provided for in this paragraph is unavailable
to an Indemnified Person or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then Counterparty
hereunder, in lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by such Indemnified
Person as a result of such losses, claims, damages or liabilities. The remedies provided for in this paragraph ‎(b) are not
exclusive and shall not limit any rights or remedies which may otherwise be available to any Indemnified Person at law or in equity.
The indemnity and contribution agreements contained in this paragraph shall remain operative and in full force and effect regardless
of the termination of the Transaction.



 


		(c)	Regulation M. Counterparty is not on the Trade Date engaged in a distribution, as
such term is used in Regulation M under the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
of any securities of Counterparty, other than a distribution meeting the requirements of the exception set forth in Rules 101(b)(10)
and 102(b)(7) of Regulation M. Counterparty shall not, until the second Scheduled Trading Day immediately following the Effective
Date, engage in any such distribution.



 


		(d)	No Manipulation. Counterparty is not entering into the Transaction to create actual
or apparent trading activity in the Shares (or any security convertible into or exchangeable for the Shares) or to raise or depress
or otherwise manipulate the price of the Shares (or any security convertible into or exchangeable for the Shares) or otherwise
in violation of the Exchange Act.



 






    15 


     


    

 


		(e)	Transfer or Assignment.



 


		(i)	Counterparty shall have the right to transfer or assign any of its rights or obligations hereunder
with respect to all, but not less than all, of the Options hereunder (such Options, the “Transfer Options”);
provided that such transfer or assignment shall be subject to reasonable conditions that Dealer may impose, including but
not limited, to the following conditions:



 


		(A)	With respect to any Transfer Options, Counterparty shall not be released from its notice and indemnification
obligations pursuant to Section ‎9(b) or any obligations under Section ‎9(n) or ‎9(s) of this Confirmation;



 


		(B)	Such transfer or assignment shall be effected on terms, including any reasonable undertakings by
such third party (including, but not limited to, an undertaking with respect to compliance with applicable securities laws in a
manner that, in the reasonable judgment of Dealer, will not expose Dealer to material risks under applicable securities laws) and
execution of any reasonable documentation and delivery of legal opinions with respect to securities laws and other matters by such
third party and Counterparty, as are reasonably requested and reasonably satisfactory to Dealer;



 


		(C)	Dealer will not, as a result of such transfer and assignment, be required to pay the transferee
on any payment date an amount under Section 2(d)(i)(4) of the Agreement greater than an amount that Dealer would have been required
to pay to Counterparty in the absence of such transfer and assignment;



 


		(D)	An Event of Default, Potential Event of Default or Termination Event will not occur as a result
of such transfer and assignment;



 


		(E)	Counterparty shall cause the transferee to make such Payee Tax Representations and to provide such
tax documentation as may be reasonably requested by Dealer to permit Dealer to determine that results described in clauses (C)
and (D) will not occur upon or after such transfer and assignment; and



 


		(F)	Counterparty shall be responsible for all reasonable costs and expenses, including reasonable counsel
fees, incurred by Dealer in connection with such transfer or assignment.



 






    16 


     


    

 


		(ii)	Dealer may transfer or assign all or any part of its rights or obligations under the Transaction
(A) without Counterparty’s consent to any affiliate of Dealer (1) that has a long-term issuer rating or a rating for its
long term, unsecured and unsubordinated indebtedness, in either case, that is equal to or better than Dealer’s credit rating
at the time of such transfer or assignment, or (2) whose obligations hereunder will be guaranteed, pursuant to the terms of a customary
guarantee in a form used by Dealer generally for similar transactions, by Dealer or Dealer’s ultimate parent, or (B) with
Counterparty’s consent (such consent not to be unreasonably withheld or delayed) to any other third party with a long-term
issuer rating or a rating for its long term, unsecured and unsubordinated indebtedness, as the case may be, equal to or better
than the lesser of (1) the credit rating of Dealer at the time of such transfer or assignment and (2) A- by Standard and Poor’s
Rating Group, Inc. or its successor (“S&P”), or A3 by Moody’s Investor Service, Inc. (“Moody’s”)
or, if either S&P or Moody’s ceases to rate such debt, at least an equivalent rating or better by a substitute rating
agency mutually agreed by Counterparty and Dealer; provided that any transfer or assignment described in clause (A) or (B)
above shall not result in a deemed exchange by Counterparty within the meaning of Section 1001 of the Code; provided further
that (x) Counterparty will not be required, as a result of such transfer or assignment, to pay the transferee or assignee on any
payment date an amount under Section 2(d)(i)(4) of the Agreement greater than the amount, if any, that Counterparty would have
been required to pay Dealer in the absence of such transfer or assignment and (y) Dealer shall cause the transferee or assignee
to make such Payee Tax Representations and to provide such tax documentation as may be reasonably requested by Counterparty to
permit Counterparty to determine that the results described in clause (x) of this proviso will not occur upon or after such transfer
and assignment. If at any time at which (A) the Section 16 Percentage exceeds 8.5%, (B) the Option Equity Percentage exceeds 14.5%,
or (C) the Share Amount exceeds the Applicable Share Limit (if any applies) (any such condition described in clauses (A), (B) or
(C), an “Excess Ownership Position”), Dealer is unable after using its commercially reasonable efforts to effect
a transfer or assignment of Options to a third party on pricing terms reasonably acceptable to Dealer and within a time period
reasonably acceptable to Dealer such that no Excess Ownership Position exists, then Dealer may designate any Exchange Business
Day as an Early Termination Date with respect to a portion of the Transaction (the “Terminated Portion”), such
that following such partial termination no Excess Ownership Position exists. In the event that Dealer so designates an Early Termination
Date with respect to a portion of the Transaction, a payment shall be made pursuant to Section 6 of the Agreement as if (1) an
Early Termination Date had been designated in respect of a Transaction having terms identical to the Transaction and a Number of
Options equal to the number of Options underlying the Terminated Portion, (2) Counterparty were the sole Affected Party with respect
to such partial termination and (3) the Terminated Portion were the sole Affected Transaction (and, for the avoidance of doubt,
the provisions of Section ‎9(l) shall apply to any amount that is payable by Dealer to Counterparty pursuant to this sentence
as if Counterparty was not the Affected Party). Dealer shall notify Counterparty of an Excess Ownership Position with respect to
which it intends to seek a transfer or assignment as soon as reasonably practicable after becoming aware of such an Excess Ownership
Position. The “Section 16 Percentage” as of any day is the fraction, expressed as a percentage, (A) the numerator
of which is the number of Shares that Dealer and any of its affiliates or any other person subject to aggregation with Dealer for
purposes of the “beneficial ownership” test under Section 13 of the Exchange Act, or any “group” (within
the meaning of Section 13 of the Exchange Act) of which Dealer is or may be deemed to be a part beneficially owns (within the meaning
of Section 13 of the Exchange Act), without duplication, on such day (or, to the extent that for any reason the equivalent calculation
under Section 16 of the Exchange Act and the rules and regulations thereunder results in a higher number, such higher number) and
(B) the denominator of which is the number of Shares outstanding on such day. The “Option Equity Percentage”
as of any day is the fraction, expressed as a percentage, (A) the numerator of which is the sum of (1) the product of the Number
of Options and the Option Entitlement and (2) the aggregate number of Shares underlying any other call option transaction sold
by Dealer to Counterparty, and (B) the denominator of which is the number of Shares outstanding. The “Share Amount”
as of any day is the number of Shares that Dealer and any person whose ownership position would be aggregated with that of Dealer
(Dealer or any such person, a “Dealer Person”) under any law, rule, regulation, regulatory order or organizational
documents or contracts of Counterparty that are, in each case, applicable to ownership of Shares (“Applicable Restrictions”),
owns, beneficially owns, constructively owns, controls, holds the power to vote or otherwise meets a relevant definition of ownership
under any Applicable Restriction, as determined by Dealer in its reasonable discretion. The “Applicable Share Limit”
means a number of Shares equal to (A) the minimum number of Shares that would give rise to reporting or registration obligations
(except for any filings of Form 13F, Schedule 13D or Schedule 13G under the Exchange Act) or other requirements (including obtaining
prior approval from any person or entity) of a Dealer Person, or is reasonably likely to result in an adverse effect on a Dealer
Person, under any Applicable Restriction, as determined by Dealer in its reasonable discretion, minus (B) 1% of the number
of Shares outstanding.



 






    17 


     


    

 


		(iii)	Notwithstanding any other provision in this Confirmation to the contrary requiring or allowing
Dealer to purchase, sell, receive or deliver any Shares or other securities, or make or receive any payment in cash, to or from
Counterparty, Dealer may designate any of its affiliates to purchase, sell, receive or deliver such Shares or other securities,
or to make or receive such payment in cash, and otherwise to perform Dealer’s obligations in respect of the Transaction and
any such designee may assume such obligations; provided that Counterparty shall have recourse to Dealer in the event of failure
by such assignee to perform any of such obligations hereunder. Dealer shall be discharged of its obligations to Counterparty to
the extent of any such performance to Counterparty by such affiliate of Dealer.



 


		(f)	Staggered Settlement. If upon advice of counsel with respect to applicable legal
and regulatory requirements, including any requirements relating to Dealer’s hedging activities hereunder, Dealer reasonably
determines that it would not be practicable or advisable to deliver, or to acquire Shares to deliver, any or all of the Shares
to be delivered by Dealer on any Settlement Date for the Transaction, Dealer may, by notice to Counterparty on or prior to any
Settlement Date (a “Nominal Settlement Date”), elect to deliver the Shares on two or more dates (each, a “Staggered
Settlement Date”) only to the extent reasonably necessary, as reasonably determined by Dealer in good faith, to avoid
an Excess Ownership Position as follows:



 


		(i)	in such notice, Dealer will specify to Counterparty the related Staggered Settlement Dates (each
of which will be on or prior to such Nominal Settlement Date) and the number of Shares that it will deliver on each Staggered Settlement
Date;



 


		(ii)	the aggregate number of Shares that Dealer will deliver to Counterparty hereunder on all such Staggered
Settlement Dates will equal the number of Shares that Dealer would otherwise be required to deliver on such Nominal Settlement
Date; and



 


		(iii)	the Net Share Settlement terms will apply on each Staggered Settlement Date, except that the Net
Shares will be allocated among such Staggered Settlement Dates as specified by Dealer in the notice referred to in clause (i) above.



 


		(g)	[Reserved.]



 


		(h)	[Reserved.]



 


		(i)	Additional Termination Events.



 


		(i)	Notwithstanding anything to the contrary in this Confirmation, upon any Early Conversion in respect
of which a “Notice of Conversion” (as such term is defined in the Indenture) that is effective as to Counterparty has
been delivered by the relevant converting “Holder” (as such term is defined in the Indenture):



 


		(A)	Counterparty shall, within five Scheduled Trading Days of the Conversion Date for such Early Conversion,
provide written notice (an “Early Conversion Notice”) to Dealer specifying the number of Convertible Notes surrendered
for conversion on such Conversion Date (such Convertible Notes, the “Affected Convertible Notes”),
and the giving of such Early Conversion Notice shall constitute an Additional Termination Event as provided in this
clause ‎(i);



 


		(B)	upon receipt of any such Early Conversion Notice, Dealer shall designate an Exchange Business Day
as an Early Termination Date (which Exchange Business Day shall be on or as promptly as reasonably practicable after the related
settlement date for such Affected Convertible Notes) with respect to the portion of the Transaction corresponding to a number of
Options (the “Affected Number of Options”) equal to the lesser of (x) the number of Affected Convertible Notes
minus the “Affected Number of Options” (as defined in the Base Call Option Confirmation), if any, that relate
to such Affected Convertible Notes and (y) the Number of Options as of the Conversion Date for such Early Conversion;



 






    18 


     


    

 


		(C)	any payment hereunder with respect to such termination shall be calculated pursuant to Section
6 of the Agreement as if (x) an Early Termination Date had been designated in respect of a Transaction having terms identical to
the Transaction and a Number of Options equal to the Affected Number of Options, (y) Counterparty were the sole Affected Party
with respect to such Additional Termination Event and (z) the terminated portion of the Transaction were the sole Affected Transaction
(and, for the avoidance of doubt, the provisions of Section ‎9(l) shall apply to any amount that is payable by Dealer to Counterparty
pursuant to this Section ‎9(i)(i) as if Counterparty were not the Affected Party) (and, in determining the amount payable pursuant
to Section 6 of the Agreement, the Calculation Agent shall not take into account any adjustments to the Conversion Rate pursuant
to any Excluded Provision); provided that the amount payable with respect to such termination shall not be greater than
(1) the Applicable Percentage, multiplied by (2) the Affected Number of Options, multiplied by (3) the excess of
(I) the Conversion Rate (after taking into account any applicable adjustments to the Conversion Rate pursuant to Section 14.03
of the Indenture), multiplied by the Applicable Limit Price on the settlement date for the Shares to be delivered pursuant
to the Indenture in respect of the Affected Convertible Note, minus (II) USD 1,000;



 


		(D)	for the avoidance of doubt, in determining the amount payable
in respect of such Affected Transaction pursuant to Section 6 of the Agreement, the Calculation Agent shall assume that (x) the
relevant Early Conversion and any conversions, adjustments, agreements, payments, deliveries or acquisitions by or on behalf of
Counterparty leading thereto had not occurred, (y) no adjustments to the Conversion Rate have occurred pursuant to any Excluded
Provision and (z) the corresponding Convertible Notes remain outstanding; and



 


		(E)	the Transaction shall remain in full force and effect, except that, as of the Conversion Date for
such Early Conversion, the Number of Options shall be reduced by the Affected Number of Options



 


		(ii)	Notwithstanding anything to the contrary in this Confirmation if an event of default with respect
to Counterparty occurs under the terms of the Convertible Notes as set forth in Section 6.01 of the Indenture, and such event of
default results in the Convertible Notes becoming or being declared due and payable pursuant to the Indenture, then such event
of default shall constitute an Additional Termination Event applicable to the Transaction and, with respect to such Additional
Termination Event, (A) Counterparty shall be deemed to be the sole Affected Party, (B) the Transaction shall be the sole Affected
Transaction and (C) Dealer shall be the party entitled to designate an Early Termination Date pursuant to Section 6(b) of the Agreement
(which Early Termination Date shall be on or as promptly as reasonably practicable after Dealer becomes aware of the occurrence
of such acceleration).



 






    19 


     


    

 


		(iii)	Promptly (but in any event within five Scheduled Trading Days) following any Repurchase Event (as
defined below), Counterparty may notify Dealer of such Repurchase Event and the aggregate principal amount of Convertible Notes
subject to such Repurchase Event (any such notice, a “Convertible Notes Repurchase Notice”); provided
that any such Convertible Notes Repurchase Notice shall contain an acknowledgment by Counterparty of its responsibilities under
applicable securities laws, and in particular Section 9 and Section 10(b) of the Exchange Act and the rules and regulations thereunder,
in respect of such Repurchase Event and the delivery of such Convertible Notes Repurchase Notice. The receipt by Dealer from Counterparty
of any Convertible Notes Repurchase Notice shall constitute an Additional Termination Event as provided in this Section ‎9(i)(iii).
Upon receipt of any such Convertible Notes Repurchase Notice, Dealer shall designate an Exchange Business Day following receipt
of such Convertible Notes Repurchase Notice (which Exchange Business Day shall be on or as promptly as reasonably practicable after
the related settlement date for the relevant Repurchase Event) as an Early Termination Date with respect to the portion of the
Transaction corresponding to a number of Options (the “Repurchase Options”) equal to the lesser of (A) (x) the
aggregate principal amount of such Convertible Notes specified in such Convertible Notes Repurchase Notice, divided by USD
1,000, minus (y) the number of Repurchase Options (as defined in the Base Call Option Confirmation), if any, that relate
to such Convertible Notes, and (B) the Number of Options as of the date Dealer designates such Early Termination Date and, as of
such date, the Number of Options shall be reduced by the number of Repurchase Options. Any payment hereunder with respect to such
termination (the “Repurchase Unwind Payment”) shall be calculated pursuant to Section 6 of the Agreement as
if (1) an Early Termination Date had been designated in respect of a Transaction having terms identical to the Transaction and
a Number of Options equal to the number of Repurchase Options, (2) Counterparty were the sole Affected Party with respect to such
Additional Termination Event and (3) the terminated portion of the Transaction were the sole Affected Transaction (and, for the
avoidance of doubt, the provisions of Section ‎9(l) shall apply to any amount that is payable by Dealer to Counterparty pursuant
to this Section ‎9(i)(iii) as if Counterparty was not the Affected Party). “Repurchase Event” means that
(i) any Convertible Notes are repurchased (whether pursuant to Section 15.02 of the Indenture or otherwise) by Counterparty or
any of its subsidiaries, (ii) any Convertible Notes are delivered to Counterparty in exchange for delivery of any property or assets
of Counterparty or any of its subsidiaries (howsoever described), (iii) any principal of any of the Convertible Notes is repaid
prior to the final maturity date of the Convertible Notes (other than upon acceleration of the Convertible Notes described in Section
‎9(i)(ii)), or (iv) any Convertible Notes are exchanged by or for the benefit of the Holders (as defined in the Indenture)
thereof for any other securities of Counterparty or any of its Affiliates (or any other property, or any combination thereof) pursuant
to any exchange offer or similar transaction; provided that neither (i) any conversion of Convertible Notes pursuant to
the terms of the Indenture, nor (ii) any exchange of Convertible Notes pursuant to Section 15.06 of the Indenture, shall in either
case constitute a Repurchase Event.



 


		(j)	Amendments to Equity Definitions.



 


		(i)	Section 11.2(e)(vii) of the Equity Definitions is hereby amended by (x) inserting the words “similar
corporate” immediately prior to the word “event” and (y) deleting the words “diluting or concentrative”
and replacing them with the word “material”; and adding the phrase “or the Options” at the end of the sentence.



 


		(ii)	Section 12.9(b)(i) of the Equity Definitions is hereby amended by replacing “either party
may elect” with “Dealer may elect or, if Counterparty represents that it and its officers and directors are not aware
of any material nonpublic information with respect to Counterparty or the Shares, Counterparty may elect,”.



 


		(k)	No Collateral or Setoff. Neither party shall have the right to set off any obligation
that it may have to the other party under the Transaction against any obligation such other party may have to it, whether arising
under the Agreement, this Confirmation or any other agreement between the parties hereto, by operation of law or otherwise.



 






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		(l)	Alternative Calculations and Payment on Early Termination and on Certain Extraordinary Events.
If (a) an Early Termination Date (whether as a result of an Event of Default or a Termination Event) occurs or is designated with
respect to the Transaction or (b) the Transaction is cancelled or terminated upon the occurrence of an Extraordinary Event (except
as a result of (i) a Nationalization, Insolvency or Merger Event in which the consideration to be paid to holders of Shares consists
solely of cash, (ii) a Merger Event that is within Counterparty’s control, or (iii) an Event of Default in which Counterparty
is the Defaulting Party or a Termination Event in which Counterparty is the Affected Party other than an Event of Default of the
type described in Section 5(a)(iii), (v), (vi), (vii) or (viii) of the Agreement or a Termination Event of the type described in
Section 5(b) of the Agreement, in each case that resulted from an event or events outside Counterparty’s control), and if
Dealer would owe any amount to Counterparty pursuant to Section 6(d)(ii) and 6(e) of the Agreement or any Cancellation Amount pursuant
to Article 12 of the Equity Definitions (any such amount, a “Payment Obligation”), then Dealer shall satisfy
the Payment Obligation by the Share Termination Alternative (as defined below), unless (a) Counterparty gives irrevocable
telephonic notice to Dealer, confirmed in writing within one Scheduled Trading Day, no later than 12:00 p.m. (New York City time)
on the Merger Date, Announcement Date (in the case of a Nationalization, Insolvency or Delisting), Early Termination Date or date
of cancellation, as applicable, of its election that the Share Termination Alternative shall not apply, (b) Counterparty remakes
the representation set forth in Section ‎8(f) as of the date of such election and (c) Dealer agrees, in its commercially reasonable
discretion, to such election, in which case the provisions of Section 12.7 or Section 12.9 of the Equity Definitions, or the provisions
of Section 6(d)(ii) and 6(e) of the Agreement, as the case may be, shall apply.



 





	 	Share Termination Alternative:	If applicable, Dealer shall deliver to Counterparty the Share Termination Delivery Property on, or within a commercially reasonable period of time after, the date when the relevant Payment Obligation would otherwise be due pursuant to Section 12.7 or 12.9 of the Equity Definitions or Section 6(d)(ii) and 6(e) of the Agreement, as applicable, in satisfaction of such Payment Obligation in the manner reasonably requested by Counterparty free of payment.
	 	 	 
	 	Share Termination Delivery Property:	A number of Share Termination Delivery Units, as calculated by the Calculation Agent, equal to the Payment Obligation divided by the Share Termination Unit Price. The Calculation Agent shall adjust the Share Termination Delivery Property by replacing any fractional portion of a security therein with an amount of cash equal to the value of such fractional security based on the values used to calculate the Share Termination Unit Price.
	 	 	 
	 	Share Termination Unit Price:	The value to Dealer of property contained in one Share Termination Delivery Unit, as determined by the Calculation Agent in good faith and by commercially reasonable means and notified by the Calculation Agent to Dealer at the time of notification of the Payment Obligation. For the avoidance of doubt, the parties agree that in determining the Share Termination Delivery Unit Price the Calculation Agent may consider the purchase price paid in connection with the purchase of Share Termination Delivery Property.
	 	 	 
	 	Share Termination Delivery Unit:	One
    Share or, if the Shares have changed into cash or any other property or the right to receive cash or any other property as
    the result of a Nationalization, Insolvency or Merger Event (any such cash or other property, the “Exchange Property”),
    a unit consisting of the type and amount of such Exchange Property received by a holder of one Share (without consideration
    of any requirement to pay cash or other consideration in lieu of fractional amounts of any securities) in such Nationalization,
    Insolvency or Merger Event, as determined by the Calculation Agent.
	 	 	 
	 	Failure to Deliver:	Applicable
	 	 	 



 


 



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	 	Other applicable provisions:	If Share Termination Alternative is applicable, the provisions of Sections 9.8, 9.9 and 9.11 (as modified above) of the Equity Definitions and the provisions set forth opposite the caption “Representation and Agreement” in Section ‎2 will be applicable, except that all references in such provisions to “Physically-settled” shall be read as references to “Share Termination Settled” and all references to “Shares” shall be read as references to “Share Termination Delivery Units”. “Share Termination Settled” in relation to the Transaction means that the Share Termination Alternative is applicable to the Transaction.







 


		(m)	Waiver of Jury Trial. Each party waives, to the fullest extent permitted by applicable
law, any right it may have to a trial by jury in respect of any suit, action or proceeding relating to the Transaction. Each party
(i) certifies that no representative, agent or attorney of either party has represented, expressly or otherwise, that such other
party would not, in the event of such a suit, action or proceeding, seek to enforce the foregoing waiver and (ii) acknowledges
that it and the other party have been induced to enter into the Transaction, as applicable, by, among other things, the mutual
waivers and certifications provided herein.



 


		(n)	Registration. Counterparty hereby agrees that if, in the good faith reasonable judgment
of Dealer based on the advice of counsel, the Shares (“Hedge Shares”) acquired by Dealer for the purpose of
hedging its obligations pursuant to the Transaction cannot be sold in the public market by Dealer without registration under the
Securities Act, Counterparty shall, at its election, either (i) in order to allow Dealer to sell the Hedge Shares in a registered
offering, make available to Dealer an effective registration statement under the Securities Act and enter into an agreement, in
form and substance reasonably satisfactory to Dealer, substantially in the form of an underwriting agreement for a registered secondary
offering of a similar size; provided, however, that if Dealer, in its sole reasonable discretion, is not satisfied
with access to due diligence materials, the results of its due diligence investigation, or the procedures and documentation for
the registered offering referred to above, then clause (ii) or clause (iii) of this paragraph shall apply at the election of Counterparty,
(ii) in order to allow Dealer to sell the Hedge Shares in a private placement, enter into a private placement agreement substantially
similar to private placement purchase agreements customary for private placements of equity securities of similar size, in form
and substance reasonably satisfactory to Dealer (in which case, the Calculation Agent shall make any adjustments to the terms of
the Transaction that are necessary, in its commercially reasonable judgment, to account for any commercially reasonable discount
from the public market price of the Shares incurred on the sale of Hedge Shares in a private placement), or (iii) purchase the
Hedge Shares from Dealer at the Relevant Price on such Exchange Business Days, and in the amounts, requested by Dealer.



 


		(o)	Tax Disclosure. Effective from the date of commencement of discussions concerning
the Transaction, Counterparty and each of its employees, representatives, or other agents may disclose to any and all persons,
without limitation of any kind, the tax treatment and tax structure of the Transaction and all materials of any kind (including
opinions or other tax analyses) that are provided to Counterparty relating to such tax treatment and tax structure.



 


		(p)	Right to Extend. Dealer may postpone or add, in whole or in part, any Valid Day or
Valid Days during the Settlement Averaging Period or any other date of valuation, payment or delivery by Dealer, with respect to
some or all of the Options hereunder, if Dealer reasonably determines, in its commercially reasonable judgment and, in respect
of clause (ii) below, based on the advice of counsel, that such action is reasonably necessary or advisable (i) to preserve Dealer’s
hedging or hedge unwind activity hereunder in light of existing liquidity conditions (but only if there is a material decrease
in liquidity relative to Dealer’s expectations on the Trade Date) or (ii) to enable Dealer to effect transactions in Shares
in connection with its hedging, hedge unwind or settlement activity hereunder in a manner that would, if Dealer were Issuer or
an affiliated purchaser of Issuer, be in compliance with applicable legal or regulatory requirements, requirements of self-regulatory
organizations with jurisdiction over Dealer or its affiliates, or related policies and procedures adopted in good faith by Dealer
(so long as such policies and procedures would generally be applicable to counterparties similar to Counterparty and transactions
similar to the Transaction); provided that no such Valid Day or other date of valuation, payment or delivery may be postponed
or added more than 50 Valid Days after the original Valid Day or other date of valuation, payment or delivery, as the case may
be.



 






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		(q)	Status of Claims in Bankruptcy.  Dealer acknowledges and agrees that this
Confirmation is not intended to convey to Dealer rights against Counterparty with respect to the Transaction that are senior to
the claims of common stockholders of Counterparty in any United States bankruptcy proceedings of Counterparty; provided
that nothing herein shall limit or shall be deemed to limit Dealer’s right to pursue remedies in the event of a breach by
Counterparty of its obligations and agreements with respect to the Transaction; provided, further, that nothing herein
shall limit or shall be deemed to limit Dealer’s rights in respect of any transactions other than the Transaction.



 


		(r)	Securities Contract; Swap Agreement. The parties hereto intend for (i) the Transaction
to be a “securities contract” and a “swap agreement” as defined in the Bankruptcy Code, and the parties
hereto to be entitled to the protections afforded by, among other Sections, Sections 362(b)(6), 362(b)(17), 546(e), 546(g), 555
and 560 of the Bankruptcy Code, (ii) a party’s right to liquidate the Transaction and to exercise any other remedies upon
the occurrence of any Event of Default under the Agreement with respect to the other party to constitute a “contractual right”
as described in the Bankruptcy Code, and (iii) each payment and delivery of cash, securities or other property hereunder to constitute
a “margin payment” or “settlement payment” and a “transfer” as defined in the Bankruptcy Code.



 


		(s)	Notice of Certain Other Events. Counterparty covenants and agrees that:



 


		(i)	promptly following the public announcement of the results of any election by the holders of Shares
with respect to the consideration due upon consummation of any Merger Event, Counterparty shall give Dealer written notice of (x)
the weighted average of the types and amounts of consideration that holders of Shares have elected to receive upon consummation
of such Merger Event or (y) if no holders of Shares affirmatively make such election, the types and amounts of consideration actually
received by holders of Shares (the date of such notification, the “Consideration Notification Date”); provided
that in no event shall the Consideration Notification Date be later than the date on which such Merger Event is consummated; and



 


		(ii)	promptly following any adjustment to the Convertible Notes in connection with any Potential Adjustment
Event, Merger Event or Tender Offer, Counterparty shall give Dealer written notice of the details of such adjustment.



 


		(t)	Wall Street Transparency and Accountability Act. In connection with Section 739 of
the Wall Street Transparency and Accountability Act of 2010 (“WSTAA”), the parties hereby agree that neither
the enactment of WSTAA or any regulation under the WSTAA, nor any requirement under WSTAA or an amendment made by WSTAA, shall
limit or otherwise impair either party’s otherwise applicable rights to terminate, renegotiate, modify, amend or supplement
this Confirmation or the Agreement, as applicable, arising from a termination event, force majeure, illegality, increased costs,
regulatory change or similar event under this Confirmation, the Equity Definitions incorporated herein, or the Agreement (including,
but not limited to, rights arising from Change in Law, Hedging Disruption, an Excess Ownership Position, or Illegality (as defined
in the Agreement)).



 


		(u)	Agreements and Acknowledgements Regarding Hedging. Counterparty understands, acknowledges
and agrees that: (A) at any time on and prior to the Expiration Date, Dealer and its affiliates may buy or sell Shares or other
securities or buy or sell options or futures contracts or enter into swaps or other derivative securities in order to adjust its
hedge position with respect to the Transaction; (B) Dealer and its affiliates also may be active in the market for Shares other
than in connection with hedging activities in relation to the Transaction; (C) Dealer shall make its own determination as to whether,
when or in what manner any hedging or market activities in securities of Issuer shall be conducted and shall do so in a manner
that it deems appropriate to hedge its price and market risk with respect to the Relevant Prices; and (D) any market activities
of Dealer and its affiliates with respect to Shares may affect the market price and volatility of Shares, as well as the Relevant
Prices, each in a manner that may be adverse to Counterparty.



 






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		(v)	Early Unwind. In the event the sale of the “Option Securities” (as defined
in the Purchase Agreement) is not consummated with the Initial Purchasers for any reason by 5:00 p.m. (New York City time) on the
Premium Payment Date, or such later date as agreed upon by the parties (the Premium Payment Date or such later date, the “Early
Unwind Date”), the Transaction shall automatically terminate (the “Early Unwind”) on
the Early Unwind Date and (i) the Transaction and all of the respective rights and obligations of Dealer and Counterparty under
the Transaction shall be cancelled and terminated and (ii) each party shall be released and discharged by the other party from
and agrees not to make any claim against the other party with respect to any obligations or liabilities of the other party arising
out of and to be performed in connection with the Transaction either prior to or after the Early Unwind Date. Each of Dealer and
Counterparty represents and acknowledges to the other that, upon an Early Unwind, all obligations with respect to the Transaction
shall be deemed fully and finally discharged.



 


		(w)	Payment by Counterparty. In the event that, following payment of the Premium, (i)
an Early Termination Date occurs or is designated with respect to the Transaction as a result of a Termination Event or an Event
of Default (other than an Event of Default arising under Section 5(a)(ii) or 5(a)(iv) of the Agreement) and, as a result, Counterparty
owes to Dealer an amount calculated under Section 6(e) of the Agreement, or (ii) Counterparty owes to Dealer, pursuant to Section
12.7 or Section 12.9 of the Equity Definitions, an amount calculated under Section 12.8 of the Equity Definitions, such amount
shall be deemed to be zero.



 


		(x)	Other Adjustments Pursuant to the Equity Definitions. Notwithstanding anything to
the contrary in this Confirmation, solely for purposes of this Section ‎9(x), the terms “Potential Adjustment Event,”
“Merger Event,” and “Tender Offer” shall each have the meanings assigned to such term in the Equity Definitions
(as amended by Section ‎9(j)(i)), and upon the occurrence of a Merger Date, the occurrence of a Tender Offer Date, or the declaration
by Counterparty of the terms of any Potential Adjustment Event, respectively, as such terms are defined in the Equity Definitions,
the Calculation Agent may, in its sole discretion, adjust the Cap Price to preserve the fair value of the Options to Dealer; provided
that in no event shall the Cap Price be less than the Strike Price; provided further that any adjustment to the Cap Price
made pursuant to this Section ‎9(x) shall be made without duplication of any other adjustment or determination hereunder (including,
for the avoidance of doubt, adjustments or determinations made in accordance with “Method of Adjustment,” “Consequences
of Merger Events / Tender Offers” and “Consequences of Announcement Events” in Section ‎3 above).



 


		(y)	Tax Forms. Counterparty shall provide to Dealer a valid U.S. Internal Revenue Service
(“IRS”) Form W-9 on or before the date of execution of this Confirmation and will promptly tender an updated
IRS Form W-9 or applicable IRS Form W-8 if the previously tendered IRS Form W-9 becomes incorrect as a result of a change in facts.
Dealer shall provide Counterparty a valid IRS Form W-9 or applicable IRS Form W-8 on or before the date of execution of this Confirmation
and will promptly tender an updated IRS Form W-9 or applicable IRS Form W-8 if the previously tendered IRS Form W-9 or applicable
IRS Form W-8 becomes incorrect as a result of a change in facts.



 






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		(z)	Certain Withholding Taxes. “Indemnifiable Tax” as defined in Section
14 of the Agreement shall not include any tax imposed or collected pursuant to Section 871(m) of the Code or Sections 1471 through
1474 of the Code, any current or future regulations or official interpretations thereof, any agreement entered into pursuant to
Section 1471(b) of the Code, or any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental
agreement entered into in connection with the implementation of such Sections of the Code (a “FATCA Withholding Tax”).
For the avoidance of doubt, a FATCA Withholding Tax is a Tax the deduction or withholding of which is required by applicable law
for the purposes of Section 2(d) of the Agreement.



 


 


 







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Please confirm
that the foregoing correctly sets forth the terms of our agreement by executing this Confirmation and returning it to Dealer.


 


Very truly yours,


 


	 	MORGAN STANLEY & CO. LLC
	 	By:	 	/s/ Scott McDavid
	 	Authorized Signatory
	 	Name:	 	Scott McDavid
	 	 	    	Managing Director
	 	 	 	 


 


 


 


 


Accepted and confirmed

as of the Trade Date:


 


	NOVAVAX, INC.
	By:	/s/ Stanley C. Erck	 
	Authorized Signatory
	Name:           President and CEO