Document:

ex10-12

 

Exhibit  10.12

LEASE AGREEMENT

     THIS LEASE made as of this 8th day of March, 2002 and between Association
for Entrepreneurial Sciences Inc., (AES), located at The Biomedical Research Institute, (BRI) , (actual lessor) located
at the address of which is 12111 Parklawn Drive, Rockville, MD 20852
(“Landlord”), and the lessor name Novavax, Inc. a Corporation in the
State of Delaware, (“Tenant”)

ARTICLE I

GRANT AND TERM

SECTION 1.01   LEASED PREMISES.

	(a)	 	Landlord, in consideration of the rent to be paid and the covenants to be
performed by Tenant, does hereby demise and lease unto Tenant, and Tenant
hereby rents and hires from Landlord, those certain premises consisting of
6,161 square feet of laboratory, and animal facilities (the “Leased
Premises”) located at 12111 Parklawn Drive, and/or 12115 Parklawn Drive,
Rockville, Maryland 20852, (the “Building”), as more particularly shown
and described on Exhibit A attached hereto. Tenant agrees to accept the
premises in “as is” condition.
	 
	(b)	 	Said lease shall include all of the equipment, fixtures, furnishings,
decor, decorations, installations, appurtenances and personal property
presently existing on said premises or to be placed installed or erected
on the premises, and together with the right to use all adjoining parking
areas, driveways, sidewalks, roads, alleys and means of ingress and egress
pertaining to the Leased Premises.

SECTION 1.02.   COMENCEMENT AND ENDING DAY OF TERM.   The term of this Lease shall
commence upon March 8th, 2002, and shall end on March 8, 2003, (One (1) year
lease).

SECTION 1.03.   RENEWAL BY TENANT.   Provided there is no continuing Event of
Default, Tenant may RENEW this Lease for an additional ONE (1) year period by
delivery of four (4) months prior written notice to Landlord.

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ARTICLE II

RENT

SECTION 2.01.   RENT.   Tenant shall pay to Landlord, without deduction or set-off
except as otherwise provided in this Lease, at the address specified herein or
furnished pursuant to this Lease, a monthly rental (“net rent”) of $10,561.40
($ 20.57 per square foot on an annual basis) during the term of this lease.
Monthly rental for the annual adjustment (on the anniversary date) renewal
period will be adjusted based on Washington D.C. area CPI (Urban Wage Earners)
and the determination of the adjusted rental for the renewal period shall be
made and communicated to Tenant (along with the calculation therefore) at least
thirty (30) days prior to the last date on which Tenant may exercise its
renewal option pursuant to Section 1.03. The annual amount of increase payable
by Tenant under this lease as rental, shall not be less than two and one-half
(2 1/2%) percent.

The monthly rents are due and payable to the Landlord’s office on the first of
each month. Payments not received by the Landlord within seven (7) days of the
due date shall incur a five (5%) late charge. Any account not settled within
thirty (30) days shall, in addition, incur a one and one half (1 1/2) per month
service charge on that outstanding balance.

SECTION 2.02   SERVICES AND BENEFITS INCLUDED IN ANNUAL RENTAL.   Landlord shall provide Tenant as part of Tenant’s Annual Rent the following
services and benefits:

	 	1.	 	Occupancy of turnkey laboratory, and animal facilities in “as
is” condition;
	 
	 	2.	 	Adequate premise security consistent with other laboratories in
business on Landlord’s leasehold;
	 
	 	3.	 	Fire, casualty and public liability coverage on the building
and the common spaces;
	 
	 	4.	 	All utilities (excluding Telephone) related to the Leased
Premises; EXCEPT FOR SPACE LOCATED AT 12115 PARKLAWN DRIVE (Keats
Plaza)
	 
	 	5.	 	Janitorial services on a regular basis;
	 
	 	6.	 	All real estate taxes payable on the

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	 	 	 	Property; and,
	 
	 	7.	 	All regular maintenance and cleaning services on Leased
Premises and the Property, unless due to the negligence or willful
misconduct of Tenant or any special requests by tenant.

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ARTICLE III

USE

SECTION 3.01. USE. Tenant shall use the Leased Premises only for
the operation of a medical research laboratory, and animal rooms
and for no other purpose without the prior written consent of
Landlord; provided, however, that at Landlord’s option, Tenant may
use the Leased Premises for any legally permissible use which
proves to be economically feasible, to be determined by Landlord
within its good faith discretion.

SECTION 3.02. WASTE/PROHIBITED USE. Tenant shall not use or permit
the Leased Premises or any part thereof to be used for any purpose
or purposes other than the purpose or purposes for which the
Leased Premises are leased. Tenant shall not commit or suffer to
be committed any waste upon the Leased Premises. Tenant shall not
use the Leased Premises or permit the same to be used in whole or
in part for any purpose or use that violates the laws, ordinances,
regulations or rules of any public authority or organization.

ARTICLE IV

MAINTENANCE

SECTION 4.01. MAINTENANCE OF BUILDING: Landlord agrees to
maintain
in good repair the outside walls, foundation and roof of
the buildings and surface of the parking areas, sidewalks and
driveways, as well as the structural soundness of the building,
including all common areas and all component parts thereof the
plumbing, electrical wiring, air conditioning and heating
equipment.

SECTION 4.02. Tenant will at all times during the term of the
lease, occupy the Leased Premises and will maintain the Leased
Premises and the immediate area around the Leased Premises, at its
own expense, in a clean, orderly, and sanitary condition.

ARTICLE V

ALTERATIONS AND ADDITIONS

SECTION 5.01. Tenant shall make no
improvements or additions in or
to the Leased Premises without Landlord’s prior written permission
which shall not be unreasonably withheld. If Tenant wishes to hire
a contractor to repair any aspects of the building, the TENANT
MUST NOTIFY BRI in writing and receive written approval and
include in it’s memo the name of the contractor, phone number,
address and inform BRI of the hours and days the vendor contractor
will be working. The contractor will

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provide an Certificate of Insurance in the amount of $1,000,000
for general
liability. In lieu of such insurance, a bond of $500,000 will be acceptable.
Minor alterations, additions or decorating may be made by Tenant in a good
workmanlike manner. All alterations, improvements or additions to the Leased
Premises shall be at Tenant’s sole expense unless otherwise agreed to in
writing by both parties. Leasehold improvement will remain the property of the
Landlord unless otherwise agreed in writing.

SECTION 5.02. In the event that any mechanics’ or material men’s
liens shall at
any time be filed against the Leased Premises
purporting to be for work, labor,
services or materials performed
or furnished to Tenant or anyone holding the
Leased Premises
through or under Tenant, Tenant shall forthwith cause the same
to
be discharged of record or by bond, indemnification agreement or
otherwise as agreed in writing between the parties within thirty
(30) days following the
date of such filing. If Tenant shall
fail to cause lien to be discharged (or
Landlord’s interest protected as allowed in the preceding sentence) after being
notified of the filing thereof as aforesaid, then, in addition to any other
right or remedy of Landlord and Tenant shall pay as additional rent, on the
first day of the next succeeding month all costs and expenses, including
reasonable attorneys’ fees incurred by Landlord in attempting to discharge such
lien.

SECTION 5.03. REPLACEMENTS. Tenant may install or place or
re-install or replace upon and, if there is no continuing Event of Default,
remove from the Leased Premises any trade fixtures, signs, machinery, and
equipment. Such trade fixtures, signs, machinery, and equipment shall not
become the property of the Landlord (other than replacements of trade fixtures,
machinery, and equipment which are the property of the Landlord, which
replacements shall also be the property of Landlord). All personal property of
the Tenant located on the Leased Premises is at Tenant’s sole risk.

ARTICLE VI

LIMITATION ON LANDLORD’S LIABILITY

SECTION 6.01. Except with respect to any damages resulting from the willful or
negligent act or omission of Landlord, its agents and employees. Landlord shall
not be liable to Tenant its employees, agents, business invitee, licensees,
customers, guests, or trespassers for any damage or loss to the property of
Tenant or others located on the Leased Premises or for any accident or injury
to person in the Leased Premises or the Building resulting from: the necessity
of repairing any portion of the Building; the use or operation (by Tenant or
any other person or persons whatsoever) of any elevators, or heating, cooling,
electrical or plumbing equipment or apparatus; the termination of this Lease by
reason of the destruction of the

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Building or the Leased Premises; any fire, robbery, theft and/or any
other casualty; any leaking in any part or portion of the Leased
Premises or the Building; any water, wind, rain or snow that may leak
into, or flow from, any part of the Leased Premises or the Building;
any acts or omissions of any occupant of any space adjacent to or
adjoining all or any part of the Leased Premises; any water, gas,
steam, fire, explosion, electricity or falling plaster; the bursting,
stoppage or leakage of any pipes, sewer pipes, drains, conduits,
ducts, appliances or plumbing works; the functioning or
malfunctioning of the fire sprinkler system; the functioning or
malfunctioning of any security system installed in the building of
any part thereof, or any other cause whatsoever.

SECTION 6.02. Landlord shall not be required to perform any of its
obligations or any other provision of this Lease, nor be liable for
loss or damage for failure to do so, nor shall Tenant be released
from any of its obligations under this Lease because of the
Landlord’s failure to perform, where such failure arises from or
through acts of God, strikes, lockouts, labor difficulties,
explosions, sabotage, accidents, riots, civil commotions, acts of
war, results of any warfare or warlike conditions in this or any
foreign country, fire and casualty, requirements or other causes
beyond the reasonable control of Landlord. If Landlord is so delayed
or prevented from performing any of its obligations during the Term,
the period of such delay or such prevention shall be deemed added to
the time herein provided for the performance of any such obligation.

ARTICLE VII

RULES AND REGULATIONS

SECTION 7.01. RULES AND REGULATIONS. Tenant agrees to comply with and
observe all rules and regulations established and amended by Landlord
from time to time, provided the same shall apply uniformly to all
tenants of the laboratories. Tenant’s failure to keep and observe
said rules and regulations shall constitute a breach of the terms of
this Lease in the same manner as if the rules and regulations were
contained herein as covenants. In the case of any conflict between
said rules and regulations and this Lease, this Lease shall be
controlling.

ARTICLE VIII

ACCESS BY LANDLORD

SECTION 8.01. RIGHT OF ENTRY. Landlord or Landlord’s agents shall
have the right to enter the Leased Premises at all reasonable times
to examine the same. Landlord or Landlord’s agents shall have the
further right to enter the Leased Premises to make such repairs,
alterations, improvements or additions as

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Landlord may deem necessary or desirable, and Landlord shall be allowed to take
all material into and upon the Leased Premises that may be required therefore
without the same constituting an eviction of Tenant in whole or part, and the
rent and other charges reserved shall in no wise abate while said repairs,
alterations, improvements, or additions are being made, by reason of loss or
interruption of business of Tenant, or otherwise. During the three (3) months
prior to the expiration of the term of this lease, Landlord may exhibit the
Leased Premises to prospective tenants.

ARTICLE IX

INDEMNIFICATION

SECTION 9.01. Tenant hereby indemnifies, and shall protect and hold Landlord
harmless from and against all liabilities, losses, claims, demands, costs,
expenses, and judgments of any nature arising, or alleged to arise, from or in
connection with (a) any injury to, or the death of, any person or loss or
damage to property on or about the Leased Premises or any adjoining property
arising from or connected with the use of the Leased Premises by Tenant during
the term, or (b) performance of any labor or services or the furnishing of any
material or other property in respect of the Leased Premises or any part
thereof by or at the request Tenant will resist and defend any action, suit, or
proceeding brought against Landlord by reason of any such occurrence by counsel
designated by Tenant and approved by Landlord.

ARTICLE X

INSURANCE AND INDEMNITY

SECTION 10.01. TENANT’S INSURANCE.

	(a)	 	Tenant, at its sole cost and expense, shall, during the entire term
hereof, procure, pay for and keep in full force and effect:
	 
		 	(i) public liability and property damage insurance with respect to the
leased premises and the operations of Tenant in, on or about the lease
premises, in which the limits with respect to public liability shall be
not less than One Million Dollars ($1,000,000.00) per occurrence for
personal injury and death and in which the limits with respect to property
damage liability shall not be less than five Hundred Thousand Dollars
($500,000.00);
	 
		 	(ii) insurance against vandalism, malicious mischief and

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	 	 	such other additional perils as now are or hereafter may be included in a
standard extended coverage endorsement from time to time in general use in
the county in which the Leased Premises are located, insuring tenant’s
merchandise, trade fixtures, equipment and all other items of personal
property of Tenant located on or in the leased premises, in an amount
equal to not less than eighty percent (80%) of the actual replacement cost
thereof; and
	 
		 	(iii) workmen’s compensation coverage as required by law.
	 
	(b)	 	All policies of insurance required to be carried by Tenant pursuant to
this Section 10.01 shall be written by responsible insurance companies
authorized to do business in the State of Maryland, in which the Leased
Premises are located, and shall name Landlord as an additional insured,
and Tenant shall deliver a copy of said policy or the certificate showing
the same to be in force and effect. In the event Tenant shall fail to
maintain any policy of insurance required hereunder, then Landlord may,
after three (3) days written notice to Tenant, obtain such policy and pay
the premium thereon and the amount so paid shall be added to the next
installment of rent. The Tenant will be reasonable for all fees associated
with the effort to insurance the Tenant.
	 
	(c)	 	Provided the insurance required to be maintained by Tenant pursuant to
Section 10.01(a) is in full force and effect and remains so, Landlord
waives, releases and discharges Tenant to the extent of insurance coverage
maintained by Tenant from all claims or demand whatsoever which Landlord
may have or acquire in the future arising out of damage to or destruction
of the Leased Premises occasioned by fire or extended coverage risks
whether such claim or demand may arise because of the negligence of
Tenant, its agents or employees or otherwise, and Landlord agrees to look
only to the insurance coverage to the extent of such coverage in the
event of such loss.
	 
	(d)	 	Landlord and Tenant hereby each release the other from any and all
liability or responsibility to the other or any one claiming through or
under them by was of sub-rogation or otherwise for any insured loss or
damage to property caused by fire or other casualty, whether such loss,
damage, fire or other insured event shall have been caused by the
negligence but not willful misconduct of the other party, provided,
however, that this release shall be applicable and in force and effect
only with respect to loss or damage occurring during such time as the
releasor’s policies of insurance shall contain a clause or endorsement to
the effect that any such release shall not adversely affect or impair said
policies or prejudice the right of the releasor

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	 	 	to recover thereunder and shall apply only to the extent of
the respective insurance coverage Landlord and Tenant agree
that each will request its insurance carriers to include in
its policies such a clause or endorsement provided that if
an additional premium shall be charged therefore, each
party shall advise the other thereof and of the amount of
such additional premium, and the other party, at its
election, may pay but shall not be obligated to do so. If
both parties cannot obtain such a waiver subrogation at
reasonable commercial rates, then both parties shall be
released from their obligation to obtain such a waiver.
	 
	(e)	 	Tenant agrees that it will indemnify and
save the Landlord harmless from any and all liability,
damage, expense, cause of action, suits, claims or
judgements arising from injury to person or property on
the demised premises, or upon the adjoining sidewalks, or
parking lots due to the negligence of Tenant, its agents
or employees. To assure such indemnity, Tenant shall carry
and keep in full force and effect at all times during the
term of this lease for the protection of the Landlord and
Tenant herein, and deliver to the Landlord a copy of said
policy or certificate showing the same to be in force and
effect. in the event Tenant shall fail to maintain such
policy of insurance then Landlord may, after three (3)
days written notice to Tenant, obtain such policy and pay
the premium thereon and the amount so paid shall be added
to the next installment of rent.
	 
	 	 	Each party will be deemed to have provided within their
respective insurance policies a waiver of subrogation until
notice is provided that waiver of subrogation has not been
obtained and the policy for which it has not been obtained.

ARTICLE XI

OFF-SET STATEMENT, ATTORNMENT AND SUBORDINATION

SECTION 11.01. OFF-SET STATEMENT. Tenant agrees within ten (10)
days after request therefore by Landlord, to execute in
recordable form and deliver to Landlord a statement, in
writing, certifying:

	(a)	 	that this Lease is in full force and effect,
	(b)	 	the date of commencement of the term of this Lease,
	(c)	 	that rent is paid currently without any off-set or defense thereto,
	(d)	 	the amount of rent, if any, paid in advance,
	(e)	 	whether this Lease has been modified and, if so, identifying the modifications, and

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	(f)	 	that there are no uncured defaults by Landlord or stating those
claimed by Tenant, provided that, in fact, such facts are accurate and
ascertainable.

SECTION 11.02. ATTORNMENT. In the event any proceedings are brought for the
foreclosure of, or in the event of the conveyance by deed in lieu of
foreclosure of, or in the event of exercise of the power of sale under, any
mortgage and/or deed of trust made by Landlord covering the leased premises,
or in the event Landlord sells, conveys or otherwise transfers its interest in
the Leased Premises or any portion thereof containing the leased premises,
this Lease shall remain in full force and effect and Tenant hereby attorn to
and covenants and agrees to execute an instrument in writing reasonably
satisfactory to the new owner whereby Tenant attorn to, such successor in
interest and recognizes such successor as the landlord under this Lease.
Payment by or performance of this Lease by any person, firm or corporation
claiming an interest in this Lease or the leased premises by, through or under
the Tenant without Landlord’s consent in writing shall not constitute an
ATTORNMENT or create any interest in this Lease or the Leased Premises.

SECTION 11.03 SUBORDINATION. Tenant agrees that this Lease shall, at the
request of Landlord, be subordinate to any first mortgages or deeds of trust
or primary leases that may hereafter be placed upon the leased premises and to
any and all advances to be made thereunder, and to the interest thereon, and
all renewals, replacements and extensions thereof, provided the mortgagees or
beneficiaries named in said mortgages or trust deeds shall agree to recognize
the interest of Tenant under this Lease in the event of foreclosure, if Tenant
is not then in default. Tenant also agrees that any mortgagee or beneficiary
may elect to have this Lease constitute a prior lien to its mortgage or deed
of trust, and in the event of such election and upon notification by such
mortgagee or beneficiary to Tenant to that effect, this Lease shall be deemed
prior in lien to such mortgage or deed of trust. Tenant agrees that upon the
request of Landlord, or any mortgagee or beneficiary, Tenant shall execute
whatever instruments may be required to carry out the intent of this Section.

SECTION 11.04. REMEDIES. Failure of Tenant to execute any statements or
instruments necessary or desirable to effectuate the foregoing provisions of
this Article, within ten (10) days upon written request so to do by Landlord,
shall constitute a breach of this Lease. In the event of such failure,
Landlord, in addition to any other rights or remedies it might have, shall
have the right by not less than ten (10) days notice to Tenant to declare this
Lease terminated and the term ended, in which event this Lease shall cease and
terminate on the date specified in

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such notice with the same force and effect as though the date set forth in
such notice were the date originally set forth herein and fixed for the
expiration of the term; upon such termination Tenant shall vacate and
surrender the leased premises, but shall remain liable as provided in this
Lease by reason of said breach. Further, Tenant hereby irrevocably appoints
Landlord as attorney-in-fact for the tenant with full power and authority to
execute and deliver in the name of the Tenant any such statements or
instruments.

ARTICLE XII

ASSIGNMENT AND SUBLETTING

SECTION 12.01. ASSIGNMENT AND SUBLETTING. Notwithstanding any provision herein
to the contrary, Tenant agrees not to assign or in any manner transfer this
Lease or any estate or interest therein, and not to lease or sublet the Leased
Premises or any part or parts thereof or any right or privilege appurtenant
thereto without the written consent of the Landlord, which consent shall not
be unreasonably withheld.

SECTION XIII

DEFAULT

SECTION 13.01. If Tenant shall violate any covenant, including the covenant to
pay rent, made by it in this Lease and shall fail to pay said rent within the
five (5) day period after notice to Tenant, or in the event of a violation of
any other covenant, failed to comply with said covenant within twenty (20)
days after receipt of notice of such violation by Landlord, or Tenant shall
abandon said Leased Premises, or shall be adjudicated insolvent or bankrupt
pursuant to the provisions of any state Act or the Federal Bankruptcy Code
(“Events of Default”), Landlord may, at its option, re-enter the leased
premises without further notice or demand to re-enter and remove, and remove
all persons and property from leased premises without being deemed guilty of
any manner of trespass and without prejudice to any remedies for arrears of
rent or breach of covenant and declare this Lease and the tenancy created
terminated. Landlord may, at its election, provide Tenant with additional time
to correct any Event of Default provided Tenant is utilizing its best efforts
to correct such Event of Default. Landlord’s agent or attorney may resume
possession of the property and relet the same for the remainder of the term
for the account of Tenant, who shall pay any deficiency. Landlord shall be
entitled to the benefit of all

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provisions of applicable laws respecting the speedy recovery of lands and
tenements held over by Tenant or proceedings in forcible entry and detainer.
If Landlord ends this Lease or ends Tenants’ right to possess the Premises
because of an Event of Default, Landlord may hold Tenant liable for rent and
other indebtedness accrued to the date the Lease ends. Tenant shall also be
liable for the rent, additional rent and other indebtedness that otherwise
would have been payable by Tenant during the remainder of the term had there
been no Event of Default, reduced by any sums Landlord receives by reletting
the Leased Premises during the Term.

ARTICLE XIV

ATTORNEY’S FEES

SECTION 14.01. In case suit shall be brought for recovery of possession of the
Leased Premises, for the recovery of rent of any other amount due under the
provisions of this Lease, or because of the breach of any other covenant
herein contained on the part of Tenant to be kept or performed, Tenant shall
pay to Landlord all expenses incurred therefore, including reasonable
attorneys’ fees. In the event of such suit, both parties waive their
respective rights to a trial by jury.

ARTICLE XV

QUIET ENJOYMENT

SECTION 15.01. Tenant upon paying the rent as provided in ARTICLE II, and
performing the covenants and agreements of this Lease shall quietly have, hold
and enjoy the Leased Premises and all rights granted Tenant in this Lease
during the term thereof and extensions thereto, if any.

ARTICLE XVI

BANKRUPTCY OR INSOLVENCY

SECTION 16.01. TENANT’S INTEREST NOT TRANSFERABLE. Neither Tenant’s interest
in this Lease, nor any estate hereby created in Tenant nor any interest herein
or therein, shall pass to any trustee or receiver or assignee for the benefit
of creditors or otherwise by operation of law except as may specifically be

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provided pursuant to the Bankruptcy Code.

SECTION 16.02.   TERMINATION BY INSOLVENCY.   In the event the interest or estate
created in Tenant hereby shall be taken in execution or by other process of law
or if Tenant is adjudicated insolvent or bankrupt pursuant to the provisions of
any State Act or the Bankruptcy Code or if Tenant is adjudicated insolvent by
a Court of competent jurisdiction other than the United States Bankruptcy
Court, or if a receiver or trustee of the property of Tenant, if any, to pay
its debts, or if any assignment shall be made of the property of Tenant or, if
any, for the benefit of creditors, then and in any such events, this Lease and
all rights of Tenant hereunder shall automatically cease and terminate with the
same force and effect as though the date of such event were the date originally
set forth herein and fixed for the expiration of the term, and Tenant shall
vacate and surrender the Leased Premises but shall remain liable as herein
provided.

ARTICLE XVII

MISCELLANEOUS

SECTION 17.01.   WAIVER; ELECTION OF REMEDIES.   One or more waivers of any
covenant or condition by Landlord shall not be construed as a waiver of a
subsequent breach of the same covenant or condition, and the consent or
approval by Landlord to or of any act by Tenant requiring Landlord’s consent or
approval shall not be deemed to render unnecessary Landlord’s consent or
approval to or of any subsequent similar act by Tenant. No breach by Tenant of
a covenant or condition of this Lease shall be deemed to have been waived by
Landlord unless such waiver is in writing signed by Landlord. The rights and
remedies of Landlord under this Lease or under any specific Section, subsection
or clause hereof shall be cumulative and in addition to any and all other
rights and remedies which Landlord has or may have elsewhere under this Lease
or at law or equity, whether or not such Section, subsection or clause
expressly so states.

SECTION 17.02.   NOTICES.   Any notices required or permitted hereunder shall be in
writing and delivered either in person to the other party or the other party’s
authorized agent, or by United States certified Mail, Return Receipt Requested,
postage fully prepaid or by telegraphic communication, to the addresses set
forth hereinafter, or to such other address as either party may designate in
writing and deliver as herein provided.

	 	 	 
	Landlord:	 	
Association for Entrepreneurial Science
	 	 	
(Biomedical Research Institute — actual landlord)
	 	 	
James L. Leef, Ph.D., President
	 	 	
12111 Parklawn Drive

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Rockville, Maryland 20852
	 
	with a copy to:	 	
Warren S. Oliveri, Jr.
	 	 	
King & Nordlinger, Attorneys at Law
	 	 	
4350 N. Fairfax Drive
	 	 	
Suite 950
	 	 	
Arlington, VA 22203
	 
	Tenant	 	
Novavax, Inc.
	 	 	
8320 Guilford Road, Suite C
	 	 	
Columbia, MD 21046
	 	 	
fax: (301) 854-3902
	 
	 	 	
*Attention: Ann McGeehan, General Counsel
	 	 	
          
          
          
  +
	 	 	
          
          
 John Spears, CEO

SECTION 17.03   EXIT POLICY.   When the Tenant vacates the
premises, the area will be broom swept, trash removed, drawers, cabinets,
refrigerators, freezers, walk-ins etc. cleaned. In addition, no reagents or
chemicals may be left behind. If this is not done tenant agrees to pay landlord
for such services. See Attachment 1, # 44 for other policy on exit.

SECTION 17.04.   CAPTIONS.   The captions and headings throughout this Lease are
for convenience and reference only and the words contained therein shall in no
way be held or deemed to define, limit, describe, explain, modify, amplify or
add to the interpretation, construction or meaning of any provision or the
scope or intent of this Lease nor in any way affect this Lease.

SECTION 17.05.   LAW OF MARYLAND.   This Lease Agreement shall be construed under
the laws of the State of Maryland.

SECTION 17.06.   HOLD OVER.   During the period of any holding over after the
termination or expiration of this Lease Agreement by Tenant, Tenant shall be
deemed to be a Tenant from month to month.

SECTION 17.07.   SUCCESSORS AND ASSIGNS.   This Lease Agreement and the covenants
and conditions herein contained shall inure to the benefit of and be binding
upon Landlord, its successors and assigns, and shall inure to the benefit of
Tenant and only such assigns of Tenant to whom the assignment by Tenant has
been consented to by Landlord.

SECTION 17.08.   ENTIRE AGREEMENT.   This Lease Agreement
constitutes the entire agreement of the parties and the same may not be amended
or modified orally. All understandings, prior negotiations and agreements
heretofore, oral and written, had between the parties are merged in this Lease
Agreement, which alone fully and completely expresses their understanding and
is

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binding upon tenant, its successors and assigns.

SECTION 17.09.   This Lease is subject to and subordinate to the
Prime Lease Agreement between American Foundation for Biological
Research as Tenant and William Klinedinst as Landlord, dated
November, 1989, a copy of which is attached.

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EXHIBITS/ATTACHMENTS

	 	 	 
	Exhibit A:	 	
        Floor plan consisting of laboratory and/or animal
facilities in reference to this lease agreement.
	 	 	 
	ATTACHMENT 1:	 	
Tenant Rules and Regulations
	 	 	 
	ATTACHMENT 2:	 	
Considerations to AES from Tenant Companies.
	 	 	 
	ATTACHMENT 3:	 	
Fire Safety Drill & Procedures
	 	 	 
	ATTACHMENT 4:	 	
Parking Permit Rules
	 	 	 
	ATTACHMENT 5:	 	
Maintenance of BRI Equipment
	 	 	 
	ATTACHMENT 6:	 	
Autoclave Policies

16

 

     IN WITNESS WHEREOF, Landlord and Tenant have signed and sealed this Leased
on the day and year first above written.

	 
	Association for Entrepreneurial Sciences (Actual Landlord -
Biomedical Research Institute)

	 
	By:     /S/ JAMES L. LEEF
	

	 
	Title:     James L. Leef, Ph.D., Director
	

	 
	TENANT NAME:     Novavax, Inc.
	

	 

	 	 	 
	By:	 	
/s/ ANN P. MCGEEHAN, ESQ.  3-08-02 
	 	 	

	 	 	
Ann P. McGeehan, Esq.
	 
	Title:	 	
/s/ General Counsel
	 	 	

	 	 	
Novavax, Inc.

17

 

ATTACHMENT 1

TENANT RULES AND REGULATIONS

Below you will find information regarding general rules which must
be followed here at the Parklawn Buildings.

	1)	 	ACCIDENTS: All accidents occurring in the common areas
including hallways and parking lots must be reported to the
Administrative office immediately. Any accidents occurring in
the laboratory should be reported to the Safety Officer,
Teresa Ponio.
	 
	2)	 	AIR LINE FILTER: A hydrophobic filter must be placed on
ALL vacuum lines. See the BRI Safety Officer, Teresa Ponio.
This is for the safety of the personnel and the protection of
the vacuum system.
	 
	3)	 	ANIMAL FACILITIES: See Dr. Lewis or Dr. Leef for access.
Charges for this service will be based on the number of cages
per day housed in the facilities. Protective clothing must be
worn at all times. Rabbits will be charged at a different
rate than mice/rats/guinea pigs/rabbits. The BRI
Institutional Animal Care and Use Committee (IACUC) is in
charge of making sure the care of research animals in the
facility conforms to the guidelines as set for the by the
Animal Welfare Act, NIH, and other governing bodies for
biomedical research. Any Tenant or employee with questions
or concerns about the animal care or research protocols in
our program is encouraged to submit comments, concerns or
suggestions, in writing, to any member of the IACUC. Every
tenant, or department must have a member present at all
animals committee meetings.
	 
	4)	 	AUTOCLAVE: You must sign up for its use for no
more than two consecutive hours of time. See the office staff
for the sign up sheet. Again, all the tenants must have
access to this facility so DON’T use the autoclave for more
than 2 hours at a time. Authorization can be granted for use
of the autoclave after hours or on weekends.
	 
	 	 	Each company is responsible for it’s materials. To autoclave material:
	 
	 	 	Place your items in an autoclave bag with the autoclave tape
and label stating the material is sterile. After sterilizing
place the autoclave bag in the large trash receptacle
available in the room. NEVER discard the red bags in the
trash receptacle or dumpster. The red bags are only to be
used for material which is to be picked up for

18

 

		 	incineration. If you need additional
supplies please see Teresa Ponio, our
Safety Officer. See the autoclave policies and procedures (Attachment # 6)
	 
	5)	 	CANVASSING, SOLICITING AND PEDDLING: Canvassing, soliciting and peddling
in the Building are prohibited, and Tenants shall cooperate to prevent
such activities.
	 
	6)	 	COMMITTEES: All tenants must assign a person(s) having authority to speak
for the tenant to the following committees, attendance is mandatory: The
general laboratory Safety Committee and The Animal Care and Use Committee:
You will be notified of the time and date of the meetings which are held
at least once a quarter.
	 
	7)	 	COMMON AREAS are for the use of all personnel and are not to be unduly
used by any one individual; Tenant shall use the Common Area only as a
means of ingress and egress, Tenants shall permit no loitering by any
persons upon Common Areas or elsewhere within the Building. The common
Areas and roof
of the Building are not for the use of the general public, and Landlord
shall in all cases retain the right to control or prevent assess thereto
by all persons whose presences, in the judgement of Landlord, shall be
prejudicial to the safety, character, reputation or interest of the
Building and it’s tenants. Tenants shall not enter or install equipments
in the mechanical rooms, air conditioning rooms, electrical closets,
janitorial closets, or similar areas or
go upon the roof of the Building without the prior written
consent of the Landlord. After initial construction of space, no tenant
shall install any radio or television antenna, loudspeakers, or other
devise on the roof or exterior walls of the Building.
	 
	8)	 	CONFERENCE ROOM: You must schedule its use; See the
office staff for the availability of the room.
	 
	9)	 	CONTRACTING: Anytime your company requires outside contracting in the
building you must notify BRI of the work you plan on doing, or the work
that has been completed. ALL work conducted must meet the specification of
the fire, state or building codes. If you elect to make repairs at your
expense, BRI must be notified so it may inspect the work to make sure it
conforms to code standards. Also, advise the BRI office if the contractor
expects to be here after normal business hours. It is the responsibility
of the Tenant to assure that any outside contractor has proof of liability
insurance and workman’s compensation coverage.
	 
	10)	 	COPIER You have access to the copier; a 15 cent charge per

19

 

	 	 	page will be billed to your company monthly. See the office staff for your
access number.
	 
	11)	 	DISPUTES: Should a dispute arise between tenants it is hoped that the
tenants can resolve the dispute amicably. Should third party intervention
be desired the BRI Administration will serve as such third party. However,
every effort should be exhausted to solve the dispute before third party
intervention is requested because such third party opinion will be
binding.
	 
	12)	 	EQUIPMENT, FURNISHING, ETC. will not be stored in hallway, landings,
stairs, load dock or any common area. This is in violation of fire safety
code.
	 
	13)	 	EQUIPMENT: All equipment and any other devise of any unusual electrical
or mechanical nature shall be placed by Tenant in the Demised premises in
settings that are structurally safe.
	 
	14)	 	FACSIMILE MACHINE: Facsimile number: (301) 881-7640, the use fee is $1.00
per page (incoming or outgoing).
	 
	15)	 	FIRE SAFETY PROCEDURES: See the (Attachment 3).
	 
	16)	 	1st FLOOR MENS ROOM: A shower is available.
	 
	17)	 	FREEZER SPACE: Freezer space is available through the Maintenance Staff
at the Freezer repository for a monthly charge. The phone number is (301)
881-4513. The freezer space located at the Parklawn building, 1st floor is
temporary storage only. ALL items must have your company name on it and
what the contents are.
	 
	18)	 	GLASSWARE STERILIZING: Companies must have prior
authorization from Dr. Leef to use this facility. There is a charge to use
the glassware facilities.
	 
	19)	 	GUEST PROCEDURES: All guests
must sign in at the guest
desk in the lobby. All guests must be accompanied
throughout the building.
	 
	20)	 	HEATER OTHER THAN THE BUILDING HEAT:
The only devices that are not
exceptable to the fire safety code is electric resistant heaters (any
glowing red strip) . The Tenants may have window air/heat conditioner only
if they properly secure the apparatus to the building and have made
provisions in the installation that the building security is

20

 

	 	 	not breached. In addition such installation must be inspected
and approved by BRI personnel.
	 
	21)	 	HOLD HARMLESS: Tenant(s) will supply Landlord
with a “Hold Harmless” agreement for the use of any of the
“common equipment” or areas. Landlord also requires a
Certificate of Insurance (general liability coverage) for
their company with a minimum of $1,000,000 of coverage. The
Certificate of Insurance must accompany your lease. It will
be the responsibility of the tenant to provide the
Administrative Office with the renewal agreement each year.
	 
	22)	 	INSECTICIDES: Tenant agrees NOT to use or cause
to have used any insecticides to control insect populations
since tenant recognized the Landlord’s research involves
raising insects for life cycles. Insecticides could interrupt
these cycles disastrously.
	 
	23)	 	JANITORIAL CLEANING: Special cleaning will be
done upon request for an additional fee. The janitor is
responsible for the routine cleaning of the laboratories such
as the trash removal, care of the floors and vacuuming in the
offices. Please notify us, in writing, of any times we should
not access your area. We will attempt to accommodate your
request.
	 
	24)	 	KEYS: All the OUTSIDE doors are keyed the same
and under no circumstances are keys to be transferred. Obtain
keys from the Administrative staff. If you lose your key
report it immediately, there is a $10 per key replacement
fee. If you change any locks, you must give us a copy of the
key immediately. This is necessary in case of fire or other
emergency. The exterior doors must remained locked after
normal business hours including holidays and weekends. Do not
prop any doors open unless you remain at the door. Do not let
guests or vendors access the building. Refer all guest or
vendors to the lobby. Under no circumstance are children
(under the age of 18) permitted in the laboratory areas
unless they have a work permit. The Administrative office is
open from 8 to 5 PM Monday through Friday, except holiday(s)
and weekends.
	 
	25)	 	LEASEHOLD IMPROVEMENTS will remain the property
of the Landlord unless otherwise agreed in writing. All
improvement must be approved in writing by the Director, Dr.
Leef, prior to the start of work.
	 
	26)	 	LIGHT FIXTURE REPLACEMENT: Any new or replacement of light
fixtures must be energy efficient with special ballast and

21

 

		
	 	backdrops. BRI is in an energy saving program with PEPCO. Please see
Administration for approval.

	27)	 	LUNCH ROOM: People use ice from the ice machine for their drinks,
always use the ice scoop so the ice remains clean. Do not wear
laboratory coats, gloves or bring lab materials into this room. Our
staff will clean the refrigerator each Friday. All food and
containers will be discarded. We recycle aluminum cans and
card-board boxes only. The microwave is for food only and you must
cover your dish. The coffee is available to guest and staff at cost.
All companies should have their own recycling program.
	 
	28)	 	MAINTENANCE OF THE BUILDING: All work orders should be
directed to the Repository staff at (301) 881-4513. Regular
maintenance involves repair and maintenance of ceilings, walls and
floors inclusive of utilities. All other special maintenance work
will be charged on the basis of parts, labor and overhead. No work
on the ceilings, walls and floors is not to be done without the
written consent of the Administrative office.
	 
	29)	 	MAINTENANCE OF BRI’S FURNISHING OR EQUIPMENT: ALL
equipment, freezers, walk-ins, furniture will be the tenants
responsibility to repair and to return in good working condition
when the tenant is through using said material. Exceptions to this
rule may be made on a case by case basis. If repairs are required on
our equipment, the tenant(s) must notify Administrative Office in
writing that such repair are necessary. The tenant is responsible
for incurred cost.
BRI reserves the right to request equipment return upon 30 day
written notice. See Attachment 5.
	 
	30)	 	MATERIAL DATA SAFETY SHEETS (MSDS): All tenants must notify the
Administrative Office in writing of the location of their MSDS.
	 
	31)	 	MEDICAL WASTE: All tenants are responsible for the removal of their
medical waste. See the office staff for a vendor.
	 
	32)	 	OBSTRUCT OR INTERFERE: Tenants shall not obstruct or interfere with
the rights of other tenants of the Building, or of persons have
business in the building, or in any way conduct any activity within
the Demised Premises which will create excessive traffic or noise
anywhere in the Building.
	 
	33)	 	OFFICE SUPPORT: You will be charged for Secretarial/receptionist,
accounts payable, mail
distribution, the use of the guest telephone in the lobby

22

 

	 	 	and bookkeeping services according to your use.
	 
	34)	 	PARKING: The building area is 30,000 square feet and has 53 legal parking spaces.
Thus, there is one (1) parking space for each 566 square feet of leased space.
Because more permits will be issued than there are spaces available, parking is on a
first come, first serve basis. Please see Attachment 4 for specific parking rules.
	 
	35)	 	PLUMBING: Tenants shall not use the washrooms, restrooms and plumbing fixtures of the
Building, and appurtenance thereto, for any other purposes than the purpose for which
they were constructed, and Tenants shall not deposit any sweepings, rubbish, jells,
rags or other improper substances therein. If Tenants or Tenant’s servants,
employees, agents, contractors, jobber, licenses, invitee, guests or visitors cause
any damage to such washrooms, restrooms, plumbing fixtures or appurtenances, such
damage shall be repaired at Tenant’s expense, and Landlord shall not be responsible
therefore.
	 
	36)	 	READING ROOM: When the conference room is being used this room is available; it seats
6 people. You must acquire authorization to use this room.
	 
	37)	 	SAFETY MEETINGS: Every Tenant shall have a person designated to attend all Safety
Meetings.
	 
	38)	 	TELEPHONE CHARGES: See the office staff for the long distance access code.
	 
	39)	 	TELEPHONE CABLING: All data and telephone lines installed
must be plentium (Category 5) fire
retardant grade equipment.
	 
	40)	 	THERMOSTAT CONTROL: All thermostats will be set at 68 degrees. Do not change the
settings without notifying maintenance.
	 
	41)	 	TRASH REMOVAL: No broken glass bottles, glass pipettes, red hazard bags or any sharp
materials are to be placed in the regular trash. The only material which will be
removed from the lab or office is what is in the trash receptacle. Break down all
card-board boxes and place the boxes in the hallway for disposal. Tenants shall not
deposit any trash, refuse, cigarettes, or other substances of any kind within or out
of the Building, except in the refuse containers provided therefore. No material
shall be placed in the trash receptacles if such material is of such nature that it
may not be disposed of in the ordinary and customary manner

23

 

		
	 	of removing and disposing of office building trash and garbage without being in
violation of any law or ordinance governing such disposal. No tenant shall cause any
unnecessary labor by reason of such tenant’s carelessness or indifference in the
preservation of good order and cleanliness. If the tenant is accumulating more trash
than normal, the tenant is responsible for removing the trash or obtaining another
dumpster. All the trash dumpster must be locked at all times.

	42)	 	EXCEPTIONAL USE OF UTILITIES: Incremental increases for utilities (inclusive of
electric, gas, water) will be accessed if a given tenant requires an unusual demand.
This will be agreed to by both Landlord and Tenant.
	 
	43)	 	INTERRUPTION OF UTILITIES: A memo will be issued 24 hours in advance except in case
of emergency. We will not be held responsible for any interruption of utilities.
	 
	44)	 	WALK-IN +4 DEGREE AND -20 WALK-IN SPACE: This is a common area but all materials
MUST be labeled with the name of contact person, phone number and a brief
description of items. Item(s) with no manufacturer label must have an identification
label with the following: name, description, and any harmful elements. This is a
temporary storage facility for the tenants. If long term needs are required contact
the repository staff. All the building tenants use this walk-in so if you need
additional space, contact the Repository (301) 881-4513.
	 
	45)	 	WINDOWS: Tenant may not install or permit the installation of any awnings, shades,
mylar films or sun filters on windows. Prior written authorization is required.
Tenants shall cooperate with Landlord in obtaining maximum effectiveness of the
cooling system of the Building by closing drapes and other window coverings when the
sun’s rays fall upon windows of the Demised Premises. Tenant shall not obstruct,
alter or impel the operation of Landlord’s heating, ventilating, air conditioning,
electrical, fans, safety or lighting systems.
	 
	46)	 	MOVING: When the Tenant moves from premises, they must repair all damage to the walls
(including nail holes) fixtures, equipment, all spackling must be smooth and ready to
paint, clean all carpet, replace carpet damaged and repair all damage and remove all
trash. There will be a scheduled walk-through before the Tenant officially the
premises.

24

 

Revised May 2000

25

 

ATTACHMENT 2

Considerations to AES from tenant companies.

	3)	 	Publicity and Press Releases: While an AES facility tenant/client,
COMPANY may include the following language in press release when
appropriate, in tenant’s sole judgment: “COMPANY is currently a tenant
and client of the Association for Entrepreneurial Science, a
biotechnology business incubator located in Rockville, Maryland.” Upon
graduation from the AES facility, COMPANY may include the following
language in all press releases when appropriate, in tenant’s sole judgment
issued for a period of 3 years: “COMPANY
is a graduate of the Association for Entrepreneurial Science, a
biotechnology business incubator located in Rockville, Maryland.”
	 
	4)	 	               
                       
                       
        

26

 

ATTACHMENT 3

FIRE SAFETY DRILL & PROCEDURES

IN CASE OF FIRE

There are seven fire alarm pull stations in the building. The most prominent
are in the main hallways, (1st and 2nd floors) near the exits, at both the
north and south ends of the building. Please familiarize yourself with these
four locations.

Whether you are the person to activate the alarm or you hear it sounding,
please do the following:

	1)	 	Immediately secure any procedure you may currently be performing. Do not
leave something running which could create a further hazard. Turn out the
lights if possible and close the door as you vacate the room, but DO NOT
LOCK the door.
	 
	2)	 	Contain the fire using common sense: If you can put out the fire — do so.
Do not endanger yourself and others by trying to fight a fire you cannot
control. Call 911 to report the fire.
	 
	3)	 	Leave the building via the nearest exit. Never go up the stairs to do
this.
	 
	4)	 	Always proceed to the parking lot and form department or company groups.
Each group must have a person able to confirm that everyone who should be
in the group, is present. When the personnel survey is complete, please
report the results to the BRI administrative staff (Leef, Smith or Dover).
That will allow us to inform the firefighters of any missing person(s)
and their probable location.
	 
	5)	 	Please stay with your group until
clearance is given to re-enter the
building. If the time outside the building is a lengthy one and you, or
any of your group decide to leave the premises, please notify one of the
BRI administrative staff named above.

27

 

	6)	 	NOTE: We are told by the Fire Department that:
	 
	 	 	Fire equipment will be at our building within 3-5 minutes after they
receive our call.
	 
	 	 	We should be able to vacate our building within 1 – 1.5 minutes after the
alarm has been sounded.
	 
	7)	 	A brief report of the fire drills should be recorded and a copy given to
the Dr. Leef or Teri Smith. This report will be made available to the fire
department when they make periodic inspections of the building.
	 
	8)	 	If you use a fire extinguisher, please report its use to the BRI
administrative staff. We must have the unit recharged after each use even
if only a small portion of its contents are used. Annually, BRI’s fire
extinguishers will be inspected.
	 
	9)	 	We are legally required to report all fires to the Fire Department even
if we extinguish the fire.

28

 

ATTACHMENT 4

PARKING PERMIT RULES

	1)	 	The parking permits will be issued to an individual. This permit is a car
pool permit and can be transferred from one car to another.
	 
	2)	 	Each company will be responsible for their records. These records should
contain the permit number and to whom the permit was issued. Visitors must
have a permit to park in the lot.
	 
	3)	 	It must be displayed at all times on the rear view mirror.
	 
	4)	 	It is suggested you have the permits returned to you upon termination of
an employee.
	 
	5)	 	The building area is 30,000 square feet and has 53 legal parking spaces.
Thus, there is one (1) parking space for each 566 square feet of leased
space. Because more permits will be issued than there are spaces
available, parking is on a first come, first serve basis.
	 
	6)	 	Biomedical Research Institute will not be responsible for any damages
incurred if a vehicle is towed away. We also will not be responsible for
any damage to or stolen items from cars parked in the lot.
	 
	7)	 	If a vehicle is towed for no permit, BRI will not be responsible for the
towing bill.
	 
	8)	 	Visitors must be issued a permit.
	 
	9)	 	Vehicles must be parked in a legal parking space.
	 
	10)	 	No vehicle is allowed to park in the loading dock or zones.
	 
	11)	 	The towing company telephone number is on the signs at the entrances to
the parking lot.
	 
	12)	 	No vehicles will be left in the parking lot that needs repair. The vehicle
will be towed at owners expense.

29

 

ATTACHMENT 5

MAINTENANCE OF BRI EQUIPMENT

Below are the procedures for the repair of BRI’s equipment in tenant use.

	1)	 	The tenant is responsible for the repair of ALL BRI EQUIPMENT in tenant’s
possession.
	 
	2)	 	The equipment is to be returned to BRI in good working order and will be
examined and accepted by BRI Administrative personnel in writing. Exceptions to the status of equipment will be made on a case by case
basis.
	 
	3)	 	If the equipment needs repair BRI must be notified that the repair is/was
necessary. BRI may require that certain equipment must have prior written
approval. If BRI bids to do the repairs and if the bid is accepted BRI
will be reimbursed for servicing the equipment.
	 
	4)	 	No BRI equipment shall leave this
building without the prior written consent of
BRI.
	 
	5)	 	Once a year, the BRI Office Manager or designee will coordinate a
walk-through (physical inventory) of all equipment in possession of
tenant.

30

 

ATTACHMENT 6

AUTOCLAVE POLICIES

	1)	 	YOU MUST SIGN UP TO USE THE AUTOCLAVE.
	 
	2)	 	ALL BAGS MUST BE LABELED WITH A COMAR STICKER.
	 
	3)	 	DO NOT USE MORE THAN TWO HOUR AT A TIME — DOES NOT EXTEND YOUR ALLOTTED
TIME.
	 
	4)	 	YOU MAY ONLY SIGN UP FOR ONE (1) DAY IN ADVANCE.
	 
	5)	 	THE AUTOCLAVE ROOM MUST REMAIN LOCKED AT ALL TIMES.
	 
	6)	 	NO UN-AUTOCLAVED TRASH MAY BE LEFT IN THIS ROOM. THIS MEANS YOU MUST
LEAVE THE MATERIALS IN YOUR LAB UNTIL YOU ARE READY TO AUTOCLAVE.
	 
	7)	 	AFTER AUTOCLAVING PLACE YOUR
RED/ORANGE AUTOCLAVED BAG IN A
REGULAR TRASH BAG IN THE TRASH CAN WITH THE COMAR STICKER
ON THE OUTSIDE OF THE REGULAR TRASH BAG. DO NOT LEAVE THE
TRASH ON THE FLOOR.
	 
	8)	 	MAKE SURE THAT THE PAN IS IN THE AUTOCLAVE BEFORE AUTOCLAVING MATERIAL.
	 
	9)	 	CLEAN UP THE YOUR MATERIAL IF IT OVERFLOWS IN THE AUTOCLAVE.
	 
	10)	 	IF YOU HAVE NOT AUTOCLAVED YOUR MATERIAL DO NOT PUT A LABEL ON THE BAG.
	 
	11)	 	ALLOW THE BIO-HAZARD BAGS TO COOL AND THEN PLACE THE MATERIALS IN THE
REGULAR TRASH BAGS.

ANY PROBLEMS WITH THE AUTOCLAVE SHOULD BE REPORTED TO THE MAINTENANCE STAFF
IMMEDIATELY AT (301) 881-4513.

Revised date: May 2000

31ex10-13

 

FACILITY RESERVATION AGREEMENT

BY AND BETWEEN

PACKAGING COORDINATORS, INC.

and

NOVAVAX INC.

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	Page
	 
	Article 1
	 	Reference	 	 	1	 
	 
	 	1.1
	 	Definitions	 	 	1	 
	 
	Article 2
	 	Area, Term and Possession	 	 	2	 
	 
	 	2.1
	 	Demise of Area	 	 	2	 
	 	2.2
	 	Term	 	 	2	 
	 	2.3
	 	Construction of the Area; Acceptance of Possession; Allowance	 	 	2	 
	 	2.4
	 	Surrender of Possession	 	 	2	 
	 	2.5
	 	PCI Access to the Area	 	 	2	 
	 
	Article 3
	 	Base Monthly Fee and Deferred Fee	 	 	3	 
	 
	 	3.1
	 	Base Monthly Fee	 	 	3	 
	 	3.2
	 	Deferred Fee	 	 	3	 
	 
	Article 4
	 	Use of Area	 	 	3	 
	 
	 	4.1
	 	Permitted Use	 	 	3	 
	 	4.2
	 	Compliance with Laws and Private Restrictions	 	 	3	 
	 	4.3
	 	Compliance with Insurance Requirements	 	 	3	 
	 	4.4
	 	Environmental Compliance and Hazardous Materials	 	 	3	 
	 	4.5
	 	Furniture and Computers	 	 	4	 
	 
	Article 5
	 	Repairs, Maintenance, Services and Utilities	 	 	4	 
	 
	 	5.1
	 	Utilities	 	 	4	 
	 
	Article 6
	 	Alterations and Improvements	 	 	5	 
	 
	 	6.1
	 	Ownership of Improvements	 	 	5	 
	 
	Article 7
	 	Limitation on PCI's Liability and Indemnity	 	 	5	 
	 
	 	7.1
	 	Limitation on PCI's Liability and Release	 	 	5	 
	 	7.2
	 	Novavax's Indemnification of PCI	 	 	5	 

2

 

	 	 	 	 	 	 	 	 	 	 
	Article 8
	 	Insurance	 	 	5	 
	 
	 	8.1
	 	Novavax Insurance	 	 	5	 
	 	8.2
	 	PCI's Insurance	 	 	6	 
	 	8.3
	 	Certificate of Insurance	 	 	6	 
	 	8.4
	 	Mutual Waiver of Subrogation	 	 	6	 
	 
	Article 9
	 	Damage to Area	 	 	7	 
	 
	 	9.1
	 	Novavax's Duty to Restore	 	 	7	 
	 
	Article 10
	 	Default, Remedies and Termination	 	 	8	 
	 
	 	10.1
	 	Events of Default	 	 	8	 
	 	10.2
	 	PCI's Remedies	 	 	9	 
	 	10.3
	 	PCI's Default	 	 	9	 
	 	10.4
	 	Novavax's Remedies	 	 	9	 
	 	10.5
	 	Termination of Supply Agreement	 	 	10	 
	 
	Article 11
	 	Assignment	 	 	10	 
	 
	 	11.1
	 	Assignment and  Subletting	 	 	10	 
	 
	Article 12
	 	General Provisions	 	 	11	 
	 
	 	12.1
	 	Taxes	 	 	11	 
	 	12.2
	 	Force Majeure	 	 	11	 
	 	12.3
	 	Notices	 	 	11	 
	 	12.4
	 	General Waivers	 	 	12	 
	 	12.5
	 	Holding Over	 	 	12	 
	 	12.6
	 	Miscellaneous	 	 	12	 
	 	12.7
	 	Entire Agreement	 	 	12	 

3

 

FACILITY RESERVATION AGREEMENT

     This Facility Reservation Agreement (the “Agreement”) is made by and
between Packaging Coordinators, Inc., a Pennsylvania corporation with offices
at 3001 Red Lion Road, Philadelphia, Pennsylvania (“PCI”), and Novavax Inc., a
Delaware corporation with offices at 8320 Guilford Road, Suite C, Columbia, Md.
21046 (“Novavax”), this ______ day of January, 2002 (the “Effective Date”).

ARTICLE 1

REFERENCE

     1.1.      Definitions. Any term that is given a special meaning by any
provision in this Agreement shall, unless otherwise specifically stated, have
such meaning wherever used in this Agreement or in any Exhibit attached hereto.
In addition, the following terms shall have the following meanings:

     "Area” shall mean the interior space leased by PCI to Novavax within the
Property consisting of approximately 19,300 square feet, including reasonable
rights of ingress and egress, as mutually agreed from time to time.

     “Area Design Plan” shall mean the design plans pursuant to which the
Novavax Improvements shall be constructed in the Area and which are attached
hereto as Exhibit A.

     “Base Monthly Fee” shall mean the Base Monthly Fee set forth in Section
3.1 below..

     “Hazardous Materials” shall mean any toxic substance, hazardous substance,
hazardous material, hazardous constituent, hazardous waste, pollutant or
contaminant which is or becomes regulated by any local governmental authority,
the Commonwealth of Pennsylvania, or the United States government, including
any material or substance defined as a “hazardous waste” pursuant to Section
1004 of the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et
seq. (42 U.S.C. Section 6903) or as a “hazardous substance” pursuant to Section
101 of the Comprehensive Environmental Response Compensation, and Liability
Act, 42 U.S.C. Section 9601, et seq. (42 U.S.C. Section 9601), excluding
ordinary cleaning and other solvents typically used in office spaces, provided
that the same are used in accordance with applicable laws.

     “Improvements” shall mean all modifications, alterations and improvements
made or added to the Area by Novavax pursuant to the Area Design Plan,
excluding Novavax equipment, moveable improvements and trade fixtures.

     “Permitted Use” shall mean Novavax’s manufacturing and PCI’s packaging of
the pharmaceutical products as set forth in the Supply Agreement (as defined
below), as well as related office and warehouse uses.

     “Property” shall mean the real property owned by PCI known as 3001 Red
Lion Road, Philadelphia, Pennsylvania.

1

 

     “Supply Agreement” shall mean that certain Supply Agreement between the
parties dated March 22, 2001 whereby PCI shall provide certain services to
Novavax in connection with the packaging of the products described in such
agreement.

ARTICLE 2

AREA, TERM AND POSSESSION

     2.1      Demise of Area. PCI hereby leases to Novavax and Novavax hereby
leases from PCI for the Term of this Agreement, and upon the terms and subject
to the conditions of this Agreement, the Area (as hereinafter defined).

     2.2      Term. Subject to Paragraph 2.4 below, the term of this Agreement
shall begin on the Effective Date and unless extended by mutual agreement of
the Parties, shall continue for a period of five (5) years (the “Term”).
Thereafter, this Agreement shall automatically renew for two (2) additional
periods of one (1) year each, unless written notice of non-renewal is provided
one hundred eighty (180) days prior to the end of the Term or any renewal term
by one party to the other party.

     2.3      Construction of the Area; Acceptance of Possession; Allowance. Novavax
shall construct the Area in accordance with all applicable laws and the Area
Design Plan, including, without limitation, the hiring of all contract
personnel and the purchase of any and all materials necessary for the
build-out of the Area. Novavax shall indemnify and hold PCI harmless from any
and all claims, suits, demands, costs, expenses and liabilities (collectively,
“Claims”) resulting from or relating to such construction of the Area and all
construction personnel or sub-contractors, provided, however, that the
foregoing indemnification shall not apply to the extent that any such Claims
are caused by the negligence or misconduct of PCI or its employees, agents or
representatives.

     2.4      Surrender of Possession. Within sixty (60) days following expiration
or termination of this Agreement, Novavax shall remove all production equipment
(including without limitation, the tank farm) and shall vacate and surrender
the Area to PCI broom clean, in the same condition as existed prior to the
construction in Section 2.3, reasonable wear and tear excepted. Novavax shall,
at Novavax’s sole expense, repair any damage to the Area or the Property,
caused by Novavax’s removal of such items. Any Improvements that Novavax does
not remove from the Area shall be deemed to have been either (i) assigned,
without cost or further action by Novavax to PCI; or (ii) abandoned by Novavax.
In either case, at PCI’s sole election and discretion, PCI may request that
Novavax execute such additional documents as PCI may reasonably request to
acknowledge and confirm such assignment, or if PCI elects to discard the
abandoned property, then Novavax shall pay all fees and costs associated with
such disposal and repair of the Area.

     2.5      PCI Access to the Area. PCI shall have access to the Area upon no
less than 24 hours prior notice to Novavax (except in the case of emergency):
(i) to comply with its obligations under this Agreement and the Supply
Agreement, (ii) for any necessary purpose in the event of an emergency, (iii)
to perform any required or necessary maintenance or repairs to the Area or the
Property, and (iv) if required to comply with applicable law. PCI shall retain
the

2

 

master keys to the Area. Except in the case of emergency, PCI shall be
accompanied while entering the Area by a Novavax representative.

ARTICLE 3

BASE MONTHLY FEE AND DEFERRED FEE

     3.1      Base Monthly Fee. Commencing on January 1, 2002 and continuing with
any fee increase throughout the Term of this Agreement, Novavax shall pay to
PCI, without prior demand therefor, in advance on the first day of each
calendar month, the amount of One hundred Thirty Thousand 00/100 Dollars
($130,000.00) as the Base Monthly Fee. The Base Monthly Fee shall increase
annually by 3.5% beginning on July 1, 2003 and continuing thereafter on each
July 1 of each contract year during the Term. The Base Monthly Fee shall be
negotiated in good faith by the parties for any renewal term.

     3.2      Deferred Fee. Commencing upon the Effective Date and continuing each
month thereafter until June 1, 2002, PCI shall defer receipt of forty percent
(40%) of the Base Monthly Fee (the “Deferred Fee”). The entire amount of the
Deferred Fee shall become due and payable on or before June 30, 2002.
Notwithstanding the foregoing, in Novavax’s sole discretion, Novavax may elect
to prepay all or any part of the Deferred Fee prior to its becoming due and
payable.

ARTICLE 4

USE OF AREA

     4.1      Permitted Use. Novavax shall be entitled to use the Area for the
Permitted Use. Office space within the Area shall be allocated for the use of
the Novavax technical representatives during the Term of the Agreement.

     4.2      Compliance with Laws and Private Restrictions. Subject to the
obligations of PCI pursuant to Sections 4.3 and 4.4 below, Novavax agrees that
its use of the Area will be in compliance with all federal, state and local
laws, rules and regulations respecting its use and occupancy of the Area.

     4.3      Compliance with Insurance Requirements. PCI and Novavax shall comply
with all requirements of any insurance company, insurance underwriter, or Board
of Fire Underwriters which are necessary to maintain reasonable insurance
coverages covering the Area within the Property.

     4.4      Environmental Compliance and Hazardous Materials. Novavax shall be
solely responsible for the transportation and disposal of any and all Hazardous
Materials generated by Novavax in the use and occupancy of the Area, including
all costs and expenses associated therewith. Novavax shall comply with all
local, Commonwealth of Pennsylvania and federal laws regarding environmental
compliance and Hazardous Materials (“Laws”) in connection with Novavax’s
operations in, and use of the Area. Notwithstanding anything to the contrary
contained in this Agreement, PCI agrees to indemnify, defend and hold harmless
Novavax from and against any and all liabilities, losses, damages, suits,
actions, causes of action, costs, expenses (including without limitation
reasonable attorneys’ fees and disbursements and court

3

 

costs), penalties, fines, demands, judgments, claims or liens (including
without limitation claims or liens imposed under any so-called “Superfund” or
other environmental legislation) arising from or in connection with the
presence of any Hazardous Materials (as defined below), (i) in the Area or the
Property, or the subsequent removal thereof from, the Property (including
without limitation the Area) prior to Novavax’s taking possession of the Area;
and (ii) from or in connection with the Property (excluding the Area) after
Novavax’s possession of the Area. PCI shall have the right to assume exclusive
control of the defense of any such suit, action or claim, and Novavax agrees to
cooperate reasonably with PCI in the performance by PCI of its obligations
under this Section 4.4.

     Notwithstanding anything to the contrary contained in this Agreement,
Novavax agrees to indemnify, defend and hold harmless PCI from and against any
and all liabilities, losses, damages, suits, actions, causes of action, costs,
expenses (including without limitation reasonable attorneys’ fees and
disbursements and court costs), penalties, fines, demands, judgments, claims or
liens (including without limitation claims or liens imposed under any so-called
“Superfund” or other environmental legislation) arising from or in connection
with any Hazardous Materials including, without limitation presence, use
release, discharge or disposal of the same, which are stored, generated or
otherwise brought onto the Area by or at the direction of Novavax. Novavax
shall have the right to assume exclusive control of the defense of any such
suit, action or claim, and PCI agrees to cooperate reasonably with Novavax in
the performance by Novavax of its obligations under Section 4.4. Novavax shall
have the right, at Novavax’s sole election and at Novavax’s sole cost and
expense, to perform or cause to be performed, from time to time during the
Term, environmental testing to determine the presence of Hazardous Materials on
or about the Area. It is expressly understood and agreed that, subject to
Novavax’s indemnification obligations under the foregoing provisions, that
Novavax shall store and use at the Area, in the ordinary course of its business
operations therein, chemicals and solvents used in support of the manufacturing
and packaging of the Products, as well as ordinary cleaning and other solvents
typically used in office spaces. Novavax shall provide to PCI a list of
chemicals and solvents, by Product, prior to Novavax’s use of the same in the
Area.

     “Hazardous Materials” means any hazardous or toxic substance, material or
waste which is or becomes regulated by any local, state or federal governmental
authority or by common law decisions, including without limitation (i) all
chlorinated solvents, (ii) petroleum products or by-products, (iii) asbestos
and (iv) polychlorinated biphenyls.

     The provisions of this Section 4.4 shall survive the expiration or earlier
termination of this Agreement.

     4.5      Furniture and Computers. Novavax shall supply any computer equipment,
office furniture and fixtures that it devises or deems necessary for the Area
(the “Novavax FF&E”). During the term of this Agreement, Novavax shall be
responsible for any and all maintenance and upkeep of the Novavax FF&E and
shall insure and assume all risk of loss therefor except to the extent caused
by the negligence or willful misconduct of PCI, or its employees, agents or
representatives. Novavax shall be responsible, at its own expense, for removal
of such Novavax FF&E in accordance with Section 2.4 above.

4

 

ARTICLE 5

REPAIRS, MAINTENANCE, SERVICES AND UTILITIES

     5.1      Utilities.

                (a)      PCI
shall, at all times during the Term of this Agreement and at its
sole cost and expense, maintain in good order, condition and repair all
plumbing, electrical, wiring conduits, connectors and fixtures, the chillers
and related piping up to the point where the main supply lines enter the Area
and the return lines to the chillers. PCI shall also provide Novavax access to
phone and computer lines for the Area.

                (b)      PCI
shall pay all charges for water, and storm and sanitary sewer
services supplied to the Area. Novavax shall pay for all process related
utilities.

ARTICLE 6

ALTERATIONS AND IMPROVEMENTS

     6.1      Ownership of Improvements. All Improvements (as well as Novavax
equipment, moveable improvements and trade fixtures) shall remain the property
of Novavax during the term of this Agreement. Upon expiration or termination
of this Agreement, any Improvements not removed from the Area in accordance
with the provisions of Section 2.4 shall be deemed to have been assigned,
without cost or further action by Novavax to PCI.

ARTICLE 7

LIMITATION ON PCI’S LIABILITY AND INDEMNITY

     7.1      Limitation on PCI’s Liability and Release. PCI shall not be liable to
Novavax for, and Novavax hereby releases PCI and its officers, agents,
employees, attorneys, and consultants from, any and all liability, whether in
contract, tort or on any other basis, for any injury to or any damage sustained
by Novavax, its agents, employees or contractors in connection with Novavax’s
construction or use of the Area, except to the extent such damage was caused
primarily by the negligence or willful misconduct of PCI or its employees,
agents or representatives, or by PCI’s breach of this Agreement. PCI shall
indemnify, defend and hold harmless from any third party claims, loss,
liability, penalties, or expense, made or legal actions filed or threatened
against Novavax that are caused primarily by the negligence or willful
misconduct of PCI or its employees, agents or representatives or by PCI’s
breach of this Agreement. Notwithstanding the foregoing, in no event shall
PCI’s indemnity obligations or any other financial obligation under this
Agreement exceed the sum of One Million Dollars ($1,000,000.00), unless the
same arises from PCI’s intentional misconduct.

     7.2      Novavax’s Indemnification of PCI. Novavax shall indemnify, defend and
hold harmless from any third party claims, loss, liability, penalties, or
expense, made or legal actions filed or threatened against PCI with respect to
the violation of any law, or the death, bodily injury, personal injury or
property damage suffered by Novavax, it’s agents, employees, subcontractors,
representatives or any other third party occurring within the Area, or from
Novavax’s use or occupancy of the Area, except to the extent the same claim,
loss, liability,

5

 

penalties, or expense is caused primarily by the negligence or misconduct of
PCI or its employees, agents or representatives.

     7.3      The indemnify obligations set forth above in Sections 7.1 and 7.2
shall survive termination or expiration of this Agreement.

ARTICLE 8

INSURANCE

     8.1      Novavax Insurance. Novavax shall maintain insurance complying with
all of the following:

                (a)      Novavax
shall procure, pay for and keep in full force and effect, at
all times during the term of this Agreement the following:

                           (i)      Commercial
general liability insurance insuring Novavax against
liability for personal injury, bodily injury, death and damage to property
occurring within the Area, or resulting from Novavax’s use or occupancy of the
Area, or resulting from Novavax activities in or about the Area or the
Property, with coverage in the amount of at least five million dollars
($5,000,000), which insurance shall contain the equivalent of a “broad form
liability” endorsement insuring Novavax’s performance of Novavax’s obligations
to indemnify PCI as contained in this Agreement;

                           (ii) 
   Fire and property damage insurance in so-called “fire and extended
coverage” form insuring Novavax against loss from physical damage to Novavax’s
FF&E, products, finished products, raw materials, components, personal
property, inventory, trade fixtures and improvements within the Area, including
the Improvements, with coverage for the full actual replacement cost thereof;
and

                           (iii) 
  With respect to the construction of the Area, making of alterations
or the construction of improvements or the like undertaken by Novavax,
contingent liability and builder’s risk insurance, in an amount and with
coverage reasonably satisfactory to PCI; and

                           (iv) 
 Workers’ compensation insurance and any other employee benefit
insurance sufficient to comply with all laws.

                (b)      Each
policy of liability insurance required to be carried by Novavax
pursuant to this paragraph or actually carried by Novavax with respect to the
Area, the Building or the Property: (i) shall name PCI, and such others as are
reasonably designated by PCI, as additional insureds; (ii) shall be primary
insurance providing that the insurer shall be liable for the full amount of the
loss, up to and including the total amount of liability set forth in the
declaration of coverage, without the right of contribution from or prior
payment by any other insurance coverage of PCI; (iii) shall be in a form
reasonably satisfactory to PCI; (iv) shall be carried with companies reasonably
acceptable to PCI with Best’s ratings of at least A + VI; (v) shall provide
that such policy shall not be subject to cancellation, lapse or change except
after at least thirty days prior written notice to PCI; and (vi) shall contain
a so-called “severability” or “cross liability” endorsement. Each policy of
property insurance maintained by Novavax with respect to the Area or the
Property shall contain a waiver and/or a permission to waive by the

6

 

insurer of any right or subrogation against PCI, its partners, principals,
members, officers, employees, agents and contractors, which might arise by
reason of any payment under such policy or by reason of any act or omission of
PCI, its partners, principals, members, officers, employees, agents and
contractors.

     8.2      PCI’s Insurance. With respect to insurance maintained by
PCI:

                (a)      PCI shall maintain, as the minimum coverage required of it by this
Agreement, fire and property damage insurance in so-called “fire and extended
coverage” form insuring Novavax (and such others as Novavax may designate)
against loss from physical damage to the Property, and shall provide coverage
for physical damage to the Building so insured for up to the entire full actual
replacement cost thereof. PCI shall not be required to cause such insurance to
cover any of Novavax’s personal property, Novavax’s FF&E, inventory, products,
finished products, raw materials, components and trade fixtures, or any
modifications, alternations or improvements made or constructed by Novavax to
or within the Area, including the Improvements.

     8.3      Certificate of Insurance. Prior to the time Novavax or any of its
contractors enters the Area, each Party shall deliver to the other Party, with
respect to each policy of insurance required to be carried by it pursuant to
this Article, a copy of such policy (appropriately authenticated by the insurer
as having been issued, premium paid) or a certificate of the insurer certifying
in form satisfactory to the other Party that a policy has been issued, premium
paid, providing the coverage required by this Paragraph and containing the
provisions specified herein. With respect to each renewal or replacement of
any such insurance, the requirements of this Paragraph mush be complied with
not less than thirty (30) days prior to the expiration or cancellation of the
policies being renewed or replaced.

     8.4      Mutual Waiver of Subrogation. PCI hereby releases Novavax, and
Novavax hereby releases PCI and their respective partners, principals, members,
officers, agents, employees and servants, from any and all liability for loss,
damage or injury to the property of the other in or about the Area or the
Property which is caused by or results from a peril or event or happening which
is covered by insurance actually carried and in force at the time of the loss
by the party sustaining such loss; provided, however, that such waiver shall be
effective only to the extent permitted by the insurance covering such loss and
to the extent such insurance is not prejudiced thereby.

ARTICLE 9

DAMAGE TO AREA

     9.1      Novavax’s Duty to Restore. If the Area is damaged by any peril after
the Effective Date of this Agreement, Novavax shall restore the same within a
commercially reasonable timeframe. Novavax shall commence and diligently
prosecute to completion the restoration of the Area to either (i) substantially
the same condition as the Area existed prior to the construction set forth in
Section 2.3 above, or (ii) to substantially the same condition in which it
existed as of the date production in the Area began at Novavax’s election.
Notwithstanding the foregoing, nothing set forth in this Section 9.1 shall in
any way affect Novavax’s obligations, and/or liability under Article 3 above.

7

 

ARTICLE 10

DEFAULT, REMEDIES AND TERMINATION

     10.1    Events of Default. Novavax shall be in default of its obligations
under this Agreement upon the occurrence of any of the following:

                (a)      If
Novavax shall fail to pay when due any sum required to be paid
hereunder by Novavax and such failure shall continue for fifteen (15) days
after written notice thereof by PCI; or

                (b)      If
 Novavax shall fail to perform any term, covenant or condition of
this Agreement other than an obligation to pay money, and such failure shall
continue for thirty (30) days after written notice from PCI to Novavax
specifying the nature of such failure and requesting Novavax to perform same
(provided that, if longer than thirty (30) days is reasonably required in order
to perform such term, covenant or condition, Novavax shall have such longer
period); or

                (c)      If
 Novavax shall make a general assignment or general arrangement for
the benefit of creditors, if a petition for adjudication of bankruptcy or for
reorganization is filed by or against Novavax and is not dismissed within
ninety (90) days, if a trustee or receiver is appointed to take possession of
substantially all of Novavax’s assets located at the Property or of Novavax’s
interest in this Agreement and possession is not restored to Novavax within
ninety (90) days, or if substantially all of Novavax’s assets located at the
Property or of Novavax’s interest in this Agreement is subjected to attachment,
execution or other judicial seizure which is not discharged within ninety (90)
days.

     10.2    PCI’s Remedies. In the event of any default by Novavax, PCI may, at
PCI’s election, terminate this Agreement by giving Novavax written notice of
termination, in which event this Agreement shall terminate on the date set
forth for termination in such notice. Any termination under this subsection
shall not relieve Novavax from its obligation to pay to PCI all Base Monthly
Fees then due, or to become due under this Agreement, or any other sums due to
PCI, or from any claim against Novavax for damages previously accrued or then
or thereafter accruing. Upon delivery of such notice of termination, Novavax’s
obligations under Article 3 shall be accelerated and shall become due and
payable in full within thirty (30) days of the date of such notice.

     10.3    PCI’s Default. PCI shall be in default of its obligations under this
Agreement if PCI fails to perform any term, covenant or condition of this
Agreement within thirty (30) days after written notice from Novavax to PCI
specifying the nature of such failure and requesting PCI to perform same
(provided that, if longer than thirty (30) days is reasonably required in order
to perform such term, covenant or condition, PCI shall have such longer
period).

     10.4    Novavax’s Remedies. In the event of PCI’s default, Novavax may
proceed in equity or at law to compel PCI to perform its obligations, to
terminate this Agreement and/or to recover damages proximately caused by such
failure to perform (except as and to the extent Novavax has waived its right to
damages as provided in this Agreement and except that in no event shall PCI be
liable to Novavax for any special, indirect or consequential loss, damage,

8

 

costs or expenses of any nature whatsoever, including, without limitation, lost
revenues or profits).

     10.5    Termination of Supply Agreement. Notwithstanding Section 2.2 hereof,
this Agreement shall terminate effective upon the termination of the Supply
Agreement.

ARTICLE 11

ASSIGNMENT

     11.1    Assignment and Subletting. Novavax shall not assign this Agreement
or sublet the Area without the express written consent of PCI, provided,
however, that Novavax may without consent, assign its interest in this
Agreement to a direct or indirect parent or subsidiary of Novavax; to a party
controlling, controlled by or under common control with Novavax; to any party
with whom Novavax may merge or consolidate; or to any party acquiring all or
substantially all of the assets of Novavax.

ARTICLE 12

GENERAL PROVISIONS

     12.1    Taxes. PCI shall pay before delinquency any and all real property
taxes, assessments, license fees, use fees, permit fees and public charges of
whatever nature or description levied, assessed or imposed by a governmental
agency arising out of, caused by reason of or based upon Novavax’s estate in
this Agreement or improvements made by Novavax to the Area. If any such taxes,
assessments, fees or public charges are levied against Novavax, Novavax shall
have the right to require PCI to pay such taxes.

     12.2    Force Majeure. The obligations of each of the parties under this
Agreement (other than the obligations to pay money) shall be temporarily
excused if such party is prevented or delayed in performing such obligations by
reason of any strikes, lockouts or labor disputes; government restrictions,
regulations, controls, action or inaction; civil commotion; or extraordinary
weather, fire or other acts of God.

     12.3    Notices. Any notice required or desired to be given by a party
regarding this Agreement shall be in writing and shall be personally served, or
in lieu of personal service may be given by reputable overnight courier
service, postage prepaid, addressed to the other party as follows:

	 	 	 
	     If to PCI:	 	
Packaging Coordinators, Inc.
	 	 	
3001 Red Lion Road
	 	 	
Philadelphia, Pennsylvania
	 	 	
Attention: President
	 
	     with a copy to:	 	
Cardinal Health, Inc.
	 	 	
7000 Cardinal Place
	 	 	
Dublin, Ohio 43017
	 	 	
Attention: General Counsel

9

 

	 	 	 
	     If to Novavax:	 	
Novavax Inc.
	 	 	
8320 Guilford Road
	 	 	
Suite C
	 	 	
Columbia, MD 21046
	 	 	
Attention: Dennis W. Genge
	 
	     with a copy to:	 	
White & McDermott, P.C.
	 	 	
65 William Street
	 	 	
Wellesley, MA 02481
	 	 	
Attention: David A. White

Any notice given in accordance with the foregoing shall be deemed received upon
actual receipt or refusal to accept delivery.

     12.4    General Waivers. One party’s consent to or approval of any act by
the other party requiring the first party’s consent or approval shall not be
deemed to waive or render unnecessary the first party’s consent to or approval
of any subsequent similar act by the other party. No waiver of any provision
hereof, or any waiver of any breach of any provision hereof, shall be effective
unless in writing and signed by the waiving party. The receipt by PCI of any
Base Monthly Fee or payment with or without knowledge of the breach of any
other provision hereof shall not be deemed a waiver of any such breach. No
delay or omission in the exercise of any right or remedy accruing to either
party upon any breach by the other party under this Agreement shall impair such
right or remedy or be construed as a waiver of any such breach theretofore or
thereafter occurring. The waiver by either party of any breach of any
provision of this Agreement shall not be deemed to be a waiver of any
subsequent breach of the same or any other provisions herein contained.

     12.5    Holding Over. This Agreement shall terminate without further notice
on the date set forth in Section 2.2. Any holding over by Novavax after such
date shall neither constitute a renewal nor extension of this Agreement nor
give Novavax any rights in or to the Area except as expressly provided in this
Paragraph. Any such holding over to which PCI has consented shall be construed
to be a tenancy from month to month, on the same terms and conditions herein
specified insofar as applicable except that the Base Monthly Fee charged to
Novavax shall be one hundred twenty-five percent (125%) of the Base Monthly Fee
under this Agreement; provided, however, that the Base Monthly Fee shall not
increase in the event Novavax is engaged in good faith negotiations to extend
the terms of this Agreement.

     12.6    Miscellaneous. Should any provisions of this Agreement prove to be
invalid or illegal, such invalidity or illegality shall in no way affect,
impair or invalidate any other provisions hereof, and such remaining provisions
shall remain in full force and effect. Any copy of this Agreement which is
executed by the parties shall be deemed an original for all purposes. This
Agreement shall, subject to the provisions regarding assignment, apply to and
bind the respective successors, and assigns of PCI and Novavax. The term
“party” shall mean PCI or Novavax as the context implies. This Agreement shall
be construed and enforced in accordance with the Laws of the Commonwealth of
Pennsylvania. The captions in this Agreement are for convenience only and
shall not be construed in the construction or interpretation of any provision
hereof. When the context of this Agreement requires, the neuter gender
includes the masculine, the feminine, a partnership, corporation, limited
liability company, joint venture or other form of

10

 

business entity, and the singular includes the plural. The terms “must,”
“shall,” “will,” and “agree” are mandatory. The term “may” is permissive.
When a party is required to do something by this Agreement, it shall do so at
its sole cost and expense without right of reimbursement from the other party
unless specific provision is made therefor. The rule of construction that a
document is to be construed against the drafting party shall not be employed in
the construction or interpretation of this Agreement.

     12.7    Entire Agreement. This Agreement and the Exhibits (as described in
Article 1), which Exhibits are by this reference incorporated herein,
constitute the entire agreement between the parties, and there are no other
agreements, understandings or representations between the parties relating to
the reservation of the Area, except as expressed herein.

     In Witness Whereof, PCI and Novavax have executed this Agreement as of the
respective dates below set forth with the intent to be legally bound thereby as
of the Effective Date of this Agreement first above set forth.

	 	 	 
	 	PACKAGING COORDINATORS, INC.

	 	 	 
	 	By:	 
	 	 	

	 	 	 
	 	Title:	 
	 	 	

	 	 	 
	 	Dated:	 
	 	 	

	 	 	 
	 	NOVAVAX INC.

	 	 	 
	 	By:	 
	 	 	

	 	 	 
	 	Title:	 
	 	 	

	 	 	 
	 	Dated:	 
	 	 	

11

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