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                                                                    EXHIBIT 10.1

                                                                 CONFIDENTIAL

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                                    AGREEMENT

                                       FOR

                                PURCHASE AND SALE

                              OF ASSETS RELATING TO

                              AVC(TM) PRODUCT LINE

                                 BY AND BETWEEN

                                  NOVAVAX, INC.

                                       AND

                           KING PHARMACEUTICALS, INC.

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                                TABLE OF CONTENTS

<TABLE>
<S>                                                                                         <C>
ARTICLE 1 CONVEYANCE OF ASSETS; OTHER AGREEMENTS.............................................1
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   1.01   ASSETS TO BE CONVEYED..............................................................1
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   1.02   PURCHASE PRICE.....................................................................2
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   1.03   PAYMENT............................................................................2
          -------
   1.04   EXISTING INVENTORY OF PRODUCTS.....................................................2
          ------------------------------
   1.05   CLOSING............................................................................2
          -------
   1.06   DELIVERY OF DOCUMENTS..............................................................3
          ---------------------
   1.07   CONVEYANCE OF ASSETS AND INVENTORY.................................................3
          ----------------------------------
   1.08   SCOPE OF NOVAVAX'S RIGHTS..........................................................3
          -------------------------
   1.09   SUPPLY AGREEMENT...................................................................5
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   1.10   TAXES..............................................................................5
          -----
   1.11   ASSUMED LIABILITIES................................................................5
          -------------------
   1.12   ACCESS TO INFORMATION..............................................................6
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ARTICLE 2 ACCOUNTS RECEIVABLE AND RETURNED GOODS.............................................6
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   2.01   PRE-CLOSING ACCOUNTS RECEIVABLE....................................................6
          -------------------------------
   2.02   POST-CLOSING ACCOUNTS RECEIVABLE...................................................6
          --------------------------------
   2.03   RETURNED GOODS.....................................................................7
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   2.04   CONTINGENT PAYMENT.................................................................7
   ----   ------------------
ARTICLE 3 REGULATORY MATTERS.................................................................7
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   3.01   FILINGS WITH FDA REGARDING TRANSFER OF NDAS........................................8
          -------------------------------------------
   3.02   RESPONSIBILITY FOR THE PRODUCTS....................................................8
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   3.03   FDA ANNUAL REPORTS AND ADVERSE EVENT REPORT........................................9
          -------------------------------------------
   3.04    REGULATORY AND MEDICAL AFFAIRS....................................................9
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   3.05   REBATES FOR AMOUNTS PAID UNDER GOVERNMENT PROGRAMS.................................9
          --------------------------------------------------
   3.06   NON-TERRITORY NEW DRUG APPLICATIONS AND SALES......................................9
                       --------------------------------
ARTICLE 4 REPRESENTATIONS AND WARRANTIES....................................................10
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   4.01   REPRESENTATIONS AND WARRANTIES OF KING............................................10
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   4.02   REPRESENTATIONS AND WARRANTIES OF NOVAVAX.........................................13
          -----------------------------------------
   4.03   SURVIVAL OF REPRESENTATIONS AND WARRANTIES........................................14
          ------------------------------------------
   4.04   CERTAIN LIMITATIONS...............................................................14
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ARTICLE 5 INDEMNIFICATION...................................................................15
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   5.01   INDEMNIFICATION BY KING...........................................................15
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   5.02   INDEMNIFICATION BY NOVAVAX........................................................16
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   5.03   PAYMENTS..........................................................................16
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   5.04   CONDUCT OF LITIGATION.............................................................17
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ARTICLE 6 MISCELLANEOUS.....................................................................17
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   6.01   ENTIRE AGREEMENT..................................................................18
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   6.02   COUNTERPARTS......................................................................18
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   6.03   BROKERAGE AND OTHER COMMISSIONS...................................................18
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   6.04   NOTICES...........................................................................18
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   6.05   ASSIGNMENT........................................................................19
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</TABLE>

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<TABLE>
<S>                                                                                         <C>
   6.06   GOVERNING LAW.....................................................................19
          -------------
   6.07   HEADINGS..........................................................................19
          --------
   6.08   EXPENSES..........................................................................20
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   6.09   SUCCESSORS AND ASSIGNS............................................................20
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   6.10   AGREEMENT TO TAKE NECESSARY AND DESIRABLE ACTIONS.................................20
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   6.11   NO IMPLIED WAIVER.................................................................20
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   6.12   FORCE MAJEURE.....................................................................20
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   6.13   CONFIDENTIALITY...................................................................20
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   6.14   RELATIONSHIP......................................................................20
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   6.15   SEVERABILITY......................................................................21
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   6.16   PRESS RELEASE.....................................................................21
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   6.17   AFFILIATES........................................................................21
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   6.18   WAIVER OF BULK SALES..............................................................21
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   6.19   EXHIBITS AND SCHEDULES............................................................21
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   6.20   INTERPRETATION....................................................................21
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</TABLE>

SCHEDULES
Schedule 1            List of Products
Schedule 1.01(a)      Tradenames
Schedule 1.01(b)      Description of Know-How
Schedule 1.01(c)      Regulatory Approvals and Filings
Schedule 1.03         Wiring Instructions to King Pharmaceuticals, Inc.
Schedule 1.04         Inventory and Expiration Dates
Schedule 1.07         Liens, Claims, Charges, Encumbrances and Restrictions on
                      the Assets and the Inventory
Schedule 4.01(k)      Form 483s, Warning Letters, Etc.
Schedule 4.01(n)      Suppliers

EXHIBITS

Exhibit A - Bill of Sale

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                                    AGREEMENT

        THIS AGREEMENT, is dated and entered into as of January 8, 2001 (this
"Agreement"), between NOVAVAX, INC., a corporation organized and existing under
the laws of the State of Delaware, having a principal place of business at 8320
Guilford Road, Columbia MD 21046 ("NOVAVAX") and KING PHARMACEUTICALS, INC., a
corporation organized and existing under the laws of the State of Tennessee,
having a principal place of business at 501 Fifth Street, Bristol, Tennessee
37620 ("KING").

                              W I T N E S S E T H:

        WHEREAS, KING desires to sell to NOVAVAX, and NOVAVAX desires to
purchase from KING, certain assets relating to KING's pharmaceutical products in
the Territory (as hereinafter defined) marketed under the tradename AVC(TM)
listed on Schedule 1 attached hereto (collectively, the "Product" or
"Products"), on the terms and subject to the conditions hereinafter set forth;

        NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth and other good and valuable consideration, the receipt and
legal sufficiency of which are hereby mutually acknowledged, KING and NOVAVAX
hereby covenant, contract, and agree as follows:

                                   ARTICLE 1

                     CONVEYANCE OF ASSETS; OTHER AGREEMENTS

        1.01   ASSETS TO BE CONVEYED.

        On the Closing Date (as defined below), and subject to the terms and
conditions of this Agreement (including, without limitation, the provisions of
Section 1.08 hereof), KING will sell, assign, convey, transfer, and deliver to
NOVAVAX, and NOVAVAX will purchase and accept from KING, the following:

        (a)    All of KING's right, title, and interest in the United States of
America, its territories and possessions (the "Territory"), in and to the
tradename set forth on Schedule 1.01(a) attached hereto (the "Tradename"),
together with the goodwill of the business symbolized by the Tradename in the
Territory;

        (b)    The know-how set forth on Schedule 1.01(b) attached hereto
relating to the production, manufacturing, packaging, release, validation, and
stability of the Products for use by NOVAVAX in the Territory (the "Know-How");

        (c)    Subject to the provisions of Section 3.06 hereof, all of KING's
right, title, and interest in the Territory in and to the new drug application
for the Product set forth on Schedule 1.01(c) attached hereto (the "NDA"),
including supplements, records, and reports that are required to be kept under
21 C.F.R. Section 314.81 (or under any comparable regulation applicable to an
abbreviated antibiotic drug application), whether issued or pending together
with

<PAGE>   5

correspondence to or from the United States Food and Drug Administration (the
"FDA") which relates exclusively to the Product; and

        (d)    The tradedress, if any, associated with the Products in the
Territory, excluding any corporate or division name of KING or any of its
Affiliates (as defined below), any logo of KING or its Affiliates, and any
tradename (other than the Tradename) of KING or any of its Affiliates (the
"Tradedress").

               All of the assets described in Sections 1.01(a) - (d) are
hereinafter sometimes referred to collectively as the "Assets."

        1.02   PURCHASE PRICE.

        The purchase price for the Assets (the "Purchase Price") shall be Three
Million Three Hundred Thirty-Two Thousand Dollars ($3,332,000).

        1.03   PAYMENT.

        The Purchase Price shall be paid to KING by NOVAVAX by wire transfer of
immediately available funds to the account specified in Schedule 1.03 attached
hereto at the Closing (as defined below).

        1.04   EXISTING INVENTORY OF PRODUCTS.

        On the Closing Date, KING will sell, assign, convey, and transfer to
NOVAVAX, and NOVAVAX will purchase and accept from KING, all of KING's finished
goods inventory of the Products with expiration dates more than nine (9) months
from the Closing Date, as set forth on Schedule 1.04 attached hereto (the
"Inventory"). The purchase price for the Inventory shall be equal to the book
value of the Inventory as of the Closing Date, as reflected on KING's books and
records, and shall be paid by NOVAVAX to KING ten (10) days after the Closing by
wire transfer of immediately available funds to the account specified in
Schedule 1.03. KING will complete shipping of the Inventory within ten (10)
business days after the Closing Date. All Inventory will be shipped at NOVAVAX's
expense to NOVAVAX's facilities in Maryland Heights, Missouri or such other
locations as the parties may mutually agree via a carrier designated by NOVAVAX.
KING shall bear the risk of loss to the Inventory until the Inventory has been
delivered to the carrier designated by NOVAVAX. Thereafter NOVAVAX shall bear
the risk of loss to the Inventory. KING will provide to NOVAVAX within ten (10)
days of shipment of the Inventory, KING's standard certificate of analysis for
each batch of Product shipped.

        1.05   CLOSING.

        The closing of the transactions provided for in this Agreement (the
"Closing") shall take place on January 8, 2001, or on such other date as KING
and NOVAVAX may agree in writing (the "Closing Date"), at the offices of Hogan &
Hartson L.L.P., 8300 Greensboro Drive, Suite 1100, McLean, Virginia 22102.

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        1.06   DELIVERY OF DOCUMENTS.

        (a)    Subject to the terms and conditions of this Agreement, KING will
deliver to NOVAVAX at the Closing (unless otherwise specified):

               (i)    An executed irrevocable bill of sale in the form of
Exhibit A hereto (the "Bill of Sale");

               (ii)   Copies of the materials comprising the Know-How described
on Schedule 1.01(b), all in accordance with a time frame and in a manner
reasonably acceptable to the parties, but in no event later than thirty (30)
business days after the Closing Date;

               (iv)   A complete copy of the NDA and other materials described
in Section 1.01(c), all in accordance with a time frame and in a manner
reasonably acceptable to the parties, but in no event later than thirty (30)
business days after the Closing Date;

               (v)    A copy of the information required by the FDA pursuant to
21 C.F.R. Section 314.72 to effect transfer of the NDA from KING to NOVAVAX;

               (vi)   An executed copy of the Supply Agreement (as defined
below); and

               (vii)  A copy of the FDA Annual Reports and Adverse Event Report
(both as defined below).

        (b)    Subject to the terms and conditions of this Agreement, NOVAVAX
will deliver to KING at the Closing:

               (i)    The Purchase Price; and

               (ii)   A copy of the information required by the FDA pursuant to
21 C.F.R. Section 314.72 to effect transfer of the NDA from KING to NOVAVAX.

        1.07   CONVEYANCE OF ASSETS AND INVENTORY.

        KING agrees to transfer and convey the Assets and the Inventory to
NOVAVAX free and clear of all liens, claims, charges, encumbrances, or
restrictions, except as specifically described on Schedule 1.07 attached hereto.

        1.08   SCOPE OF NOVAVAX'S RIGHTS.

        (a)    NOVAVAX hereby acknowledges and agrees that, notwithstanding
anything to the contrary set forth in this Agreement: (i) KING shall at all
times be permitted to, and shall retain all know-how and other rights necessary
to enable KING to, manufacture and market in and outside the Territory, and sell
and distribute outside the Territory, the Products and any one or more
pharmaceutical products that are equivalent or substantially equivalent to the
Products; (ii) KING shall retain all know-how and rights necessary for KING to
manufacture, market, sell and distribute all pharmaceutical products other than
the Products; (iii) KING and its Affiliates

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shall at all times be permitted to, and shall retain all know-how and other
rights necessary to enable KING to, ship, deliver and distribute the Products to
other parties within the Territory for purposes of having such other parties
distribute the Products outside the Territory; (iv) neither NOVAVAX nor its
Affiliates shall interfere with, or have the right to prohibit, the development,
manufacture, sale, or distribution of the Products outside the Territory; (v)
NOVAVAX will acquire no right, title, or interest whatsoever in any property or
assets of KING or any of KING's Affiliates except as expressly set forth in this
Agreement, including no right, title, or interest to any property or assets
outside the Territory; (vi) neither NOVAVAX nor its Affiliates shall use or
disclose the Know-How outside of the Territory; (vii) neither NOVAVAX nor its
Affiliates shall manufacture, market, distribute, or sell any of the Products
outside of the Territory or knowingly cause the Products to be manufactured,
marketed, distributed, or sold outside the Territory; and (viii) neither NOVAVAX
nor its Affiliates shall market, distribute or sell any of the Products inside
the Territory to any person or entity which it knows or has any reason to
suspect will market, sell or distribute the Product outside the Territory.

        (b)    NOVAVAX acknowledges and agrees that KING and its Affiliates
shall be entitled to use the Tradename and the Know-How after Closing to the
extent necessary to fulfill KING's obligations hereunder, under the Supply
Agreement, under applicable laws or regulations and in connection with the
exercise of the rights reserved by KING and its Affiliates described in Section
1.08(a).

        (c)    KING acknowledges and agrees that: (i) for a period of five (5)
years from the Closing Date, except as provided in the Supply Agreement and
except in connection with the exercise of the rights reserved by KING and its
Affiliates described in Section 1.08(a), KING shall not, and shall not permit
any of its Affiliates to, sell, produce, manufacture, market, or distribute in
the Territory any identical product ("Identical Products") or any Products; (ii)
other than for purposes of sales of Products or Identical Products outside the
Territory neither KING nor its Affiliates shall knowingly cause the Products or
any Identical Products to be manufactured, marketed, distributed, or sold inside
the Territory to any person or entity other than NOVAVAX or its Affiliates; and
(iii) other than for purposes of sales of Products or Identical Products outside
the Territory, KING agrees that neither KING nor its Affiliates shall use or
disclose the Know-How inside the Territory. This Section 1.08(c) shall not apply
to any products produced, sold, manufactured, marketed, or distributed by any
business (or any portion thereof), person, or group of persons, which is
acquired by, or which acquires, or which forms a merger with KING or any of its
Affiliates (whether through the formation of a new holding company or
otherwise), in a single transaction or a series of related transactions provided
that such business, person or group of persons sold, manufactured, marketed, or
distributed such products prior to such merger or acquisition.

        (d)    Nothing in this Section 1.08 shall prohibit (i) the provision by
KING or any of its Affiliates of assistance to the purchaser of any
manufacturing facility previously owned by KING or any of its Affiliates that is
of the type of assistance that is customarily provided by sellers of
manufacturing facilities to purchasers of such facilities and that relates
solely to manufacturing; or (ii) the manufacture by KING or any of its
Affiliates of any Identical Products in the Territory for sale or distribution
outside the Territory.

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        (e)    The parties acknowledge that the Inventory purchased under this
Agreement and the Products to be supplied under the Supply Agreement may contain
packaging and labeling with the names, logos, and trademarks of KING and its
Affiliates (the "KING Packaging Materials"). NOVAVAX may distribute such
Inventory and Products with the KING Packaging Materials; however, NOVAVAX shall
not, and shall have no right to, use such names, logos, or tradenames for any
other purpose and NOVAVAX shall acquire no right, title, or interest in or to
such names, logos, and tradenames.

        (f)    Notwithstanding Section 1.08(e) above, (i) NOVAVAX shall use
commercially reasonable efforts to make all necessary arrangements as soon as
possible so that NOVAVAX will ship all Products (other than the Inventory)
without the use of any KING Packaging Materials, including obtaining all
necessary packaging and labeling materials to do so and related regulatory
approvals and, in any event, by March 31, 2001, NOVAVAX shall distribute all
such Products without the use of any KING Packaging Materials, (ii) if any
changes of packaging and labeling described in this subsection (f) render
obsolete or unusable any packaging or labeling materials or components acquired
by KING for the Products, then NOVAVAX shall purchase from KING at KING's
Acquisition Cost (as defined in the Supply Agreement) all such packaging and
labeling materials or components rendered obsolete or unusable, and (iii)
NOVAVAX will purchase, at its expense, all tooling and/or equipment necessary to
package and label the Products without KING Packaging Materials as contemplated
by this subsection (f), except the tools, dies, molds, and the like used
exclusively in the manufacture of the Products, if any, referenced in Section
1.11 of this Agreement.

        1.09   SUPPLY AGREEMENT.

        Contemporaneously with the execution of this Agreement, KING and NOVAVAX
are entering into a supply agreement (the "Supply Agreement") under which KING
agrees to supply, and NOVAVAX agrees to purchase, the AVC(TM) Cream Product
referenced on Schedule 1 at a purchase price equal to 110% of KING's Cost of
Product (as defined in the Supply Agreement), and on the additional terms and
conditions more specifically described therein, and which provides for certain
other matters. The Supply Agreement shall not govern the AVC(TM) Suppositories
referenced on Schedule 1, which may be manufactured and supplied for NOVAVAX by
R.P. Scherer or another third party.

        1.10   TAXES.

        NOVAVAX shall be responsible for and shall promptly pay all federal,
state, and local transfer, sales, and other taxes, if any, levied or imposed as
a result of the transactions contemplated by this Agreement, excluding any tax
payable on any income or gain of KING.

        1.11   ASSUMED LIABILITIES.

        NOVAVAX shall not assume or become liable for any obligation or
liability of KING pertaining to the Assets or the Products, of any nature
whatsoever, fixed or contingent, that arose prior to the Closing Date, including
without limitation any undisclosed liabilities, any obligations pursuant to
product warranties or product liabilities arising from Products manufactured or

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shipped prior to the Closing, and any tax liabilities arising from the conduct
of business of KING prior to the Closing or imposed upon KING as a result of the
transfer of Assets hereunder.

        1.12   ACCESS TO INFORMATION.

        For a period of four (4) years after the Closing, KING agrees to
cooperate with NOVAVAX and to grant to NOVAVAX and its employees, attorneys,
accountants, officers, representatives, and agents, during normal business hours
and upon ten (10) days' advance notice, reasonable access to KING's management
personnel and to the records relating to the Products (including, without
limitation, the NDA) and to permit copying at NOVAVAX's expense of documents
relating to the Assets for the purposes of (i) any financial reporting or tax
matters (including, without limitation, any financial and tax audits, tax
contests, tax examination, preparation of any NOVAVAX tax returns or financial
records) relating to the Products; (ii) any claims or litigation involving
NOVAVAX and the Assets relating to the Products; (iii) any investigation of
NOVAVAX being conducted by any federal, state, or local governmental authority
relating to the Products; (iv) any matter relating to any indemnification or
representation or warranty or any other term of this Agreement; or (v) any
similar or related matter. KING shall maintain all such records and documents in
the United States and shall not destroy or dispose of any such records and
documents without the prior written consent of NOVAVAX. NOVAVAX shall use its
reasonable efforts to ensure that its access to and requests for records and
documents pursuant to this Section are conducted so as not to interfere with the
normal and ordinary operation of KING's business. NOVAVAX acknowledges that the
records and documents made available to NOVAVAX by KING shall be governed by the
Disclosure Agreement (as defined in Section 6.13 hereto).

                                    ARTICLE 2

                     ACCOUNTS RECEIVABLE AND RETURNED GOODS

        2.01   PRE-CLOSING ACCOUNTS RECEIVABLE.

        KING and NOVAVAX agree that any accounts receivable or invoices arising
out of sales of the Products by or on behalf of KING on or prior to 11:59 p.m.
(E.S.T.) on the Closing Date shall inure to the benefit of KING.

        2.02   POST-CLOSING ACCOUNTS RECEIVABLE.

        NOVAVAX and KING agree that any accounts receivable or invoices arising
out of sales of the Products by or on behalf of NOVAVAX after 11:59 p.m.
(E.S.T.) on the Closing Date shall inure to the benefit of NOVAVAX. Without
derogating from the foregoing, KING agrees that it shall continue to take orders
for the Products for ninety (90) days following the Closing Date. Such orders
shall be reported by KING to NOVAVAX promptly after receipt and in no event more
than two (2) business days after such orders are received. KING and NOVAVAX
agree to determine promptly after the Closing a mutually agreeable reporting
procedure to communicate the information required by this Section 2.02.

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        2.03   RETURNED GOODS.

        Except as otherwise expressly set forth below and subject to NOVAVAX's
timely compliance with its obligations set forth in this Section 2.03, KING and
NOVAVAX agree that during the six (6) month period immediately following the
Closing Date, KING shall be responsible for handling returns of all Products
that were sold by KING prior to the Closing Date and that are returned by
customers for credit for other KING products after the Closing Date. KING shall
handle such returns during such period in accordance with its then applicable
returned goods policy. NOVAVAX agrees to provide KING with any information
reasonably requested by KING from time to time regarding NOVAVAX's selling
prices for the Products in order to assist KING in its determination of the
reimbursement prices for returned Products. Such information shall be provided
by NOVAVAX to KING promptly, and in any event within ten (10) days after KING's
written request therefor. In the event that during such six (6) month period any
returns are delivered to NOVAVAX, such returns shall be shipped by NOVAVAX to
KING and KING shall reimburse NOVAVAX for the shipping costs incurred.

        2.04   CONTINGENT PAYMENT.

        Two Million Dollars ($2,000,000) of the Purchase Price shall be received
by KING as contingent payment (the "Contingent Payment") pending confirmation of
aggregate, consolidated Net Sales (as defined below) of the Products in each of
the calendar years 2001 through 2004 totaling not less than Eight Hundred Fifty
Thousand Dollars ($850,000) per calendar year (for each of the relevant calendar
years, the "Sales Target"), and such Contingent Payment shall be subject to pro
rata reduction for Net Sales of Products below the Sales Target for each of the
relevant calendar years. Notwithstanding the foregoing, the full Purchase Price,
including the Contingent Payment, shall be retained by KING with no refund of
the Contingent Payment if NOVAVAX fails to use commercially reasonable efforts
to promote and sell the Products. If the immediately preceding sentence does not
apply, then KING shall pay to NOVAVAX, within thirty (30) days after receiving
from NOVAVAX's chief financial officer a certificate as to the aforesaid Net
Sales during the applicable calendar years, a payment in the amount of
twenty-five percent (25%) of the Contingent Payment if the Sales Target for a
particular calendar year is not achieved, or such portion of such twenty-five
percent (25%) of the Contingent Payment as shall reflect a pro rata reduction
for consolidated Net Sales of Products during each of the relevant calendar
years of less than the Sales Target for such calendar year. For purposes of this
Agreement, Net Sales shall mean all gross revenue actually received by a party
from sales of the Products, less (a) credits for refunds and returns, including
returns for stock balancing purposes, (b) sales, use and similar taxes billed by
such party to its customers and required to be paid to the appropriate taxing
authorities by such party; (c) discounts, allowances and commissions paid or
allowed by a party on sales of the Products, and (d) amounts paid by such party
and billed through to such party's customers for insurance, shipping and similar
charges.

                                    ARTICLE 3

                               REGULATORY MATTERS

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        3.01   FILINGS WITH FDA REGARDING TRANSFER OF NDAS.

        At the Closing, the parties shall file with the FDA the information
required pursuant to 21 C.F.R. Section 314.72, or any successor regulation
thereto, regarding the transfer of the NDAs from KING to NOVAVAX. KING shall
file the information required of a former owner, and NOVAVAX shall file the
information required of a new owner. The parties also agree to use their
reasonable best efforts to take any and all other actions required by the FDA,
or other necessary governmental agencies, if any, to effect the transfer of the
NDA from KING to NOVAVAX. KING may retain an archival copy of the NDA, including
supplements and records that are required to be kept under 21 C.F.R. Section
314.81, and KING shall treat such archived copies as Confidential Information
(as defined in the Supply Agreement) of NOVAVAX and disclosure of such
information shall be governed by the Supply Agreement.

        3.02   RESPONSIBILITY FOR THE PRODUCTS.

        (a)    After the Closing and in the Territory, NOVAVAX shall assume all
regulatory responsibilities permitted by applicable laws and regulations to be
assumed by NOVAVAX, reporting and otherwise, in connection with the Products and
the NDA including, but not limited to, responsibility for reporting any adverse
drug experiences in connection with the Products, and responsibility for
compliance with all laws and regulations, including the Prescription Drug
Marketing Act of 1987, as the same may be amended from time to time.

        (b)    NOVAVAX and its Affiliates agree promptly to submit to KING all
adverse drug experience information or customer complaints brought to the
attention of NOVAVAX or its Affiliates in respect of the Products, as well as
any material events and matters concerning or affecting the safety or efficacy
of the Products. KING and its Affiliates agree promptly to submit to NOVAVAX all
adverse drug experience information or customer complaints brought to the
attention of KING or its Affiliates in respect of the Products, as well as any
material events and matters concerning or affecting the safety or efficacy of
the Products. NOVAVAX and KING agree to determine promptly after Closing a
mutually agreeable reporting procedure to communicate the information required
by this Section 3.02(b).

         (c)   After the Closing, NOVAVAX shall assume all responsibility for
any and all FDA fee obligations for holders or owners of approved New Drug
Applications and approved, marketed prescription drug products relating to the
Products, including, but not limited to, those defined under the Prescription
Drug User Fee Act of 1992, as the same may be amended from time to time.

        (d)    Promptly after the Closing, NOVAVAX shall submit a "Changes Being
Effected in Thirty Days" filing ("CBE 30") with the FDA to request FDA
permission for KING to manufacture and distribute the Products at its facility
in Bristol, Tennessee, or at the facility of one of its Affiliates. KING shall
provide NOVAVAX with all information necessary to submit such CBE 30.

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        (e)    Promptly after the Closing, NOVAVAX shall take all actions
necessary or required under applicable laws, rules, and regulations, to reflect
that the Assets are owned by NOVAVAX and that NOVAVAX has responsibility
therefor.

        (f)    After the Closing, KING shall direct all complaints or inquiries
concerning the Products in the Territory to NOVAVAX to the attention of Medical
Affairs Department, at facsimile number (301) 854-3902.

        3.03   FDA ANNUAL REPORTS AND ADVERSE EVENT REPORT.

        At the Closing, KING shall provide NOVAVAX with (i) a copy of the annual
reports provided by KING to the FDA for the calendar years 1999 and 2000 (the
"FDA Annual Reports") and (ii) a report listing in reasonable detail any and all
adverse drug experiences and/or customer complaints brought to the attention of
KING or its Affiliates in respect of the Products during the twelve (12) month
period prior to the Closing Date, as well as any material events and matters
concerning or affecting the safety or efficacy of the Products known to KING or
its Affiliates prior to the Closing Date (the "Adverse Events Report").

        3.04   REGULATORY AND MEDICAL AFFAIRS.

        Upon the reasonable request of NOVAVAX, KING agrees to provide NOVAVAX
with services relating to medical and regulatory affairs concerning the
Products, at NOVAVAX's expense, for six (6) months following the Closing Date,
the cost and nature of which shall be mutually agreed upon by the parties.

        3.05   REBATES FOR AMOUNTS PAID UNDER GOVERNMENT PROGRAMS.

        NOVAVAX shall reimburse KING for all rebates KING is obligated to pay
pursuant to any government rebate program for amounts charged to KING's NDC
codes for the Products with respect to sales of the Products from one hundred
twenty (120) days after the Closing Date. All payments due under this Section
3.05 shall be made promptly to KING upon submission to NOVAVAX of invoices that
describe the requested payments in reasonable detail. NOVAVAX shall obtain new
NDC codes for the Products as soon as practicable after the Closing Date. In the
event NOVAVAX disputes an amount owed under a government rebate program, KING
shall provide to NOVAVAX copies of any documents and records evidencing original
rebate claims and any resubmissions of such claims and data relating to unit
rebate calculations in order to enable NOVAVAX to resolve such disputed amount.

        3.06   NON-TERRITORY NEW DRUG APPLICATIONS AND SALES.

        After the Closing, NOVAVAX agrees to cooperate with KING and permit KING
to use the NDA to the extent necessary, useful or helpful in support of (a) any
new drug applications or similar regulatory filings made by KING and/or its
Affiliates outside the Territory and (ii) and sales by KING and its Affiliates
of the Products outside the Territory.

                                    ARTICLE 4

                                        9
<PAGE>   13

                         REPRESENTATIONS AND WARRANTIES

        4.01   REPRESENTATIONS AND WARRANTIES OF KING.

        KING makes the following representations and warranties. The phrase "to
the knowledge of KING" or any substantially equivalent phrase, as used in this
Article 4, shall mean to the actual knowledge of officers and directors of KING
after reasonable inquiry.

        (a)    ORGANIZATION AND STANDING. KING is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Tennessee.

        (b)    POWER AND AUTHORITY. KING has all requisite corporate power and
authority to execute, deliver, and perform this Agreement and the other
agreements and instruments to be executed and delivered by it pursuant hereto
and to consummate the transactions contemplated herein and therein. The
execution, delivery, and performance of this Agreement and of the other
agreements and instruments to be executed and delivered by KING pursuant hereto
do not, and the consummation of the transactions contemplated hereby and thereby
and compliance with the terms, conditions and provisions hereof and thereof will
not, violate or conflict with any provisions of KING's Articles of
Incorporation, Bylaws, any law or regulation applicable to KING, or any
agreement, mortgage, lease, instrument, order, judgment, or decree to which KING
is a party or by which KING is bound or constitute a default thereunder or
result in the creation or acceleration of any lien, charge, security interest,
or other encumbrance of any nature whatsoever on the Assets.

        (c)    CORPORATE ACTION; BINDING EFFECT. KING has duly and properly
taken all action required by law, its Articles of Incorporation, its Bylaws, or
otherwise, to authorize the execution, delivery, and performance by it of this
Agreement, the Bill of Sale and the Supply Agreement (collectively, the Bill of
Sale and the Supply Agreement are referred to herein as the "Collateral
Agreements"), and the other instruments to be executed and delivered by it
pursuant hereto and the consummation of transactions contemplated hereby and
thereby. This Agreement has been duly executed and delivered by KING and
constitutes, and the Collateral Agreements and the other instruments
contemplated hereby and thereby when duly executed and delivered by KING will
constitute, legal, valid, and binding obligations of KING enforceable against it
in accordance with their respective terms, except as enforcement may be affected
by bankruptcy, insolvency, or other similar laws relating to or affecting
generally the enforcement of creditors' rights and by general principles of
equity.

        (d)    CONSENTS. No consent or approval of, or filing with or notice to,
any federal, state, or local governmental or regulatory authority, agency, or
department or any other person not a party to this Agreement is required or
necessary to be obtained by KING or on its behalf in connection with the
execution, delivery, and performance of this Agreement or the Collateral
Agreements or to consummate the transactions contemplated hereby or thereby,
except as contemplated by Section 3.01 hereof. No consent of any person who is a
party to a contract or other agreement with respect to the manufacturing and
sale of the Products is required to be obtained on the part of KING to
consummate the transactions contemplated by this Agreement or

                                       10
<PAGE>   14

the Collateral Agreements and to continue the manufacture and sale of the
Products as previously conducted by KING.

        (e)    OWNERSHIP OF ASSETS. KING is the owner of, and as such has full
right, title and interest in and to, the Assets described in Sections 1.01(a),
1.01(c), and 1.01(d) and, to KING's knowledge, the Assets described in Section
1.01(b), free and clear of all liens, claims, charges, or encumbrances, except
for liens for taxes not yet due and payable and except as described on Schedule
1.07 attached hereto.

        (f)    LITIGATION OR DISPUTES. Except as disclosed in Schedule 4.01(f)
attached hereto, there is no claim, outstanding commitment to any governmental
regulatory agency, action, suit, proceeding, investigation, or arbitration
pending or, to KING's knowledge, threatened against KING relating to the Assets
and, to KING's knowledge, no event has occurred nor does any condition exist on
the basis of which any such proceeding would reasonably be expected to be
instituted with any substantial chance of recovery, and KING is not in violation
of or in default with respect to any applicable law, rule, regulation, judgment,
order, writ, injunction, award, or decree of any arbitrator, court, or
administrative body, the result of any of which, either individually or
cumulatively, would have a materially adverse effect on the Assets in the
Territory or KING's compliance with and performance under the terms of this
Agreement or the Collateral Agreements.

        (g)    TRADENAMES; INTELLECTUAL PROPERTY. Schedule 1.01(a) attached
hereto is a true and correct list of all tradenames owned by KING and used by
KING in the manufacture, marketing, and sale of the Product in the Territory.
There are no registered trademarks used or held by KING for use in connection
with or otherwise necessary for the conduct of KING's business as now conducted
for the Products in the Territory. KING has good right to use the Know-How,
Tradenames and Tradedress in the Territory without infringing on the rights of
any third party. KING owns no patents necessary for the conduct of KING's
business as now conducted for the Products in the Territory. To KING's
knowledge, KING is not infringing on or violating in any material respect any
patent, trademark, service mark, tradename or copyright of any third party with
respect to the Assets, and KING has not received any notice of any claim that
any of the Assets infringe on any property rights of any other party. There is
no claim, action, suit, or proceeding, pending or, to KING's knowledge,
threatened alleging that the use by KING or its Affiliates of the Tradename,
Tradedress or the Know-How infringes any patents or other intellectual property
rights of third parties. KING has not executed or granted to any Affiliate or
any third party in the Territory any license, sublicense, or contract covering
the Know-How, the Tradedress or the Tradenames.

        (h)    COMPLIANCE WITH LAW AND NECESSARY PERMITS. KING has conducted its
operations in connection with the manufacture and sale of the Products in
material compliance with all applicable federal, state, and local laws and
regulations, including FDA regulations, and KING has not received written notice
of a violation or alleged violation of any such law or regulation. KING
possesses all material approvals, consents, licenses, and permits ("Necessary
Permits") required for the conduct of its business as now conducted for the
Products or as will be necessary to perform its obligations under the Supply
Agreement. All such Necessary Permits

                                       11
<PAGE>   15

possessed by KING are in full force and effect and (i) to KING's knowledge no
suspension or cancellation of any Necessary Permit is threatened (ii) there is
no reason to believe that on expiration any Necessary Permit will not be
renewed, and (iii) none of the Necessary Permits will be materially adversely
affected by the consummation of the transactions contemplated by this Agreement
and the Collateral Agreements.

        (i)    WARRANTY AND DISCLAIMER OF WARRANTIES. KING warrants that the
Inventory was manufactured in accordance with the applicable specifications for
the Products and in accordance with current good manufacturing practices in
effect at the time of manufacture. KING further warrants that the Inventory,
when delivered to NOVAVAX, will not be (i) adulterated or misbranded by KING
within the meaning of the United States Federal Food, Drug and Cosmetic Act, as
amended (the "FD&C Act") or (ii) an article that may not be introduced into
interstate commerce under the provisions of Sections 404 or 505 of the FD&C Act.
Set forth on Schedule 1.04 attached hereto is a list accurate in all material
respects of the expiration dates of the Inventory. WITH RESPECT TO THE
INVENTORY, KING MAKES NO OTHER WARRANTY, EXPRESS OR IMPLIED, AND SPECIFICALLY
MAKES NO WARRANTY OF MERCHANTABILITY OR WARRANTY OF FITNESS FOR ANY PARTICULAR
PURPOSE.

        (j)    RECALLS OR WITHDRAWALS. During the period commencing on January
1, 2000, and ending on the date hereof, there have been no: (i) Products which
have been recalled or withdrawn by KING or its Affiliates in the Territory
(whether voluntarily or otherwise) or (ii) proceedings in the Territory brought
against KING or its Affiliates (whether such proceedings have since been
completed or remain pending) seeking the recall, withdrawal, or seizure of any
of the Products or seeking to enjoin KING or any of its Affiliates from
distributing such Products.

        (k)    FACILITIES AND MANUFACTURING. Except as set forth on Schedule
4.01(k) attached hereto, and only to the extent it could have a material adverse
effect on the Assets or KING's performance hereunder or under any of the
Collateral Agreements, during the period commencing on January 1, 2000, and
ending on the date hereof, with respect only to the Products, neither KING nor
its Affiliates have received or been subject to: (i) any FDA Form 483's relative
to the Products; (ii) any FDA Notices of Adverse Findings relative to the
Products; or (iii) warning letters or other correspondence from the FDA or any
other governmental officials or agencies concerning the Products in which the
FDA or other such governmental officials or agencies asserted that or questioned
whether the operations of KING were not in compliance with applicable law,
regulations, rules, or guidelines.

        (l)    CONDUCT OF BUSINESS. Since January 1, 2000, KING has conducted
its business relating to the Products in the ordinary course of its business in
all material respects.

        (m)    ABSENCE OF UNDISCLOSED LIABILITIES. To KING's knowledge, KING has
no liabilities with respect to the Products or the Assets of any nature, whether
accrued, absolute, contingent or otherwise, asserted or unasserted, known or
unknown, that will become the obligation of NOVAVAX as a consequence of the
transactions contemplated by this Agreement

                                       12
<PAGE>   16

or the Collateral Agreements, except for liabilities contemplated by the terms
of this Agreement and the Collateral Agreements.

        (n)    SUPPLIERS. Schedule 4.01(n) lists all suppliers to which KING
made payments during calendar year 2000, or expects to make payments in relation
to the Products during calendar year 2001, in excess of $5,000. KING has no
information which might reasonably indicate that any of the suppliers listed on
Schedule 4.01(n) intend to cease selling to or dealing with KING or the
manufacturer of the Products, nor has any information been brought to KING's
attention which might reasonably lead it to believe any such supplier intends to
alter in any material respect the amount of such sales or the extent of dealings
in relation to the Products or would alter in any material respect such sales or
dealings in the event of the consummation of the transactions contemplated by
this Agreement or the Collateral Agreements; provided, however, that NOVAVAX
acknowledges and agrees that there currently exists no agreement for the
manufacture or packaging of the AVC(TM) Suppositories referenced on Schedule 1
and that there can be no assurances regarding the success or timeliness of the
filing of the CBE 30 or the FDA's response thereto, and that any inquiry or
request by the FDA related to the CBE 30 for the AVC(TM) Cream could cause a
delay or interruption of supply of the Products. Except as provided in the
immediately preceding sentence, KING has no information which might reasonably
indicate, nor has any information been brought to KING's attention which might
reasonably lead it to believe that any supplier will not be able to fulfill
outstanding or currently anticipated purchase orders placed by KING.

        4.02   REPRESENTATIONS AND WARRANTIES OF NOVAVAX.
        NOVAVAX represents and warrants to KING as follows:

        (a)    ORGANIZATION AND STANDING. NOVAVAX is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware.

        (b)    POWER AND AUTHORITY. NOVAVAX has all requisite corporate power
and authority to execute, deliver, and perform this Agreement, and the other
agreements and instruments to be executed and delivered by it pursuant hereto
and to consummate the transactions contemplated herein and therein. The
execution, delivery, and performance of this Agreement by NOVAVAX do not, and
the consummation of the transactions contemplated hereby will not, violate any
provision of NOVAVAX's Certificate of Incorporation, Bylaws, any law or
regulation applicable to NOVAVAX, or any agreement, mortgage, lease, instrument,
order, judgment, or decree to which NOVAVAX is a party or by which NOVAVAX is
bound.

        (c)    CORPORATE ACTION; BINDING EFFECT. NOVAVAX has duly and properly
taken all action required by law, its Certificate of Incorporation, its Bylaws,
or otherwise, to authorize the execution, delivery, and performance by it of
this Agreement and the other instruments to be executed by it pursuant hereto
and the consummation of the transactions contemplated hereby and thereby. This
Agreement has been duly executed and delivered by NOVAVAX and constitutes, and
the other instruments contemplated hereby when duly executed and delivered by
NOVAVAX will constitute, legal, valid, and binding obligations of NOVAVAX
enforceable

                                       13
<PAGE>   17

against it in accordance with their respective terms, except as enforcement may
be affected by bankruptcy, insolvency, or other similar laws and by general
principles of equity.

        (d)    ACCESS TO INFORMATION. For a period of four (4) years after the
Closing, NOVAVAX agrees to cooperate with KING and to grant to KING and its
employees, attorneys, accountants, officers, representatives, and agents, during
normal business hours and upon ten (10) days' advance notice, reasonable access
to NOVAVAX's management personnel and to the records relating to the Products
during the period the Assets were owned by KING (including, without limitation,
the NDA) and to permit copying at KING's expense of documents relating to the
Assets during the period the Assets were owned by KING for the purposes of (i)
any financial reporting or tax matters (including, without limitation, any
financial and tax audits, tax contests, tax examination, preparation of any KING
tax returns or financial records) relating to the Product; (ii) any claims or
litigation involving KING and the Assets relating to the Product; (iii) any
investigation of KING being conducted by any federal, state, or local
governmental authority relating to the Product; (iv) any matter relating to any
indemnification or representation or warranty or any other term of this
Agreement; or (v) any similar or related matter. NOVAVAX shall maintain all such
records and documents in the United States and shall not destroy or dispose of
any such records and documents without the prior written consent of KING. KING
shall use its reasonable efforts to ensure that its access to and requests for
records and documents pursuant to this Section are conducted so as not to
interfere with the normal and ordinary operation of NOVAVAX's business. KING
acknowledges that the records and documents made available to KING by NOVAVAX
shall be governed by the Confidentiality Agreement (as defined in Section 6.13
hereto). Any employees, attorneys, accountants, officers, representatives, or
agents of KING which access such information on KING's behalf pursuant to this
Section 4.02(d) shall be bound by obligations of confidentiality not to disclose
such information substantially similar in form and substance to the
confidentiality obligations of KING set forth in the Confidentiality Agreement.

        (e)    CONSENTS. No consent or approval of, or filing with or notice to,
any federal, state, or local governmental or regulatory authority, agency, or
department or any other person not a party to this Agreement is required or
necessary to be obtained by NOVAVAX or on its behalf in connection with the
execution, delivery, and performance of this Agreement or to consummate the
transactions contemplated hereby, except as contemplated by Section 3.01 hereof.

        4.03   SURVIVAL OF REPRESENTATIONS AND WARRANTIES.

        The representations, warranties, and indemnities of the parties hereto
contained in this Article 4 and in Article 5 shall survive the Closing Date for
a period equal to one (1) year, except that Section 4.01(e) (Ownership of
Assets) and indemnification with respect thereto shall survive the Closing Date
for a period equal to two (2) years.

        4.04   CERTAIN LIMITATIONS.

        (a)    KING does not make any representation or warranty as to the
business prospects of the Products. NOVAVAX has conducted its own thorough due
diligence review and analysis,

                                       14
<PAGE>   18

as it deemed necessary and appropriate of the Assets and of the business
prospects of the Products. NOVAVAX is not relying on any representations or
warranties from KING as to the business prospects of the Products or any other
representations or warranties, except as expressly set forth herein.

        (b)    NOVAVAX acknowledges and agrees that KING does not manufacture,
package or test the Products and is dependent upon third parties for
manufacturing, packaging and testing of the Products. NOVAVAX acknowledges and
agrees that KING does not guarantee or warrant that any such third party will
continue to manufacture, package or test the Products and/or supply the Products
to KING. NOVAVAX acknowledges and agrees that there is no guarantee of a
continued or uninterrupted supply of Products. NOVAVAX acknowledges and agrees
that it is purchasing the Products subject to the foregoing limitations. KING
and NOVAVAX agree to cooperate with each other in connection with the
negotiation of any manufacturing, packaging, testing or supply arrangements for
the Products.

        (c)    NOVAVAX acknowledges and agrees that KING neither manufactures,
packages or tests nor has a contract with a third party to have manufactured,
packaged or tested the AVC(TM) Suppositories referenced in Schedule 1. NOVAVAX
acknowledges and agrees that NOVAVAX shall be solely responsible for contracting
with R.P. Scherer or other third parties to obtain the manufacturing, packaging
and testing of such AVC(TM) Suppositories.

                                    ARTICLE 5

                                 INDEMNIFICATION

        5.01   INDEMNIFICATION BY KING.

        (a)    KING shall indemnify, defend, and hold harmless NOVAVAX from and
against and compensate NOVAVAX for any and all demands, claims, actions, causes
of action, assessments, judgments, deficiencies, damage, loss, liability, and
expense of any nature whatsoever (including, without limitation, reasonable
attorneys' fees and expenses) (collectively, "Indemnified Amounts") arising out
of, in whole or in part, (i) any misrepresentation or breach of representation,
warranty, covenant, or agreement made or to be performed by KING or any
non-fulfillment of any obligation of KING pursuant to this Agreement or the
Collateral Agreements; (ii) any claim (including, without limitation, a claim
based on contract, warranty or tort) arising out of the design, assembly,
processing, manufacture, or sale of any Product sold and/or manufactured on or
prior to the Closing Date or any services rendered by or on behalf of KING in
respect of the Products on or prior to the Closing Date; (iii) any federal,
state, local or other tax liability, or any assessment in the nature of any tax,
including interest and penalties thereon, with respect to any fiscal period of
KING or portion thereof on or prior to the Closing Date or arising out of the
sale of the Products or the Assets on or prior to Closing; (iv) the litigation,
if any, disclosed on Schedule 4.01(f) hereto and all related proceedings; and
(v) any liability not specifically and expressly assumed by NOVAVAX, whether or
not known or asserted at or prior to Closing, relating to or arising from the
ownership, control, manufacture or sale of the Products or any of the Assets or
any other state of facts which existed at or prior to Closing.

                                       15
<PAGE>   19

        (b)    In the event of indemnification by KING pursuant to Section
5.01(a)(i), KING shall not have any obligation to indemnify NOVAVAX from and
against any Indemnified Amounts: (i) until NOVAVAX has incurred Indemnified
Amounts in excess of a One Hundred Thousand Dollar ($100,000) threshold (after
which point KING will be obligated to indemnify NOVAVAX from and against all
Indemnified Amounts) or thereafter, and (ii) to the extent the Indemnified
Amounts NOVAVAX has incurred exceed a One Million Dollar ($1,000,000) aggregate
ceiling (after which point KING will have no obligation to indemnify NOVAVAX
from and against further such Indemnified Amounts).

        (c)    KING shall not be liable under this Section 5.01 for any
settlement effected without its consent of any claim, litigation, or proceeding
in respect of which indemnity may be sought hereunder, which consent shall not
unreasonably be withheld.

        5.02   INDEMNIFICATION BY NOVAVAX.

        (a)    NOVAVAX shall indemnify, defend, and hold harmless KING from and
against any and all Indemnified Amounts arising out of, in whole or in part, (i)
any misrepresentation or breach of representation, warranty, covenant, or
agreement made or to be performed by NOVAVAX or any non-fulfillment of any
obligation of NOVAVAX pursuant to this Agreement or the Collateral Agreements;
(ii) any claim (including, without limitation, a claim based on contract,
warranty or tort) arising out of the design, assembly, processing, manufacture,
or sale of any Product sold and/or manufactured after the Closing Date or any
services rendered by or on behalf of NOVAVAX in respect of the Products after
the Closing Date; (iii) any federal, state, local or other tax liability, or any
assessment in the nature of any tax, including interest and penalties thereon,
with respect to any fiscal period of NOVAVAX or portion thereof after the
Closing Date or arising out of the sale of the Products or the Assets after the
Closing Date; and (iv) any liability not specifically and expressly assumed by
KING, whether or not known or asserted after the Closing Date, relating to or
arising from the ownership, control, manufacture or sale of the Products or any
of the Assets or any other state of facts which existed after the Closing Date;
provided, however, that NOVAVAX shall not have any obligation to indemnify KING
from and against any Indemnified Amounts: (i) until KING has incurred
Indemnified Amounts in excess of a One Hundred Thousand Dollar ($100,000)
threshold (after which point NOVAVAX will be obligated to indemnify KING from
and against all Indemnified Amounts) or thereafter, and (ii) to the extent the
Indemnified Amounts KING has incurred exceed a One Million Dollar ($1,000,000)
aggregate ceiling (after which point NOVAVAX will have no obligation to
indemnify KING from and against further such Indemnified Amounts).

        (b)    NOVAVAX shall not be liable under this Section 5.02 for any
settlement effected without its consent of any claim, litigation or proceeding
in respect of which indemnity may be sought hereunder, which consent shall not
unreasonably be withheld.

        5.03   PAYMENTS.

        All amounts payable under this Article 5 shall be paid promptly after
receipt by the indemnifying party of written notice from the indemnified party
stating that such Indemnified Amounts have been incurred, the amount thereof and
of the related indemnity payment and

                                       16
<PAGE>   20

substantiation of such amount and such indemnity payment; provided, however, any
disputed amounts shall be due and payable promptly after such amounts are
finally determined to be owing by the indemnifying party to the indemnified
party.

        5.04   CONDUCT OF LITIGATION.

        Each party indemnified under the provisions of this Agreement, upon
receipt of written notice of any claim or the service of a summons or other
initial legal process upon it in any action instituted against it, in respect of
the agreements contained in this Agreement, shall promptly give written notice
of such claim, or the commencement of such action, or threat thereof, to the
party from whom indemnity shall be sought hereunder; provided, however, that the
failure to provide such notice within a reasonable period of time shall not
relieve the indemnifying party of any of its obligations hereunder except to the
extent the indemnifying party is prejudiced by such failure. Each indemnifying
party shall be entitled at its own expense to participate in the defense of such
claim or action, or, if it shall elect, to assume such defense, in which event
such defense shall be conducted by counsel chosen by such indemnifying party,
which counsel may be any counsel reasonably satisfactory to the indemnified
party against whom such claim is asserted or who shall be the defendant in such
action, and such indemnified party shall bear all fees and expenses of any
additional counsel retained by it or them. The indemnifying party shall provide
the indemnified person with such additional information and opportunity for
consultation as may reasonably be requested by it. The indemnified person shall
render all assistance as the indemnifying party shall reasonably request in the
defense of any such action. Notwithstanding the foregoing, if the named parties
in such action (including impleaded parties) include the indemnified and the
indemnifying parties, and the indemnified party shall have been advised by
counsel that there may be a conflict between the positions of the indemnifying
party and the indemnified party in conducting the defense of such action or that
there are legal defenses available to such indemnified party different from or
in addition to those available to the indemnifying party, then counsel for the
indemnified party shall be entitled, if the indemnified party so elects, to
conduct the defense to the extent reasonably determined by such counsel to be
necessary to protect the interests of the indemnified party, at the expense of
the indemnifying party, if it is determined by agreement of the indemnifying
party and the indemnified party or by a court of competent jurisdiction that the
indemnified party is entitled to indemnification hereunder for the Indemnified
Amounts giving rise to such action. If the indemnifying party shall elect not to
assume the defense of such claim or action, such indemnifying party shall
reimburse such indemnified party for the reasonable fees and expenses of any
counsel retained by it, and shall be bound by the results obtained by the
indemnified party in respect of such claim or action if it is determined by
agreement of the indemnifying party and the indemnified party or by a court of
competent jurisdiction that the indemnified party is entitled to indemnification
hereunder for the Indemnified Amounts giving rise to such action; provided,
however, that no such claim or action shall be settled without the written
consent of the indemnifying party, which consent shall not be unreasonably
withheld or delayed.

                                    ARTICLE 6

                                  MISCELLANEOUS

                                       17
<PAGE>   21

        6.01   ENTIRE AGREEMENT.

        This Agreement and the Collateral Agreements constitute the entire
agreement between KING and NOVAVAX with respect to the subject matter hereof and
thereof and supersede all prior agreements and understandings, both written and
oral, between the parties with respect to the subject matter hereof and thereof.
This Agreement or any provision hereof cannot be amended, changed, supplemented,
or waived except in a writing signed by each of the parties hereto.

        6.02   COUNTERPARTS.

        This Agreement and any amendment or supplement hereto may be executed in
several counterparts, each of which shall be deemed to be an original, and all
of which taken together shall constitute one and the same instrument.

        6.03   BROKERAGE AND OTHER COMMISSIONS.

        KING and NOVAVAX each represent and warrant to the other that all
negotiations relative to this Agreement and the transactions contemplated hereby
have been carried on by each directly with the other without intervention of any
broker, finder, or other intermediary and that, subject to the provisions of
Article 5, each indemnifies the other and holds it harmless against any claim
against the other for brokerage or other commissions relating to this Agreement
or to the transactions contemplated hereby by any person claiming to have been
engaged as a broker or finder by the indemnifying party.

        6.04   NOTICES.

        All notices and other communications required or permitted under this
Agreement shall be in writing and shall be delivered personally or sent by: (a)
registered or certified mail, return receipt requested; (b) a
nationally-recognized courier service guaranteeing next-day delivery, charges
prepaid; or (c) facsimile (with the original promptly sent in any of the
foregoing manners). Any such notices shall be addressed to the receiving party
at such party's address set forth below, or at such other address as may from
time to time be furnished by similar notice by either party.

        If to KING:   King Pharmaceuticals, Inc.
                      501 Fifth Street
                      Bristol, Tennessee 37620
                      Attn:  Chief Executive Officer
                      Facsimile: (423) 989-8006

                      With a copy to:

                      King Pharmaceuticals, Inc.
                      501 Fifth Street
                      Bristol, Tennessee  37620

                                       18
<PAGE>   22

                      Attention:  Legal Department
                      Facsimile:  (423) 989-6282

        If to NOVAVAX:   Novavax, Inc.
                      8320 Guilford Road
                      Columbia, Maryland 21046
                      Attention: Chief Executive Officer
                      Facsimile:  (301) 854-3902

                      With a copy to:

                      White & McDermott, P.C.
                      65 William Street
                      Wellesley, Massachusetts 02481
                      Attn:  David A. White
                      Facsimile:  (781) 237-8120

        Any such notice or communication shall be effective upon such personal
delivery or delivery to such courier, upon transmission by facsimile, or three
(3) days after it is sent by such registered or certified mail, as the case may
be. Copies shall be sent in the same manner as originals.

        6.05   ASSIGNMENT.

        Neither party may assign its rights or obligations under this Agreement
without the prior written consent of the other party; provided, however, that
either party may assign its rights and obligations under this Agreement, without
the prior written consent of the other party, to an Affiliate. Any purported
assignment without a required consent shall be void. Any permitted assignee
shall assume all obligations of its assignor under this Agreement. No assignment
shall relieve either party of its responsibility for the performance of any
obligation under this Agreement.

        6.06   GOVERNING LAW.

        THIS AGREEMENT SHALL BE CONSTRUED AND GOVERNED IN ALL RESPECTS UNDER AND
IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO THE
CONFLICTS OF LAWS PRINCIPLES THEREOF.

        6.07   HEADINGS.

        The table of contents and all headings used in this Agreement are for
convenience of reference only and shall not affect the interpretation of this
Agreement.

                                       19
<PAGE>   23

        6.08   EXPENSES.

        All legal and other costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby shall be paid by the party
incurring such expenses.

        6.09   SUCCESSORS AND ASSIGNS.

        This Agreement shall be binding upon and shall inure to the benefit of
the parties and their respective successors and permitted assigns.

        6.10   AGREEMENT TO TAKE NECESSARY AND DESIRABLE ACTIONS.

        KING and NOVAVAX each agree to execute and deliver such other documents,
certificates, agreements, and other writings and to take such other actions as
may be reasonably necessary in order to consummate or implement expeditiously
the transactions contemplated by this Agreement.

        6.11   NO IMPLIED WAIVER.

        No failure or delay on the part of the parties hereto to exercise any
right, power, or privilege hereunder or under any instrument executed pursuant
hereto shall operate as a waiver; nor shall any single or partial exercise of
any right, power, or privilege preclude any other or further exercise thereof or
the exercise of any other right, power, or privilege. All rights and remedies
granted herein shall be cumulative and in addition to other rights and remedies
to which the parties may be entitled at law or in equity.

        6.12   FORCE MAJEURE.

        Any delay in the performance of any of the obligations of either party
hereto (except the payment of money owed) shall not be considered a breach of
this Agreement and the time required for performance shall be extended for a
period equal to the period of such delay, provided that such delay is due to:
acts of God, weather, fire, explosion; invasion, riot or other civil unrest;
governmental laws, orders, restrictions, actions, embargoes or blockades;
national or regional emergency, injunction, strikes, lock-outs, labor trouble or
other industrial disturbances; inability to obtain or interruption of materials,
labor, containers, fuel or transportation; or any other cause beyond the control
of the affected party. The party so affected shall give prompt notice to the
other party of such cause and shall use its reasonable efforts to relieve the
effect of such cause as rapidly as possible.

        6.13   CONFIDENTIALITY.

        KING and NOVAVAX have entered into a Confidentiality Agreement dated as
of September 1, 2000 (the "Confidentiality Agreement").

        6.14   RELATIONSHIP.

                                       20
<PAGE>   24

        Nothing in this Agreement shall be deemed to create an agency, joint
venture, amalgamation, partnership, or similar relationship between NOVAVAX and
KING.

        6.15   SEVERABILITY.

        In case any provision of this Agreement shall be held to be invalid,
illegal, or unenforceable, the validity, legality, or enforceability of the
remaining provisions hereof will not in any way be affected or impaired thereby.

        6.16   PRESS RELEASE.

        So long as this Agreement is in effect, neither of the parties hereto,
nor their Affiliates, shall issue or cause the dissemination of any press
release or other announcement with respect to this Agreement or the transactions
contemplated hereby without consulting with and obtaining the consent of the
other Party which shall not be unreasonably withheld; provided, however, that
such consent shall not be required where such release or announcement is
required by applicable law or legal process.

        On the Closing Date, the parties shall issue a joint press release
regarding the sale of the Assets, and KING shall, in cooperation with NOVAVAX,
inform any customer who places a purchase order with KING for the Products that
the Assets have been sold to NOVAVAX. As soon as practicable after the Closing,
KING shall send to all of its current wholesalers and distributors a letter, in
form and substance mutually agreeable to KING and NOVAVAX, on KING letterhead
informing them of the sale of the Assets to NOVAVAX.

        6.17   AFFILIATES.

        As used in this Agreement, "Affiliate" shall mean any corporation or
non-corporate entity that controls, is controlled by, or is under common control
with the party. A corporation or non-corporate entity shall be regarded as in
control of another corporation if it owns or directly or indirectly controls at
least fifty percent (50%) of the voting stock of the other corporation or (a) in
the absence of the ownership of at least of fifty percent (50%) of the voting
stock of a corporation or (b) in the case of a non-corporate entity, the power
to direct or cause the direction of the management and policies of such
corporation or non-corporate entity, as applicable.

        6.18   WAIVER OF BULK SALES.

        KING and NOVAVAX waive compliance with any bulk sales law or similar law
in connection with the consummation of the transactions contemplated herein.

        6.19   EXHIBITS AND SCHEDULES.

        All Exhibits and Schedules referred to herein form an integral part of
this Agreement and are incorporated into this Agreement by reference.

        6.20   INTERPRETATION.

                                       21
<PAGE>   25

        The parties hereto acknowledge and agree that: (a) each party and its
representatives have reviewed and negotiated the terms and provisions of this
Agreement and have contributed to its revision; and (b) the terms and provisions
of this Agreement shall be construed fairly as to each party hereto and not in
favor of or against either party regardless of which party was generally
responsible for the preparation or drafting of this Agreement.

                                       [SIGNATURE PAGE FOLLOWS]

                                       22
<PAGE>   26

        IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first above written.

                                     NOVAVAX, INC.

                                     By:
                                        --------------------------------------

                                     Name:
                                          ------------------------------------

                                     Title:
                                           -----------------------------------

                                     KING PHARMACEUTICALS, INC.

                                     By:
                                        --------------------------------------

                                     Name:
                                          ------------------------------------

                                     Title:
                                           -----------------------------------

                                       23
<PAGE>   27

                                    EXHIBIT A

                                  BILL OF SALE

                                   (Attached)

<PAGE>   28

                            IRREVOCABLE BILL OF SALE

        KING PHARMACEUTICALS, INC., a Tennessee corporation having a principal
place of business at 501 Fifth Street, Bristol, Tennessee 37620 ("KING"), for
good and valuable consideration, the receipt and legal sufficiency of which
hereby expressly are acknowledged, does hereby irrevocably sell, convey, assign,
and transfer to NOVAVAX, INC., a Delaware corporation having a principal place
of business at 8320 Guilford Road, Columbia, Maryland 21046 ("NOVAVAX"), its
successors and assigns, right, title and interest, free and clear of all liens,
claims, charges, or encumbrances (except as described in Schedule 1.07 of the
Purchase Agreement referred to below), in and to the Tradename, the Know-How in
the Territory, the NDA in the Territory, the Tradedress in the Territory, and
the Inventory in the Territory, each as defined in the Agreement for Purchase
and Sale of Assets Relating to AVC(TM) dated as of January ______, 2001 between
KING and NOVAVAX (the "Purchase Agreement") and all pursuant to and on the terms
and conditions of the Purchase Agreement.

        IN WITNESS WHEREOF, KING has duly executed and delivered this
Irrevocable Bill of Sale as of January ________, 2001.

                                            KING PHARMACEUTICALS, INC.

                                            By:
                                               -------------------------------

                                            Name:
                                                 -----------------------------

                                            Title:
                                                  ----------------------------<PAGE>   1
                                                                    EXHIBIT 10.2

                                                                  EXECUTION COPY

                              COPROMOTION AGREEMENT

                                     BETWEEN

                                  NOVAVAX, INC.

                                       AND

                           KING PHARMACEUTICALS, INC.

                                 JANUARY 8, 2001

<PAGE>   2

                                TABLE OF CONTENTS

<TABLE>
<C>                                                                                         <C>
1.    DEFINITIONS............................................................................1

2.  GRANT OF RIGHTS..........................................................................2
  2.1   Grant of Rights to KING..............................................................2
  2.2   Grant of Rights to NOVAVAX...........................................................2
  2.3   Trademark............................................................................2

3.  RESPONSIBILITIES OF KING.................................................................4
  3.1   Promotion by KING....................................................................4
  3.2   Manufacture, Shipment, Etc. of the KING Products.....................................6
  3.3   KING Detail and Sales Reports........................................................6
  3.4   KING Sales Force.....................................................................7

4.  RESPONSIBILITIES OF NOVAVAX..............................................................8
  4.1   Promotion of Copromote Products by NOVAVAX...........................................8
  4.2   Manufacture, Shipment, Etc. of the NOVAVAX Products..................................9
  4.3   NOVAVAX Detail and Sales Reports....................................................10
  4.4   NOVAVAX Sales Force.................................................................11

5.  TRAINING AND PROMOTIONAL MATERIAL.......................................................12
  5.1   Training............................................................................12
  5.2   Promotional Materials...............................................................12

6.  COPROMOTE PRODUCT SAMPLES...............................................................13
  6.1   Supply, Storage and Distribution of Samples.........................................13
  6.2   Use of Samples......................................................................13

7.  CERTAIN REGULATORY MATTERS..............................................................14
  7.1   Licenses............................................................................14
  7.2   Regulatory Responsibility...........................................................14
  7.3   Efficacy and Safety Information.....................................................15
  7.4   Notice of Adverse Events............................................................16
  7.5   Product Technical Complaints and Recalls............................................17
  7.6   Returns.............................................................................18
  7.7   Notice of Government Inspections....................................................19
  7.8   Government Inquiries................................................................19
  7.9   Medical Inquiries...................................................................19

8.  MANAGEMENT COMMITTEE....................................................................20
  8.1   Establishment of the PMC............................................................20
  8.2   Purpose and Responsibilities of the PMC.............................................20
  8.3   PMC Meetings........................................................................21
  8.4   Vote and Approval...................................................................21
  8.5   Marketing Plan and Budget...........................................................22
</TABLE>

                                       i
<PAGE>   3

<TABLE>
<S>                                                                                        <C>
  8.6   Additional Studies, Line Extensions and New Products................................22
  8.7   Dispute Resolution..................................................................23

9.  FEES AND EXPENSES.......................................................................24
  9.1   Consideration Fee...................................................................24
  9.2   Milestone Payments..................................................................25
  9.3   Residual Payments...................................................................25
  9.4   Marketing Expenses..................................................................26
  9.5   Excess Detail Costs.................................................................28
  9.6   Other Miscellaneous Costs and Expenses..............................................28
  9.7   Costs Savings.......................................................................28

10. RECORDKEEPING AND AUDITS................................................................29
  10.1  Maintenance of Books and Records....................................................29
  10.2  Payment Audits......................................................................29
  10.3  Compliance Audits...................................................................30

11. TERM AND TERMINATION....................................................................30
  11.1  Term of Agreement...................................................................30
  11.2  Termination by NOVAVAX..............................................................31
  11.3  Termination by KING.................................................................31
  11.4   Failure to Meet Detail Requirements................................................33
  11.5  Effects of Termination..............................................................33
  11.6  Actions Upon Termination............................................................34
  11.7  Survival............................................................................34
  11.8  Payments Upon Termination...........................................................34

12. CONFIDENTIALITY; OWNERSHIP..............................................................36
  12.1  Confidential Information............................................................36

13. INDEMNIFICATION AND INSURANCE...........................................................37
  13.1  Indemnification by KING.............................................................37
  13.2  Indemnification by NOVAVAX..........................................................38
  13.3  Claims Procedures...................................................................38
  13.4  Insurance...........................................................................39

14. REPRESENTATIONS AND WARRANTIES..........................................................39
  14.1  By KING.............................................................................39
  14.2  By NOVAVAX..........................................................................40

15. NOTICES.................................................................................41

16. MISCELLANEOUS PROVISIONS................................................................42
  16.1  Assignment; Change of Control.......................................................42
  16.2  Governing Law.......................................................................43
  16.3  Non-Waiver..........................................................................44
  16.4  Entire Agreement....................................................................44
</TABLE>

                                       ii
<PAGE>   4

<TABLE>
<S>                                                                                        <C>
  16.5  Jurisdiction; Venue.................................................................44
  16.6  Severability........................................................................45
  16.7  Relationship of the Parties.........................................................46
  16.8  Public Announcements................................................................46
  16.9  Counterparts........................................................................46
  16.10   Force Majeure.....................................................................46
  16.11   Interpretation....................................................................46
  16.12   Certain Expenses and Commissions..................................................47
  16.13   Third Party Beneficiaries.........................................................47
  16.14   Covenant Not to Promote Competing Product.........................................47
  16.15   Headings..........................................................................47
</TABLE>

                                      iii
<PAGE>   5
                                                                  Execution Copy

                              COPROMOTION AGREEMENT

                THIS COPROMOTION AGREEMENT (this "Agreement") is entered into
and effective as of this 8th day of January, 2001 (the "Effective Date"), by and
between KING PHARMACEUTICALS, INC., a Tennessee corporation ("KING"), and
NOVAVAX, INC., a Delaware corporation ("NOVAVAX").

                WHEREAS, KING and NOVAVAX each have a field representative sales
force focused on physicians and health care practitioners who specialize in the
practice of obstetrics or gynecology or who frequently prescribe hormone
replacement therapy products ("OB/GYN");

                WHEREAS, NOVAVAX owns or will own a patent or patents related to
the NOVAVAX Products and expects to file with the FDA a New Drug Application for
ESTRASORB(TM);

                WHEREAS, KING markets and distributes an oral contraceptive
product for women containing the actives levonorgestrel and ethinyl estradiol
under the registered trademark NORDETTE(R) (each a "KING Product" or
collectively, the "KING Products");

                WHEREAS, KING and NOVAVAX are engaged in the business of and
have expertise in, among other things, the promotion of pharmaceutical products
to the OB/GYN community; and

                WHEREAS, KING and NOVAVAX desire to work together to promote the
NOVAVAX Products and the KING Products in the United States, its territories and
possessions, the District of Columbia and the Commonwealth of Puerto Rico (the
"Territory") upon the terms and conditions set forth herein.

                NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth in this Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:

1.      DEFINITIONS

        Capitalized terms used herein without definition shall have the
respective meanings assigned thereto in Annex I attached hereto and incorporated
herein for all purposes of this Agreement (such definitions to be equally
applicable to both the singular and plural forms of the terms defined). Unless
otherwise specified, all references herein to "Articles" or "Sections" are to
Articles or Sections of this Agreement.

<PAGE>   6

2.      GRANT OF RIGHTS

        2.1     GRANT OF RIGHTS TO KING.

                (a)     NOVAVAX hereby grants to KING and its Affiliates, on an
exclusive basis together with NOVAVAX and its Affiliates, the right to promote
the NOVAVAX Products within the Territory during the Term of this Agreement,
upon and subject to the terms and conditions set forth in this Agreement.

                (b)     The grant of rights within the Territory set forth in
Section 2.1(a) is subject to and limited only by the right of NOVAVAX and its
Affiliates to promote the NOVAVAX Products within the Territory during the Term
of this Agreement in accordance with the terms and conditions of this Agreement.

        2.2     GRANT OF RIGHTS TO NOVAVAX.

                (a)     KING hereby grants to NOVAVAX and its Affiliates, on an
exclusive basis together with KING and its Affiliates, the right to promote the
KING Products in the Territory during the Term of this Agreement, upon and
subject to the terms and conditions set forth in this Agreement.

                (b)     The grant of rights set forth in Section 2.2(a) is
subject to and limited only by the right of KING and its Affiliates to promote
the KING Products within the Territory during the Term of this Agreement in
accordance with the terms and conditions of this Agreement.

        2.3     TRADEMARK.

                (a)     Required Use and Compliance. Each party shall promote
the NOVAVAX Products only under the NOVAVAX Trademarks. KING shall not use any
trademark or servicemark other than the NOVAVAX Trademarks in promoting the
NOVAVAX Products without the prior approval of NOVAVAX. Each party shall promote
the KING Products only under the KING Trademarks. NOVAVAX shall not use any
trademark or servicemark other than the KING Trademarks in promoting the KING
Products without the prior approval of KING. The NOVAVAX Trademarks and KING
Trademarks are set forth on Exhibit 2.3(a).

                (b)     Validity of Trademarks. KING acknowledges the validity
of NOVAVAX's right, title and interest in and to the NOVAVAX Trademarks and KING
shall not have, assert or acquire any right, title or interest in or to any of
the NOVAVAX Trademarks, except as otherwise explicitly provided in this
Agreement. NOVAVAX acknowledges the validity of KING's right, title and

                                       2
<PAGE>   7

interest in and to the KING Trademarks and NOVAVAX shall not have, assert or
acquire any right, title or interest in or to any of the KING Trademarks, except
as otherwise explicitly provided in this Agreement.

                (c)     Use of Trademarks.

                        (i)     NOVAVAX Trademarks. In connection with the
subject matter hereof, KING shall use the NOVAVAX Trademarks only in a manner
consistent with NOVAVAX's trademark usage guidelines (the "NOVAVAX Guidelines")
and shall not use any NOVAVAX Trademark in connection with any goods or products
other than the NOVAVAX Products, notwithstanding that such goods or products are
dissimilar to the NOVAVAX Products or have a different use. The parties shall
develop the NOVAVAX Guidelines as soon as practicable after the Effective Date.
KING shall use the NOVAVAX Trademarks only to the extent authorized herein.

                        (ii)    KING Trademarks. In connection with the subject
matter hereof, NOVAVAX shall use the KING Trademarks only in a manner consistent
with KING's trademark usage guidelines (the "KING Guidelines") and shall not use
any KING Trademark in connection with any goods or products other than the KING
Products, notwithstanding that such goods or products are dissimilar to the KING
Products or have a different use. The parties shall develop the KING Guidelines
as soon as practicable after the Effective Date. NOVAVAX shall use the KING
Trademarks only to the extent authorized herein.

                (d)     Notice of Infringement.

                        (i)     Each party shall give the other party notice of
any infringement or threatened infringement of any of such other party's
Trademarks used in connection with the Copromote Products. Except as otherwise
provided in Section 2.3(d)(ii) below, each party shall determine in its sole
discretion what action, if any, to take in response to the infringement or
threatened infringement of that party's Trademark. Each party agrees to identify
the primary brand Trademarks of its Copromote Products (each a "Primary Brand
Trademark"). Exhibit 2.3(d) sets forth the list of Primary Brand Trademarks for
the KING Products and the NOVAVAX Products as of the Effective Date. In the
event that one party chooses to take enforcement action in response to the
infringement or threatened infringement of its Trademark, the other party shall
reasonably cooperate in such enforcement; provided, however, the enforcing party
shall reimburse the other party for reasonable expenses incurred by the other
party that are related to such enforcement.

                        (ii)    As to each Primary Brand Trademark only, if the
party owning such a Trademark fails to take enforcement action within one
hundred twenty (120) days following notice thereof in response to the
infringement or threatened infringement of its Trademark, the other party shall
have the right, in

                                       3
<PAGE>   8

its sole discretion, to conduct litigation or other enforcement proceedings at
the expense of the owner of the Primary Brand Trademark, naming the Primary
Brand Trademark owner as a party plaintiff. In such event, the Primary Brand
Trademark owner shall reasonably cooperate in such enforcement.

                        (iii)   The parties shall cooperate in good faith with
respect to all Trademark enforcement actions hereunder, and each party shall
notify the other party promptly of all substantive developments with respect to
such Trademark enforcement actions, including, without limitation, all material
filings, court papers and other related documents. Each party shall consider the
timely given, reasonable comments and advice of the other party with respect to
the strategy employed and submissions made relative to any Trademark enforcement
actions. The party enforcing such Trademark action shall retain for its own
account any damages or other monetary relief obtained in connection therewith.

3.      RESPONSIBILITIES OF KING

        3.1     PROMOTION BY KING.

                (a)     NOVAVAX Product Promotion. Commencing as of the NOVAVAX
Product Initiation Date and continuing throughout the Term, KING shall use its
Commercially Reasonable Efforts to market and promote the NOVAVAX Products to
OB/GYN's in the Territory in accordance with the then current Marketing Plan.
Without limiting the foregoing, KING agrees that at all times during the period
commencing as of the NOVAVAX Product Initiation Date, KING or its Affiliates
shall (i) have at least fifty (50) field sales representatives Detailing the
NOVAVAX Products to OB/GYN's in the Territory, and (ii) perform Details of the
NOVAVAX Products at a minimum rate of 60,000 per twelve (12) month period in the
Territory. On or prior to each anniversary of the NOVAVAX Product Initiation
Date, the target and minimum number of Details for the NOVAVAX Products shall be
determined by the PMC. Beginning on the NOVAVAX Product Initiation Date and
thereafter, KING or its Affiliates shall be responsible for performing at least
fifty percent (50%) of such target Details. The number of Details required in
this Section 3.1(a) shall be conducted and spaced according to the current
Marketing Plan then in effect, provided, however, that the total number of
Details required in any annual Marketing Plan shall not be less than fifty
percent (50%) of the total number of Details required in the Marketing Plan for
the previous year, unless KING can demonstrate good cause, to NOVAVAX's
reasonable satisfaction, that a further reduction in the number of Details would
be prudent given the then current market conditions (which determination shall
not be subject to Section 8.7(b)). KING agrees, subject to NOVAVAX providing
KING with a sufficient quantity of samples (as determined by the PMC) of the
NOVAVAX Products, to use its Commercially Reasonable Efforts to provide, and/or
to cause its Affiliates to provide, samples of the

                                       4
<PAGE>   9

NOVAVAX Products to OB/GYN's in the Territory in accordance with the then
current Marketing Plan.

                (b)     KING Product Promotion. Commencing as of the KING
Product Initiation Date and continuing throughout the Term, KING shall use its
Commercially Reasonable Efforts to market and promote the KING Products to
OB/GYN's in the Territory in accordance with the then current Marketing Plan.
Without limiting the foregoing, KING agrees that at all times during the period
commencing as of the KING Product Initiation Date, KING or its Affiliates shall
(i) have at least fifty (50) field sales representatives Detailing the KING
Products to OB/GYN's in the Territory, and (ii) perform the minimum Details set
by the PMC, as set forth in the current Marketing Plan then in effect. On or
prior to each anniversary of the KING Product Initiation Date, the target and
minimum number of Details for the KING Products shall be determined by the PMC.
Beginning on the KING Product Initiation Date and thereafter, KING or its
Affiliates shall be responsible for performing at least fifty percent (50%) of
such target Details. The number of Details required in this Section 3.1(b) shall
be conducted and spaced according to the current Marketing Plan then in effect,
provided, however, that the total number of Details required in any annual
Marketing Plan shall not be less than fifty percent (50%) of the total number of
Details required in the Marketing Plan for the previous year, unless KING can
demonstrate good cause, to NOVAVAX's reasonable satisfaction, that a further
reduction in the number of Details would be prudent given the then current
market conditions (which determination shall not be subject to Section 8.7(b)).
KING agrees to use its Commercially Reasonable Efforts to provide, and/or to
cause its Affiliates to provide, samples of the KING Products to OB/GYN's in the
Territory in accordance with the then current Marketing Plan.

                (c)     In performing its duties hereunder, KING shall, and
shall cause its employees and the employees of its relevant Affiliates to,
comply with all regulatory, professional and legal requirements, including,
without limitation, the FDA's regulations and guidelines concerning the
advertising of prescription drug products, the American Medical Associations'
Guidelines on Gifts to Physicians, the PhRMA Guidelines for Marketing Practices,
and the ACCME Standards for Commercial Support of Continuing Medical Education,
which may be applicable to the Copromote Products and services (including
without limitation the manufacturing, packaging, warehousing, handling and
distribution of samples of the Copromote Products) to be provided by KING
hereunder. No employee of KING or of any of its relevant Affiliates shall make
any representation, statement, warranty or guaranty with respect to the
Copromote Products that is not consistent with current labeling of the Copromote
Products or promotional materials approved by the PMC, that is deceptive or
misleading, that disparages the Copromote Products or the good name, good will
and reputation of NOVAVAX or that diminishes in any material respect any NOVAVAX
Trademark. KING represents and warrants that its services hereunder will be
provided in a professional, ethical and competent manner.

                                       5
<PAGE>   10

        3.2     MANUFACTURE, SHIPMENT, ETC. OF THE KING PRODUCTS.

                KING (and/or its Affiliates) shall have the sole responsibility
for the manufacture, shipment, distribution, warehousing, billing and order
confirmation of the KING Products and for the collection of receivables
resulting from sales of the KING Products in the Territory. NOVAVAX may make
recommendations to KING from time to time regarding the price of and pricing
strategies for the KING Products during the Term, including, without limitation,
price increases and decreases and the timing thereof, provided, however, that
KING shall have the sole authority to determine the price of the KING Products
in the Territory during the Term, including price increases and decreases and
the timing thereof. KING shall manufacture or cause to be manufactured the KING
Products and samples of the KING Products in accordance with all applicable
laws, including, without limitation, the Act and all applicable regulations
thereunder, the NDA and current Good Manufacturing Practices. KING shall use its
best efforts to maintain the NDA for the KING Products in good standing with the
FDA and shall enforce all intellectual property rights of each and every kind
associated therewith. KING shall use its best efforts to ensure that adequate
quantities of the KING Products and samples of the KING Products are available
to meet the anticipated demand for the KING Products and samples of the KING
Products in the Territory during the Term of this Agreement.

        3.3     KING DETAIL AND SALES REPORTS.

                (a)     NOVAVAX Products. Throughout the Term, KING shall
provide NOVAVAX with a report within thirty (30) calendar days after the end of
each calendar quarter, with the first such report due for the calendar quarter
during which the NOVAVAX Product Initiation Date occurs, setting forth the
following information regarding the efforts of KING's sales force in promoting
and Detailing the NOVAVAX Products during the preceding quarter (or part
thereof): (i) the number of Details made and recorded by KING's standard record
keeping procedures based on data recorded by the sales force; (ii) the names,
addresses and phone numbers of the OB/GYN's called upon; (iii) the names of and
the percentage of OB/GYN's Detailed who were provided with samples of the
NOVAVAX Products; (iv) the actual number of such samples delivered on each
Detail; and (v) such other information as may be required in the then current
Marketing Plan.

                (b)     KING Products. Throughout the Term, KING shall provide
NOVAVAX with a report within thirty (30) calendar days after the end of each
calendar quarter, with the first such report due for the calendar quarter during
which the KING Product Initiation Date occurs, setting forth the following
information regarding the efforts of KING's sales force in promoting and
Detailing the KING Products during the preceding quarter (or part thereof): (i)
the number of Details made and recorded by KING's standard record keeping
procedures

                                       6
<PAGE>   11

based on data recorded by the sales force; (ii) the names, addresses and phone
numbers of the OB/GYN's called upon; (iii) the names of and the percentage of
OB/GYN's Detailed who were provided with samples of the KING Products; (iv) the
actual number of such samples delivered on each Detail; and (v) such other
information as may be required in the then current Marketing Plan.

                (c)     The reports provided by KING pursuant to Section 3.3(a)
and Section 3.3(b) are referred to herein as the "KING Detail Reports". Each
KING Detail Report shall be delivered in an electronic format and in hard copy
form.

                (d)     Within fifteen (15) days after the end of each month,
KING shall provide to NOVAVAX a summary report setting forth (i) the gross sales
of the KING Products in the Territory for such month, (ii) the gross sales of
the KING Products in the Territory since January 1 of such year, (iii) the Net
Sales of the KING Products in the Territory for such month and the itemized
deductions taken in calculating all such Net Sales, and (iv) the Net Sales of
the KING Products in the Territory since January 1 of such year. All reports
required by this Section 3.3(d) shall be provided to NOVAVAX either by facsimile
or transmitted electronically, in each case with a confirmation copy sent by
mail.

                (e)     KING shall furnish to NOVAVAX, within thirty (30)
calendar days after the end of each Agreement Quarter and each calendar quarter
for which Residual Payments are due, a report setting forth in reasonable detail
the calculation of the Incremental Sales of KING Products in the Territory for
such Agreement Quarter or calendar quarter in a form approved by NOVAVAX.

        3.4     KING SALES FORCE.

                (a)     Except as agreed to by the parties and subject to the
terms and conditions of this Agreement, KING shall be solely responsible for the
costs and expenses of establishing, maintaining and training KING's (and its
Affiliates') sales force of sufficient size to perform its obligations
hereunder, and conducting KING's other activities under this Agreement;
provided, however, that (i) such training shall be conducted in accordance with
Section 5.1 and (ii) the content and strategic direction of any training
provided by KING that relates specifically to the Copromote Products shall be
coordinated with the PMC. Notwithstanding the foregoing, KING shall pay
incentive compensation to its sales representatives having primary
responsibility for Detailing the Copromote Products with respect to sales of the
Copromote Products in the Territory in accordance with KING's Sales Incentive
Compensation Plan for KING's own prescription drug products, it being understood
that KING shall determine the target payout for the Copromote Products in a
manner consistent with the way in which it determines the target payouts for
prescription drug products of comparable commercial potential.

                (b)     To the extent practicable, all written, electronic and
visual

                                       7
<PAGE>   12

communications provided to any of KING's (and its Affiliates') sales
representatives regarding strategy, positioning or selling messages for the
Copromote Products will, at the request of the PMC, be subject to review by the
PMC and KING's Regulatory Affairs department in accordance with Section 5.2(a).

4.      RESPONSIBILITIES OF NOVAVAX.

        4.1     PROMOTION OF COPROMOTE PRODUCTS BY NOVAVAX.

                (a)     NOVAVAX Product Promotion. Commencing as of the NOVAVAX
Product Initiation Date and continuing throughout the Term, NOVAVAX shall use
its Commercially Reasonable Efforts to market and promote the NOVAVAX Products
to OB/GYN's in the Territory in accordance with the then current Marketing Plan.
Without limiting the foregoing, NOVAVAX agrees that at all times during the
period commencing as of the NOVAVAX Product Initiation Date, NOVAVAX or its
Affiliates shall (i) have at least fifty (50) field sales representatives
Detailing the NOVAVAX Products to OB/GYN's in the Territory, and (ii) perform
Details of the NOVAVAX Products at a minimum rate of 60,000 per twelve (12)
month period in the Territory. On or prior to each anniversary of the NOVAVAX
Product Initiation Date, the target and minimum number of Details for the
NOVAVAX Products shall be determined by the PMC. Beginning on the NOVAVAX
Product Initiation Date and thereafter, NOVAVAX or its Affiliates shall be
responsible for performing at least fifty percent (50%) of such target Details.
The number of Details required in this Section 4.1(a) shall be conducted and
spaced according to the current Marketing Plan then in effect, provided,
however, that the total number of Details required in any annual Marketing Plan
shall not be less than fifty percent (50%) of the total number of such Details
required in the Marketing Plan for the previous year, unless NOVAVAX can
demonstrate good cause, to KING's reasonable satisfaction, that a further
reduction in the number of Details would be prudent given the then current
market conditions (which determination shall not be subject to Section 8.7(b)).
NOVAVAX agrees to use its Commercially Reasonable Efforts to provide, and/or to
cause its Affiliates to provide, samples of the NOVAVAX Products to OB/GYN's in
the Territory in accordance with the then current Marketing Plan.

                (b)     KING Product Promotion. Commencing as of the KING
Product Initiation Date and continuing throughout the Term, NOVAVAX shall use
its Commercially Reasonable Efforts to market and promote the KING Products to
OB/GYN's in the Territory in accordance with the then current Marketing Plan.
Without limiting the foregoing, NOVAVAX agrees that at all times during the
period commencing as of the KING Product Initiation Date, NOVAVAX or its
Affiliates shall (i) have at least fifty (50) field sales representatives
Detailing the KING Products to OB/GYN's in the Territory, and (ii) perform the
minimum Details set by the PMC, as set forth in the current Marketing Plan then
in effect.

                                       8
<PAGE>   13

On or prior to each anniversary of the KING Product Initiation Date, the target
and minimum number of Details for the KING Products shall be determined by the
PMC. Beginning on the KING Product Initiation Date and thereafter, NOVAVAX or
its Affiliates shall be responsible for performing at least fifty percent (50%)
of such target Details. The number of Details required in this Section 4.1(b)
shall be conducted and spaced according to the current Marketing Plan then in
effect, provided, however, that the total number of Details required in any
annual Marketing Plan shall not be less than fifty percent (50%) of the total
number of Details required in the Marketing Plan for the previous year, unless
KING can demonstrate good cause, to NOVAVAX's reasonable satisfaction, that a
further reduction in the number of Details would be prudent given the then
current market conditions (which determination shall not be subject to Section
8.7(b)). NOVAVAX agrees, subject to KING providing NOVAVAX with a sufficient
quantity of samples (as determined by the PMC) of the KING Products, to use its
Commercially Reasonable Efforts to provide, and/or to cause its Affiliates to
provide, samples of the KING Products to OB/GYN's in the Territory in accordance
with the then current Marketing Plan.

                (c)     In performing its duties hereunder, NOVAVAX shall, and
shall cause its employees and the employees of its relevant Affiliates to,
comply with all regulatory, professional and legal requirements, including,
without limitation, the FDA's regulations and guidelines concerning the
advertising of prescription drug products, the American Medical Associations'
Guidelines on Gifts to Physicians, the PhRMA Guidelines for Marketing Practices,
and the ACCME Standards for Commercial Support of Continuing Medical Education,
which may be applicable to the Copromote Products and services (including
without limitation the manufacturing, packaging, warehousing, handling and
distribution of samples of the Copromote Products) to be provided by NOVAVAX
hereunder. No employee of NOVAVAX or of any of its relevant Affiliates shall
make any representation, statement, warranty or guaranty with respect to the
Copromote Products that is not consistent with current labeling of the Copromote
Products or promotional materials approved by the PMC, that is deceptive or
misleading, that disparages the Copromote Products or the good name, good will
and reputation of KING or that diminishes in any material respect any KING
Trademark. NOVAVAX represents and warrants that its services hereunder will be
provided in a professional, ethical and competent manner.

        4.2     MANUFACTURE, SHIPMENT, ETC. OF THE NOVAVAX PRODUCTS.

                NOVAVAX (and/or its Affiliates) shall have the sole
responsibility for the manufacture, shipment, distribution, warehousing, billing
and order confirmation of the NOVAVAX Products and for the collection of
receivables resulting from sales of the NOVAVAX Products in the Territory. KING
may make recommendations to NOVAVAX from time to time regarding the price of and
pricing strategies for the NOVAVAX Products during the Term, including, without
limitation, price increases and decreases and the timing thereof, provided,

                                       9
<PAGE>   14

however, that NOVAVAX shall have the sole authority to determine the price of
the NOVAVAX Products in the Territory during the Term, including price increases
and decreases and the timing thereof. NOVAVAX shall manufacture or cause to be
manufactured the NOVAVAX Products and samples of the NOVAVAX Products in
accordance with all applicable laws, including, without limitation, the Act and
all applicable regulations thereunder, the NDA and current Good Manufacturing
Practices. NOVAVAX shall use its best efforts to maintain the NDA for the
NOVAVAX Products in good standing with the FDA and shall enforce all patents and
intellectual property rights of each and every kind associated therewith.
NOVAVAX shall use its best efforts to ensure that adequate quantities of the
NOVAVAX Products and samples of the NOVAVAX Products are available to meet the
anticipated demand for the NOVAVAX Products and samples of the NOVAVAX Products
in the Territory during the Term of this Agreement.

        4.3     NOVAVAX Detail and Sales Reports.

                (a)     NOVAVAX Products. Throughout the Term, NOVAVAX shall
provide KING with a report within thirty (30) calendar days after the end of
each calendar quarter, with the first such report due for the calendar quarter
during which the NOVAVAX Product Initiation Date occurs, setting forth the
following information regarding the efforts of NOVAVAX's sales force in
promoting and Detailing the NOVAVAX Products during the preceding quarter (or
part thereof): (i) the number of Details made and recorded by NOVAVAX's standard
record keeping procedures based on data recorded by the sales force; (ii) the
names, addresses and phone numbers of the OB/GYN's called upon; (iii) the names
of and the percentage of OB/GYN's Detailed who were provided with samples of the
NOVAVAX Products; (iv) the actual number of such samples delivered on each
Detail; and (v) such other information as may be required in the then current
Marketing Plan.

                (b)     KING Products. Throughout the Term, NOVAVAX shall
provide KING with a report within thirty (30) calendar days after the end of
each calendar quarter, with the first such report due for the calendar quarter
during which the KING Product Initiation Date occurs, setting forth the
following information regarding the efforts of NOVAVAX's sales force in
promoting and Detailing the KING Products during the preceding quarter (or part
thereof): (i) the number of Details made and recorded by NOVAVAX's standard
record keeping procedures based on data recorded by the sales force; (ii) the
names, addresses and phone numbers of the OB/GYN's called upon; (iii) the names
of and the percentage of OB/GYN's Detailed who were provided with samples of the
KING Products; (iv) the actual number of such samples delivered on each Detail;
and (v) such other information as may be required in the then current Marketing
Plan.

                (c)     The reports provided by NOVAVAX pursuant to Section
4.3(a) and 4.3(b) are referred to herein as the "NOVAVAX Detail Reports". Each

                                       10
<PAGE>   15

NOVAVAX Detail Report delivered pursuant hereto shall be delivered in an
electronic format and in hard copy form.

                (d)     Throughout the Term, NOVAVAX shall provide to KING a
weekly report setting forth the gross sales of the NOVAVAX Products in the
Territory for the previous business week. Additionally, within fifteen (15) days
after the end of each month, NOVAVAX shall provide to KING a summary report
setting forth (i) the gross sales of the NOVAVAX Products in the Territory for
such month, (ii) the gross sales of the NOVAVAX Products in the Territory since
January 1 of such year, (iii) the Net Sales of the NOVAVAX Products in the
Territory for such month and the itemized deductions taken in calculating all
such Net Sales, and (iv) the Net Sales of the NOVAVAX Products in the Territory
since January 1 of such year. All reports required by this Section 4.3(c) shall
be provided to KING either by facsimile or transmitted electronically, in each
case with a confirmation copy sent by mail.

                (e)     NOVAVAX shall furnish to KING, within thirty (30)
calendar days after the end of each Agreement Quarter and each calendar quarter
for which Residual Payments are due, a report setting forth in reasonable detail
the calculation of the total Net Sales of NOVAVAX Products in the Territory for
such Agreement Quarter or calendar quarter in a form approved by KING.

        4.4     NOVAVAX SALES FORCE.

                (a)     Except as agreed to by the parties and subject to the
terms and conditions of this Agreement, NOVAVAX shall be solely responsible for
the costs and expenses of establishing, maintaining and training NOVAVAX's (and
its Affiliates') sales force of sufficient size to perform its obligations
hereunder, and conducting NOVAVAX's other activities under this Agreement;
provided, however, that (i) such training shall be conducted in accordance with
Section 5.1 and (ii) the content and strategic direction of any training
provided by NOVAVAX that relates specifically to the Copromote Products shall be
coordinated with the PMC. Notwithstanding the foregoing, NOVAVAX shall pay
incentive compensation to its sales representatives having primary
responsibility for Detailing the Copromote Products with respect to sales of the
Copromote Products in the Territory in accordance with NOVAVAX's Sales Incentive
Compensation Plan for NOVAVAX's own products, it being understood that NOVAVAX
shall determine the target payout for the Copromote Products in a manner
consistent with the way in which it determines the target payouts for
prescription drug products of comparable commercial potential.

                (b)     To the extent practicable, all written, electronic and
visual communications provided to any of NOVAVAX's (and its Affiliates') sales
representatives regarding strategy, positioning or selling messages for the
Copromote Products will, at the request of the PMC, be subject to review by the
PMC and KING's Regulatory Affairs department in accordance with Section

                                       11
<PAGE>   16

5.2(a).

5.      TRAINING AND PROMOTIONAL MATERIAL

        5.1     TRAINING.

                (a)     Each of the parties agrees to make its sales
representatives available for training with respect to the marketing and sale of
the Copromote Products. The parties agree that KING shall, subject to the PMC's
approval, be responsible for developing and, if applicable, conducting training
programs for each of KING's and NOVAVAX's sales forces. Training shall be
carried out at a time which is mutually acceptable to the parties. The parties'
relevant local operating entity Affiliates shall be responsible for the
development and conduct of training programs, subject to the direction of KING
and NOVAVAX and the oversight of the PMC, on an ongoing basis to assure a
consistent, focused promotional strategy. As additional members are added to the
parties' respective sales forces responsible for marketing the Copromote
Products, training will be given to groups of the newly selected members.

                (b)     Each party shall decide where the training of its sales
representatives will occur and absorb the costs of transporting, housing and
maintaining their respective personnel for such training. Subject to the
oversight of the PMC, all sales and marketing training materials will be
prepared and supplied by KING.

        5.2     PROMOTIONAL MATERIALS.

                (a)     All written sales, promotion and advertising materials
("Marketing Materials") relating to the Copromote Products shall be consistent
with the Marketing Plans approved by the PMC. All Marketing Materials shall be
subject to copy clearance procedures established by the parties from time to
time, including review by each party. Marketing Materials prepared by either
party shall be provided to the other party for legal and regulatory comment,
which comment shall occur within five (5) days after such party's receipt of the
Marketing Materials approved by the PMC and shall be given due consideration.

                (b)     In all written or visual materials used in the Territory
related to the Copromote Products which identify either of the parties, the
parties will be presented and described to the medical communities (including,
for example, the physician, pharmacy, governmental, reimbursement and hospital
sectors) as joining in the promotion of the Copromote Products in the Territory.
All such written and visual materials and all documentary information,
promotional material, and oral presentations (where practical) regarding the
promoting of the Copromote Products will state this arrangement and will

                                       12
<PAGE>   17

display the names and logos of the parties with equal prominence, as permitted
by applicable law.

6.      COPROMOTE PRODUCT SAMPLES

        6.1     SUPPLY, STORAGE AND DISTRIBUTION OF SAMPLES.

                (a)     NOVAVAX Products. NOVAVAX shall provide KING, from time
to time on a schedule and in such quantities to be reasonably determined by the
PMC, with samples of the NOVAVAX Products to be used by KING solely in marketing
and promoting the Copromote Products in the Territory, in accordance with the
then current Marketing Plan. NOVAVAX shall ship the samples to one central
warehouse of KING, as designated by KING, and the risk of loss and
responsibility for handling and warehousing of the samples shall pass to KING
upon delivery to a carrier designated by KING. KING shall be responsible for
distributing the samples to its sales representatives in a timely manner. KING
shall also be responsible for securing the return of and reconciling existing
sample inventories from its discontinued field sales representatives. All
samples of the NOVAVAX Products provided to KING hereunder shall be accompanied
by an appropriate Certificate of Analysis of the NOVAVAX Product specifications
and an indication of expiration dating.

                (b)     KING Products. KING shall provide NOVAVAX, from time to
time on a schedule and in such quantities to be reasonably determined by the
PMC, with samples of the KING Products to be used by NOVAVAX solely in marketing
and promoting the Copromote Products in the Territory. KING shall ship the
samples to one central warehouse of NOVAVAX, as designated by NOVAVAX, and the
risk of loss and responsibility for handling and warehousing of the samples
shall pass to NOVAVAX upon delivery to a carrier designated by NOVAVAX. NOVAVAX
shall be responsible for distributing the samples to its sales representatives
in a timely manner. NOVAVAX shall also be responsible for securing the return of
and reconciling existing sample inventories from its discontinued field sales
representatives. All samples of the KING Products provided to NOVAVAX hereunder
shall be accompanied by an appropriate Certificate of Analysis of the KING
Product specifications and an indication of expiration dating.

        6.2     USE OF SAMPLES.

                (a)     NOVAVAX Products. Samples of the NOVAVAX Products
supplied by NOVAVAX to KING or to NOVAVAX's sales representatives for use in the
Territory shall be used by KING and NOVAVAX solely in making Detail calls to
OB/GYN's in the Territory pursuant to this Agreement. Upon its receipt of
NOVAVAX Product samples, KING shall be responsible for accountability and
compliance with the PDMA, and other applicable federal, state and local laws

                                       13
<PAGE>   18
and regulations relating to such samples or the distribution of same. NOVAVAX
shall be responsible for accountability and compliance with the PDMA, and other
applicable federal, state and local laws and regulations relating to NOVAVAX
Product samples that NOVAVAX supplies for distribution by NOVAVAX's sales
representatives. KING and NOVAVAX each shall be responsible for adherence by its
respective sales representatives to such laws and regulations.

                (b)     KING Products. Samples of the KING Products supplied by
KING to NOVAVAX or to KING's sales representatives shall be used by KING and
NOVAVAX solely in making Detail calls to OB/GYN's in the Territory pursuant to
this Agreement. Upon its receipt of KING Product samples, NOVAVAX shall be
responsible for accountability and compliance with the PDMA, and other
applicable federal, state and local laws and regulations relating to such
samples or the distribution of same. KING shall be responsible for
accountability and compliance with the PDMA, and other applicable federal, state
and local laws and regulations relating to KING Product samples that KING
supplies for distribution by KING's sales representatives. KING and NOVAVAX each
shall be responsible for adherence by its respective sales representatives to
such laws and regulations.

                (c)     Audit Rights. Each party or its appointed agents shall
have the right to audit the records and/or reports for the Copromote Product
samples, as required to be kept by the other party under the PDMA, during normal
business hours, at convenient times and upon no less than five (5) calendar
days' prior notice.

7.      CERTAIN REGULATORY MATTERS

        7.1     LICENSES.

                Each party hereto shall, at its sole cost and expense, maintain
in full force and effect all necessary licenses, permits and other
authorizations required by law, regulation, ordinance or statute to carry out
its duties and obligations in the Territory under this Agreement.

        7.2     REGULATORY RESPONSIBILITY.

                (a)     NOVAVAX Products. All regulatory matters regarding the
NOVAVAX Products shall remain under the control of NOVAVAX, subject to the
participation by KING in matters related to the marketing of the NOVAVAX
Products to OB/GYN's in the Territory. Notwithstanding the foregoing, NOVAVAX
shall promptly provide KING with copies of all communications received from any
regulatory agency or authority concerning the NOVAVAX Products or any Marketing
Materials related to the NOVAVAX Products and shall submit copies of all such
communications and filings to be made to any

                                       14
<PAGE>   19

regulatory agency or authority for prior review and comment within five (5)
business days. NOVAVAX shall provide adequate notice to KING and shall include
KING in all meetings with the FDA, electronic, in person, or otherwise. NOVAVAX
shall give due consideration to all comments timely made by KING and shall
notify KING, in writing, if it declines to address any such comments, stating
the reason therefor.

                (b)     KING Products. All regulatory matters regarding the KING
Products shall remain under the control of KING, subject to the participation by
NOVAVAX in matters related to the marketing of the KING Products to OB/GYN's in
the Territory. Notwithstanding the foregoing, KING shall promptly provide
NOVAVAX with copies of all communications received from any regulatory agency or
authority concerning the KING Products or any Marketing Materials and shall
submit copies of all communications and filings to be made to any regulatory
agency or authority for prior review and comment within five (5) business days.
KING shall provide adequate notice to NOVAVAX and shall include NOVAVAX in all
meetings with the FDA, electronic, in person, or otherwise. KING shall give due
consideration to all comments timely made by NOVAVAX and shall notify NOVAVAX,
in writing, if it declines to address any such comments, stating the reason
therefor.

        7.3     EFFICACY AND SAFETY INFORMATION.

                (a)     NOVAVAX Products. NOVAVAX shall furnish KING with
efficacy and safety information in its possession as reasonably requested by
KING to assist KING in promoting the NOVAVAX Products to OB/GYN's in the
Territory, including without limitation relevant clinical and safety data
included in the NDA for the NOVAVAX Products and additional information, if any,
related to the efficacy and safety profile of the NOVAVAX Products. Except for
that information that is to be disclosed to OB/GYN's in connection with
conducting Details, such information shall be treated as Confidential and
Proprietary Information pursuant to Section 12 of this Agreement and shall not
be disclosed to third parties without NOVAVAX's prior written approval or
direction.

                (b)     KING Products. KING shall furnish NOVAVAX with efficacy
and safety information reasonably requested by NOVAVAX to assist NOVAVAX in
promoting the KING Products to OB/GYN's in the Territory, including without
limitation relevant clinical and safety data included in the NDA for the KING
Products and additional information, if any, related to the efficacy and safety
profile of the KING Products. Except for that information that is to be
disclosed to OB/GYN's in connection with conducting Details, such information
shall be treated as confidential and proprietary information pursuant to Section
12 of this Agreement and shall not be disclosed to third parties without KING's
prior written approval or direction.

                                       15
<PAGE>   20

        7.4     NOTICE OF ADVERSE EVENTS.

                (a)     Each party shall promptly notify the other party of any
event(s) that materially affect(s) or could materially affect the marketing of
the Copromote Products, including without limitation adverse drug reactions and
governmental inquiries.

                (b)     NOVAVAX Products. Serious Adverse Events for the NOVAVAX
Products learned of by KING shall be submitted in writing to NOVAVAX within two
(2) business days from the date of learning thereof by KING. Non-Serious Adverse
Events for the NOVAVAX Products learned of by KING shall be submitted in writing
to NOVAVAX no more than five (5) business days from the date of learning thereof
by KING. NOVAVAX and/or its Affiliates shall have the sole responsibility for
reporting and responding to such events to applicable regulatory authorities in
the Territory; provided, that KING may take such actions (including issuing such
reports) as it determines is required by applicable law. NOVAVAX shall promptly
provide KING with copies of all periodic reports and product safety update
reports relating to the NOVAVAX Products which are filed or received from third
parties. Notwithstanding the foregoing, within one hundred twenty (120) days
after the Effective Date, the parties shall meet and establish a standard
operating procedure ("SOP") addressing the responsibilities of each party with
respect to adverse event reporting, which SOP shall supercede this Section 7.4,
it being understood, however, that with regard to the NOVAVAX Products, NOVAVAX
shall have the responsibility of reporting all adverse events to the appropriate
regulatory authorities.

                (c)     KING Products. Serious Adverse Events for the KING
Products learned of by NOVAVAX shall be submitted in writing to KING within two
(2) business days from the date of learning thereof by NOVAVAX. Non-Serious
Adverse Events for the KING Products learned of by NOVAVAX shall be submitted in
writing to KING no more than five (5) business days from the date of learning
thereof by NOVAVAX. KING and/or its Affiliates shall have the sole
responsibility for reporting and responding to such events to applicable
regulatory authorities in the Territory; provided, that NOVAVAX may take such
actions (including issuing such reports) as it determines is required by
applicable law. KING shall promptly provide NOVAVAX with copies of all periodic
reports and product safety update reports relating to the KING Products which
are filed or received from third parties. Notwithstanding the foregoing, within
one hundred twenty (120) days after the Effective Date, the parties shall meet
and establish an SOP addressing the responsibilities of each party with respect
to adverse event reporting, which SOP shall supercede this Section 7.4, it being
understood, however, that with regard to the KING Products, KING shall have the
responsibility of reporting all adverse events to the appropriate regulatory
authorities.

                                       16
<PAGE>   21

        7.5     PRODUCT TECHNICAL COMPLAINTS AND RECALLS.

                (a)     NOVAVAX Products. NOVAVAX shall have the sole authority
and responsibility to respond to any regulatory agencies, including without
limitation the FDA, to respond to NOVAVAX Product Technical Complaints and
medical complaints and to handle all returns, recalls or market withdrawals of
the NOVAVAX Products in accordance with applicable law, at NOVAVAX's cost and
expense; provided, however, that if any such returns, recalls or market
withdrawals of the NOVAVAX Products are caused solely by actions or inactions by
KING constituting a breach of the provisions of this Agreement or a violation of
applicable law, KING, as NOVAVAX's sole remedy, shall bear all reasonable Direct
Costs associated with such actions or inactions in connection therewith,
provided, however, that KING shall have no obligation to reimburse NOVAVAX for
any incidental or consequential damages incurred in connection therewith,
including, without limitation, any lost profits. Prior to the NOVAVAX Product
Initiation Date, the PMC shall adopt an SOP for handling NOVAVAX Product
Technical Complaints, medical inquiries and adverse event information received
by the parties not otherwise specified in this Agreement. The PMC shall revise
the SOP from time to time during the Term as the PMC deems necessary.

                (b)     KING Products. KING shall have the sole authority and
responsibility to respond to any regulatory agencies, including without
limitation the FDA, to respond to KING Product Technical Complaints and medical
complaints and to handle all returns, recalls or market withdrawals of the KING
Products in accordance with applicable law, at KING's cost and expense;
provided, however, that if any such returns, recalls or market withdrawals of
the KING Products are caused solely by actions or inactions by NOVAVAX
constituting a breach of the provisions of this Agreement or a violation of
applicable law, NOVAVAX, as KING's sole remedy, shall bear all reasonable Direct
Costs associated with such actions or inactions in connection therewith,
provided, however that NOVAVAX shall have no obligation to reimburse KING for
any incidental or consequential damages incurred in connection therewith,
including, without limitation, any lost profits. Prior to the KING Product
Initiation Date, the PMC shall adopt an SOP for handling KING Product Technical
Complaints, medical inquiries and adverse event information received by the
parties not otherwise specified in this Agreement. The PMC shall revise the SOP
from time to time during the Term as the PMC deems necessary.

                (c)     Each party shall promptly (but in any case, not later
than 48 hours) notify the other party in writing of any order, request or
directive of a court or other governmental authority to recall or withdraw a
Copromote Product. NOVAVAX shall be solely responsible for determining whether
to issue a recall or withdrawal and for the cost and expense of any such recall
or withdrawal of the NOVAVAX Products, subject to reasonable consultation with
KING. King shall be solely responsible for determining whether to issue a recall
or withdrawal and for

                                       17
<PAGE>   22

the cost and expense of any such recall or withdrawal of the KING Products,
subject to reasonable consultation with NOVAVAX.

                (d)     Because the NOVAVAX Products are manufactured by or on
behalf of NOVAVAX and the underlying NDA is owned solely by NOVAVAX or an
Affiliate of NOVAVAX, KING shall send NOVAVAX Product Technical Complaints to
NOVAVAX. If the NOVAVAX Product Technical Complaint cannot be categorized as a B
Complaint (meaning no actual or potential harm to patient), then the NOVAVAX
Product Technical Complaint will be categorized as an A Complaint. A Complaints
shall be sent to NOVAVAX within twenty-four (24) hours of receipt and B
Complaints shall be sent within three (3) business days of receipt, but no more
than four (4) calendar days from the receipt date by KING. NOVAVAX shall
promptly notify KING following receipt by NOVAVAX of any NOVAVAX Product
Technical Complaints.

                (e)     Because the KING Products are manufactured by or on
behalf of KING and the underlying NDA is owned solely by KING or an Affiliate of
KING, NOVAVAX shall send KING Product Technical Complaints to KING. If the KING
Product Technical Complaint cannot be categorized as a B Complaint (meaning no
actual or potential harm to patient), then the KING Product Technical Complaint
will be categorized as an A Complaint. A Complaints shall be sent to KING within
twenty-four (24) hours of receipt and B Complaints shall be sent within three
(3) business days of receipt, but no more than four (4) calendar days from the
receipt date by NOVAVAX. KING shall promptly notify NOVAVAX following receipt by
KING of any KING Product Technical Complaints.

                7.6     RETURNS.

                (a)     Any NOVAVAX Products returned to KING shall be shipped
to the facility designated by NOVAVAX, with shipping and other Direct Costs to
be paid by NOVAVAX. Risk of loss or damage with respect to NOVAVAX Products
shipped to NOVAVAX under this Section 7 shall pass to NOVAVAX on delivery to a
carrier designated by NOVAVAX. KING shall incur no liability of any nature in
the handling of such returns unless such NOVAVAX Products were handled or stored
improperly by KING.

                (b)     Any KING Products returned to NOVAVAX shall be shipped
to the facility designated by KING, with shipping and other Direct Costs to be
paid by KING. Risk of loss or damage with respect to the KING Products shipped
to KING under this Section 7 shall pass to KING on delivery to a carrier
designated by KING. NOVAVAX shall incur no liability of any nature in the
handling of such returns unless such KING Products were handled or stored
improperly by NOVAVAX.

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<PAGE>   23

        7.7     NOTICE OF GOVERNMENT INSPECTIONS.

                (a)     NOVAVAX agrees that, to the extent it becomes aware of
the results, observations and/or outcome of any inspections or audits of the
facilities or operations involved in the manufacture, processing, testing or
packaging of the Copromote Products conducted by governmental agencies,
including without limitation the FDA, NOVAVAX will notify KING of any such
information as it relates to the Copromote Products within three (3) days of
obtaining the information. NOVAVAX will provide KING copies of reports of
quality audits conducted by NOVAVAX and will apprise KING of material
manufacturing issues affecting supply of the Copromote Products.

                (b)     KING agrees that, to the extent it becomes aware of the
results, observations and/or outcome of any inspections or audits of the
facilities or operations involved in the manufacture, processing, testing or
packaging of the Copromote Products conducted by governmental agencies,
including without limitation the FDA, KING will notify NOVAVAX of any such
information as it relates to the Copromote Products within three (3) days of
obtaining the information. KING will provide NOVAVAX copies of reports of
quality audits conducted by KING and will apprise NOVAVAX of material
manufacturing issues affecting supply of the Copromote Products.

        7.8     GOVERNMENT INQUIRIES.

                Upon being contacted by the FDA or any other federal, state or
local agency for any regulatory purpose pertaining specifically to this
Agreement or to the Copromote Products, a party shall immediately notify the
other party. Either party may permit unannounced FDA or similar unannounced
inspections of Copromote Products or facilities and respond to the extent
necessary to comply with its obligations under applicable law. Each party shall
provide the other with notices of any other inspection and shall allow that
party to participate to the extent necessary in the sole opinion of that party,
in such inspections and responses pertaining to the Copromote Products.

        7.9     MEDICAL INQUIRIES.

                (a)     NOVAVAX Products. NOVAVAX shall handle all medical
inquiries concerning the NOVAVAX Products. KING shall refer all medical
information requests and/or medical inquiries to NOVAVAX in accordance with the
procedures set forth in the SOP referred to in Section 7.5.

                (b)     KING Products. KING shall handle all medical inquiries
concerning the KING Products. NOVAVAX shall refer all medical information
requests to the Regulatory Affairs department of KING in accordance with the
procedures set forth in the SOP referred to in Section 7.5.

                                       19
<PAGE>   24

8.      MANAGEMENT COMMITTEE

        8.1     ESTABLISHMENT OF THE PMC.

                The parties hereto recognize that it is in the best interests of
both parties to (a) maximize the sales of and profits arising from the Copromote
Products in the Territory and (b) optimize the marketing of the Copromote
Products in the Territory during the Term and to coordinate the activities of
both parties with respect to the promotion of the Copromote Products in the
Territory. Accordingly, the parties hereby establish a management committee (the
"Product Management Committee" or "PMC") made up of three (3) representatives of
each party. One of KING's senior representatives shall chair the PMC. Both
parties shall have the right from time to time to substitute individuals, on a
permanent or temporary basis, for any of its previously designated members of
the PMC. The members appointed by each party shall be vested with appropriate
decision-making authority and power with respect to the promotion and marketing
of the Copromote Products by such party. Members of each such committee shall be
employees of the parties (or their Affiliates), respectively, and shall not be
outside consultants, independent contractors or outside legal counsel, but such
Persons are permitted to attend meetings of the PMC. Each party shall bear its
own costs associated with its participation on the PMC.

        8.2     PURPOSE AND RESPONSIBILITIES OF THE PMC.

                The purpose of the PMC is to oversee the marketing and promotion
of the Copromote Products by the parties as contemplated by this Agreement by
coordinating the marketing and promotional efforts of the parties in the
Territory and maximizing the sales thereof. Accordingly, in addition to the
specific matters addressed elsewhere in this Agreement, and subject to the other
provisions of this Agreement the PMC shall approve the following:

                (a)     marketing and promotion activities for the Copromote
Products in the Territory;

                (b)     the annual Marketing Plan for the Copromote Products and
related Budget of Net Sales and Marketing Expenses for use in the Territory;

                (c)     the market definition against which the Copromote
Products will be measured in the Territory;

                (d)     Copromote Product production forecasts for the
Territory;

                (e)     Marketing Expenses in the Territory;

                                       20
<PAGE>   25

                (f)     targets for sales force staffing, number and frequency
of quarterly and annual Details in the Territory;

                (g)     Copromote Product positioning, strategy and objectives
in the Territory;

                (h)     determining the format and quantities of promotional
sales, marketing and educational materials for the Copromote Products which will
be provided to the OB/GYN's called upon in the Details by either party's sales
representatives in the Territory;

                (i)     quantities and schedule of delivery of samples of the
Copromote Products to be provided by NOVAVAX to each party's sales
representatives and to the OB/GYN's called upon in the Details by each party's
sales force in the Territory; and

                (j)     managed health care strategy tactics in the Territory.

        8.3     PMC MEETINGS.

                During the Term of this Agreement, the PMC shall meet: (a) at
least once each Agreement Quarter on a date and at a location to be agreed to by
the PMC, and (b) upon written notice by either party to the other that a meeting
is required or requested, in which case a meeting will be held within thirty
(30) calendar days of such notice on a date and at a location to be agreed to by
the parties, or sooner if warranted by circumstances. Notice requesting a
meeting shall include adequate information describing the activity to be
reviewed. Any meetings of the PMC may be held in person at a location to be
agreed to by the parties, or by videoconference or teleconference. Other
representatives of the parties may attend PMC meetings as consultants or
advisors to the participants. At least one week prior to any meeting of the PMC,
each of the parties shall provide the other party with a proposed agenda of the
matters to be discussed at such meeting. The parties shall agree, at the first
meeting of the PMC, upon procedures for maintaining meeting minutes. If the
parties cannot agree upon a time and location, then the PMC Chairman shall
designate, in his sole discretion, a reasonable time and location.

        8.4     VOTE AND APPROVAL.

                The PMC may take action on a matter at a meeting only if a
quorum exists with respect to that matter. The attendance of at least two (2)
members of the PMC of each party at a meeting shall constitute a quorum for the
transaction of business. Each member of the PMC shall be entitled to cast one
(1) vote on any matter to be acted upon at any meeting of the PMC. All decisions
made by the PMC shall require a unanimous vote by the members of the PMC present
at the meeting. Any action required or permitted to be taken at any meeting of
the

                                       21
<PAGE>   26

PMC may be taken without a meeting if the action is taken by all members of the
PMC. The action must be evidenced by one or more written consents describing the
action taken and signed by each member of the PMC.

        8.5     MARKETING PLAN AND BUDGET.

                On or prior to October 31 of each year during the Term of this
Agreement, the parties shall develop a Marketing Plan and the related Budget for
the following calendar year and submit such Marketing Plan to the PMC for
approval; provided, that the Marketing Plan with respect to the KING Products
for the period beginning with the KING Product Initiation Date shall be
developed by the parties and submitted for the approval of the PMC on or prior
to the KING Product Initiation Date, and the Marketing Plan with respect to the
NOVAVAX Products for the period beginning with the NOVAVAX Product Initiation
Date shall be developed by the parties and submitted for the approval of the PMC
on or prior to the NOVAVAX Product Initiation date. Each Marketing Plan shall
set forth the manner in which the Copromote Products are to be promoted and
Detailed in the Territory during the period to which the Marketing Plan relates
and shall include, at a minimum: (a) the minimum number of quarterly and annual
Details to be provided by each party and targets therefor which shall be
allocated in a professionally equitable manner (the "Minimum Targeted Details");
(b) Copromote Product positioning, strategy and tactics with supporting
advertising and promotional activity to be undertaken; (c) the Budget,
including, without limitation, direct to consumer advertising, if any; (d) any
training and/or sampling programs to be conducted; (e) medical and education
programs to be conducted; (f) public relations activities; (g) medical
conventions to be attended; and (h) such other information relating to the
marketing of the Copromote Products as deemed advisable by the PMC. Neither
party shall make any material change in any previously approved Marketing Plan
without the prior written approval of the PMC. Additionally, within one hundred
twenty (120) days after the Effective Date, NOVAVAX shall submit to the PMC for
review and approval an initial NOVAVAX Product production forecast, and KING
shall submit to the PMC for review and approval an initial KING Product
production forecast.

        8.6     ADDITIONAL STUDIES, LINE EXTENSIONS AND NEW PRODUCTS.

                (a)     Any proposals for additional clinical studies of any
NOVAVAX Product, including, without limitation, Phase IV studies and clinical
studies for purposes of expanding the indications or otherwise changing the
label for such NOVAVAX Product shall be submitted to the PMC for consideration,
whether such studies are proposed by KING or NOVAVAX.

                        (i)     If KING, in its sole discretion, elects to
equally share with NOVAVAX and actually pays those Direct Costs for such study
for which NOVAVAX will be responsible, KING shall be entitled to receive fifty
percent

                                       22
<PAGE>   27

(50%) of any revenues that NOVAVAX may receive in connection with such study. If
KING, in its sole discretion, elects not to share in the costs of such study,
NOVAVAX shall be free to proceed with such study and KING shall have no right to
receive any portion of any revenue NOVAVAX receives in connection therewith so
long as such revenues are clearly identifiable and separable.

                        (ii)    If NOVAVAX, in its sole discretion, elects to
equally share with KING and actually pays those Direct Costs for such study for
which KING will be responsible, NOVAVAX shall be entitled to receive fifty
percent (50%) of any revenues that KING may receive in connection with such
study. If NOVAVAX, in its sole discretion, elects not to share in the costs of
such study, KING shall be free to proceed with such study and NOVAVAX shall have
no right to receive any portion of any revenue KING receives in connection
therewith so long as such revenues are clearly identifiable and separable.

                (b)     Any proposals for development of additional NOVAVAX
Products, including, without limitation, new formulations and line extensions,
shall be submitted to the PMC for consideration, whether such development
activities are proposed by NOVAVAX or KING. If KING, in its sole discretion,
elects to equally share with NOVAVAX and actually pays those Direct Costs for
such development activities for which NOVAVAX will be responsible, KING shall be
entitled to receive fifty percent (50%) of any revenues that NOVAVAX actually
receives from sales of products resulting from such development activities and
any such additional products shall become NOVAVAX Products under this Agreement.
If KING, in its sole discretion, elects not to share in the costs of such
development activities, NOVAVAX shall be free to proceed with such development
activities and KING shall have no right to receive any portion of any revenues
in connection therewith so long as such revenues are clearly identifiable and
separable and such additional products shall not be considered to be NOVAVAX
Products under this Agreement (i.e., NOVAVAX will have the right to receive all
the benefits in connection with such additional products and KING shall have no
obligations in connection therewith).

        8.7     DISPUTE RESOLUTION.

                (a)     The parties recognize that disputes as to certain
matters may from time to time arise during the Term of this Agreement that
relate to either party's rights and/or obligations hereunder. It is the
objective of the parties to establish procedures to facilitate the resolution of
disputes arising under this Agreement in an expedient manner by mutual
cooperation and without resort to litigation. To accomplish this objective, the
parties agree to follow the procedures set forth in this Section 8.7 if and when
a dispute arises under this Agreement.

                (b)     Unless otherwise specifically recited in this Agreement,
disputes between the parties under this Agreement shall be first referred to the

                                       23
<PAGE>   28

PMC by either party as soon as reasonably possible after such dispute has
arisen. If the PMC is unable to resolve such a dispute within fifteen (15) days
of being requested by a party to resolve such dispute, either party may, by
written notice to the other, have such dispute referred to their respective
executive officers designated below or their designees, for attempted resolution
by negotiations within thirty (30) days after such notice is received. The
designated officers are as follows:

                        For NOVAVAX: President of Novavax, Inc.

                        For KING: President of KING Pharmaceuticals, Inc.

                        Any dispute that cannot be resolved within thirty (30)
calendar days after submission to the designated officers shall be submitted for
arbitration in accordance with the rules of the American Arbitration
Association, and the award or decision made by the arbitrator(s) designated
pursuant to the American Arbitration Association rules of arbitration shall be
binding upon the parties hereto and a judgment consistent therewith may be
entered in any court of competent jurisdiction; provided, however, that nothing
herein contained shall preclude a party from seeking equitable remedies in a
court of competent jurisdiction in order to enforce the provisions of Section 16
hereof. Any proceeding brought by NOVAVAX against KING shall be brought in a
state or federal court in Tennessee. Any proceeding brought by KING against
NOVAVAX shall be brought in a state or federal court in Maryland.

                (c)     Notwithstanding Section 8.7(b), if the PMC proposes a
modification to a previously approved Marketing Plan and such modification is
expected to have a material adverse impact on the results of operations of one
of the parties then the individuals identified in Section 8.7(b) shall mutually
agree to such modifications prior to the implementation thereof.

9.      FEES AND EXPENSES

        9.1     CONSIDERATION FEE.

                (a)     NOVAVAX Products. Within forty-five (45) days after the
end of each calendar quarter during the Term, NOVAVAX shall pay to KING (by wire
transfer of immediately available funds to an account designated by KING to
NOVAVAX in writing) an amount ("NP Consideration Fee") equal to fifty percent
(50%) of the Net Sales of the NOVAVAX Products in the Territory during such
quarter minus fifty percent (50%) of the Net Costs of NOVAVAX Products in the
Territory during such quarter; provided, however, that NOVAVAX shall be solely
responsible for the Net Costs of NOVAVAX Products to the extent that such Net
Costs, as a percentage of Net Sales, exceed seventeen percent (17%)

                                       24
<PAGE>   29

during any calendar quarter. By way of example only, Exhibit 9.1 reflects a
sample calculation of the NP Consideration Fee.

                (b)     KING Products. Within forty-five (45) days after the end
of each calendar quarter during the Term, KING shall pay to NOVAVAX (by wire
transfer of immediately available funds to an account designated by NOVAVAX to
KING in writing) an amount ("KP Consideration Fee") equal to (i) fifty percent
(50%) of the Incremental Sales for the KING Products during such quarter
(calculated using the baseline sales figures on Exhibit 9.1(b)) minus (ii) fifty
percent (50%) of the Incremental Costs for the KING Products during such
quarter. By way of example only, Exhibit 9.1 reflects a sample calculation of
the KP Consideration Fee.

        9.2     MILESTONE PAYMENTS.

                KING shall pay NOVAVAX Five Million Dollars ($5,000,000) if (i)
the NDA for ESTRASORB(TM) is accepted for filing by the FDA on or before June
30, 2001; and (ii) NOVAVAX provides KING with the Consultant Opinion Letters
required to be delivered pursuant to Section 5(a) of that certain Note Purchase
Agreement dated as of December 19, 2000 by and between King and Novavax (the
"Note Purchase Agreement"), King shall pay NOVAVAX Two Million Five Hundred
Thousand Dollars ($2,500,000) if (i) the NDA for ESTRASORB(TM) is accepted for
filing by the FDA after June 30, 2001, but on or before September 30, 2001; and
(ii) NOVAVAX provides KING with the Consultant Opinion Letters required to be
delivered pursuant to Section 5(a) of the Note Purchase Agreement.

        9.3     RESIDUAL PAYMENTS.

                (a)     Payments by NOVAVAX. If this Agreement shall expire at
the end of the Initial Term and KING shall not have elected (or shall not have
the right to elect) to extend the Initial Term with respect to the NOVAVAX
Products for the Extended Promotion Term, then for the twenty-four (24) month
period after the date of such expiration: (i) NOVAVAX shall make residual
payments (the "Residual Payments") to KING equal to twenty-five percent (25%) of
Net Sales of the NOVAVAX Products during such period, and (ii) shall conduct its
business involving the marketing and sale of the NOVAVAX products only in the
ordinary course and shall not affect the time of any sales of the NOVAVAX
Products in order to affect the amount of Net Sales for such period. Within
forty-five (45) days after the end of each calendar quarter (or part thereof)
during such period, NOVAVAX shall pay to KING (by wire transfer of immediately
available funds to an account designated by KING to NOVAVAX in writing) an
amount equal to the Residual Payments accrued but unpaid through the end of such
calendar quarter.

                                       25
<PAGE>   30

                (b)     Payments by KING. For the twenty-four (24) month period
after the date of expiration of this Agreement: (i) KING shall make Residual
Payments to NOVAVAX equal to twenty-five percent (25%) of Incremental Sales of
the KING Products during such period, and (ii) shall conduct its business
involving the marketing and sale of the KING products only in the ordinary
course and shall not affect the time of any sales of the KING Products in order
to affect the amount of Net Sales for such period. Within forty-five (45) days
after the end of each calendar quarter (or part thereof) during such period,
KING shall pay to NOVAVAX (by wire transfer of immediately available funds to an
account designated by NOVAVAX to KING in writing) an amount equal to the
Residual Payments accrued but unpaid through the end of such calendar quarter.

        9.4     MARKETING EXPENSES.

                (a)     In accordance with Section 8.5, as part of the Marketing
Plan, the parties shall develop a Budget of Marketing Expenses and submit such
Marketing Plan to the PMC for approval for each calendar year during the Term.
The parties acknowledge and agree that the Marketing Expenses approved by the
PMC in the Budget shall be shared equally by the parties.

                (b)     NOVAVAX Products. NOVAVAX shall initially pay for all
Marketing as such Marketing Expenses are incurred for NOVAVAX Products and shall
keep accurate and reasonably detailed records of such payments. NOVAVAX shall
provide KING with a weekly update of an estimate of the Marketing Expenses and
other PMC approved miscellaneous expenses incurred by NOVAVAX during the
previous week within fifteen (15) days after the end of each month. NOVAVAX
shall provide KING with a detailed statement of Marketing Expenses and other
PMC-approved miscellaneous expenses incurred during such month along with an
invoice for KING's share thereof, which invoice will be payable, less any
credits for Marketing Expenses and other PMC-approved miscellaneous expenses
incurred and paid by KING within fifteen (15) days of KING's receipt thereof.
KING shall also provide NOVAVAX with a weekly update of an estimate of the
Marketing Expenses and other PMC approved miscellaneous expenses incurred and
paid (other than to NOVAVAX) by it during the previous week and within fifteen
(15) days after the end of each month, KING shall provide NOVAVAX with a
detailed statement of all Marketing Expenses and other PMC-approved
miscellaneous expenses incurred by KING during such month. Within thirty (30)
days after the end of each calendar quarter during the Term, NOVAVAX shall
prepare a reconciliation statement of Marketing Expenses incurred by each party
during such calendar quarter. If such reconciliation statement shall show that
either party reasonably incurred and paid Marketing Expenses and other
PMC-approved miscellaneous costs and expenses in excess of the amount payable by
such party, and that the other party incurred and paid Marketing Expenses below

                                       26
<PAGE>   31

the amount payable by such party, then within thirty (30) days after such
reconciliation statement is submitted to KING, the underpaying party shall
reimburse the other party for the amount of such underpayment. Any overpayment
which is not reimbursed in accordance with the foregoing sentence shall be
credited to Marketing Expenses payable by the overpaying party in the following
calendar year, up to an amount equal to five percent (5%) of the amount that was
payable by such party pursuant to this Section 9.4(b) as applicable, in the year
to which the overpayment relates, and the remainder of any such unreimbursed
overpayment shall be repaid as determined by the PMC.

                (c)     KING Products. KING shall initially pay for all
Marketing as such Marketing Expenses are incurred for KING Products and shall
keep accurate and reasonably detailed records of such payments. KING shall
provide NOVAVAX with a weekly update of an estimate of the Marketing Expenses
incurred during the previous week within fifteen (15) days after the end of each
month. KING shall provide NOVAVAX with a detailed monthly statement of Marketing
Expenses and other PMC-approved miscellaneous expenses related to Incremental
Sales incurred during such month along with an invoice for NOVAVAX's share
thereof, which invoice will be payable, less any credits for Marketing Expenses
and other PMC-approved miscellaneous expenses incurred and paid by NOVAVAX
within fifteen (15) days of NOVAVAX's receipt thereof. NOVAVAX shall also
provide KING with a weekly update of an estimate of the Marketing Expenses and
other PMC-approved miscellaneous expenses incurred by it during the previous
week and within fifteen (15) days after the end of each month, NOVAVAX shall
provide KING with a detailed statement of all Marketing Expenses and other
PMC-approved miscellaneous expenses incurred by NOVAVAX during such month.
Within thirty (30) days after the end of each calendar quarter during the Term,
KING shall prepare a reconciliation statement of Marketing Expenses incurred by
each party during such calendar quarter. If such reconciliation statement shall
show that either party reasonably incurred and paid Marketing Expenses and other
PMC-approved miscellaneous costs and expenses in excess of the amount payable by
such party, and that the other party incurred and paid Marketing Expenses below
the amount payable by such party, then within thirty (30) days after such
reconciliation statement is submitted to NOVAVAX, the underpaying party shall
reimburse the other party for the amount of such underpayment. Any overpayment
which is not reimbursed in accordance with the foregoing sentence shall be
credited to Marketing Expenses payable by the overpaying party in the following
calendar year, up to an amount equal to five percent (5%) of the amount that was
payable by such party pursuant to this Section 9.4(c) as applicable, in the year
to which the overpayment relates, and the remainder of any such unreimbursed
overpayment shall be repaid as determined by the PMC.

                                       27
<PAGE>   32

        9.5     EXCESS DETAIL COSTS.

                If, during any calendar year during the Term, a party reasonably
determines, based on the NOVAVAX Detail Reports or the KING Detail Reports, as
the case may be, that the other party is failing to conduct the minimum number
or percentage of Details (the "Minimum Targeted Details") for the NOVAVAX
Products required to be conducted by such other party by the Marketing Plan for
such year, then such party may elect to conduct a greater number of Details for
the NOVAVAX Products than the Minimum Targeted Details for such party (such
greater number of Details, the "Excess Details"). A party conducting Excess
Details for the NOVAVAX Products shall notify the other party promptly in
writing following the Agreement Quarter in which such Excess Details were
conducted, and within thirty (30) days after receipt of such notice, the other
party shall pay to such party an amount equal to two (2) times the then current
Detail Cost multiplied by the number of such Excess Details; provided, that any
payments to a party under this Section 9.5 on Details for the NOVAVAX Products
in excess of one hundred five percent (105%) of the Minimum Targeted Details for
such party for any calendar year shall be subject to the prior approval of the
PMC.

        9.6     OTHER MISCELLANEOUS COSTS AND EXPENSES.

                Except as otherwise expressly provided in this Agreement, KING
and NOVAVAX shall each pay one-half (1/2) of all costs and expenses, which are
specifically approved by the PMC; provided, however that this Section 9.6 shall
not be construed to require KING or any of its Affiliates to manufacture the
NOVAVAX Products or samples of the NOVAVAX Products, nor shall it be construed
to require NOVAVAX or any of its Affiliates to manufacture the KING Products or
samples of the KING Products.

        9.7     COSTS SAVINGS.

                (a)     If KING is able to assist NOVAVAX in reducing NOVAVAX's
cost of goods of any NOVAVAX Product, then NOVAVAX shall pay to KING one half
(1/2) of the resulting cost savings and the parties shall in good faith
establish arrangements for making such payments; provided, however, this Section
9.7 shall not be construed or interpreted to require KING or any of its
Affiliates to manufacture any NOVAVAX Product or any active ingredients or to
provide any components or labeling.

                (b)     If NOVAVAX is able to assist KING in reducing KING's
cost of goods of any KING Product, then KING shall pay to NOVAVAX one half (1/2)
of the resulting cost savings and the parties shall in good faith establish
arrangements for making such payments; provided, however, this Section 9.7 shall
not be construed or interpreted to require NOVAVAX or any of its Affiliates

                                       28
<PAGE>   33

to manufacture any KING Product or any active ingredients or to provide any
components or labeling.

10.     RECORDKEEPING AND AUDITS

        10.1    MAINTENANCE OF BOOKS AND RECORDS.

                Each party shall maintain complete and accurate books and
records in sufficient detail, in accordance with GAAP and all applicable laws,
rules, ordinances and regulations, to enable verification of the performance of
such party's obligations under this Agreement. Such records shall be maintained
for a period of twenty-four (24) months after the end of the Term or longer if
required by applicable law.

        10.2    PAYMENT AUDITS.

                (a)     Either party (herein, the "Auditing Party") may demand,
no more than once during any calendar year from the KING Product Initiation Date
until two (2) years following the end of the Term, an audit of the relevant
books and records of the other party (herein, the "Audited Party") in order to
verify the Audited Party's reports on the matters addressed in this Agreement.
Upon no less than fifteen (15) days' prior written notice to the Audited Party,
the Audited Party shall grant access to members of a nationally recognized
independent public accounting firm selected by the Auditing Party to the
relevant books and records of the Audited Party in order to conduct a review or
audit thereof. Such access shall be available during normal business hours. The
accountants shall report their conclusions and calculations to the Auditing
Party and the Audited Party; provided, that in no event shall the accountants
disclose any information of the Audited Party except to the extent necessary to
verify the Audited Party's reporting and other compliance with the terms of this
Agreement and, at the request of the Audited Party, such accountants will
execute appropriate non-disclosure agreements. Except as hereinafter set forth,
the Auditing Party shall bear the full cost of the performance of any such
audit. Any information obtained from an audit under this Section 10.2 shall be
deemed Confidential and Proprietary Information of the Audited Party.

                (b)     If, as a result of any audit of the books and records of
the Audited Party, it is shown that the Audited Party's payments to the Auditing
Party under this Agreement with respect to the period of time audited were less
than the amount which should have been paid to the Auditing Party pursuant to
this Agreement, then the Audited Party shall pay to the Auditing Party the
amount of such shortfall within thirty (30) days after the Auditing Party's
demand therefor. If, as a result of any audit of the books and records of
Audited Party, it is shown that the Audited Party's payments to the Auditing
Party under this Agreement with respect to the period of time audited were

                                       29
<PAGE>   34

more than the amount which should have been paid to the Auditing Party pursuant
to this Agreement, then the Auditing Party shall pay to the Audited Party the
amount of such overpayment within thirty (30) days after the Audited Party's
demand therefor. In addition, if any amount payable by the Audited Party
pursuant to this Section 10.2 is more than the amount which should have
originally been paid pursuant to this Agreement by an amount in excess of ten
percent (10%) of the payments actually made with respect to the period in
question, then the Audited Party shall also reimburse the Auditing Party for its
documented reasonable out-of-pocket costs and expenses incurred in connection
with the audit.

        10.3    COMPLIANCE AUDITS.

                In addition to the access and audit rights of the parties set
forth in Section 10.2, no more than once during any calendar year during the
Term, each party shall, and shall cause its Affiliates to, afford to the other
party reasonable access during normal business hours (and at such other times as
the parties may mutually agree) to the relevant books, records and other
information of such party upon reasonable prior notice from the other party may
reasonably request in order to monitor such party's compliance with such party's
obligations under the applicable Marketing Plan and its other non-monetary
obligations under this Agreement. Such access shall be available during normal
business hours. Any inspection conducted by either party pursuant to this
Section 10.3 shall be at the sole cost and expense of such party.

11.     TERM AND TERMINATION

        11.1    TERM OF AGREEMENT.

                (a)     The initial term of this Agreement (the "Initial Term")
shall commence as of the Effective Date hereof and, unless terminated sooner or
extended as provided below, shall continue until the last to expire of any
patent rights covering the NOVAVAX Products which grant exclusivity to the
marketing of the NOVAVAX Products (the Initial Term, as extended or sooner
terminated, the "Term").

                (b)     If NOVAVAX (or any of its Affiliates) shall obtain any
additional patent or other exclusive rights with respect to the manufacturing,
sale, marketing or promotion of the NOVAVAX Products, and such rights shall have
a term which extends beyond the Initial Term ("Additional Exclusivity Rights"),
then NOVAVAX shall so notify KING promptly and KING may, in its sole discretion,
elect to extend the Initial Term until the expiration or termination of such
Additional Exclusivity Rights (the "Extended Promotion Term"); provided,
however, that KING shall not be entitled to extend the Initial

                                       30
<PAGE>   35

Term pursuant to this Section 11.1(b) if KING shall then be in breach or default
of this Agreement in any material respect. If KING shall elect to extend the
Initial Term pursuant to this Section 11.1(b), then KING shall provide written
notice thereof to NOVAVAX at least sixty (60) days prior to the expiration of
the Initial Term, in which case the terms and conditions of this Agreement shall
remain in full force and effect until the expiration of the Extended Promotion
Term, unless terminated sooner as provided herein. In connection with any
extension of the Initial Term pursuant to this Section 11.1(b), the parties
shall in good faith enter into such amendments or modifications to this
Agreement that may be necessary or appropriate to implement the terms and
conditions of this Agreement, as modified or supplemented by the Additional
Exclusivity Rights; provided, that the extension provided under this Section
11.1(b) shall not be subject to agreement on such amendments or modifications,
and failing such agreement this Agreement shall continue in full force and
effect.

        11.2    TERMINATION BY NOVAVAX.

                (a)     NOVAVAX shall have the right to terminate this Agreement
except as provided in Section 11.4 below, at any time upon written notice to
KING, if KING breaches in a material way any of the representations, warranties,
covenants or agreements set forth in this Agreement or otherwise materially
defaults in the performance of any of its duties or obligations under this
Agreement, which breach or default shall not be cured within sixty (60) days
after written notice is given to KING specifying the breach or default.

                (b)     NOVAVAX shall have the right to terminate this Agreement
with respect to any KING Product upon thirty (30) days' prior notice to KING if
there has been a material adverse change in the market for such KING Product in
the Territory such as a recall or withdrawal of such KING Product, or a safety
problem related to such KING Product, which was not remedied by KING within
sixty (60) days after receiving notice of such change.

                (c)     To the extent permitted by law, NOVAVAX shall have the
right to terminate this Agreement immediately upon notice to KING, if KING is
declared bankrupt or insolvent where there is an assignment for the benefit of
creditors, or if a receiver is appointed or proceedings commenced, (and not
dismissed within ninety (90) days) voluntarily or involuntarily, under any
bankruptcy or similar law.

        11.3    TERMINATION BY KING.

                KING shall have the right to terminate this Agreement, in its
sole discretion, as follows:

                (a)     at any time on or before June 30, 2001 or immediate
notice, in the event that KING, in conducting its continued due diligence on the
NOVAVAX

                                       31
<PAGE>   36

Products, determines, in its sole discretion, that there are safety or efficacy
concerns relating to the NOVAVAX Products;

                (b)     immediately upon written notice to NOVAVAX, if (i) the
FDA shall not have given written notice to NOVAVAX that the FDA has accepted the
NDA for the ESTRASORB(TM) Model Claims on or prior to March 31, 2002, or (ii)
KING is advised between March 31, 2002 and December 31, 2002, by a nationally
recognized pharmaceuticals consulting firm, that the FDA is not expected to
approve the NDA for the ESTRASORB(TM) by December 31, 2002;

                (c)     within sixty (60) days after the third anniversary of
the NOVAVAX Product Initiation Date, upon sixty (60) days' written notice to
NOVAVAX if annualized Net Sales of the NOVAVAX Products, based on the run rate
over the preceding six (6) months are less than Fifty Million dollars
($50,000,000);

                (d)     except as provided in Section 11.4 below, at any time
upon written notice to NOVAVAX, if NOVAVAX breaches in a material way any of the
representations, warranties, covenants or agreements set forth in this Agreement
or otherwise materially defaults in the performance of any of its duties or
obligations under this Agreement, which breach or default shall not be cured
within sixty (60) days after written notice is given to NOVAVAX specifying the
breach or default;

                (e)     upon thirty (30) days' prior notice to NOVAVAX if there
has been a material adverse change in the market for a NOVAVAX Product in the
Territory such as a recall or withdrawal of such NOVAVAX Product, or a safety
problem related to such NOVAVAX Product;

                (f)     with respect to any KING Product, upon thirty (30) days'
prior notice to NOVAVAX if there has been a material adverse change in the
market for such KING Product in the Territory such as a recall or withdrawal of
such King Product, or a safety problem related to such KING Product; or

                (g)     immediately upon notice to NOVAVAX, to the extent
permitted by law, if NOVAVAX is declared bankrupt or insolvent where there is an
assignment for the benefit of creditors, or if a receiver is appointed or
proceedings commenced (and not dismissed within ninety (90) days), voluntarily
or involuntarily, under any bankruptcy or similar law.

                (h)     an "Event of Default" shall have occurred under that
certain 4% Convertible Senior Note, dated December 19, 2000, made by NOVAVAX to
KING.

                                       32
<PAGE>   37

        11.4    FAILURE TO MEET DETAIL REQUIREMENTS.

                Notwithstanding any provision in this Agreement to the contrary,
in the event that either party (the "Nonperforming Party") fails to perform at
least ninety percent (90%) of the minimum number of Details it is required to
perform during any calendar year and the other party has performed at least
ninety percent (90%) of the minimum number of Details it is required to perform
during such calendar year, such other party shall have sixty (60) days from its
receipt of the Nonperforming Party's final Detail Report for such calendar year
to notify the Nonperforming Party that it is in breach of such obligations, in
which event the Nonperforming Party shall have the opportunity to cure such
default by providing a sufficient number of extra Details to make up for such
short fall prior to the end of the first full calendar quarter following the
calendar quarter in which the other party provides such breach notice to the
Nonperforming Party. In the event the Nonperforming Party fails to so cure such
default, the other party may, within thirty (30) days after the end of such
calendar quarter, terminate this Agreement on sixty (60) days' prior notice to
the Nonperforming Party. If the other party (i) fails to give timely notice of
the Nonperforming Party's breach or of termination due to the other
Nonperforming Party's failure to cure such breach in accordance with this
Section 11.4 or (ii) elects, in accordance with Section 9.5 hereof, to perform
excess Details to make up the Nonperforming Party's shortfall of required
Details, the other party shall be deemed to have waived its rights under this
Section 11.4 with respect to such breach, provided, however, that any such
waiver shall not be construed as a waiver of such other party's rights under
this Section 11.4 as to any further breaches by the Nonperforming Party.
Notwithstanding the foregoing, the parties agree that the Nonperforming Party
shall not be in breach of its Detailing obligations for any calendar year
hereunder if the Nonperforming Party provides at least ninety percent (90%) of
the minimum number of Details it is required to perform during such calendar
year.

        11.5    EFFECTS OF TERMINATION.

                (a)     Neither the termination nor expiration of this Agreement
shall release or operate to discharge either party from any liability or
obligation that may have accrued prior to such termination or expiration. Any
termination of this Agreement as provided herein shall not be an exclusive
remedy but shall be in addition to any remedies whatsoever that may be available
to the terminating party.

                (b)     Notwithstanding the giving of any notice of termination
pursuant to this Section 11, each party shall continue to fulfill its
obligations under this Agreement at all times until the effective date of any
such termination.

                                       33
<PAGE>   38

        11.6    ACTIONS UPON TERMINATION.

                (a)     NOVAVAX Products. Upon the termination or expiration of
this Agreement for any reason with respect to the NOVAVAX Products, KING shall
immediately cease all of its promotional and marketing activities for the
terminated NOVAVAX Products, discontinue any use of the NOVAVAX Trademarks
related to the terminated NOVAVAX Products, and return to NOVAVAX or destroy all
sales training and Marketing Materials for the terminated NOVAVAX Products
containing NOVAVAX Trademarks and any remaining terminated NOVAVAX Products
samples (not already distributed or destroyed with destruction certified by
KING). After any termination NOVAVAX shall retain the right to use any sales
training and Marketing Materials developed under the auspices of the PMC during
the Term of this Agreement, provided, however, that NOVAVAX shall have no
further right to use KING's name or any KING Trademark or logos in connection
therewith.

                (b)     KING Products. Upon the termination or expiration of
this Agreement for any reason with respect to the KING Products, NOVAVAX shall
immediately cease all of its promotional and marketing activities for the
terminated KING Products, discontinue any use of the KING Trademarks related to
the terminated KING Products, and return to KING or destroy all sales training
and Marketing Materials for the terminated KING Products containing KING
Trademarks and any remaining terminated KING Products samples (not already
distributed or destroyed with destruction certified by NOVAVAX). After any
termination KING shall retain the right to use any sales training and Marketing
Materials developed under the auspices of the PMC during the Term of this
Agreement, provided, however, that KING shall have no further right to use
NOVAVAX's name or any of the NOVAVAX Trademarks or logos in connection
therewith.

        11.7    SURVIVAL.

                The representations, warranties, covenants and agreements of the
parties in Sections 3.3(e), 4.3(e), 9 (to the extent applicable pursuant to
Section 11.8), 10, 11, 12, 13, 14, 15 and 16 hereof shall survive any expiration
or termination of this Agreement.

        11.8    PAYMENTS UPON TERMINATION.

                (a)     The expiration or termination of this Agreement pursuant
to this Section 11 with respect to any Copromote Product shall not release (i)
either party from any obligation to pay to the other party any amounts accrued
under Section 9 of this Agreement in connection with activities completed,
expenses accrued and Net Sales realized for such Copromote Product with respect
to the period prior to the effective date of such expiration or termination; or
(ii) if applicable, NOVAVAX from any obligation to make Residual Payments to
KING;

                                       34
<PAGE>   39

provided, that no further amounts shall be payable under Section 9, except as
provided for in this Section 11.

                (b)     Within thirty (30) days after the expiration or
termination of this Agreement, KING shall provide to NOVAVAX (i) a KING Detail
Report for the month during which such expiration or termination occurs (and all
KING Detail Reports for prior months that were required to be submitted to
NOVAVAX pursuant to Section 3.3 but were not submitted); (ii) a statement of Net
Sales for the KING Products during the period of January 1 of the calendar year
in which such expiration or termination occurs through the effective date of
such expiration or termination; (iii) a reasonably detailed statement of
Marketing Expenses incurred by KING during such period; and (iv) a reasonably
detailed statement of costs and expenses incurred by KING in performing Excess
Details, if any, during such period.

                (c)     Within thirty (30) days after the expiration or
termination of this Agreement, NOVAVAX shall provide to KING (i) a NOVAVAX
Detail Report for the month during which such expiration or termination occurs
(and all NOVAVAX Detail Reports for prior months that were required to be
submitted to KING pursuant to Section 4.3 but were not submitted); (ii) a
statement of Net Sales for the NOVAVAX Products during the period of January 1
of the calendar year in which such expiration or termination occurs through the
effective date of such expiration or termination; and (iii) a reasonably
detailed statement of Marketing Expenses incurred by NOVAVAX during such period;
and (iv) a reasonably detailed statement of costs and expenses incurred by
NOVAVAX in performing Excess Details, if any, during such period.

                (d)     Within thirty (30) days after receipt of such
information from NOVAVAX and KING, the PMC shall determine the net amount due
and or payable by KING and NOVAVAX, and such amount shall be paid by the parties
within thirty (30) days after such PMC determination.

                (e)     In the event of termination of this Agreement pursuant
to Section 11.3(b), NOVAVAX, as KING's sole remedy for the failure to have such
Model Claims approved, shall, within thirty (30) days after the effective date
of such termination, pay to KING an amount equal to all Marketing Expenses paid
and other PMC approved miscellaneous expenses by KING incurred under Section 9.2
and Section 9.4 hereof prior to the date of termination, less any reimbursements
NOVAVAX has previously made to KING for NOVAVAX's share of such Marketing
Expenses and other PMC approved miscellaneous expenses.

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<PAGE>   40

12.     CONFIDENTIALITY; OWNERSHIP

        12.1    CONFIDENTIAL INFORMATION.

                (a)     Each party acknowledges that it may receive confidential
or proprietary information of the other party in the performance of this
Agreement, including without limitation information obtained or reviewed in
connection with any audits or investigations performed pursuant to Section 10.2
or Section 10.3 of this Agreement. Each party shall hold confidential and shall
not, directly or indirectly, disclose, publish or use for the benefit of any
third party or itself, except in carrying out its duties hereunder, any
confidential or proprietary information of the other party or confidential or
proprietary information jointly developed by the parties, without first having
obtained the furnishing party's written consent to such disclosure or use.
"Confidential or Proprietary Information" shall include without limitation
know-how, scientific information, clinical data, efficacy and safety data,
adverse event information, formulas, methods and processes, specifications,
pricing information (including discounts, rebates and other price adjustments)
and other terms and conditions of sales, customer information, business plans,
and all other intellectual property. This restriction shall not apply to any
information within the following categories:

                        (i)     is or becomes part of the public domain other
        than by unauthorized acts of the party obligated not to disclose such
        information or its Affiliates, sublicensees, consultants and
        contractors, as applicable;

                        (ii)    can be shown by written documentation to have
        been disclosed to or already in the possession of the receiving party or
        its Affiliates or sublicensees by a third party, provided such
        information was not obtained by such third party directly or indirectly
        from the other party under this Agreement pursuant to a confidentiality
        agreement;

                        (iii)   can be shown by written documentation to have
        been independently developed by the receiving party or its Affiliates
        without breach of any of the provisions of this Agreement by personnel
        without access to the confidential information;

                        (iv)    is disclosed by the receiving party pursuant to
        interrogatories, formal requests for information or documents, subpoena,
        or a civil investigative demand of a court or governmental agency;
        provided, however, that, to the extent practicable, the receiving party
        notifies the other party promptly following receipt thereof so that the
        other may seek a protective order or other appropriate remedy to prevent
        or limit such disclosure, and provided further that the disclosing party
        furnishes only that portion of the information which it is advised by
        counsel is legally

                                       36
<PAGE>   41

required and imposes such obligations of secrecy as are possible in that regard;

                        (v)     is required to be disclosed by a party under any
        statutory, regulatory or similar legislative requirement or any rule of
        any stock exchange to which it or any Affiliate is subject; provided,
        however, that the non-disclosing party shall be allowed to review the
        proposed disclosure and the disclosing party agrees to consider in good
        faith any proposed revisions thereof provided to the disclosing party
        within two (2) business days of the non-disclosing party's receipt of
        the proposed disclosure and the parties shall seek confidential
        treatment for such disclosure as permitted by applicable law; or

                        (vi)    is required by authorities to obtain regulatory
        approval.

                (b)     The obligations set forth in this Section 12 shall
survive the termination or expiration of this Agreement for a period of five (5)
years. The confidentiality obligations described in this Section 12 shall be in
addition to the parties' obligations under the Confidentiality Agreements dated
as of September 1, 2000 (the "Confidentiality Agreements"), except that to the
extent there is a conflict between the Confidentiality Agreements and provisions
of this Agreement, this Agreement shall govern.

13.     INDEMNIFICATION AND INSURANCE

        13.1    Indemnification by KING.

                KING shall defend, indemnify and hold NOVAVAX and its
Affiliates, and their respective officers, directors, employees, successors and
assigns, harmless from and against any and all claims, liabilities, losses,
costs, actions, suits, damages and expenses (other than special, incidental,
consequential or punitive damages, but including attorneys' fees and costs)
arising out of: (a) any breach by KING of any representation, warranty or
covenant contained in this Agreement; (b) the infringement or alleged
infringement of any patent, trademark or other intellectual property rights of a
third party by its activities with respect to the KING Products or KING
Trademarks; (c) any personal injury (including death) and/or property damage
resulting from the handling, possession or use of the KING Products; (d) any
claims by third parties relating to the performance or nonperformance of KING's
obligations under this Agreement; and (e) any other liability arising out of the
manufacture, marketing, labeling, distribution or use of the KING Products;
provided, however, that KING shall not be required to indemnify NOVAVAX with
respect to any such claim, liability, loss, cost, action, suit, damage or
expense hereunder to the extent covered by NOVAVAX's indemnification obligation
in Section 13.2, or which arises from NOVAVAX's

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<PAGE>   42

negligent act or omission or intentional misconduct or that of any NOVAVAX
affiliate.

        13.2    INDEMNIFICATION BY NOVAVAX.

                NOVAVAX shall defend, indemnify and hold KING and its
Affiliates, and their respective officers, directors, employees, successors and
assigns, harmless from and against any and all claims, liabilities, losses,
costs, actions, suits, damages and expenses (other than special, incidental,
consequential or punitive damages, but including attorneys' fees and costs)
arising out of: (a) any breach by NOVAVAX of any representation, warranty or
covenant contained in this Agreement; (b) the infringement or alleged
infringement of any patent, trademark or other intellectual property rights of a
third party by its activities with respect to the NOVAVAX Products or Trademark
in accordance with the terms and conditions of this Agreement; (c) any personal
injury (including death) and/or property damage resulting from the handling,
possession or use of the NOVAVAX Products; (d) any claims by third parties
relating to the performance or nonperformance of NOVAVAX's obligations under
this Agreement; and (e) any other liability arising out of the manufacture,
marketing, labeling, distribution or use of the NOVAVAX Products; provided,
however, that NOVAVAX shall not be required to indemnify KING with respect to
any such claim, liability, loss, cost, action, suit, damage or expense hereunder
to the extent covered by KING's indemnification obligation in Section 13.1, or
which arises from KING's negligent act or omission or intentional misconduct or
that of any KING Affiliate.

        13.3    CLAIMS PROCEDURES.

                A party (the "Indemnitee") which intends to claim
indemnification under this Section 13 shall notify the other party (the
"Indemnitor") within a reasonable time in writing of any action, claim or
liability in respect of which the Indemnitee believes it is entitled to claim
indemnification, provided that the failure to give timely notice to the
Indemnitor shall not release the Indemnitor from any liability to the Indemnitee
to the extent the Indemnitor is not prejudiced thereby. The Indemnitor shall
have the right, by notice to the Indemnitee, to assume the defense of any such
action or claim within the fifteen (15) day period after the Indemnitor's
receipt of notice of any action or claim with counsel of the Indemnitor's choice
and at the sole cost of the Indemnitor. If the Indemnitor does not so assume the
defense of such third party claim, the Indemnitee may assume such defense with
reasonable counsel of its choice and at the sole cost of the Indemnitor. If the
Indemnitor so assumes such defense, the Indemnitee may participate therein
through counsel of its choice, but at the sole cost of the Indemnitee. The party
not assuming the defense of any such claim shall render all reasonable
assistance to the party assuming such defense, and all reasonable out-of-pocket
costs of such assistance shall be for the account of the Indemnitor. No such
claim shall be settled other than by the party defending the same, and then only
with

                                       38
<PAGE>   43

the consent of the other party which shall not be unreasonably withheld;
provided that the Indemnitee shall have no obligation to consent to any
settlement of any such action or claim which imposes on the Indemnitee any
liability or obligation which cannot be assumed and performed in full by the
Indemnitor, and the Indemnitee shall have no right to withhold its consent to
any settlement of any such action or claim if the settlement involves only the
payment of money by the Indemnitor or its insurer.

        13.4    INSURANCE.

                Each party shall maintain insurance (either through purchase of
a policy form a nationally recognized third party insurer or through maintenance
of a self-insurance program) against such risks and upon such terms (including
coverages, deductible limits and self-insured retentions) as is customary for
the activities to be conducted by such party under this Agreement and is
appropriate to cover its indemnification obligations hereunder. Each party shall
name the other as an additional insured on such party's relevant insurance
policies, as its interests may appear, and shall furnish to the other party
evidence of such insurance, upon request.

14.     REPRESENTATIONS AND WARRANTIES

        14.1    BY KING.

                KING represents and warrants to NOVAVAX that:

                (a)     the execution, delivery and performance of this
Agreement by KING does not conflict with, or constitute a breach of or under,
any order, judgment, agreement or instrument to which KING is a party; and

                (b)     the execution, delivery and performance of this
Agreement by KING does not require the consent of any Person or the
authorization of (by notice or otherwise) any governmental or regulatory
authority;

                (c)     the rights granted by KING to NOVAVAX hereunder do not
conflict with any rights granted by KING to any third party;

                (d)     KING has sufficient rights in and to the KING Products
and all intellectual property, use, development, manufacturing, marketing,
distribution and sale rights related thereto necessary or advisable for such
purposes as contemplated by this agreement (the "KING Product Rights"), free and
clear of any liens or encumbrances, except for any customer contracts,
government contracts and contracts with hospitals or group purchasing
organizations, in each case entered into in the ordinary course of business
(collectively, "Product Contracts");

                                       39
<PAGE>   44

                (e)     except for the Product Contracts, there are no
agreements between KING and any Person with respect to the rights of KING in the
Territory in the KING Products and the KING Product Rights;

                (f)     KING has the right to and, as of the Effective Date, has
no reason to believe it will not have a continuous and sufficient supply of the
active ingredient included in the KING Products during the entire Term;

                (g)     it has no notice that any KING Product Rights, or that
the use thereof as contemplated under this Agreement, interfere or infringe on
any intellectual property rights owned or possessed by any Person;

                (h)     there are no third party pending patent applications
which, if issued, may cover the use, development, manufacture, distribution or
sale of the KING Products;

                (i)     there are no claims, judgments or settlements against or
owed by KING or pending or threatened claims or litigation relating to the KING
Products or the KING Product Rights;

                (j)     it has reviewed the available safety data relating to
the KING Products and has no reason to believe the KING Products are not safe;

                (k)     any KING Product samples provided to NOVAVAX hereunder
have been at all times in the control of KING or its designate and meet
applicable specifications contained in the NDA for the KING Product.

        14.2    BY NOVAVAX.

                NOVAVAX represents and warrants to KING that:

                (a)     the execution, delivery and performance of this
Agreement by NOVAVAX does not conflict with, or constitute a breach of or under,
any order, judgment, agreement or instrument to which NOVAVAX is a party;

                (b)     the execution, delivery and performance of this
Agreement by NOVAVAX does not require the consent of any Person or the
authorization of (by notice or otherwise) any governmental or regulatory
authority,

                (c)     the rights granted by NOVAVAX to KING hereunder do not
conflict with any rights granted by NOVAVAX to any third party;

                (d)     NOVAVAX has sufficient rights in and to the NOVAVAX
Products and all intellectual property, use, development, manufacturing,
marketing, distribution and sale rights related thereto necessary or advisable
for such purposes as contemplated by this agreement (the "NOVAVAX Product
Rights"), free and clear of any liens or encumbrances;

                                       40
<PAGE>   45

                (e)     there are no agreements between NOVAVAX and any Person
in with respect to the rights of NOVAVAX in the Territory in the NOVAVAX
Products and the NOVAVAX Product Rights;

                (f)     NOVAVAX has the right to and, as of the Effective Date,
has no reason to believe it will not have a continuous and sufficient supply of
the active ingredient included in the NOVAVAX Products during the entire Term;

                (g)     it has no notice that any NOVAVAX Product Rights, or
that the use thereof as contemplated under this Agreement, interfere or infringe
on any intellectual property rights owned or possessed by any Person;

                (h)     there are no third party pending patent applications
which, if issued, may cover the use, development, manufacture, distribution or
sale of the NOVAVAX Products;

                (i)     there are no claims, judgments or settlements against or
owed by NOVAVAX or pending or threatened claims or litigation relating to the
NOVAVAX Products or the NOVAVAX Product Rights;

                (j)     it has reviewed the available safety data relating to
the NOVAVAX Products and has no reason to believe the NOVAVAX Products are not
safe;

                (k)     any NOVAVAX Product samples provided to KING hereunder
have been at all times in the control of NOVAVAX or its designate and meet
applicable specifications contained in the NDA for the NOVAVAX Product.

15.     NOTICES

        Except as otherwise specifically provided herein, any notice or other
documents to be given under this Agreement shall be in writing and shall be
deemed to have been duly given if sent by registered post, nationally recognized
overnight courier or confirmed facsimile transmission to a party (followed by
hard copy by mail) or delivered in person to a party at the address or facsimile
number set out below for such party or such other address as the party may from
time to time designate by written notice to the other:

        If to KING:

               KING Pharmaceuticals, Inc.
               501 Fifth Street
               Bristol, Tennessee  37620
               Attn:  President
               Facsimile:  (423) 989-8055

                                       41
<PAGE>   46

               with a copy (which shall not constitute notice) to:

               KING Pharmaceuticals, Inc.
               501 Fifth Street
               Bristol, Tennessee  37620
               Attn:  Executive Vice President and General Counsel
               Facsimile:  (423) 989-6282

        If to NOVAVAX:

               Novavax, Inc.
               8320 Guilford Road
               Columbia, Maryland  21046
               Attn:  Chief Executive Officer
               Telecopy:  (301) 854-3902

               with a copy (which shall not constitute notice) to:

               White & McDermott, P.C.
               65 William Street, Suite 250
               Wellesley, Massachusetts 02481
               Attn:  David A. White
               Telecopy:  (781) 237-8120

Any such notice or other document shall be deemed to have been received by the
addressee three (3) business days following the date of dispatch of the notice
or other document by post or, where the notice or other document is sent by
overnight courier, by hand or is given by facsimile, simultaneously with the
transmission or delivery thereof.

16.     MISCELLANEOUS PROVISIONS

        16.1    Assignment; Change of Control.

                (a)     Neither party shall assign or otherwise transfer this
Agreement or any interest herein or right hereunder without the prior written
consent of the other party, and any such purported assignment, transfer or
attempt to assign or transfer any interest herein or right hereunder shall be
void and of no effect, except that without the prior written consent of NOVAVAX,
KING may assign its rights and obligations hereunder to an Affiliate. In the
case of an assignment in accordance with this Section 16.1, the assigning party
shall remain responsible for all of its obligations and agreements set forth
herein, notwithstanding such assignment and such transferee or successor shall
assume in writing the obligations of the party to which it is the transferee or
successor. Subject to the foregoing, this Agreement

                                       42
<PAGE>   47

shall be binding upon and inure to the benefit of the parties hereto and their
respective permitted successors and assigns.

                (b)     NOVAVAX and KING acknowledge and agree that KING's
obligations, commitments (financial and otherwise) and investments pursuant to
the terms hereof and pursuant to various other commercial arrangements between
KING and NOVAVAX are based on the premise that (i) KING expects that it shall
take several years for the NOVAVAX Products to develop and mature to be viable
and economically profitable pharmaceutical products, and (ii) KING believes that
the best organizational and corporate structure to achieve these objectives is
for NOVAVAX to remain an independent biopharmaceutical company focused on the
research, development and commercialization of proprietary healthcare products
for women.

                (c)     Upon a Change of Control of NOVAVAX, King may elect, in
King's sole option, any or all of the following: (i) terminate all provisions of
this Agreement with respect to the KING Products, (ii) terminate all rights of
NOVAVAX to promote the NOVAVAX Products in the Territory pursuant to the terms
hereof or otherwise, or (iii) require NOVAVAX to (A) assign and transfer to KING
all rights of ownership to any governmental or regulatory applications or
approvals in the Territory issued or pending (including any correspondence with
respect thereto) with respect to any NOVAVAX Products and any trademarks in the
Territory with respect to any NOVAVAX Products, and (B) license to KING on an
exclusive and perpetual basis solely in the Territory all intellectual property
rights and Know How with respect to the NOVAVAX Products as may be necessary to
make, use, promote and sell the NOVAVAX Products in the Territory; provided,
however, if KING elects its rights under clause (ii) or (iii) above, KING will
pay NOVAVAX a royalty of seven and one-half percent (7.5%) of the Net Sales of
the NOVAVAX Products received by KING, and such royalty payment shall be subject
to commercial terms substantially similar to the terms of the Exclusive License
and Distribution Agreement dated as of the date hereof between KING and NOVAVAX.

                (d)     NOVAVAX acknowledges and agrees that the agreements
contained in this Section 16.1 are an integral part of the transactions
contemplated in this Agreement, and that, without these agreements, KING would
not enter into this Agreement and certain other commercial arrangements with
NOVAVAX.

        16.2    GOVERNING LAW.

                This Agreement shall be governed by, and construed in accordance
with, the laws of the State of Delaware, without giving effect to any choice of
law or conflict of law rules or provisions (whether of the State of Delaware or
any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Delaware.

                                       43
<PAGE>   48

        16.3    NON-WAIVER.

                The failure of either party to enforce or to exercise, at any
time or for any period of time, any term of or any right arising pursuant to
this Agreement does not constitute, and shall not be construed as, a waiver of
such term or right, and shall in no way affect that party's right later to
enforce or exercise such term or right.

        16.4    ENTIRE AGREEMENT.

                This Agreement and the Confidentiality Agreements contain all of
the terms agreed to by the parties regarding the subject matter of this
Agreement and supersede any prior agreements, understandings or arrangements
between them, whether oral or in writing. This Agreement may not be amended,
modified, altered or supplemented except by means of a written agreement or
other instrument executed by both of the parties hereto. No course of conduct or
dealing between the parties shall act as a modification or waiver of any
provisions of this Agreement.

        16.5    JURISDICTION; VENUE.

                (a)     Each of NOVAVAX and KING hereby waives personal service
of any process upon it in connection with any suit, action or proceeding arising
out of or relating to this Agreement or the transactions contemplated hereby,
and hereby covenants and agrees that all such service of process may be made in
the manner set forth in Section 15 with the same effect as though served on it
personally.

                (b)     NOVAVAX hereby covenants and agrees that any suit,
action or proceeding initiated by the Company against KING, its affiliates,
subsidiaries, successors and/or assigns arising out of or relating to this
Agreement or the transactions contemplated hereby shall be brought exclusively
in the federal courts located in and/or state courts of the State of Tennessee.
In the event of any such suit, action or proceeding initiated by NOVAVAX, each
of NOVAVAX and KING hereby submit to the exclusive jurisdiction and venue of the
federal courts located in and state courts of the State of Tennessee and hereby
waive any and all objections based on jurisdiction or venue that such party may
have under applicable law or the Federal Rules of Civil Procedure. Each of the
parties hereby irrevocably designates CT Corporation in the State of Tennessee
(the "Tennessee Process Agent") as its designee, appointee and agent to receive,
for and on its behalf, service of process in the State of Tennessee in any such
suit, action or proceedings with respect to this Agreement and the transactions
contemplated hereby. Service on the Tennessee Process Agent shall be deemed
complete upon delivery thereof to the Tennessee Process Agent, provided that, in
the

                                       44
<PAGE>   49

case of any such service upon the Tennessee Process Agent, the party effecting
such service shall also deliver a copy thereof to the other parties in
accordance with the notice provision set forth in Section 10.8. Each such party
shall take all such action as may be necessary to continue the appointment of
the Tennessee Process Agent in full force and effect or to appoint another
agent, who shall thereafter be referred to herein as the "Tennessee Process
Agent," so that each such party shall at all times have an agent for service for
the foregoing purposes in the State of Tennessee.

                (c)     KING hereby covenants and agrees that any suit, action
or proceeding initiated by KING against NOVAVAX, its affiliates, subsidiaries,
successors and/or assigns arising out of or relating to this Agreement or the
transactions contemplated hereby shall be brought exclusively in the federal
courts located in and/or state courts of the State of Maryland. In the event of
any such suit, action or proceeding initiated by KING, each of NOVAVAX and KING
hereby submit to the exclusive jurisdiction and venue of the federal courts
located in and state courts of the State of Maryland and hereby waive any and
all objections based on jurisdiction or venue that such party may have under
applicable law or the Federal Rules of Civil Procedure. Each of the foregoing
parties hereby irrevocably designates CT Corporation in the State of Maryland
(the "Maryland Process Agent"), as its designee, appointee and agent to receive,
for and on its behalf, service of process in the State of Maryland in any such
suit, action or proceedings with respect to this Agreement and the transactions
contemplated hereby. Service on the Maryland Process Agent shall be deemed
complete upon delivery thereof to the Maryland Process Agent, provided that in
the case of any such service upon the Maryland Process Agent, the party
effecting such service shall also deliver a copy thereof to the other parties in
accordance with the notice provision set forth in Section 15. Each such party
shall take all such action as may be necessary to continue the appointment of
the Maryland Process Agent in full force and effect or to appoint another agent,
who shall thereafter be referred to herein as the "Maryland Process Agent," so
that each such party shall at all times have an agent for service for the
foregoing purposes in the State of Maryland.

        16.6    SEVERABILITY.

                In the event that any of the provisions or a portion of any
provision of this Agreement are held to be invalid, illegal or unenforceable by
a court of competent jurisdiction or a governmental authority, such provision or
portion of provision shall be construed and enforced as if it had been narrowly
drawn so as not to be invalid, illegal or unenforceable and the validity,
legality and enforceability of the enforceable portion of any such provision and
the remaining provisions shall not be adversely affected thereby.

                                       45
<PAGE>   50

        16.7    RELATIONSHIP OF THE PARTIES.

                The parties hereto are acting and performing as independent
contractors. Nothing in this Agreement creates the relationship of partnership,
joint venture, sales agency or principal and agent. Neither party is the agent
of the other, and neither party may hold itself out as such to any other party.
All financial obligations associated with each party's business shall be the
sole responsibility of such party.

        16.8    PUBLIC ANNOUNCEMENTS.

                The form and content of any public announcement to be made by
one party regarding this Agreement, or the subject matter contained herein,
shall be subject to the prior written consent of the other party (which consent
shall not be unreasonably withheld, delayed or conditioned), except as may be
required by applicable law (including, without limitation, disclosure
requirements of the SEC, NYSE, NASDAQ, AMEX or any other stock exchange) in
which event the party making the announcement shall endeavor to give the other
party reasonable advance notice and review of any such disclosure.

        16.9    COUNTERPARTS.

                This Agreement shall become binding when any one or more
counterparts hereof, individually or taken together, shall bear the signatures
of each of the parties hereto. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original as against the party
whose signature appears thereon, but all of which taken together shall
constitute but one and the same instrument.

        16.10   FORCE MAJEURE.

                Neither party shall be liable to the other party for any failure
to perform as required by this Agreement (other than the obligation to pay
money) if the failure to perform is due to circumstances reasonably beyond such
party's control including, without limitation, acts of God, civil disorders or
commotions, acts of aggression, fire, explosions, floods, drought, war,
sabotage, embargo, utility failures, material shortages, labor disturbances, a
national health emergency, or appropriations of property. A party whose
performance is affected by a force majeure event shall take prompt action using
its reasonable best efforts to remedy the effects of the force majeure event.

        16.11   INTERPRETATION.

                The parties hereto acknowledge and agree that: (a) each party
and its representatives have reviewed and negotiated the terms and provisions of
this Agreement and have contributed to its revision; and (b) the terms and
provisions

                                       46
<PAGE>   51

of this Agreement shall be construed fairly as to each party hereto and not in
favor of or against either party regardless of which party was generally
responsible for the preparation or drafting of this Agreement.

        16.12   CERTAIN EXPENSES AND COMMISSIONS.

                Except as otherwise expressly set forth in this Agreement, the
parties hereto shall each pay all their costs and expenses, including legal and
accounting fees, incurred in connection with the preparation, negotiation,
execution and delivery of this Agreement, respective brokerage fees, commissions
and finder's fees, if any, and shall indemnify and hold the other harmless from
and against any and all other claims or liabilities for such costs and expenses,
brokerage fees, commissions and finder's fees incurred by reason of any action
taken by any such party.

        16.13   THIRD PARTY BENEFICIARIES.

                This Agreement is not intended to confer upon any non-party
rights or remedies hereunder, except as may be received or created as part of a
valid assignment.

        16.14   COVENANT NOT TO PROMOTE COMPETING PRODUCT.

                NOVAVAX shall not (or assist any third party to) manufacture,
market, sell, or promote any product directly competitive with any of the
Copromote Products during the Term of this Agreement, except in connection with
the performance of its obligations under this Agreement and except for the
manufacture, marketing, sale, or promotion of Gynodiol.

        16.15   HEADINGS.

                The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.

                             SIGNATURE PAGES FOLLOW

                                       47
<PAGE>   52

        IN WITNESS WHEREOF, the parties have duly executed this Copromotion
Agreement as of the first date written above.

                                KING PHARMACEUTICALS, INC.

                                By:
                                   ----------------------------------------
                                Name:
                                     --------------------------------------
                                Title:
                                      -------------------------------------

                                NOVAVAX, INC.

                                By:
                                   ----------------------------------------
                                Name:
                                     --------------------------------------
                                Title:
                                      -------------------------------------

<PAGE>   53

                                     ANNEX I

                                   DEFINITIONS

               "ACT" shall mean the United States Federal Food, Drug and
Cosmetic Act, as it may be amended from time to time.

               "ADDITIONAL EXCLUSIVITY RIGHTS" shall have the meaning set forth
in Section 11.1(b).

               "AFFILIATE(s)" shall mean, with respect to any Person, any other
Person that directly, or indirectly through one or more intermediaries,
controls, is controlled by or is under common control with, such Person. A
Person shall be regarded as in control of another Person if such Person owns, or
directly or indirectly controls, more than fifty percent (50%) of the voting
securities (or comparable equity interests) or other ownership interests of the
other Person, or if such Person directly or indirectly possesses the power to
direct or cause the direction of the management or policies of the other Person,
whether through the ownership of voting securities, by contract or any other
means whatsoever, provided, however, that, for purposes of this Agreement, the
term "Affiliate" shall not include subsidiaries in which a party or its
Affiliates owns a majority of the ordinary voting power to elect a majority of
the Board of Directors, but is restricted from electing such majority by
contract or otherwise, until such time as such restrictions are no longer in
effect.

               "AGREEMENT" shall mean this Agreement, together with all
appendices, exhibits and schedules referenced herein or attached hereto, and as
the same may be amended or supplemented from time to time hereafter pursuant to
the provisions hereof.

               "AGREEMENT QUARTER" shall mean each three (3) month period
commencing on the first (1st) day of January, April, July or October, as the
case may be, during the Term.

               "AUDITED PARTY" shall have the meaning set forth in Section
10.2(a).

               "AUDITING PARTY" shall have the meaning set forth in Section
10.2(a).

               "BASELINE" shall have the meaning set forth in Exhibit 9.1(b).

               "BUDGET(s)" shall mean the annual budget of Net Sales and
Marketing Expenses prepared and approved by the PMC in accordance with this
Agreement.

<PAGE>   54

               "CHANGE OF CONTROL" shall mean any sale of voting securities or
sale of assets (whether by sale, merger, consolidation, share exchange or
otherwise in one transaction or a series of transactions) in or by a party
hereto that, directly or indirectly, results in any third party becoming the
beneficial owner, directly or indirectly, of securities or assets of such first
party representing over fifty percent (50%) of the combined voting power of such
Person's then outstanding securities or over fifty percent (50%) of such first
party's total assets.

               "COMMERCIALLY REASONABLE EFFORTS" shall mean efforts and
resources normally used by a party for a product owned by it or to which it has
rights, which is of similar market potential at a similar state in its
development or product life, taking into account issues of safety, efficacy,
product profile, the competitiveness of the marketplace, the proprietary
position of the product, the regulatory structure involved, the profitability of
the applicable products, and other relevant commercial factors.

               "CONFIDENTIALITY AGREEMENTS" shall have the meaning set forth in
Section 12.1(b).

               "CONFIDENTIAL OR PROPRIETARY INFORMATION" shall have the meaning
set forth in 12.1(a).

               "COPROMOTE PRODUCTS" shall mean collectively the KING Products
and the NOVAVAX Products.

               "CURRENT GOOD MANUFACTURING PRACTICES" shall mean the current
standards for the manufacture of biologicals, as set forth in the Act and
applicable regulations and guidelines promulgated thereunder or successors
thereto, as shall be in effect from time to time during the Term.

               "DETAIL(s)" or "DETAILING" shall mean a face-to-face contact by a
sales representative with an OB/GYN during which time the promotional message
involving the Copromote Products is a primary topic of discussion and the
product discussed for either the longest period of time during the contact or,
at a minimum, discussed no less than the second longest period of time during
the contact.

               "DETAIL COST" shall be the cost per Detail to be established by
the PMC each year and included in the Marketing Plan for such year.

               "DIRECT COST" shall mean all reasonable out-of-pocket costs other
than direct sales force expenses directly attributable to an activity (i.e.,
those costs which vary with such activity), including, but not limited to,
direct labor for such activity and consumable bulk and other materials, as
determined in

                                   ANNEX I - 2
<PAGE>   55

accordance with generally accepted cost accounting practices in the country of
the activity, but without any allocation for fixed overhead costs allocable to
the activity, including, but not limited to, direct benefit and labor expenses
for technical services and support services, depreciation, maintenance and
repairs and insurance costs associated with such activity.

               "EFFECTIVE DATE" shall have the meaning set forth in the PREAMBLE
of this Agreement.

               "ESTRASORB" shall mean the product described in Phase III
Clinical Study.

               "EXCESS DETAILS" shall have the meaning set forth in Section 9.5.

               "EXTENDED PROMOTION TERM" shall have the meaning set forth in
Section 11.1(c).

               "FDA" shall mean the United States Food and Drug Administration
or any successor entity thereto.

               "GAAP" shall mean United States generally accepted accounting
principles.

               "INCREMENTAL COSTS" shall mean an amount equal to (i) the ratio
of Net Costs for any given quarter to Net Sales for such quarter, multiplied by
(ii) Incremental Sales for such quarter.

               "INCREMENTAL SALES" shall mean Net Sales for a given quarter
minus the applicable "Baseline" for such quarter, as set forth on Exhibit
9.1(b).

               "INDEMNITEE" shall have the meaning set forth in Section 13.3.

               "INDEMNITOR" shall have the meaning set forth in Section 13.3.

               "INITIAL TERM" shall have the meaning set forth in Section
11.1(a).

               "KING" shall have the meaning set forth in the PREAMBLE of this
Agreement.

               "KING DETAIL REPORT" shall have the meaning set forth in Section
3.3(c).

               "KING GUIDELINES" shall have the meaning set forth in Section
2.3(c).

                                   ANNEX I - 3
<PAGE>   56

               "KING PRODUCT INITIATION DATE" shall mean the first business day
of the month immediately following the date on which NOVAVAX provides written
notice to KING that NOVAVAX wishes to commence marketing and promotion of the
KING Products pursuant to this Agreement; provided, however, that in no case
shall the King Product Initiation Date be fewer than twenty (20) days following
the date on which NOVAVAX provides such notice.

               "KING PRODUCT RIGHTS" shall have the meaning set forth in Section
14.1(d).

               "KING PRODUCT TECHNICAL COMPLAINTS" shall mean any complaint that
questions the purity, identity, potency or quality of the KING Products, its
packaging or labeling, the compliance of any batch of the KING Products with
applicable laws, including the Act, or any complaint that concerns any incident
that causes the KING Products or their labeling to be mistaken for, or applied
to, another article or any bacteriological contamination, or any significant
chemical, physical, or other change or deterioration in the KING Products, or
any failure of one or more batches of the KING Products to meet the
specifications therefor in the NDA.

               "KING PRODUCTS" shall mean NORDETTE(R).

               "KING TRADEMARK" shall mean the federally registered trademark
NORDETTE(R), and any other related trademark or servicemark containing the word
"NORDETTE", and any other trademark or service mark (whether registered or
unregistered) that KING uses on or with any of the KING Products or in any
promotional material related to any of the KING Products.

               "KNOW-HOW" shall mean all tangible and intangible technical and
other information including, but not limited to ideas, conceptions,
reductions-to-practice, discoveries, data, designs, chemical structures,
formulae, materials, intermediates, inventions (whether patentable or not),
methods, models, prototypes, samples, works (whether copyrightable or not),
assays, research plans, procedures, designs, experiments, tests, results of
experimentation and testing (including results of research or development),
processes (including manufacturing processes, uses, specifications and
techniques), laboratory records, note books, chemical, pharmacological,
toxicological, clinical, analytical and quality control data, trial data, case
report forms, data analyses, reports, manufacturing data, summaries and
information contained in submissions to and from ethical committees and
regulatory authorities, which relates to or concerns a Copromote Product.
Know-How includes all documents and copies thereof (whether in written,
machine-readable, physical or graphic form) and other things (such as
prototypes,

                                  ANNEX I - 4
<PAGE>   57

materials, samples, models, etc.) which contain, embody or refer to the
Know-How. Such information, documents or things will not be excluded from being
Know-How hereunder by reason of the fact that they become available to the
public only through a wrongful act or omission to act of a party hereto or a
sublicensee or distributor of a party hereto. The fact that an item is known to
the public shall not be taken to exclude the possibility that a compilation
including the item, and/or a development relating to the item, is (and remains)
not known to the public. Know-How includes, but is not limited to, any and all
rights that protect the Know-how, such as copyrights software, rights, trade
secret rights, database rights and/or design rights.

               "KP CONSIDERATION FEE" shall have the meaning set forth in
Section 9.1(b).

               "MARKETING EXPENSES" shall mean the costs and expenses directly
related to the marketing and promotion of the Copromote Products in the
Territory in accordance with the Marketing Plans, including without limitation
costs and expense relating to: (i) general advertising, including without
limitation journal advertising, direct mail and point of prescription
advertising; (ii) continuing medical education programs, (iii) market research;
(iv) the Direct Costs of samples of the Copromote Products; (v) Copromote
Product-related publications and (vi) trade shows and conventions.

               "MARKETING MATERIALS" shall have the meaning set forth in Section
5.2(a).

               "MARKETING PLAN" shall mean an annual plan and budget for the
promotion and marketing of the Copromote Products as developed pursuant to
Section 8.5.

               "MINIMUM TARGETED DETAILS" shall have the meaning set forth in
Section 9.5.

               "MODEL CLAIMS" shall mean final approval by the FDA of
Estrasorb(TM) as an estrogen hormone replacement therapy prescription product.

               "NDA" shall mean the new drug applications related to the
Copromote Products, submitted to the FDA pursuant to provisions of the Act and
applicable regulations related thereto.

               "NET COSTS" shall mean costs of goods sold in accordance with
GAAP, less Marketing Expenses.

                                  ANNEX I - 5
<PAGE>   58

               "NET SALES" shall mean all gross revenue actually received by a
party from sales of any Copromote Products, less (a) credits for refunds and
returns, (b) sales, use and similar taxes billed by such party to its customers
and required to be paid to the appropriate taxing authorities by such party; (c)
discounts, allowances and commissions paid or allowed by a party on sales of
such Copromote Products, and (c) amounts paid by such party and billed through
to such party's customers for insurance, shipping and similar charges.

               "NON-SERIOUS ADVERSE EVENT" shall mean any adverse drug
experience associated with the use of the Copromote Products in humans, whether
or not considered drug related which is not a Serious Adverse Event.

               "NOTE PURCHASE AGREEMENT" shall have the meaning set forth in
Section 9.2.

               "NOVAVAX" shall have the meaning set forth in the PREAMBLE.

               "NOVAVAX DETAIL REPORT" shall have the meaning set forth in
Section 4.3(c).

               "NOVAVAX GUIDELINES" shall have the meaning set forth in Section
2.3(c).

               "NOVAVAX PRODUCT" shall mean ESTRASORB(TM) and, subject to
Section 8.6 hereof, any hormone replacement therapy pharmaceutical product
marketed in the field of women's health including or using technology or Know
How derived from to ESTRASORB(TM), including but not limited to products
containing a combination of a NOVAVAX Product and another pharmaceutical
product; provided that NOVAVAX Product shall specifically exclude any
pharmaceutical or related products owned by NOVAVAX as a direct result of the
consummation of the Fielding Acquisition Agreement (as defined in the Note
Purchase Agreement).

               "NOVAVAX PRODUCT INITIATION DATE" shall mean the date on which
the FDA provides written approval of the NDA for ESTRASORB(TM).

               "NOVAVAX PRODUCT RIGHTS" shall have the meaning set forth in
Section 14.2(d).

               "NOVAVAX PRODUCT TECHNICAL COMPLAINTS" shall mean any complaint
that questions the purity, identity, potency or quality of the NOVAVAX Products,
its packaging or labeling, the compliance of any batch of the NOVAVAX Products
with applicable laws, including the Act, or any complaint that concerns any
incident that causes the NOVAVAX Products or their labeling to be mistaken

                                  ANNEX I - 6
<PAGE>   59

for, or applied to, another article or any bacteriological contamination, or any
significant chemical, physical, or other change or deterioration in the NOVAVAX
Products, or any failure of one or more batches of the NOVAVAX Products to meet
the specifications therefor in the NDA.

               "NOVAVAX TRADEMARK" shall mean the federally registered trademark
ESTRASORB(TM), and any other related trademark or servicemark containing the
word "ESTRASORB", and any other trademark or service mark (whether registered or
unregistered) that NOVAVAX decides to use on or with the NOVAVAX Products or in
any promotional material related to any of the NOVAVAX Products.

               "NP CONSIDERATION FEE" shall have the meaning set forth in
Section 9.1(a).

               "OB/GYN" shall have the meaning set forth in the PREAMBLE of the
Agreement in each case who are authorized by applicable law to prescribe the
Copromote Products.

               "PDMA" shall mean the Prescription Drug Marketing Act, as
amended, an the implementing rules and regulations thereunder.

               "PERSON" shall mean an individual, corporation, partnership,
limited liability company, trust, business trust, association, joint stock
company, joint venture, pool, syndicate, sole proprietorship, unincorporated
organization, governmental authority, or any other form of entity not
specifically listed herein.

               "PRIMARY BRAND TRADEMARK" shall have the meaning set forth in
Section 2.3(d).

               "PRODUCT MANAGEMENT COMMITTEE" or "PMC" shall have the meaning
set forth in Section 8.1.

               "PRODUCT TECHNICAL COMPLAINTS" shall mean any complaint that
questions the purity, identity, potency or quality of the Copromote Products,
its packaging or labeling, the compliance of any batch of the Copromote Products
with applicable laws, including the Act, or any complaint that concerns any
incident that causes the Copromote Products or their labeling to be mistaken
for, or applied to, another article or any bacteriological contamination, or any
significant chemical, physical, or other change or deterioration in the
Copromote Products, or any failure of one or more batches of the Copromote
Products to meet the specifications therefor in the NDA.

                                  ANNEX I - 7
<PAGE>   60

               "RESIDUAL PAYMENTS" shall have the meaning set forth in Section
9.3.

               "SERIOUS ADVERSE EVENT" shall mean any serious and unexpected
adverse drug experience, as defined by FDA in 21 C.F.R. Section 314.80,
associated with the use of the drug in humans, whether or not considered drug
related.

               "SOP" shall have the meaning set forth in Section 7.4.

               "TERM" shall have the meaning set forth in Section 11.1(a).

               "TERRITORY" shall mean the United States, its territories and
possessions, the District of Columbia and the Commonwealth of Puerto Rico.

               "TRADEMARKS" shall mean collectively the KING Trademarks and the
NOVAVAX Trademarks.

                                  ANNEX I - 8
<PAGE>   61

                                 EXHIBIT 2.3(a)

                                   TRADEMARKS

                                      KING:

                                    KING Logo

                                  Monarch Logo

                                    NOVAVAX:

                                  NOVAVAX Logo

                                       i
<PAGE>   62

                                 EXHIBIT 2.3(d)

                            PRIMARY BRAND TRADEMARKS

                                  ESTRASORB(TM)

                                   NORDETTE(R)

                                       ii
<PAGE>   63

                                   EXHIBIT 9.1

                      CONSIDERATION FEE SAMPLE CALCULATION

I.      NP CONSIDERATION FEE (CALCULATED AND PAID ON A QUARTERLY BASIS)

        NP Consideration Fee to be paid to King at follows:

        (50% of the Net Sales Estrasorb(TM)in the Territory) MINUS (50% of the
        Net Costs of Estrasorb(TM)in the Territory)*

        *Novavax is solely responsible for Net Costs in excess of 17% of Net
        Sales.

        EXAMPLE A:

        Quarterly Net Sales of Estrasorb(TM) in the Territory = $10,000,000
        Quarterly Net Costs of Estrasorb(TM) in the Territory = $1,500,000

        (50%)($10,000,000) = $5,000,000
        (50%)($1,500,000) = $750,000

        NP Consideration Fee = $5,000,000 - $750,000

        NP CONSIDERATION FEE = $4,250,000

        EXAMPLE B:

        Quarterly Net Sales of Estrasorb(TM) in the Territory = $10,000,000
        Quarterly Net Costs of Estrasorb(TM) in the Territory = $2,000,000

        (50%)($10,000,000) = $5,000,000

        (17%)($10,000,000) = $1,700,000 (thus Novavax is responsible for all
        costs in excess of $1,700,000)

        (50%)($1,700,000) = $850,000

        NP Consideration Fee = $5,000,000 - $850,000

        NP CONSIDERATION FEE = $4,150,000

                                      iii
<PAGE>   64

II.     KP CONSIDERATION FEE (calculated and paid on a quarterly basis)

        KP Consideration fee to be paid to Novavax as follows:

        50% of Incremental Sales of Nordette(R) in the Territory MINUS 50% of
        Incremental Costs of Nordette(R) in the Territory.

        Incremental Sales = Quarterly Net Sales of Nordette(R) in the Territory
        MINUS "Baseline" Net Sales.

        Incremental Costs = (Ratio of Quarterly Net Costs of Nordette(R) in the
        Territory to  Quarterly Net Sales of Nordette(R) in the Territory) X
        (Incremental Sales)

        EXAMPLE:

        Quarterly Net Sales of Nordette(R) in the Territory = $10,000,000
        "Baseline" Net Sales of Nordette(R) in the Territory = $8,000,000
        Quarterly Net Costs of Nordette(R) in the Territory = $2,000,000

        Incremental Sales = $10,000,000 MINUS $8,000,000 = $2,000,000
        Incremental Costs = (20%)($2,000,000) = $400,000

        KP Consideration Fee = (50%)($2,000,000) MINUS (50%)($400,000)

        KP Consideration Fee = $1,000,000 MINUS $200,000

        KP Consideration Fee = $800,000

                                       iv
<PAGE>   65

                                 EXHIBIT 9.1(b)

                   BASELINES FOR CALCULATING INCREMENTAL SALES

NORDETTE(R)
<TABLE>
<CAPTION>
QUARTER                                           BASELINE
------------------------------------------------- -----------------------------------------------
<S>                                               <C>
1Q (January 1--March 31)                          $6,400,000
------------------------------------------------- -----------------------------------------------
2Q (April 1--June 30)                             $7,500,000
------------------------------------------------- -----------------------------------------------
3Q (July 1--September 30)                         $8,000,000
------------------------------------------------- -----------------------------------------------
4Q (October 1--December 31)                       $8,100,000
------------------------------------------------- -----------------------------------------------
</TABLE>

                                       v

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00019-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00019-of-00352.parquet"}]]