<SUBMISSION>
<ACCESSION-NUMBER>0000950133-05-003591
<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>7
<PERIOD>20050630
<FILING-DATE>20050809
<DATE-OF-FILING-DATE-CHANGE>20050809
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>NOVAVAX INC
<CIK>0001000694
<ASSIGNED-SIC>2836
<IRS-NUMBER>222816046
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10-Q
<ACT>34
<FILE-NUMBER>000-26770
<FILM-NUMBER>051009241
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>508 LAPP ROAD
<CITY>MALVERN
<STATE>PA
<ZIP>19355
<PHONE>4849131200
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>508 LAPP ROAD
<CITY>MALVERN
<STATE>PA
<ZIP>19355
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>w11762e10vq.htm
<DESCRIPTION>NOVAVAX, INC.
<TEXT>
<HTML>
<HEAD>
<TITLE>e10vq</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 1pt solid black; font-size: 1pt">&nbsp;</DIV>








<DIV align="center" style="font-size: 14pt; margin-top: 12pt"><B>UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION</B>
</DIV>

<DIV align="center" style="font-size: 12pt"><B>Washington, D.C. 20549</B>
</DIV>

<DIV align="center" style="font-size: 18pt; margin-top: 12pt"><B>FORM 10-Q</B>
</DIV>


<DIV align="center" style="font-size: 12pt; margin-top: 12pt"><B>QUARTERLY REPORT UNDER SECTION 13 or 15(d)<BR>
OF THE SECURITIES EXCHANGE ACT OF 1934</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="47%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="47%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><B>For Quarterly Period Ended</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>Commission File No.</B></TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><U><B>June&nbsp;30, 2005</B></U>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><U><B>0-26770</B></U></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center" style="font-size: 24pt; margin-top: 12pt"><B><U>NOVAVAX, INC.</U></B>
</DIV>

<DIV align="center" style="font-size: 10pt">(Exact name of registrant as specified in its charter)</DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="47%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="47%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><U><B>Delaware</B></U>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><U><B>22-2816046</B></U></TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">(State or other jurisdiction of
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(I.R.S. Employer</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">incorporation or organization)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Identification No.)</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><U><B>508 Lapp Road, Malvern, PA</B></U>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><U><B>19355</B></U></TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">(Address of principal executive offices)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(Zip code)</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><U><B>(484)&nbsp;913-1200</B></U><BR>
(Registrant&#146;s telephone number, including area code)
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Indicate by check mark whether the registrant (1)&nbsp;has filed all reports required to be filed
by Section&nbsp;13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12&nbsp;months (or
for such shorter period that the registrant was required to file such reports), and (2)&nbsp;has been
subject to such filing requirements for the past 90&nbsp;days.
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><FONT face="Wingdings">&#254;</FONT> Yes&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="Wingdings">&#111;</FONT> No
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule
12b-2 of the Exchange Act.)
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><FONT face="Wingdings">&#254;</FONT> Yes&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="Wingdings">&#111;</FONT> No
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The number of shares outstanding of each of the issuer&#146;s classes of common stock, as of the latest
practicable date:
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt">Shares of Common Stock Outstanding at July&nbsp;29, 2005: 43,553,876
</DIV>


<DIV style="width: 100%; border-bottom: 1pt solid black; margin-top: 10pt; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>









<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
Form&nbsp;10-Q<BR>
For the Quarter Ended June&nbsp;30, 2005</B>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>Table of Contents</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="83%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Page No.</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD colspan="7" align="left"><B>Part I. Financial Information</B></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Item&nbsp;1</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Financial Statements</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consolidated Balance Sheets as of June 30, 2005 and December 31, 2004</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consolidated Statements of Operations for the three-month and six-month periods ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">June 30, 2005 and 2004</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consolidated Statements of Cash Flows for the six months ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">June 30, 2005 and 2004</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Notes to the Consolidated Financial Statements</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Item&nbsp;2</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Management's Discussion and Analysis of Financial</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Condition and Results of Operations</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">16</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Item&nbsp;3</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Quantitative and Qualitative Disclosures about Market Risk</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">27</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Item&nbsp;4</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Controls and Procedures</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">27</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD colspan="7" align="left"><B>Part II. Other Information</B></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Item&nbsp;1</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Legal Proceedings</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Item&nbsp;2</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Unregistered Sales of Equity Securities and Use of Proceeds</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Item&nbsp;3</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Defaults upon Senior Securities</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Item&nbsp;4</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Submission of Matters to a Vote of Security Holders</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Item&nbsp;5</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Other Information</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">29</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Item&nbsp;6</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Exhibits</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">29</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" align="left">Signature</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">30</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD colspan="3" align="left">Certifications</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">31</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">2
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="margin-top: 12pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left"><B>Part I.</B></TD>
    <TD>&nbsp;</TD>
    <TD><B>Financial Information</B></TD>
</TR>
</TABLE>
</DIV>


<DIV align="left" style="margin-top: 12pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left"><B>Item&nbsp;1.</B></TD>
    <TD>&nbsp;</TD>
    <TD><B>Financial Statements</B></TD>
</TR>
</TABLE>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
CONSOLIDATED BALANCE SHEETS<BR>
(in thousands, except share information)</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>June 30,</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>December 31,</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>ASSETS</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Current assets:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Cash and cash equivalents</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,442</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">17,876</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Trade accounts receivable, net of allowance for doubtful accounts
of $765 and $752 as of June&nbsp;30, 2005 and December&nbsp;31, 2004,
respectively</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,133</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">827</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Inventory, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,400</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,464</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Prepaid expenses and other current assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,329</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,770</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:60px; text-indent:-15px">Total current assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,304</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23,937</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Property and equipment, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,759</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14,147</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Goodwill</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33,141</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33,141</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other intangible assets, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,617</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,048</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other non current assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,477</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,720</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:60px; text-indent:-15px">Total assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">60,298</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">77,993</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>LIABILITIES and STOCKHOLDERS&#146; EQUITY</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Current liabilities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Accounts payable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,230</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,242</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Accrued expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,747</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,140</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Current portion of capital lease obligations and other liabilities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">654</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,194</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:60px; text-indent:-15px">Total current liabilities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,631</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,576</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Convertible notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">35,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">35,000</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Deferred rent</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">165</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">166</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Non-current portion of capital lease obligations and other liabilities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">808</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">970</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Stockholders&#146; equity:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Preferred stock, $.01 par value, 2,000,000 shares authorized;
no shares issued and outstanding</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Common stock, $.01 par value, 100,000,000 shares authorized;
39,807,724 shares issued and 39,553,876 outstanding</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">398</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">398</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Additional paid-in capital</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">167,511</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">167,496</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Notes receivable from directors</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,480</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,480</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Accumulated deficit</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(145,322</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(130,720</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Treasury stock, 253,848 shares, cost basis</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,413</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,413</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:60px; text-indent:-15px">Total stockholders&#146; equity</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,694</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33,281</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:60px; text-indent:-15px">Total liabilities and stockholders&#146; equity</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">60,298</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">77,993</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The accompanying notes are an integral part of the consolidated financial statements.
</DIV>


<P align="center" style="font-size: 10pt">3
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
CONSOLIDATED STATEMENTS OF OPERATIONS<BR>
(in thousands, except share and per share information)<BR>
(unaudited)</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6"><B>Three months ended</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6"><B>Six months ended</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6" style="border-bottom: 1px solid #000000"><B>June 30,</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6" style="border-bottom: 1px solid #000000"><B>June 30,</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Revenues:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Net product sales</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,889</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,656</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,608</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,854</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Contract research and development</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">426</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">286</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">669</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,246</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Milestone and licensing fees</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">63</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">125</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:60px; text-indent:-15px">Total revenues</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,315</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,005</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,277</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,225</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Operating costs and expenses:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Cost of products sold</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,027</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,501</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,006</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,763</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Research and development</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,377</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,229</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,599</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,277</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Selling and marketing</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,844</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,556</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,901</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,330</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">General and administrative</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,292</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,059</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,413</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,091</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:75px; text-indent:-15px">Total operating costs and expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,540</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,345</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">16,919</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,461</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Loss from operations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(5,225</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(7,340</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(13,642</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(12,236</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Interest expense, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(491</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(377</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(960</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(739</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net loss</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5,716</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(7,717</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(14,602</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(12,975</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Basic and diluted loss per share</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.14</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.22</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.37</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.37</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Basic and diluted weighted average number
of common shares outstanding</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39,553,876</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">34,779,657</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39,553,876</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">34,750,944</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The accompanying notes are an integral part of the consolidated financial statements.
</DIV>


<P align="center" style="font-size: 10pt">4
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
CONSOLIDATED STATEMENTS OF CASH FLOWS<BR>
(in thousands)<BR>
(unaudited)</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6"><B>Six months ended</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6"><B>June 30,</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>Operating Activities:</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Net loss</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(14,602</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(12,975</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Reconciliation of net loss to net cash used in
operating activities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:75px; text-indent:-15px">Amortization</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">431</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">327</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:75px; text-indent:-15px">Depreciation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,426</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,029</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:75px; text-indent:-15px">Retirement of capital assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">42</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:75px; text-indent:-15px">Provision for bad debts</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">59</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:75px; text-indent:-15px">Amortization of deferred financing costs</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">206</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">51</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:75px; text-indent:-15px">Deferred rent</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:75px; text-indent:-15px">Non-cash stock compensation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">15</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Changes in operating assets and liabilities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:105px; text-indent:-15px">Trade accounts receivable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(318</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,398</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:105px; text-indent:-15px">Inventory</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,063</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">108</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:105px; text-indent:-15px">Prepaid expenses and other assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">440</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,442</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:105px; text-indent:-15px">Accounts payable and accrued expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,405</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,905</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:105px; text-indent:-15px">Facility exit costs</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(85</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:105px; text-indent:-15px">Deferred revenue</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(125</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:105px; text-indent:-15px">Other non current assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">38</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(300</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Net cash used in operating activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(12,738</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(10,744</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>Investing Activities:</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Capital expenditures</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(80</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(902</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Net cash used in investing activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(80</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(902</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>Financing Activities:</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Principal payments of capital lease obligations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(616</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(733</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Proceeds from exercise of stock options and warrants</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">369</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Net cash used in financing activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(616</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(364</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net change in cash and cash equivalents</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(13,434</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(12,010</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cash and cash equivalents at beginning of period</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,876</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">27,633</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cash and cash equivalents at end of period</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,442</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">15,623</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The accompanying notes are an integral part of the consolidated financial statements.
</DIV>


<P align="center" style="font-size: 10pt">5
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS</B>
</DIV>


<DIV align="left" style="margin-top: 12pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left"><B>1.</B></TD>
    <TD>&nbsp;</TD>
    <TD><B>Basis of Presentation</B></TD>
</TR>
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Novavax, Inc., a Delaware corporation (&#147;Novavax&#148; or &#147;the Company&#148;), was incorporated in 1987,
and is a specialty biopharmaceutical company engaged in the research, development and
commercialization of proprietary products using our topical drug delivery technology and the
development of preventive vaccines and proteins for infectious diseases and cancers. The Company
sells, markets, and distributes a line of prescription pharmaceuticals and prenatal vitamins. The
Company&#146;s principal technology platform involves the use of patented oil and water emulsions that
the Company believes can be used as vehicles for the topical delivery of a wide variety of drugs
and other therapeutic products, including hormones. In October&nbsp;2003, the Company&#146;s initial product
candidate, ESTRASORB<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>, the first topical emulsion for estrogen therapy, was approved for
marketing by the Food and Drug Administration. The FDA approved ESTRASORB for the treatment of
moderate to severe vasomotor systems (hot flashes) associated with menopausal women. Since its
launch in June&nbsp;2004, ESTRASORB prescription trends have not met the Company&#146;s initial expectations,
however, ESTRASORB continues to be an important product and asset to the Company. We are actively
seeking a well established, global pharmaceutical partner that could provide the optimal
opportunity and resources for ESTRASORB to be successful on a larger
scale.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company plans to continue leveraging our technologies to develop other new product
candidates to be marketed by the Company, co-promoted or licensed to other drug companies. While
our main therapeutic areas of concentration have been women&#146;s health and infectious diseases, we
believe our technologies can be applied more broadly.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The products currently under development or in clinical trials by the Company will require
significant additional research and development efforts, including extensive preclinical and
clinical testing and regulatory approval, prior to commercial use. There can be no assurance that
the Company&#146;s research and development efforts will be successful or that any of the Company&#146;s
potential products will prove to be safe and effective in clinical trial. Even if developed, these
products may not receive regulatory approval or be successfully introduced and marketed at prices
that would permit the Company to operate profitably. The Company also recognizes that the
commercial launch of any product is subject to certain risks including, but not limited to,
manufacturing scale-up and market acceptance. No assurance can be given that the Company can
generate sufficient product revenue to become profitable or generate positive cash flow from
operations at all or on a sustained basis.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The consolidated financial statements of Novavax for the three and six months ended June&nbsp;30,
2005 and 2004 are unaudited. These financial statements reflect all adjustments which, in the
opinion of management, are necessary for a fair presentation of the results for the interim periods
presented. All such adjustments are of a normal recurring nature. These interim results are not
necessarily indicative of the results to be expected for the fiscal year ending December&nbsp;31, 2005.
</DIV>

<P align="center" style="font-size: 10pt">6
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Certain information in footnote disclosures normally included in financial statements prepared
in accordance with generally accepted accounting principles has been condensed or omitted pursuant
to the rules and regulations of the Securities and Exchange Commission, although the Company
believes the disclosures herein are adequate to make the information presented not misleading. We
suggest that these consolidated financial statements be read in conjunction with the audited
consolidated financial statements and the notes thereto in the Company&#146;s Annual Report on Form 10-K
for the year ended December&nbsp;31, 2004.
</DIV>

<DIV align="left" style="margin-top: 12pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left"><B>2.</B></TD>
    <TD>&nbsp;</TD>
    <TD><B>Summary of Significant Accounting Policies</B></TD>
</TR>
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Basis of Presentation</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The accompanying consolidated financial statements include the accounts of the Company and its
wholly-owned subsidiary. All significant inter-company accounts and transactions have been
eliminated in consolidation.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Use of Estimates</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The preparation of financial statements in conformity with accounting principles generally
accepted in the United States requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Inventories</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories consist of raw materials, work-in-process and finished goods, are priced at the
lower of cost or market, using the first-in-first-out method, and were as follows:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>June 30, 2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>December 31, 2004</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6"><B>(amounts in thousands)</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Raw materials</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">324</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">351</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Work-in-process</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">700</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Finished goods</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,134</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,413</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,458</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,464</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Less: Inventory reserve</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(58</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,400</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,464</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">7
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Revenue Recognition</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company recognizes revenue in accordance with the provisions of Staff Accounting Bulletin
No.&nbsp;104, <I>Revenue Recognition</I>. For our product sales, revenue is recognized when all of the
following criteria are met: persuasive evidence of an arrangement exists, shipment of product to
our distributor has occurred, the seller&#146;s price to the buyer is fixed or determinable, and
collectibility is reasonably assured. The Company recognizes these sales net of allowances for
returns, rebates and chargebacks. A large part of our product sales are to distributors who resell
the products to their customers. The Company provides rebates to members of certain buying groups
who purchase from our distributors, to the distributors that sell to these customers at prices
determined under contracts between us and the customer and to state agencies that administer
various programs such as the federal Medicaid and Medicare programs. Rebate amounts are usually
based upon the volume of purchases or by reference to a specific price for a product. The Company
estimates the amount of the rebate that will be paid, and records the liability as a reduction of
revenue when we record our sale of the products. Settlement of the rebate generally occurs from
three to 12&nbsp;months after sale. The Company regularly analyzes historical rebate trends and makes
adjustments to recorded reserves for changes in trends and terms of rebate programs. In a similar
manner, we estimate amounts for returns based on historical trends, distributor inventory levels
and product prescription data and adjust those reserves as product returns occur. The shipping and
handling costs the Company incurs are included in cost of sales in our accompanying statements of
operations.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For up-front payments and licensing fees related to our contract research or technology, the
Company defers and recognizes revenue as earned over the life of the related agreement. Milestone
payments are recognized as revenue upon achievement of contract-specified events and when there are
no remaining performance obligations. Revenue earned under current research contracts is
recognized per the contracts&#146; terms and conditions for invoicing of costs incurred and the
achievement of defined milestones.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Net Loss per Share</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic loss per share is computed by dividing the net loss (the numerator) by the weighted
average number of common shares outstanding (the denominator) during the period. Shares issued
during the period and shares reacquired during the period are weighted for the portion of the
period that they were outstanding. The computation of diluted loss per share is similar to the
computation of basic loss per share except that the denominator is increased to include the number
of additional common shares that would have been outstanding if the dilutive potential common
shares had been issued (e.g. upon exercise of stock options). Potentially dilutive common shares
are not included in the computation of diluted earnings per share if they are anti-dilutive. Net
loss per share as reported was not adjusted for potential common shares, as they are anti-dilutive.
</DIV>

<P align="center" style="font-size: 10pt">8
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Property and Equipment</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property and equipment are recorded at cost. Manufacturing equipment is generally depreciated
over 7 to 10&nbsp;years. Manufacturing leaseholds are amortized over the remaining lease term of our
manufacturing facility, under the straight line method. Depreciation of other fixtures and
equipment is also provided under the straight line method over the estimated useful lives of the
assets, generally 3 to 7&nbsp;years. Amortization of other leasehold improvements is provided over the
shorter of the estimated useful lives of the improvements or the term of the respective lease.
Repairs and maintenance costs are expensed as incurred.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property and equipment is comprised of the following:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6" style="border-bottom: 1px solid #000000"><B>As of</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>June 30, 2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>December 31, 2004</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6"><B>(amounts in thousands)</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Machinery and equipment</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16,104</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16,082</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Leasehold improvements</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,441</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,437</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Computer software and hardware</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">481</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">480</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,026</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,999</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Less accumulated depreciation.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(5,267</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3,852</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">12,759</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">14,147</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Accounting for Facility Exit Costs</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In July&nbsp;2004, the Company entered into a long-term agreement to lease a 32,900 square foot
facility in Malvern, Pennsylvania, for the consolidation and expansion of corporate headquarters
and product development activities. The lease, with a commencement date of September&nbsp;15, 2004, has
an initial term of ten years with two five year renewal options. Standard annual escalation rental
rates are in effect during the initial lease term. With advance notice, the Company also has an
option to lease adjoining space of 17,000 square feet, which could be built out for future
manufacturing needs.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company applied the principles of SFAS No.&nbsp;146, <I>Accounting for Costs Associated with Exit
or Disposal Activities, </I>in accounting for contract termination costs and associated costs that will
continue to be incurred under the operating lease expiring on October&nbsp;31, 2006 related to the
Company&#146;s former corporate offices located in Columbia, Maryland. For the year ended December&nbsp;31,
2004, $252,000 was included in facility exit costs on the consolidated statement of operations,
which represents the difference between the fair value of the remaining lease payments, reduced by
current estimated sublease rentals that could be reasonably obtained.
</DIV>

<P align="center" style="font-size: 10pt">9
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">A roll-forward of Facility Exit Cost liability is as follows:
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Non-</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Current</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Current</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6"><B>(in thousands)</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>Original amount expensed and set up as a liability</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">151</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">101</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Lease payments applied to the liability</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(28</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(24</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" nowrap align="left" style="border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>Balance as of December&nbsp;31, 2004</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">123</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">77</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Lease payments applied to the liability</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(49</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(33</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Adjustment to original estimate</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">20</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(22</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" nowrap align="left" style="border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>Balance as of June&nbsp;30, 2005</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">94</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">22</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="left" style="border-top: 3px double #000000">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Goodwill and Intangible Assets</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Goodwill principally results from business acquisitions. Assets acquired and liabilities
assumed are recorded at their fair values; the excess of the purchase price over the value of the
identifiable net assets acquired is recorded as goodwill. Other intangible assets are the result of
product acquisitions, non-compete arrangements, and internally-discovered patents. In accordance
with SFAS No.&nbsp;142, <I>Goodwill and Other Intangible Assets </I>(&#147;SFAS No.&nbsp;142&#148;), goodwill and intangible
assets deemed to have indefinite lives are not amortized but are subject to impairment tests
annually, or more frequently should indicators of impairment arise. As of June&nbsp;30, 2005 the
Company determined a reassessment of goodwill was necessary due to a substantial drop in the
market value of the company&#146;s stock since December&nbsp;31, 2004 and below performance expectations of
its product, ESTRASORB. The Company engaged an independent business valuation firm to assist in
this assessment. and ultimately determined that there was no impairment of goodwill as of June&nbsp;30,
2005. The Company utilizes a discounted cash flow analysis that includes profitability
information, estimated future operating results, trends and other information in assessing whether
the value of indefinite-lived intangible assets can be recovered. Under SFAS No.&nbsp;142, goodwill
impairment is deemed to exist if the carrying value of a reporting unit exceeds its estimated fair
value. Other intangible assets are amortized on a straight-line basis over their estimated useful
lives, ranging from five to 15&nbsp;years. Amortization expense was $215,000 and $164,000 for the three
months ending June&nbsp;30, 2005 and 2004, respectively, and $431,000 and $327,000 for the six months
ending June&nbsp;30, 2005 and 2004, respectively.
</DIV>

<P align="center" style="font-size: 10pt">10
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of June&nbsp;30, 2005 and December&nbsp;31, 2004, the Company&#146;s other intangible assets and related
accumulated amortization consisted of the following (in thousands):
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="28%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="10" style="border-bottom: 1px solid #000000"><B>As of June 30, 2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="10" style="border-bottom: 1px solid #000000"><B>As of December 31, 2004</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="10"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Accumulated</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Accumulated</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Gross</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Amortization</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Net</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Gross</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Amortization</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Net</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>Other intangible assets, net</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Acquisition</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">148</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(148</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">148</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(148</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">ESTRASORB rights</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,514</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(263</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,251</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,514</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(136</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,378</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">AVC product acquisition</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,332</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,142</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,190</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,332</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,904</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,428</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Patents</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,525</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,349</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,176</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,525</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,283</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,242</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8,519</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(3,902</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,617</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8,519</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(3,471</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">5,048</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Stock-Based Compensation</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In December&nbsp;2004, the Financial Accounting Standards Board issued Statement No.&nbsp;123 (revised)
<I>Share-Based Payment </I>(&#147;SFAS No.&nbsp;123R&#148;), which is a revision of Statement No.&nbsp;123, <I>Accounting for
Stock-Based Compensation </I>(&#147;SFAS No.&nbsp;123&#148;). SFAS No.&nbsp;123R supersedes APB No.&nbsp;25, <I>Accounting for
Stock Issued to Employees </I>(&#147;APB No.&nbsp;25&#148;), and amends SFAS No.&nbsp;95, <I>Statement of Cash Flows.</I>
Generally, the approach in SFAS No.&nbsp;123R is similar to the approach described in SFAS No.&nbsp;123.
However, SFAS No.&nbsp;123R requires all share-based payments to employees, including grants of employee
stock options, to be recognized in the income statement based on their fair values. Pro forma
disclosure is no longer an alternative.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SFAS No.&nbsp;123R must be adopted in the first annual financial reporting period beginning after
June&nbsp;15, 2005. The Company will adopt SFAS No.&nbsp;123R on January&nbsp;1, 2006.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SFAS No.&nbsp;123R permits public companies to adopt its requirements using one of two methods:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>A &#147;modified prospective&#148; method in which compensation cost is recognized beginning with
the effective date (a)&nbsp;based on the requirements of SFAS No.&nbsp;123R for all share-based
payments granted after the effective date and (b)&nbsp;based on the requirements of SFAS No.&nbsp;123
for all awards granted to employees prior to the effective date of SFAS No.&nbsp;123R that
remain unvested on the effective date.</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">11
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Stock-Based Compensation (continued):</I>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>A &#147;modified retrospective&#148; method which includes the requirements of the modified
prospective method described above, but also permits entities to restate based on the
amounts previously recognized under SFAS No.&nbsp;123 for purposes of pro forma disclosures
either for (a)&nbsp;all prior periods presented or (b)&nbsp;prior interim periods of the year of
adoption.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company plans to adopt SFAS No.&nbsp;123R using the modified prospective method.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As permitted by SFAS No.&nbsp;123, the Company currently accounts for share-based payments to
employees using the intrinsic value method permitted by APB No.&nbsp;25 and, as such, generally
recognizes no compensation cost for employee stock options. Accordingly, the adoption of SFAS No.
123R&#146;s fair value method will have a significant impact on the Company&#146;s results of operations,
although it will have no impact on the Company&#146;s overall financial position. The impact of adoption
of SFAS No.&nbsp;123R cannot be predicted at this time because it will depend on levels of share-based
payments granted in the future. However, had the Company adopted SFAS No.&nbsp;123R in prior periods,
the impact of that standard would have approximated the impact of SFAS No.&nbsp;123 as described in the
disclosure of pro forma net income and earnings per share below. SFAS No.&nbsp;123R also requires the
benefits of tax deductions in excess of recognized compensation cost to be reported as a financing
cash flow, rather than as an operating cash flow as required under current literature.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This requirement will reduce net operating cash flows and increase net financing cash flows in
periods after adoption. The Company cannot estimate what those amounts will be in the future
because they depend on, among other things, when employees exercise stock options. For the six
months ended June&nbsp;30, 2005 and 2004, the Company did not pay any taxes, therefore, there was no
effect on operating cash flows for such excess tax deductions.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Had the Company applied the fair value principles of SFAS No.&nbsp;123, for its employee options,
its net loss for the three and six months ending June&nbsp;30, 2005 and 2004 would have increased as
follows:
</DIV>

<P align="center" style="font-size: 10pt">12
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6"><B>Three Months Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6"><B>Six Months Ended</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6" style="border-bottom: 1px solid #000000"><B>June 30,</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6" style="border-bottom: 1px solid #000000"><B>June 30,</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="14"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="14"><B>(Amounts in thousands, except per share data)</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net loss, as reported</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5,716</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(7,717</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(14,602</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(12,975</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Deduct: Total
stock-based employee
compensation expense
determined under
fair value based
method for all
awards</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,025</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,504</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,970</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,639</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Pro forma net loss</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(6,741</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(9,221</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(16,572</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(15,614</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net loss per share:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Basic and
diluted &#151;
as reported</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.14</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(0.22</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.37</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.37</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Basic and
diluted &#151;
pro forma</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.17</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(0.27</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.42</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.45</TD>
    <TD nowrap>)</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;These pro forma amounts are not necessarily indicative of the future effects of applying
the fair value-based method due to, among other things, the vesting period of the stock options and
the fair value of additional stock options issued in future years.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In May&nbsp;2005, the Company granted 182,434 restricted shares totaling $270,000 in value at the
date of grant to various employees and officers of the Company which vests over a three-year
period. In accordance with APB No.&nbsp;25, for the three months
ended June&nbsp;30, 2005, $15,000 of non-cash
stock compensation expense was included in total operating costs and expenses related to this
restricted stock and additional paid-in capital was increased accordingly.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Sales and Issuance of Common Stock</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There were no sales or issuances of common stock during the three or six month periods ended
June&nbsp;30, 2005. See <I>Subsequent Events </I>for a discussion of stock issuances subsequent to June&nbsp;30,
2005.
</DIV>

<P align="center" style="font-size: 10pt">13
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Segment Information</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company currently operates in one business segment, which is the research, development and
commercialization of products focused on women&#146;s health and infectious diseases. The Company is
managed and operated as one business. A single management team that reports to the Chief Executive
Officer comprehensively manages the entire business. The Company does not operate separate lines
of business with respect to its products or product candidates. Accordingly, the Company does not
have separately reportable segments as defined by FASB Statement No.&nbsp;131, <I>Disclosure about Segments
of an Enterprise and Related Information</I>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Related Party Transactions</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In March&nbsp;2002, pursuant to the Novavax, Inc. 1995 Stock Option Plan, the Company approved the
payment of the exercise price of options by two of its directors, through the delivery of
full-recourse, interest-bearing promissory notes in the aggregate amount of $1,479,268. The
borrowings accrue interest at 5.07% per annum and are secured by an aggregate of 261,667 shares of
common stock owned by the directors. The notes are payable upon the earlier to occur of the
following: (i)&nbsp;payable in full upon the date on which the director ceases for any reason to be a
director of the Company, (ii)&nbsp;payable in part to the extent of net proceeds, upon the date on which
the director sells all or any portion of the pledged shares or (iii)&nbsp;payable in full on March&nbsp;21,
2007. As of June&nbsp;30, 2005 and December&nbsp;31, 2004, accrued interest receivable related to the
borrowing was $246,000 and $209,000, respectively.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition, in April&nbsp;2002, we executed a conditional guaranty of a brokerage margin account
for a director, in the amount of $500,000. Prior to demanding payment from the Company, the
brokerage firm must first make demand for payment to the director and then liquidate the account.
Thereafter, if there remains a shortfall, the brokerage firm may demand payment from the Company.
As of June&nbsp;30, 2005 and December&nbsp;31, 2004, the Company had not recorded any liability on its
balance sheet related to this guarantee as we believe the possibility of required payment by the
Company to be unlikely.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Restructuring of the Sales Force</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In March, 2005, the Company implemented a measure to control expenses by reducing the size of
its sales force. The total estimated cost to be incurred in connection with this restructuring
was approximately $238,000. Included in this amount were one-time termination benefits of $129,000,
all of which were paid as of June&nbsp;30, 2005, auto lease contract termination costs of approximately
$95,000, which are still included in accrued expenses as of June&nbsp;30, 2005, and $14,000 of other
associated costs, all of which were paid as of June&nbsp;30, 2005. Included in the accompanying
statements of operations for the three and six months ended June&nbsp;30, 2005 are $32,000 and $206,000
related to these expenses, respectively.
</DIV>

<P align="center" style="font-size: 10pt">14
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>NOVAVAX, INC.<BR>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><I>Subsequent Events</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In July&nbsp;2005, the Company completed an agent-led offering of 4,000,000 shares of common stock
at $1.00 per share for gross proceeds of $4,000,000. The stock was issued pursuant to an existing
shelf registration statement. Net proceeds after deducting underwriter, legal, accounting and
other miscellaneous fees, were approximately $3.6&nbsp;million.
</DIV>

<P align="center" style="font-size: 10pt">15
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;2.</B>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS<BR>
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following discussion may contain statements that are not purely historical. Certain
statements contained herein or as may otherwise be incorporated by reference herein constitute
&#147;forward-looking statements&#148; within the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements include, but are not limited to, statements regarding product
sales, future product development and related clinical trials, and statements regarding future
research and development, including Food and Drug Administration approval. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of the Company, or industry results, to be materially
different from those expressed or implied by such forward-looking statements.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Such factors include, among other things, the following: general economic and business
conditions; competition; ability to enter into future collaborations with industry partners,
including an ESTRASORB<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP> licensing agreement, unexpected changes in technologies and
technological advances; ability to obtain rights to technology; ability to obtain and enforce
patents; ability to commercialize and manufacture products; ability to establish and maintain
commercial-scale manufacturing capabilities; results of clinical studies; progress of research and
development activities; business abilities and judgment of personnel; availability of qualified
personnel; changes in, or failure to comply with, governmental regulations; ability to obtain
adequate financing in the future through product licensing, co-promotional arrangements, public or
private equity financing or otherwise; and other factors referenced herein.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All forward-looking statements contained in this quarterly report are based on information
available to the Company on the date hereof, and the Company assumes no obligation to update any
such forward-looking statements, except as specifically required by law. Accordingly, past results
and trends should not be used to anticipate future results or trends.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Recent Development</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In July&nbsp;2005, we completed an agent-led offering of 4,000,000 shares of common stock at $1.00
per share for gross proceeds of $4,000,000. The stock was issued pursuant to an existing shelf
registration statement. Net proceeds were approximately $3.6&nbsp;million.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Taking into effect this event, at June&nbsp;30, 2005, on a pro-forma basis, our cash balance would
have been approximately $8.0&nbsp;million, total assets of
approximately $63.9&nbsp;million and stockholder&#146;s
equity of approximately $22.3&nbsp;million.
</DIV>

<P align="center" style="font-size: 10pt">16
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Overview</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Novavax is a specialty biopharmaceutical company engaged in the research, development and
commercialization of proprietary products using our topical drug delivery technology and the
development of preventive vaccines and proteins for infectious diseases. We sell, market, and
distribute a line of prescription pharmaceuticals and prenatal vitamins. Our proprietary topical
micellar nanoparticle (&#147;MNP&#148;) drug delivery platform, our principal technology platform, involves
the use of patented oil and water nanoemulsions which can be used as vehicles for the delivery of a
wide variety of drugs and other therapeutic products, including hormones. In October&nbsp;2003, our
initial product candidate, ESTRASORB, the first topical emulsion for estrogen therapy, was approved
for marketing by the Food and Drug Administration. The FDA approved ESTRASORB for the treatment of
moderate to severe vasomotor symptoms (hot flashes) associated with menopausal women, and we
commercially launched this product in June&nbsp;2004.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Since its launch, ESTRASORB has been favorably accepted by those physicians who have
prescribed it and the patients who have been using it for the treatment of moderate to severe
vasomotor symptoms associated with menopause. However, to date, ESTRASORB prescription trends have
not met our initial expectations. We attribute the slow start to the long lasting effects of the
Women&#146;s Health Initiative study, the unanticipated simultaneous approval and launch of a
competitive product and an overall competitive market. During the first 12&nbsp;months of marketing,
management concluded that our marketing resources were not sufficiently available to us in order to
generate the awareness of the product directly to the consumer. For
that reason we have continually evaluated the effective optimization and sizing of our sales forces and have been seeking a well
established, global pharmaceutical partner that could provide the optimal opportunity for ESTRASORB
to be successful on a larger scale.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will continue to focus our efforts on the development of additional compounds that use our
proprietary topical MNP drug delivery platform that we believe have a high probability of technical
success and that have a large market potential. As part of our research and development efforts, we
intend to file or activate two Investigational New Drug Applications (INDs) with the FDA by the
first quarter of 2006 for two of our product candidates. The table below summarizes our most
advanced drug candidates currently in clinical or preclinical development.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We plan to continue leveraging our technologies to develop these and other new product
candidates to be marketed by the Company, or co-promoted, or licensed to other drug companies.
</DIV>

<P align="center" style="font-size: 10pt">17
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><IMG src="w11762w1176277.gif" alt="(GRAPH)">
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We also conduct research and development on preventative vaccines and proteins for
infectious diseases and cancers, and tolergens to prevent the initiation and progression of stroke,
heart attack and other inflammatory diseases. Currently, the major impetus is the development and
exploitation of our core Virus-like particle (&#147;VLP&#148;) technology for developing novel vaccines.
VLPs are genetically-engineered particles that imitate the important three-dimensional structures
of viruses but are composed of recombinant proteins and therefore are powerful immunogens but incapable
of causing infection and disease. Our proprietary production technology for VLPs employs insect
cells and the baculovirus expression system. We believe the main advantage of this technology is a
more rapid production of a safe, effective, low-cost vaccine as compared to the labor-intensive
egg-based and cell culture based production processes. Other key advantages of this technology are
the ability to rapidly respond to emerging threats or new strains and the reduced risk of allergic
reaction. Projects in development using our proprietary VLP technology include vaccines for HIV,
SARS and pandemic and seasonal influenza. We are also developing E-selectin tolergen for the
prevention of secondary strokes.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Critical Accounting Policies and Changes to Accounting Policies</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The preparation of financial statements in conformity with accounting principles generally
accepted in the United States requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
</DIV>

<P align="center" style="font-size: 10pt">18
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS<BR>
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There have been no material changes in our critical accounting policies or critical accounting
estimates since December&nbsp;31, 2004, nor have we adopted any accounting policy that has or will have
a material impact on our consolidated financial statements. For further discussion of our
accounting policies see Note 2 <I>Summary of Significant Accounting Policies</I>, in the Notes to the
Consolidated Financial Statements included in this Quarterly Report on Form 10-Q and Note 3 in the
Notes to the Consolidated Financial Statements for our Annual Report on Form 10-K for the fiscal
year ended December&nbsp;31, 2004.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Results of Operations</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following is a discussion of the historical consolidated financial condition and results
of operations of Novavax, Inc. and its wholly-owned subsidiary and should be read in conjunction
with the consolidated financial statements and notes thereto set forth in this Quarterly Report on
Form 10-Q. Additional information concerning factors that could cause actual results to differ
materially from those in the Company&#146;s forward-looking statements is contained from time to time in
the Company&#146;s SEC filings, including but not limited to the Company&#146;s Annual Report on Form 10-K
for the fiscal year ended December&nbsp;31, 2004.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Three months ended June&nbsp;30, 2005 (&#147;2005&#148;) compared to the three months ended June&nbsp;30, 2004 (&#147;2004&#148;): (In thousands)</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><B>Revenues:</B></U>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>$ Change</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>% Change</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Product Sales:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Vitamins</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">530</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">653</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(123</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-19</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Gynodiol</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">297</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">238</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">59</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">25</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">AVC Cream</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">376</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">158</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">218</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">138</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">ESTRASORB</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">691</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,481</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(790</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-53</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Other</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(5</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">126</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(131</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-104</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:30px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total product sales</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,889</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,656</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(767</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-29</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Contract research</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">426</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">286</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">140</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">49</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Milestone and licensing fees</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">63</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(63</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-100</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:30px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,315</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,005</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(690</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-23</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:30px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">19
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS<BR>
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenues for the second quarter of 2005 were $2.3&nbsp;million, which was $1.2&nbsp;million higher than
the first quarter of 2005 or 141%. Revenues for the second quarter 2005 consisted of product sales
of $1.9&nbsp;million, compared to $2.7&nbsp;million in 2004; contract revenues of $0.4&nbsp;million in 2005,
compared to $0.3&nbsp;million in 2004; and milestone and licensing fees of zero in 2005, compared to
$0.1&nbsp;million in 2004. Total revenues for the three months ended June&nbsp;30, 2005 of $2.3&nbsp;million, when
compared to $3.0&nbsp;million for 2004, decreased $0.7&nbsp;million or 23%. The net decrease in 2005 product
sales compared to 2004 is primarily attributable to the $1.5&nbsp;million of initial commercial launch
sales of ESTRASORB in June&nbsp;2004 compared to $0.7&nbsp;million of ESTRASORB sales in 2005. The major
wholesalers depleted their initial launch inventories from June 2004
into the second quarter of 2005 and are now placing additional orders that correspond with their anticipated monthly resell levels.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The increase in contract revenue for 2005 as compared to 2004 is primarily attributable to the
first milestone completion on a new contract for 2005. We currently have research contracts
totaling over $2.0&nbsp;million for 2005 and we expect that as contract milestones are met we will
continue to see an increase in revenues in subsequent quarters.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><B>Operating costs and expenses:</B></U>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>$ Change</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>% Change</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cost of sales</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,027</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,501</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">526</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">35</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Research and development</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,377</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,229</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">148</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">12</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Selling and marketing</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,844</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,556</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3,712</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-67</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">General and administrative</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,292</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,059</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">233</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">11</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">7,540</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10,345</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(2,805</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-27</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cost of sales, which includes fixed idle capacity costs at our manufacturing facility,
increased to $2.0&nbsp;million in 2005, compared to $1.5&nbsp;million in 2004. Of the $2.0&nbsp;million cost of
sales, $1.0&nbsp;million was due to idle plant capacity costs at our ESTRASORB manufacturing facility,
which was operating at higher production levels at this time last year. The remaining $1.0&nbsp;million
is lower than the $1.5&nbsp;million in 2004 by 33% and correlates to 2005 revenues being lower than 2004
by $0.8&nbsp;million or 29%. ESTRASORB cost of sales percentages will continue to be high until we can
increase production volumes or partner the product, to offset the fixed costs related to the
manufacturing process and facility. We are working to design alternative packaging solutions to
further streamline production and lower costs of production.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Research and development costs increased from $1.2&nbsp;million in 2004 to $1.4&nbsp;million in 2005, or
11%. The increase of $0.2&nbsp;million was due to research and development spending incurred to
support the development of future products.
</DIV>

<P align="center" style="font-size: 10pt">20
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS<BR>
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Selling and marketing costs were $1.8&nbsp;million in 2005 compared to $5.5&nbsp;million in 2004. The
decrease of $3.7&nbsp;million, or 67%, was primarily due to a $3.2&nbsp;million decrease in marketing costs
for 2005 compared to 2004 as higher marketing costs were incurred in 2004 for the commercial launch
of ESTRASORB. A $0.5&nbsp;million decrease in selling costs for 2005 compared to 2004 accounted the
remaining difference which resulted from the restructuring of our sales force in March&nbsp;2005.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;General and administrative costs were $2.3&nbsp;million in 2005 compared to $2.1&nbsp;million in 2004.
Increases in legal fees and business development costs accounted for the increase over 2004, offset
by other cost saving measures implemented during 2004 and 2005.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><B>Interest Income/(Expense): </B></U>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>$ Change</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>% Change</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Interest income.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">42</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">63</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(21</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-33</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Interest expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(533</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(440</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(93</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-21</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(491</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(377</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(114</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-30</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net interest expense was $0.5&nbsp;million for 2005 compared to $0.4&nbsp;million in 2004. Our
2004 interest expense related primarily to the promissory notes with King of $40.0&nbsp;million in 2002
though July&nbsp;2004, at which time such notes were redeemed and we issued new convertible notes
totaling $35.0&nbsp;million to a group of institutional investors. The 2005 increase in interest
expense of $0.1&nbsp;million is due to the increase in the amortization of deferred financing costs
related to the new notes.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><B>Net loss:</B></U>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>$ Change</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>%Change</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net loss</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5,716</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(7,717</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(2,001</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">26</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net loss per share</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.14</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.22</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.08</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">36</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Weighted shares outstanding</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39,553,876</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">34,779,657</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,774,219</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">14</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss for 2005 was $5.7&nbsp;million or $(.14) per share, as compared to $7.7&nbsp;million or
$(.22) per share for 2004, a decrease of $2.0&nbsp;million, or $.08 per share. The decrease is
primarily due to the decrease in operating expenses of $2.8&nbsp;million partially offset by the
decrease in revenues of $0.7&nbsp;million, all previously discussed.
</DIV>

<P align="center" style="font-size: 10pt">21
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS<BR>
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Six months ended June&nbsp;30, 2005 (&#147;2005&#148;) compared to the six months ended June&nbsp;30, 2004 (&#147;2004&#148;): (In thousands)</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><B>Revenues:</B></U>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>$ Change</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>% Change</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Product Sales:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Vitamins</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">752</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,107</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(1,355</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-64</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Gynodiol</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">335</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">613</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(278</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-45</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">AVC Cream</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">472</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">430</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">42</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">10</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">ESTRASORB</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,035</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,481</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(446</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-30</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Other</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">223</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(209</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-94</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:30px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total product sales</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,608</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,854</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,246</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-46</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Contract research</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">669</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,246</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(577</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-46</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Milestone and licensing fees</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#150;&#150;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">125</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(125</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-100</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:30px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,277</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">6,225</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(2,948</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-47</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:30px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenues for 2005 consisted of product sales of $2.6&nbsp;million, compared to $4.9&nbsp;million in
2004; contract revenues of $0.7&nbsp;million, compared to $1.2&nbsp;million in 2004; and no milestone and
licensing fees in 2005, compared to $0.1&nbsp;million in 2004. Total revenues for 2005 were $3.3
million, as compared to $6.2&nbsp;million for 2004, a $2.9&nbsp;million or 47% decrease.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Of the total decrease in revenues, product sales accounted for $2.3&nbsp;million. This decrease is
primarily attributable to an overall reduction in sales of prenatal vitamins, Gynodiol, ESTRASORB
and other products. In addition, in 2004 we filled substantial backorders for our newest prenatal
vitamins which negatively effects the comparison to 2005. The reduction in 2005 product sales,
other than for ESTRASORB, is primarily due to continued generic pressure on our prenatal line.
The net decrease in ESTRASORB is primarily attributable to the $1.5&nbsp;million of commercial launch
sales in June&nbsp;2004 compared to $1.0&nbsp;million of ESTRASORB sales in 2005. The major wholesalers
depleted their initial launch inventories from June 2004 into the
second quarter of 2005 and are now placing
additional orders that correspond with their anticipated monthly resell levels. In addition, $0.2
million of distributor services fees are included as an offset to revenue for 2005 which were not
incurred in 2004.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The decrease in contract revenue for 2005 as compared to 2004 is primarily due to the
completion of several contracts during the first quarter of 2004 which resulted in final payments
totaling $0.3&nbsp;million, as well as $0.5 revenue recognized on the NIH contact that was later
cancelled in July&nbsp;2004. This was partially offset by $0.1&nbsp;million for the completion of the first
milestone on a new contract for 2005. We currently have research contracts totaling over $2.0
million for 2005 and we expect that as contract milestones are met we will continue to see an
increase in revenues in subsequent quarters.
</DIV>

<P align="center" style="font-size: 10pt">22
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS<BR>
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><B>Operating costs and expenses:</B></U>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>$ Change</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>% Change</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cost of sales</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,006</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,763</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,243</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">127</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Research and development</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,599</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,277</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,678</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-39</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Selling and marketing</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,901</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,330</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,429</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-29</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">General and administrative</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,413</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,091</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">322</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">8</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16,919</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">18,461</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(1,542</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-8</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cost of sales, which includes fixed idle capacity costs at our manufacturing
facility, increased to $4.0&nbsp;million in 2005, compared to $1.8&nbsp;million in 2004. Of the $4.0&nbsp;million
cost of sales, $2.5&nbsp;million was due to idle plant capacity at our ESTRASORB manufacturing facility,
which was operating at higher production levels at this time last year. The remaining $1.5&nbsp;million
for 2005 is lower than the $1.8&nbsp;million for 2004 but is higher as a percentage of product revenues.
ESTRASORB sales in 2005 were 40% of net product sales in 2005 as compared to 31% in 2004, and
carry a higher cost of sales than our other products. In the initial periods of ESTRASORB
production, the cost of sales percentages have been and will be unusually high until we increase
production volumes or partner the product to offset the fixed costs related to the manufacturing
process and facility. We are working to design alternative packaging solutions to further
streamline production and lower costs of production.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Research and development costs decreased from $4.3&nbsp;million in 2004 to $2.6&nbsp;million in 2005.
The decrease of $1.7&nbsp;million, or 39%, was due to manufacturing start-up costs in 2004 being
accounted for in the research and development category until April&nbsp;2004. The 2004 manufacturing
costs were incurred to prepare and validate the facility for GMP and Food and Drug Administration
compliance and not to build inventory. Beginning in April&nbsp;2004, manufacturing costs have been
included in cost of sales, inventory or written off to idle capacity cost.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Selling and marketing costs were $5.9&nbsp;million in 2005 compared to $8.3&nbsp;million in 2004. The
decrease of $2.4&nbsp;million, or 29%, was primarily due to a $3.2&nbsp;million decrease in marketing costs
for 2005 compared to 2004. Marketing costs for 2004 were related to the initial product launch
advertising and promotion for ESTRASORB. A $0.8&nbsp;million increase in selling costs for 2005
compared to 2004 accounts for the remaining difference, and is due to a greater number sales
personnel in the first quarter of 2005 as compared to the same period in 2004.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;General and administrative costs were $4.4&nbsp;million in 2005 compared to $4.1&nbsp;million in 2004.
Increases in legal fees and business development costs accounted for the increase over 2004, offset
by other cost saving measures implemented during 2004 and 2005.
</DIV>

<P align="center" style="font-size: 10pt">23
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS<BR>
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><B>Interest Income/(Expense): </B></U>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>$ Change</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>% Change</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Interest income.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">103</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">145</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(42</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-29</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Interest expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,063</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(884</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(179</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-20</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(960</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(739</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(221</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">-30</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net interest expense was $1.0&nbsp;million in 2005 compared to $0.7&nbsp;million in 2003. Our 2004
interest expense related primarily to the promissory notes with King of $40.00&nbsp;million in 2003
through July&nbsp;2004, at which time such notes were redeemed and we issued new convertible notes
totaling $35.0&nbsp;million to a group of institutional investors. The 2005 increase in interest
expense of $0.2&nbsp;million is due to the increase in the amortization of deferred financing costs
related to the new notes.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><B>Net loss:</B></U>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>$ Change</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>%Change</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net loss</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(14,602</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(12,975</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,612</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">12</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net loss per share</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.37</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(.37</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">0</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Weighted shares outstanding</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39,553,876</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">34,750,944</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,802,932</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">22</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss for 2005 was $14.6&nbsp;million or $(.37) per share, as compared to $13.0&nbsp;million or
$(.37) per share for 2004, an increase of $1.6&nbsp;million or 12%, with no change in net loss per
share, due to the issuance of additional shares in the second half of 2004. The increase in net
loss is the result of decreased revenues of $2.9&nbsp;million and the increase in net interest expense
of $0.2&nbsp;million, partially offset by decreased operating expenses of $1.6&nbsp;million, all previously
described.
</DIV>

<P align="center" style="font-size: 10pt">24
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS<BR>
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><B>Liquidity and Capital Resources</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our capital requirements depend on numerous factors, including but not limited to product
sales and returns, the ability to enter into a satisfactory license agreement for ESTRASORB, the ability to gain
market share, the marketing and manufacturing costs related to
the commercialization of ESTRASORB, the commitments and progress of our research and development
programs, the progress of preclinical and clinical testing, the time and costs involved in
obtaining regulatory approvals, the costs of filing, prosecuting, defending and enforcing any
patent claims and other intellectual property rights, competing technological and market
developments, and changes in our product lines. We plan to have multiple products in various
stages of product development and we believe our research and development as well as selling,
marketing and general administrative expenses and capital requirements will continue to increase.
Future activities, including efficiencies in commercial-scale manufacturing capabilities, and
product development are subject to our ability to raise funds through debt or equity financing, or
collaborative arrangements with industry partners.
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Six months</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>ending</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>June 30, 2005</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(in thousands)</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left"><U><B>Summary of Cash Flows:</B></U></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net cash used in:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Operating activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(12,738</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Investing activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(80</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Financing activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(616</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net change in cash and cash equivalents</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(13,434</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Beginning cash and cash equivalents</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,876</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Ending cash and cash equivalents</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,442</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">25
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS<BR>
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents were $4.4&nbsp;million at June&nbsp;30, 2005, a decrease of $13.4&nbsp;million from
the December&nbsp;31, 2004 balance of $17.9&nbsp;million. Of the $13.4&nbsp;million of cash used in the first six
months of 2005, $12.7&nbsp;million was used for operating activities, $0.1&nbsp;million was used for
investing activities and $0.6&nbsp;million for financing activities. Operating activities consisted of
the net loss of $14.6&nbsp;million, as previously discussed, non-cash activities of $2.0&nbsp;million, offset
by $(0.2) million of net changes in balance sheet accounts. Working capital was $2.7&nbsp;million at
June&nbsp;30, 2005 compared to $15.4&nbsp;million at December&nbsp;31, 2004. The decrease in working capital of
$12.7&nbsp;million was primarily due to the $12.7&nbsp;million used for operating activities.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
previously mentioned in the <I>Recent Development</I> section, on July&nbsp;5, 2005, the Company
completed an offering of 4,000,000 shares of common stock at $1.00 per share. The stock was issued
pursuant to an existing shelf registration statement. The net proceeds after deducting
underwriter, legal, accounting and other miscellaneous fees were
approximately $3.6&nbsp;million. As of June 30, on a pro-forma basis,
our cash balance would have been approximately $8.0&nbsp;million. We intend to use the
proceeds from this offering for general corporate purposes, including but not limited to our
internal research and development programs, such as preclinical and clinical testing and studies of
our product candidates and the development of new technologies, and general working capital.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During the remainder of 2005, we anticipate lower cash requirements than we experienced during
the first half of 2005 primarily due to the reduction in our sales force that occurred in March
2005 and the reduction in marketing costs. Partially offsetting this is an anticipated increase in
research and development expenditures as new product candidates progress to the Investigational New
Drug stage. Sales of ESTRASORB have been below our expectations and our 2005 sales for ESTRASORB
and subsequent cash receipts will not offset related sales and manufacturing expenses. In summary,
we expect our quarterly use of cash to decrease over the remainder of 2005.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will continue to pursue obtaining capital through product licensing, co-development
arrangements on new products, or the public or private sale of securities of the Company. We have
demonstrated our ability to obtain capital, as required; however, there can be no assurance that we
will be able to obtain additional capital or, if such capital is available, that the terms of any
financing will be satisfactory to the Company. Based on our assessment of the availability of
capital and our business operations as currently contemplated, in the absence of new financings,
licensing arrangements or partnership agreements, we believe we will have adequate resources
through 2005. If we are unable to obtain additional capital, we will continue to assess our
capital resources and based on those resources we may be required to delay, reduce the scope of, or
eliminate one or more of our product research and development programs, downsize our organization,
reduce or defer our marketing expenses or reduce general and administrative infrastructure.
</DIV>

<P align="center" style="font-size: 10pt">26
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS<BR>
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B>
</DIV>


<DIV align="left" style="margin-top: 12pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left"><B>Item&nbsp;3.</B></TD>
    <TD>&nbsp;</TD>
    <TD><B>Quantitative and Qualitative Disclosures about Market Risk</B></TD>
</TR>
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There have been no material changes during the period from the end of our last fiscal year
through June&nbsp;30, 2005 to the information concerning the Company&#146;s quantitative and qualitative
disclosures about market risk set forth in Item&nbsp;7A of our Annual Report on Form 10-K for the fiscal
year ended December&nbsp;31, 2004 as filed with the SEC.
</DIV>

<DIV align="left" style="margin-top: 12pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left"><B>Item&nbsp;4.</B></TD>
    <TD>&nbsp;</TD>
    <TD><B>Controls and Procedures</B></TD>
</TR>
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company maintains disclosure controls and procedures that are designed to ensure that
information required to be disclosed in the Company&#146;s reports (as defined in Rules&nbsp;13a-15(e) and
15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended), is recorded,
processed, summarized and reported within the time periods specified in the SEC&#146;s rules and forms,
and that such information is accumulated and communicated to the Company&#146;s management, including
its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions
regarding required disclosure. In designing and evaluating the disclosure controls and procedures,
management recognized that any controls and procedures, no matter how well designed and operated,
can provide only reasonable assurance of achieving the desired control objectives, and management
necessarily was required to apply its judgment in evaluation the cost-benefit relationship of
possible controls and procedures.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Evaluation</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company carried out an evaluation, under the supervision, and with the participation, of
the Company&#146;s management, including the Company&#146;s Chief Executive Officer and Chief Financial
Officer, of the effectiveness of the Company&#146;s disclosure controls and procedures as of June&nbsp;30,
2005. Based on that evaluation, the Company&#146;s Chief Executive Officer and Chief Financial Officer
concluded that the Company&#146;s disclosure controls and procedures were effective as of June&nbsp;30, 2005.
Such evaluation did not identify any change in the Company&#146;s internal controls over financial
reporting during the quarter ended June&nbsp;30, 2005 that could materially affect the internal control
over financial reporting.
</DIV>

<P align="center" style="font-size: 10pt">27
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Part II. Other Information</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U>Item&nbsp;1 &#150; Legal Proceedings</U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company is a defendant in a lawsuit filed by a former director alleging that the Company
wrongfully terminated the former director&#146;s stock options. Management believes that the
termination and cancellation of the options was in accordance with the terms of the option
agreements, following his termination for cause in 1997 by a former parent company, IGI, Inc., and
the lawsuit is without merit and intends to vigorously defend the claim. Management cannot
reasonably estimate the liability, if any, related to this claim, or the likelihood of an
unfavorable settlement. Accordingly, no liability related to this contingency is accrued in the
consolidated balance sheet as of June&nbsp;30, 2005. Any unfavorable determination however, may have a
material adverse impact on future operating results.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U>Item&nbsp;2 &#150; Unregistered Sales of Equity Securities and Use of Proceeds</U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Not applicable.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U>Item&nbsp;3 &#150; Defaults upon Senior Securities</U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Not applicable.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U>Item&nbsp;4 &#150; Submission of Matters to a Vote of Security Holders</U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At the Company&#146;s Annual Meeting of Stockholders held on May&nbsp;4, 2005, the following proposals
were adopted by the votes specified below:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>To elect two directors as Class&nbsp;I directors to serve of the Board of Directors for a
three-year term expiring at the 2008 Annual Meeting of Stockholders:</TD>
</TR>

</TABLE>
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="80%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">FOR</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">WITHHELD</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Denis M. O&#146;Donnell, M.D.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33,441,605</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,063,060</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Nelson M. Sims</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33,233,109</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,271,466</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition to the two Class&nbsp;I Directors elected at this year&#146;s Annual Meeting of
Stockholders, the Board is composed of three Class&nbsp;II Directors and three Class&nbsp;III Directors.
The continuing Class&nbsp;II Directors, whose terms will expire at the Company&#146;s 2006 Annual Meeting,
are Gary C. Evans, John O. Marsh, Jr. and J. Michael Lazarus. The continue Class&nbsp;III Directors,
whose terms will expire at the Company&#146;s 2007 Annual Meeting, are Susan B. Bayh, Mitchell J.
Kelly and Michael A. McManus, Jr. Subsequent to the Annual Meeting Ms.&nbsp;Bayh have
resigned as a directors. On August&nbsp;8, 2005, Mr. Sims retired as
a director.
</DIV>



<DIV align="left" style="font-size: 10pt; margin-top: 12pt">2. To approve the Novavax, Inc. 2005 Stock Incentive Plan
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="80%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">FOR</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">AGAINST</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">ABSTAIN</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center"><DIV style="margin-left:30px; text-indent:-15px">17,289,403</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">2,754,779</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">145,062</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">28
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">3.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>To approve the issuance of the share of Common Stock, $.01 par value, of the Company
issuable with respect to senior convertible notes in the aggregate principal amount of
$35,000,000 issued to certain qualified institutional buyers and accredited investors.</TD>
</TR>

</TABLE>
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="80%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">FOR</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">AGAINST</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">ABSTAIN</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center"><DIV style="margin-left:30px; text-indent:-15px">17,864,913</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">2,021,981</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">302,350</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">4.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>To ratify the appointment of Ernst &#038; Young LLP as the independent registered public
accounting firm for the Company for the current fiscal year ending December&nbsp;31, 2005</TD>
</TR>

</TABLE>
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="80%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">FOR</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">AGAINST</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">ABSTAIN</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center"><DIV style="margin-left:30px; text-indent:-15px">28,122,826</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">8,262,889</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">118,950</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U>Item&nbsp;5 &#150; Other Information</U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
August&nbsp;8, 2005, Nelson M. Sims retired as President and Chief Executive Officer of the
Company and a director of the Company. Also, on August&nbsp;8, 2005,
Dr. Rahul Singhvi was elected
President and Chief Executive Officer and a director of the Company
and Ray Hage was elected Chief Operating Officer.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U>Item&nbsp;6 &#150; Exhibits </U>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">10.1</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Lease Agreement, effective as of April&nbsp;1, 2005 by, and between United
HealthCare Services, Inc., a Minnesota corporation and the Company.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">31.1</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Certification of principal executive officer pursuant to
Section&nbsp;302 of the Sarbanes-Oxley Act of 2002.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">31.2</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Certification of principal financial officer pursuant to
Section&nbsp;302 of the Sarbanes-Oxley Act of 2002.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">32.1</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Certification pursuant to 18 U.S.C. Section&nbsp;1350, as adopted
pursuant to Section&nbsp;906 of the Sarbanes-Oxley Act of 2002 by Nelson M. Sims,
President and Chief Executive Officer of the Company.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">32.2</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Certification pursuant to 18 U.S.C. Section&nbsp;1350, as adopted
pursuant to Section&nbsp;906 of the Sarbanes-Oxley Act of 2002 by Dennis W. Genge,
Vice President and Chief Financial Officer of the Company.</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">29
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SIGNATURES</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned thereunto duly authorized.
</DIV>


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">NOVAVAX, INC.<BR>
(Registrant)<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">Date: August 9, 2005&nbsp;</TD>
    <TD valign="top" style="border-bottom: 1px solid #000000">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/  Dennis W. Genge
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">Dennis W. Genge&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">Vice President and Chief Financial Officer<BR>
(Principal Financial and Accounting Officer)&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt">30
</DIV>

</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>2
<FILENAME>w11762exv10w1.htm
<DESCRIPTION>EX-10.1
<TEXT>
<HTML>
<HEAD>
<TITLE>exv10w1</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>EXHIBIT 10.1</B>
</DIV>


<DIV align="right" style="font-size: 10pt; margin-top: 12pt">Execution Draft
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt">LEASE
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;THIS LEASE AGREEMENT, dated as of the Execution Date (this &#147;Lease&#148;), is by and between
United Health Care Services, Inc., a Minnesota corporation, as landlord (&#147;Landlord&#148;), and
Novavax, Inc., a Delaware corporation, as tenant (&#147;Tenant&#148;).
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>1.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>BASIC LEASE PROVISIONS</B></TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>1.1 Basic Lease Definitions. </B>In this Lease, the following defined terms have the
meanings indicated.
</DIV>
<DIV align="right">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="98%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="13%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="80%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(a)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Execution Date
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">As of April&nbsp;&nbsp;&nbsp;, 2005.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(b)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Building:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">1 Taft Court, Rockville, Maryland, which is deemed to contain 34,000 RSF</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(c)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Premises:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Suite&nbsp;200 (identified on
<U>Exhibit&nbsp;A</U>), located on the 2nd floor of the
Building and deemed to contain 11,743 RSF.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(d)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Use:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">General administrative non-governmental office use consistent with
that of a first-class office building, bench-top medical
laboratory purposes and, to the extent permitted by applicable
law and zoning codes, light assembly purposes.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(e)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Scheduled Term:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">60&nbsp;months.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(f)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Commencement Date:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">April&nbsp;1, 2005.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(g)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Expiration Date
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">March&nbsp;31, 2010</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(h)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Base Rent:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">The following amounts payable in accordance with Article&nbsp;4</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="80%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="21%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Annual Base Rent</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Annual Base Rent for</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Monthly Base Rent</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center">Months</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Rate per RSF</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">11,743 RSF</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">for 11,743 RSF</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">

<TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">Commencement Date until
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">0.00</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">0.00</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">0.00</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">May&nbsp;30, 2005</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">June&nbsp;1, 2005-
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">20.00</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">234,860.00</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">19,571.67</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">

<TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">March&nbsp;31, 2006</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">April&nbsp;1, 2006-
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">20.60</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">241,905.84</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">20,158.82</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">March&nbsp;31, 2007
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">($20.00&nbsp;x&nbsp;1.03</TD>
    <TD nowrap valign="top">)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">April&nbsp;1, 2007-
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">21.22</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">249,186.46</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">20,765.54</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">March&nbsp;31, 2008
</DIV></TD>
    <TD>&nbsp;</TD>

<TD nowrap colspan="3" align="center" valign="top">($20.60&nbsp;x&nbsp;1.03)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">April&nbsp;1, 2008-
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">21.86</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">256,701.98</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">21,391.83</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">March&nbsp;31, 2009
</DIV></TD>
    <TD>&nbsp;</TD>

<TD nowrap colspan="3" align="center" valign="top">($21.22&nbsp;x&nbsp;1.03)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">1
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="80%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="21%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">April&nbsp;1, 2009-
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">22.52</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">264,452.36</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">22,037.70</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">February&nbsp;28, 2010
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="RIGHT" valign="top">($21.86&nbsp;x&nbsp;1.03</TD>
    <TD align="LEFT" valign="top">)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">March&nbsp;1, 2010 to
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">0.00</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">0.00</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">0.00</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">March&nbsp;31, 2010</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="right">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="98%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="13%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="80%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(i)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Base Year (&#147;Base Year&#148;)
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Calendar Year 2005</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(j)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Tenant&#146;s Share:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Thirty-four and five tenths percent (34.5%)
which is 11,743 RSF comprising the Premises
divided by 34,000 RSF comprising the Building</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(k)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Security Deposit:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">$19,571.67</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(l)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Notice Address:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">For each party, the following address(es):</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="right">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="95%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="45%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="45%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center">To Landlord</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">To Tenant</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">United HealthCare Services, Inc.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Novavax, Inc.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Attention: Lease Administration
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Attention: Dennis W. Genge</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">MN008-E305
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">508 Lapp Road</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">9900 Bren Road
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Malvern, PA 19355</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Minnetonka, MN 55343</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">With a copy to:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">With a copy to:</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">United HealthCare Services, Inc.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">David A. White, Esq.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Facility Manager
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">White White &#038; Van Etten LLP</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">800 Oak Street
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">55 Cambridge Parkway</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Frederick, MD 21703
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Cambridge, MA 02142</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="right">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="98%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="13%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="80%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(m)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Brokers:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Trammell Crow Company (for Landlord); and USI Real Estate Brokerage Services, Inc. (for Tenant).
Brokers will be paid by Landlord in accordance with a separate agreement.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(n)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Liability Limit:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">$1,000,000.00 for any one accident or occurrence.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(o)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Construction Allowance:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">$58,715.00 ($5.00 times 11,743 RSF).</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">(p)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Business Hours:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">From 8:00 a.m. to 6:00 p.m. on Monday through Friday and from 8:00 a.m. to 12:00 noon on Saturday,
excepting: New Year&#146;s Day, Martin Luther King, Jr. Day, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and the day after Thanksgiving Day, Christmas Day, and other legal holidays
commonly observed in similar class office buildings in the locale of the Building (&#147;Holidays&#148;).</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">2
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>PROJECT</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>2.1 Project. </B>The &#147;Project&#148; is collectively (i)&nbsp;the Building; (i)&nbsp;the land (&#147;Land&#148;) (whether
leased or owned) on which the Building is located; (iii)&nbsp;all Common Areas servicing the Building
and the Land; and (iv)&nbsp;all easements, licenses, appurtenants and rights in connection
therewith.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>2.2 Base Building. </B>&#147;Base Building&#148; means Building Structure and Mechanical Systems,
collectively, defined as follows:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Building Structure</U>. &#147;Building Structure&#148; means the foundations, floor/ceiling slabs,
roofs, exterior walls, load-bearing interior walls, exterior glass and mullions,
columns, beams, shafts, stairs, stairwells, Building mechanical, electrical and
telephone closets, Common Areas, public areas, and any other structural components
in the Building. The Building Structure excludes the Leasehold Improvements (and
similar improvements to other premises) and the Mechanical Systems.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Mechanical Systems</U>. &#147;Mechanical Systems&#148; means the mechanical,
electronic, physical or informational systems generally serving the Building
(including those serving the Premises on a non-exclusive basis) or Common Areas,
including the sprinkler, plumbing, heating, ventilating, air conditioning, lighting,
communications, security, drainage, sewage, waste disposal, vertical transportation,
and fire/life safety systems.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>2.3 Common Areas. </B>Tenant will have a non-exclusive right to use the Common Areas
subject to the terms of this Lease. &#147;Common Areas&#148; means those interior and exterior common
and public areas on the Land and in the Building (and appurtenant easements) designated by
Landlord for the non-exclusive use by Tenant in common with Landlord, other tenants and occupants, and
their employees, agents and invitees, including any parking facilities serving the Building that are
owned or leased by Landlord.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>2.4 Premises. </B>Landlord leases to Tenant the Premises subject to the terms of this Lease.
Except as provided elsewhere in this Lease, by taking possession of the Premises Tenant accepts the
Premises in their &#147;as is&#148; condition and with all faults, and the Premises are deemed in good
order, condition, and repair. The Premises include the Leasehold Improvements and excludes certain areas,
facilities and systems, as follows:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Leasehold Improvements</U>. &#147;Leasehold improvements&#148; means all
non-structural improvements in the Premises or, to the extent referenced below,
exclusively serving the Premises, and any structural improvements to the Building
made to accommodate Tenant&#146;s particular use of the Premises. The Leasehold
Improvements may exist in the Premises as of the Execution Date, or be installed by
Landlord or Tenant under this Lease at the cost of either party. The Leasehold
Improvements include: (1)&nbsp;interior non-load-bearing walls and partitions (including
those surrounding structural columns entirely or partly within the Premises); (2)&nbsp;the
interior one-half of walls that separate the Premises from adjacent areas designated
for leasing; (3)&nbsp;the interior drywall on exterior structural walls, and walls that
separate the Premises from the Common Areas (defined below); (4)&nbsp;stairways and
stairwells connecting parts of the Premises on different floors, except those
required for emergency exiting; (5)&nbsp;the frames, casements, doors, windows and
openings installed in or on the improvements described in (1-4), or that provide
entry/exit to/from the Premises;</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">3
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>(6) all hardware, fixtures, cabinetry, railings, paneling, woodwork and finishes in
the Premises or that are installed in or on the improvements described in (1-5); (7)
if any part of the Premises is on the ground floor, the ground floor exterior
windows (including mullions, frames and glass); (8)&nbsp;integrated ceiling systems
(including grid, panels and lighting); (9)&nbsp;carpeting and other floor finishes; (10)
kitchen, rest room, laboratory or other similar facilities that exclusively serve
the Premises (including plumbing fixtures, toilets, sinks and built-in appliances);
and (11)&nbsp;the sprinkler heads, plumbing fixtures and lighting fixtures. Notwithstanding anything to the
contrary contained herein, Leasehold Improvements shall also include the heating,
ventilating and air conditioning systems exclusively serving the Premises.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Exclusions from the Premises</U>. The Premises does not include: (1)&nbsp;any
areas above the finished ceiling or integrated ceiling systems, or below the finished
floor coverings that are not part of the Leasehold Improvements, (2)&nbsp;janitor&#146;s
closets, (3)&nbsp;stairways and stairwells to be used for emergency exiting or as Common Areas, (4)
rooms for Mechanical Systems or connection of telecommunications equipment, (5)&nbsp;vertical
transportation shafts, (6)&nbsp;vertical or horizontal shafts, risers, chases, flues
or ducts, and (7)&nbsp;any easements or rights to natural light, air or view.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>2.5 Building Standard. </B>&#147;Building Standard&#148; means the minimum or exclusive type,
brand, quality or quantity of materials Landlord designates for use in the Building from time to time.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>2.6 Tenant&#146;s Personal Property. </B>&#147;Tenant&#146;s Personal Property&#148; means those trade
fixtures, furnishings, equipment, work product, inventory, stock-in-trade and other personal property
of Tenant that are not permanently affixed to the Project in a way that they become a part of the
Project and will not, if removed, impair the value of the Leasehold Improvements that Tenant is
required to deliver to Landlord at the end of the Term under &#167;3.4.
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>3.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>TERM</B></TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>3.1 Term. </B>&#147;Term&#148; means the period that begins on the Commencement Date and ends
on the Expiration Date, subject to renewal, extension or earlier termination as may be further
provided in this Lease. &#147;Month&#148; means a full calendar month of the Term.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;<U>Commencement Date</U>. &#147;Commencement Date&#148; is April&nbsp;1, 2005.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;<U>Expiration Date</U>. &#147;Expiration Date&#148; means March&nbsp;31, 2010.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>3.2
Option to Extend Term. </B>(a)&nbsp;Provided this Lease is in full force and effect and that
no Default by Tenant, as defined in this Lease, is in existence either on the date of Tenant&#146;s
Extension Notice (as hereinafter defined) or, unless waived in writing by Landlord for the
purpose of this Extension Option (as hereinafter defined), on the Extension Effective Date, and provided
further that this Lease shall not have theretofore been assigned and the Premises (nor any portion
thereof) shall have theretofore been subleased (other than pursuant to an assignment or sublease not
requiring Landlord&#146;s consent thereto), Tenant shall have the right, at Tenant&#146;s option, to extend the
Term of this Lease for one (1)&nbsp;additional period of five (5)&nbsp;years (the &#147;Optional Extended Term&#148;)
commencing on the day following the Expiration Date (the &#147;Extension Effective Date&#148;) and ending
on the fifth (5<SUP style="font-size: 85%; vertical-align: text-top">th</SUP>) anniversary of the Expiration Date (the &#147;Optional Extended Term
Expiration Date&#148;). Such option to extend (the &#147;Extension Option&#148;) shall be exercised by Tenant giving
written notice (&#147;Tenant&#146;s Extension Notice&#148;) of the exercise thereof to Landlord at least nine (9)
months before the Expiration Date. If Tenant shall fail to timely give Tenant&#146;s Exercise Notice as
provided
</DIV>

<P align="center" style="font-size: 10pt">4
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">herein, the Extension Option shall be deemed automatically and irrevocably waived by Tenant. The
Term as extended pursuant to the Extension Option shall be upon the same terms, covenants, and
conditions as set forth in this Lease except that the Base Rent payable during the Optional
Extended Term, if exercised, shall equal the Market Rate (defined below). In the event Tenant
exercises the Extension Option as provided herein, then Tenant shall, within fifteen (15)&nbsp;days
after Landlord&#146;s request, execute and deliver an amendment to the Lease memorializing such
exercise and the Rent payable by Tenant during the Optional Extended Term. At any time within
twelve (12)&nbsp;months prior to the Expiration Date, Tenant may request that Landlord furnish Tenant
with Landlord&#146;s determination of the Market Rent for the Optional Extended Term, which Landlord shall furnish
within thirty (30)&nbsp;days after such request.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&#147;Market Rate&#148; means the rate then being offered by landlords for comparable bench-top
medical laboratory space in the Rockville, Maryland market and for a comparable term, taking into
account any tenant improvement allowances or other leasing concessions offered in connection
therewith.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>3.3 Holdover. </B>If Tenant keeps possession of the Premises after the end of the Term
(a &#147;Holdover&#148;) without Landlord&#146;s prior written consent (which may be withheld in its sole
discretion), then in addition to the remedies available elsewhere under this Lease or by Law, Tenant will
be a tenant at sufferance and must comply with all of Tenant&#146;s obligations under this Lease, except
that during the Holdover Tenant will pay 200% of the monthly Base Rent and Additional Rent last
payable under this Lease, without prorating for any partial month of Holdover. Tenant shall
indemnify and defend Landlord from and against all direct claims and damages that Landlord
suffers due to Tenant&#146;s failure to return possession of the Premises to Landlord at the end of the
Term. Landlord&#146;s deposit of Tenant&#146;s Holdover payment will not constitute Landlord&#146;s consent to a
Holdover, or create or renew any tenancy.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>3.4 Condition on Expiration. </B>By the end of the Term, Tenant will return possession of
the Premises to Landlord vacant, free of Tenant&#146;s Personal Property, in broom-clean condition,
and with all Leasehold Improvements in good working order and repair (excepting ordinary wear and
tear), except that Tenant will remove Tenant&#146;s Wiring and those Leasehold Improvements and
Alterations that, when approved by Landlord, were required to be removed at the end of the
Term. If Tenant fails to return possession of the Premises to Landlord in this condition, Tenant shall
reimburse Landlord for the costs incurred to put the Premises in the condition required under
this &#167;3.4. Tenant&#146;s Personal Property left behind in the
Premises after the end of the Term will
be considered abandoned and Landlord may move, store, retain or dispose of these items at
Tenant&#146;s cost.
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>4.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>RENT</B></TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>4.1
Base Rent. </B>Tenant shall prepay the Base Rent for July, 2005 by the Execution Date,
which Landlord will apply toward Tenant&#146;s July, 2005 Base Rent obligation under this Lease.
During the Term, Tenant shall pay all other Base Rent in advance, in monthly installments, on
the 1<SUP style="font-size: 85%; vertical-align: text-top">st</SUP> of each calendar month. Base Rent for any partial month will be prorated.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>4.2 Additional Rent. </B>Tenant&#146;s obligation to pay Taxes and Expenses under this &#167;4.2 is
referred to in this Lease as &#147;Additional Rent.&#148;
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Taxes</U>. For each calendar year after the Base Year (each, a
&#147;Comparison Year&#148;), Tenant shall pay as in the manner described below the Tenant&#146;s
Share of the amount</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">5
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>that Taxes for the Comparison Year exceed Taxes for the Base Year. &#147;Taxes&#148; means
the total costs incurred by Landlord for: (1)&nbsp;real and personal property taxes and
assessments (including ad valorem and special assessments) levied on the Project and
Landlord&#146;s personal property used in connection with the Project; (2)&nbsp;taxes on rents
or other income derived from the Building; (3)&nbsp;capital and place-of-business taxes; (4)
taxes, assessments or fees in lieu of the taxes described in (l)
through (3) above;
and (5)&nbsp;the reasonable costs incurred to reduce the taxes described in (1)&nbsp;through (4)
above. Taxes exclude net income taxes and taxes paid under &#167;4.3.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Expenses</U>. For each Comparison Year, Tenant shall pay in the manner described below
the Tenant&#146;s Share of the amount that Expenses for the Comparison Year exceed Expenses for
the Base Year. &#147;Expenses&#148; means the total costs incurred by Landlord to operate, manage,
administer, equip, secure, protect, repair, replace, refurbish, clean, maintain, decorate
and inspect the Project, including a market fee to manage the Project
of not more than 4% of
the gross revenue of the Project. Expenses that vary with occupancy will be calculated as if
the Project is 95% occupied and operating and all such services are provided to all tenants.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Expenses include:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(A)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Standard Services provided under &#167;6.1;<BR></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(B)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Repairs and maintenance performed under &#167;7.2;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(C)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Insurance maintained under &#167;9.1 (including deductibles paid);</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(D)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Wages, salaries and benefits of personnel up to the level
of property manager to the extent they render services to the Project;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(E)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Costs of operating the Project management office
(including reasonable rent);</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(F)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Costs of operating, repairing or maintaining the parking
facilities serving the Project;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(G)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Charges for replacement of electronic key cards; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(H)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Costs which would, under generally accepted accounting
principles, be deemed capital costs or capital expenditures may be included
in the definition of &#147;Expenses&#148; only to the extent that such costs: (i)
relate to an expenditure which is required to comply with changes in
applicable Laws which occur after the Commencement Date; or (ii)&nbsp;relate to
an expenditure which is incurred based upon a reasonable forecast that such
expenditure will reduce in future years another cost which would be deemed
an Expense; and (iii)&nbsp;are amortized, with interest of eight percent (8%) per
annum, on a straight-line basis over the useful life of the improvement to
which such cost relates, with only the amortized amount for each year to be
included in Expenses for such year.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Expenses exclude:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(A)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Taxes;</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">6
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(B)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Mortgage payments (principal and interest), and ground lease rent;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(C)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Commissions, advertising costs, attorney&#146;s fees and costs
of improvements in connection with leasing space in the Building;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(D)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Costs reimbursed by insurance proceeds or tenants of the
Building (other than as Additional Rent);</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(E)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Depreciation;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(F)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Collection costs and legal fees paid in disputes with tenants;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(G)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Costs to maintain and operate the entity that is Landlord (as
opposed to operation and maintenance of the Project); and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(H)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>In the Base Year, only, installments of costs amortized
under subsection (c)&nbsp;of this &#167;4.2.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(U)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Tenant specific costs billed to and paid by specific tenants.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Amortization and Accounting Principles</U>.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Landlord will use sound real estate accounting and management principles,
consistently applied, to determine Additional Rent.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Any special assessment will only be included in Taxes to the extent it is
levied after the Commencement Date and then only based upon that installment thereof
(including interest thereon) payable in a particular tax year assuming such special
assessment was spread over the longest term available to Landlord by the assessing
authority and at the lowest interest rate available from the assessing authority.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(d)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Estimates</U>. Landlord will reasonably estimate Additional Rent each calendar year
that Additional Rent may be payable. Tenant will pay the estimated Additional Rent
in advance, in monthly installments, on the first day of each month, until the estimate
is revised by Landlord. Landlord may reasonably revise its estimate during a
calendar year and the monthly installments after the revision will be paid based on
the revised estimate. The aggregate estimates of Additional Rent paid by Tenant in a
calendar year is the &#147;Estimated Additional Rent.&#148;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(e)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Settlement</U>. As soon as reasonably practical after the end of each calendar year that
Additional Rent is payable, Landlord will give Tenant a statement of the actual
Additional Rent for the calendar year. The statement of Additional Rent is
conclusive, binds Tenant, and Tenant waives all rights to contest the statement,
except for items of Additional Rent to which Tenant objects by notice to Landlord
given within one year after receipt of Landlord&#146;s statement; however, Tenant&#146;s
objection will not relieve Tenant from its obligation to pay Additional Rent pending
resolution of any objection. Upon Tenant&#146;s request, Landlord shall provide Tenant
with a copy of the tax bill or bills evidencing the Taxes included in Additional Rent.
If the Additional Rent exceeds the Estimated Additional Rent for the calendar year,
then Tenant shall pay the underpayment to Landlord in a lump sum as Rent within 30
days after receipt of Landlord&#146;s statement of Additional Rent. If the Estimated
Additional Rent exceeds the Additional Rent for the calendar year, then Landlord</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">7
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>shall credit the overpayment against Rent next due; provided, however, that if the
amount of such overpayment exceeds the Rent due for the balance of
the Term,
Landlord shall promptly refund such excess to Tenant. However, if the Term ends
during a calendar year, then Landlord&#146;s and Tenant&#146;s obligations under this
&#167;4.2(e) shall survive the end of the Term.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(f)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Audit Right</U>. Landlord shall maintain records concerning
estimated and actual Expenses for no less than twelve (12)&nbsp;months following the period
covered by the statement or statements furnished Tenant, after which time Landlord may dispose of
such records. Provided that Tenant is not then in Default of its obligation to pay
Base Rent, Additional Rent or other payments required to be made by it under this
Lease and provided that Tenant is not otherwise in Default under this Lease, Tenant
may, at Tenant&#146;s sole cost and expense, cause a Qualified Person (defined below) to
inspect Landlord&#146;s Expense records. Within ninety (90)&nbsp;calendar days after receipt
of Landlord&#146;s written statement under Section&nbsp;4.2(e) of Expenses for the previous
year, Tenant must provide Landlord written notice if Tenant elects to cause a
Qualified Person to inspect Landlord&#146;s records. Such inspection, if any, shall be
conducted no more than once each year of the Term, during Landlord&#146;s normal
business hours at least twenty (20)&nbsp;calendar days&#146; after Tenant&#146;s written notice of its
intent to inspect, but not more than three (3)&nbsp;months after such notice. Any errors
disclosed by the review shall be promptly corrected by Landlord; provided, however,
that if Landlord disagrees with any such claimed errors, Landlord shall have the right
to cause another review to be made by an independent auditor of Landlord&#146;s choice.
In the event the results of the review of records (taking into account, if applicable,
the results of any additional review caused by Landlord) reveal that Tenant has
overpaid obligations for a preceding period, the amount of such overpayment shall be
credited against Tenant&#146;s subsequent installment(s) of Base Rent, Additional Rent
and other payments due to Landlord under the Lease. In the event that such results
show that Tenant has underpaid its obligations for a preceding period, the amount of
such underpayment shall be paid by Tenant to Landlord with the next succeeding
installment obligation of estimated Expenses. If the actual Expenses allocable to the
Premises for any given year were improperly computed and if the actual Expenses
allocable to the Premises are overstated by more than five percent (5%), Landlord
shall reimburse Tenant for the cost of its audit.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>4.3
Other Taxes.</B> Upon demand, Tenant will reimburse Landlord for taxes paid by
Landlord on (a)&nbsp;Tenant&#146;s Personal Property, (b)&nbsp;Rent, (c)&nbsp;Tenant&#146;s occupancy of the Premises, or
(d)&nbsp;this Lease. If Tenant cannot lawfully reimburse Landlord for these taxes, then the Base
Rent will be increased to yield to Landlord the same amount after these taxes were imposed as Landlord
would have received before these taxes were imposed. Notwithstanding anything to the contrary
contained in this Lease, in no event will Tenant be obligated to pay any income, franchise, excise,
gross receipt, gift, succession, estate, transfer or inheritance taxes or income taxes measured by
the net income of Landlord from all sources.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>4.4
Terms of Payment.</B> &#147;Rent&#148; means all amounts payable by Tenant under this Lease
and the Exhibits, including Base Rent and Additional Rent. If a time for payment of an item of
Rent is not specified in this Lease, then Tenant will pay Rent within 30&nbsp;days after receipt of
Landlord&#146;s statement or invoice. Unless otherwise provided in this Lease, Tenant shall pay Rent without
notice,
</DIV>

<P align="center" style="font-size: 10pt">8
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">demand, deduction, abatement or setoff, in lawful U.S. currency, at Landlord&#146;s Notice Address.
Landlord will send invoices payable by Tenant to Tenant&#146;s Notice Address; however, neither
Landlord&#146;s failure to send an invoice nor Tenant&#146;s failure to receive an invoice for Base Rent
(and installments of Estimated Additional Rent) will relieve Tenant of its obligation to timely
pay Base Rent (and installments of Estimated Additional Rent). Each partial payment by Tenant
shall be deemed a payment on account; and, no endorsement or statement on any check or any
accompanying letter shall constitute an accord and satisfaction, or affect Landlord&#146;s right to
collect the full amount due. No payment by Tenant to Landlord will be
deemed to extend the Term or render any notice, pending suit or judgment ineffective.
By notice to the other, each party may change its Notice Address.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>4.5 Late Payment. </B>If Landlord does not receive all or part of any item of Rent when due, then
Tenant shall, from and after the second such occurrence in any given calendar year, pay Landlord a
one time &#147;Late Charge&#148; of 5% of the overdue amount. Tenant agrees that the Late Charge is not a
penalty, and will compensate Landlord for costs not contemplated under this Lease that are
impracticable or extremely difficult to fix. Landlord&#146;s acceptance of a Late Charge does not waive
Tenant&#146;s default.
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>5.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>USE &#038; OCCUPANCY</B></TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>5.1 Use. </B>Tenant shall use and occupy the Premises only for the Use. Landlord does not
represent or warrant that the Project is suitable for the conduct of Tenant&#146;s particular business.
Tenant shall not test its emergency generators during Business Hours.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>5.2 Compliance with Laws and Directives.</B>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Definition of Laws; Tenant&#146;s Compliance</U>. &#147;Laws&#148; are, collectively, all federal, state,
local and municipal laws, statutes, rules, regulations, orders, ordinances, codes,
orders and directives, including, without limitation, local building and zoning
codes, and the Americans with Disabilities Act. Subject to the remaining terms of this
Lease, Tenant shall comply at Tenant&#146;s expense with all directives of Landlord&#146;s
insurers or Laws concerning:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The Alterations (subject to the provisions of Article&nbsp;8 of this Lease),</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Tenant&#146;s employer/employee obligations, or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Tenant&#146;s failure to comply with this Lease.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Landlord&#146;s Compliance</U>. Subject to the remaining terms of this Lease, Landlord shall
comply at Landlord&#146;s cost with all directives of Landlord&#146;s insurers or Laws
concerning the Project other than those that are Tenant&#146;s obligation under
subsection (a). The costs of compliance under this subsection (b)&nbsp;will be included in
Expenses to the extent allowed under &#167;4.2.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>5.3 Occupancy. </B>Tenant shall not interfere with Building services or other tenants&#146; rights
to quietly enjoy their respective premises or the Common Areas. Tenant shall not make or continue
any nuisance, including any objectionable odor, noise, fire hazard, vibration, or wireless or
electromagnetic transmission. Tenant will not maintain any Leasehold Improvements or use the
Premises in a way that increases the cost of insurance required under &#167;9.2, or requires insurance in
addition to the coverage required under &#167;9.2.
</DIV>

<P align="center" style="font-size: 10pt">9
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>5.4 Tenant&#146;s Environmental, Health and Safety Compliance Requirements.</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>5.4.1 </B>For purposes of this Section, and in addition to any other provision of this Lease,
the following requirements apply:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>&#147;Hazardous Materials Laws</B>&#148; shall mean all federal, state and local laws, statutes, ordinances, orders, regulations, plans, policies and decrees now or hereafter
in effect and applicable to the Project which relate to (i)&nbsp;Hazardous Materials; (ii)
the use, treatment, storage, generation, manufacture, emission, transportation or
disposal of Hazardous Materials or solid waste; or (iii)&nbsp;occupation safety and
health, industrial hygiene, land use or the protection of human, plant or animal
health, safety or welfare, including, without limitation, the Comprehensive
Environmental Response, Compensation, and Liability Act (42 U.S.C.
&#167;9601 <U>et</U>
<U>seq.</U>)(&#147;<B>CERCLA</B>&#148;); the Hazardous Materials
Transportation Act (49 U.S.C. &#167;180 <U>et</U>
<U>seq.</U>); the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C. &#167;136
<U>et</U> <U>seq.</U>); the Resource Conservation and Recovery Act
(42 U.S.C. &#167;6901 <U>et</U>
<U>seq.</U>)(&#147;<B>RCRA</B>&#148;); the Toxic Substances Control
Act (42 U.S.C. 7401<U>et</U> <U>seq.</U>); the Clean
Air Act (42 U.S.C. &#167;740 <U>et</U> <U>seq.</U>); the Federal Water Pollution Control Act (33
U.S.C. &#167;1251 <U>et</U> <U>seq.</U>); the Occupational Safety and
Health Act (29 U.S.C. &#167;651 <U>et</U>
<U>seq.</U>); the Safe Drinking Water Act (42 U.S.C. 300f <U>et</U>
<U>seq.</U>); and the rules,
regulations and ordinances of applicable federal, state and local agencies and
bureaus, as amended from time to time.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>&#147;Hazardous Materials&#148; </B>shall mean (i)&nbsp;any chemical, compound, material, mixture or substance that is now or hereafter defined or listed in, or otherwise classified pursuant to, any applicable Hazardous Materials Laws as a &#147;hazardous substance&#148;, &#147;hazardous material&#148;, &#147;hazardous waste&#148;, &#147;extremely hazardous waste&#148;,
&#147;acutely hazardous waste&#148;, &#147;radioactive waste&#148;, &#147;infectious waste&#148;, &#147;biohazardous waste&#148;, &#147;toxic substance&#148;, &#147;pollutant&#148;, &#147;toxic pollutant&#148;, &#147;contaminant&#148; and
any other term or terms not mentioned herein intended to define, list, or classify
substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, toxicity, reproductive toxicity, &#147;EP toxicity&#148; or &#147;TCLP
toxicity&#148;; (ii)&nbsp;petroleum, natural gas, natural gas
liquids, liquified natural gas, synthetic gas usable for fuel (or mixtures of natural gas and such synthetic gas) and
ash produced by a resource recovery facility utilizing a municipal solid waste
stream, and drilling fluids, produced waters and other wastes associated with the
exploration, development or production of crude oil, natural gas, or geothermal
resources; (iii)&nbsp;asbestos in any form; (iv)&nbsp;urea formaldehyde foam insulation; (v)
transformers or other equipment which contain dielectric fluid containing levels
of polychlorinated biphenyls (PCBs); (vi)&nbsp;radon; (vii)&nbsp;medical or biological substances or wastes including, without limitation, bloodborne pathogens regulated
under 29 C.F.R. standard 1910.1030; and (viii)&nbsp;any other chemical, material, or
substance that, because of its quantity, concentration, or physical or chemical
characteristics, exposure to which is limited or regulated for health and safety reasons by any governmental authority, or which poses a significant present or potential hazard to human health and safety or to the environment if released into the
workplace or the environment.</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">10
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>"<B>Hazardous Materials Claims</B>&#148; shall mean any and all enforcement,
clean-up, abatement, removal or other governmental or regulatory actions, orders or
notices of violations threatened, instituted or completed pursuant to any Hazardous
Materials Laws, together with all claims, accusations, allegations or other demands
made or threatened by any third party against Tenant, Landlord or the Project,
including, without limitation, allegations of nuisance, trespass, waste, strict
liability for ultrahazardous activity, equitable indemnity, contribution, cost
recovery compensation, indemnity, relating to any damage, personal injury (including sickness,
disease or death), tangible or intangible property damage, indirect or
consequential damages, damage to the environment or natural resources, or relating
to fines, penalties or restrictions, in connection with any Hazardous Materials.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>5.4.2 </B>Tenant agrees not to use, treat, store, generate, manufacture, emit, transport or dispose of and not to suffer or permit anyone else to use, treat, store, generate,
manufacture, emit, transport or dispose of, whether temporarily or permanently, any Hazardous
Material at, on, or beneath the Project except in compliance with Hazardous Materials Laws. At all
times during the term of the Lease, Tenant shall promptly submit to Landlord any notices it receives
from any governmental entity in connection with a violation or alleged violation of any Hazardous
Materials Laws or Tenant&#146;s use, treatments, storage, manufacture, generation, emission,
transportation or disposal of Hazardous Materials.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>5.4.3 </B>At any time within the last six (6)&nbsp;months of expiration or sooner termination
of the Lease, and at any time thereafter in cases of abandonment,
Landlord may require Tenant to conduct such environmental health and
safety or industrial hygiene or medical audit investigation (&#147;Audit&#148;) on, in or around the Project as Landlord reasonably believes is reasonably
necessary to satisfy itself that Tenant has complied with Section&nbsp;5.4 of this Lease.
Furthermore, if at any time prior to such six (6)&nbsp;month period, Landlord reasonably believes that Tenant
has not complied with said section, Landlord may require Tenant to conduct such an Audit. If the
Audit indicates that Tenant has complied with this Section&nbsp;5.4, Landlord, and not Tenant, will
bear the cost of the Audit. At the end of the Term of the Lease, Tenant, at Tenant&#146;s cost and
expense, shall undertake to clean, decontaminate, and disinfect the Project to the extent that
the Audit indicates that Tenant is responsible for the contamination, including the removal or
proper disposition of all of Tenant&#146;s Hazardous Materials, and provide a report and clearance
certification reasonably acceptable to Landlord, certifying the completion of the cleanup and decontamination.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>5.4.4 </B>To the fullest extent permitted by law, Tenant agrees to protect, indemnify, defend, save and hold Landlord and its Affiliates harmless from and against any
foreseeable or unforeseeable claim, action, suit, proceeding, loss, costs, damage, liability, deficiency,
fine, penalty or expense (including, without limitation, reasonable attorneys&#146; fees and costs),
directly or indirectly resulting from, arising out of, or based upon (i)&nbsp;any Hazardous Materials Claims
arising from Tenant&#146;s negligence or willful act or omission; (ii)&nbsp;Tenant&#146;s use, treatment, storage,
generation, manufacture, emission, transportation or disposal of Hazardous Materials in, on or
under the Project; (iii)&nbsp;any residual contamination on or about the Project affecting any
natural resource or the environment caused by Tenant&#146;s use, treatment, storage, generation,
manufacture, emission, transportation or disposal of Hazardous Materials in, on or under the Project; (iv)
any violation or alleged violation by Tenant of any Hazardous Materials Laws; or (v)&nbsp;any claim,

</DIV>

<P align="center" style="font-size: 10pt">11
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">demand or cause of action, or any action or other proceeding, whether meritorious or not,
brought or asserted against any person or entity indemnified herein which directly or indirectly
relates to, arises from or is based on any of the matters described in clauses (i)-(v) or any
allegation of any such matters. This obligation on the part of Tenant shall survive the expiration
or earlier termination of this Lease. Tenant shall have the right to assume exclusive control of
the defense of any such claim, action, suit or proceeding, and Landlord agrees to cooperate
reasonably with Tenant in the performance by Tenant of its obligations under this Section&nbsp;5.4.4.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>5.4.5 </B>Notwithstanding anything contained in this Lease, Tenant shall, at Tenant&#146;s sole cost
and expense, upon expiration or sooner termination of the Lease, promptly remove from the Project
any and all personal property and trade fixtures used in connection with the use, treatment,
storage, generation, emission, or disposal of Hazardous Materials.
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>6.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>SERVICES </B>&#038; <B>UTILITIES</B></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>6.1</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>Standard Services.</B></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Standard Services Defined</U>. &#147;Standard Services&#148; means:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Heating, ventilation and air-conditioning (&#147;HVAC&#148;) during
Business Hours as reasonably required to comfortably use and occupy the Premises and
interior Common Areas;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Tempered water from the public utility for use in Common Areas
rest rooms and kitchen and laboratory facilities in the Premises;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Janitorial services to the Common Areas and the Premises to the
extent reasonably determined by Landlord;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(4)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Access to the Premises 24 hours a day, 7&nbsp;days a week, 52&nbsp;weeks a year; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(5)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Electricity from Landlord&#146;s selected provider(s) for Common
Areas lighting that require electric light during the day or are open at night, including
replacement of tubes and ballasts in lighting fixtures.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Standard Services Provided</U>. During the Term, Landlord provides the Standard
Services to Tenant. The cost of the Standard Services is included in Expenses.
Landlord is not responsible for any inability to provide Standard Services due to
either: the concentration of personnel or equipment in the Premises; or Tenant&#146;s use
of equipment in the Premises that is not customary office equipment, has special
cooling requirements, or generates heat.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>6.2 Additional Services</B>. Unless Tenant obtains Landlord&#146;s prior written consent, Tenant
will not use utilities or services in excess of the Standard Services. If Landlord so consents,
Landlord may provide utilities and services in excess of the Standard Services subject to the following:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Electricity</U>. Electricity for the Premises shall not be furnished by
Landlord but shall be furnished by the electric utility company serving the Building
as determined by Landlord. Tenant shall make all necessary arrangements with the
utility company for metering and paying for electric current furnished by said
utility company to the Tenant and Tenant shall pay for all charges for electric
current consumed on the</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">12
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Premises during the Term of this Lease. Tenant&#146;s electrical use in the
Premises shall not exceed the capacity of the existing system serving the Premises,
nor shall Tenant use more than its proportionate share of the Building electrical
riser capacity. Landlord, or its agent, shall provide to Tenant and install in the
Premises all lamps, bulbs, ballasts and starters used in the Premises
(provided that Tenant may at its sole cost and expense and in its sole discretion
purchase, and engage directly a licensed union electrician to change, lamps and
bulbs used in the Premises).</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>HVAC.</u> If tenant requests HVAC service to the Premises
during non-Business
Hours, Tenant will pay as Rent Landlord&#146;s scheduled rate for this service, which
shall be a competitive rate.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Lighting</U>. Subject to Tenant&#146;s rights under clause (a)&nbsp;above, Landlord
will furnish both Building Standard and non-Building Standard lamps, bulbs, ballasts and starters
that are part of the Leasehold Improvements.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(d)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Other Utilities and Services</U>. Tenant will pay as Rent the actual cost
of utilities or services (other than HVAC and lighting addressed in (a)&nbsp;and (b)) either used by
Tenant or provided at Tenant&#146;s request in excess of that provided as part of the
Standard Services. Tenant&#146;s excess consumption may be estimated by Landlord
unless either Landlord requires or Tenant elects to install Building Standard meters to
measure Tenant&#146;s consumption.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(e)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Additional Systems and Metering</U>. Landlord may require Tenant, at
Tenant&#146;s expense, to upgrade or modify existing Mechanical Systems serving the Premises or
the Leasehold Improvements to the extent necessary to meet Tenant&#146;s excess
requirements (including installation of Building Standard meters to measure the same).</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>6.3 Telecommunications Services. </B>Tenant will contract directly with third party providers
and will be solely responsible for paying for all telephone, data transmission, video and other
telecommunication services (&#147;Telecommunication Services&#148;) subject to the following:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Providers</U>. Each Telecommunications Services provider that does not
already provide service to the Building shall be subject to Landlord&#146;s approval, which
Landlord may withhold in Landlord&#146;s sole discretion. Without liability to Tenant,
the license of any Telecommunications Services provider servicing the Building may
be terminated under the terms of the license, or not renewed upon the expiration of
the license. Landlord hereby consents to Tenant&#146;s existing Telecommunications
Services provider, which is Inter-Tel, and Tenant shall not replace such provider
without Landlord&#146;s prior written consent, which consent will not be unreasonably
withheld.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Tenant&#146;s Wiring</U>. Landlord may, in its sole discretion, designate the
location of all wires, cables, fibers, equipment, and connections (&#147;Tenant&#146;s Wiring&#148;) for Tenant&#146;s
Telecommunications Services, and restrict and control access
to telephone cabinets and rooms (provided Tenant shall have reasonable access
thereto). Tenant may not use or access the Base Building, Common Areas or roof
for Tenant&#146;s Wiring without Landlord&#146;s prior written consent, which consent
shall not be unreasonably withheld,</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">13
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>conditioned or delayed. Landlord hereby consents to the existing location of
Tenant&#146;s Wiring.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>This &#167;6.3 is solely for Tenant&#146;s benefit, and no one else shall be
considered a third party beneficiary of these provisions.</TD>
</TR>
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>6.4 Interruption of Services.</B></DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Without breaching the Lease, Landlord may:</TD>
</TR>
</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Comply with Laws or voluntary government or industry
guidelines
concerning the services to be provided by Landlord or obtained by
Tenant under this Article&nbsp;6;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Interrupt, limit or discontinue the services to be provided by
Landlord or obtained by Tenant under this Article&nbsp;6 as may be reasonably required during
an emergency or Force Majeure event; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If Landlord gives Tenant reasonable prior notice and uses
commercially reasonable efforts not to disturb Tenant&#146;s use of the Premises for the Use,
interrupt, limit or discontinue the services to be provided by Landlord or
obtained by Tenant under this Article&nbsp;6 to repair and maintain the Project
under &#167;7.2, or make any improvements or changes to the Project.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Abatement for Interruption of Standard Services</U>. If due to an
interruption in a utility
service that prevents Landlord from providing any of the Standard Services for more
than five (5)&nbsp;consecutive days, Tenant is actually unable to use all or a part of the
Premises for the normal conduct of its business (&#147;Untenantable&#148;), then from the fifth
(5<SUP style="font-size: 85%; vertical-align: text-top">th</SUP>) consecutive day of interruption until the Standard Services are restored,
Landlord shall abate Tenant&#146;s Base Rent and Additional Rent, subject to the following:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Landlord will only abate Base Rent and Additional Rent to the
extent the Premises are untenantable and not actually used by Tenant to conduct
business;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Landlord will only abate Base Rent and Additional Rent if the
interruption of Standard Services is within Landlord&#146;s
reasonable control to remedy; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Landlord will only abate Base Rent and Additional Rent to the
extent the interruption in Base Rent and Additional Rent is or would be covered by
insurance. Landlord must maintain under &#167;9.2; and</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>No Other Liability</U>. Except as provided under (b), Landlord will not be
liable in any manner for any interruption in services to be provided by Landlord or obtained by
Tenant under this Article&nbsp;6 (including damage to Tenant&#146;s Personal Property,
consequential damages, actual or constructive eviction, or abatement of any other item of Rent).</TD>
</TR>

</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>7. REPAIRS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>7.1 Tenant&#146;s Repairs</B>. Except as provided in Articles 10 and 12, during the Term Tenant
shall, at Tenant&#146;s cost, repair and maintain (and replace, as necessary) the Leasehold Improvements
</DIV>

<P align="center" style="font-size: 10pt">14
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">and keep the Premises in good order and condition, reasonable wear and tear excepted. Tenant&#146;s
work under this &#167;7.1 (a)&nbsp;is subject to the prior approval and supervision of Landlord, which
approval shall not be unreasonably withheld, conditioned or delayed, (b)&nbsp;must be performed in
compliance with Laws and Building rules and regulations, and (c)&nbsp;must be performed in a
first-class, lien free and workmanlike manner, using materials not less than Building Standard.
Notwithstanding anything to the contrary contained in this Lease, in no event shall Tenant be
obligated to make any repairs or replacements (i)&nbsp;except to the extent required to comply with
Section&nbsp;5.2 and Section&nbsp;8.1(a)(2), which would, under generally accepted accounting
principles, be deemed capital costs or capital expenditures,
(ii)&nbsp;to the extent required as the result of the negligence or willful
misconduct of Landlord, its agents, employees, representatives or contractors, or (iii)&nbsp;to the
extent required as the result of the failure of Landlord to perform any of its obligations under
this Lease, all of which repairs or replacements shall be made by Landlord at Landlord&#146;s sole cost
and expense.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>7.2 Landlord&#146;s Repairs. </B>Except as provided in Articles 10 and 12, during the Term Landlord
shall, at Landlord&#146;s cost (but included as Expenses to the extent provided in &#167;4.2) repair and
maintain (and replace, as necessary) all parts of the Project that are not Tenant&#146;s responsibility
to repair and maintain under &#167;7.1 (or any other tenant&#146;s responsibility under their respective
lease) and keep the Project in good order and condition according to the standards prevailing for
comparable office buildings in the area in which the Building is located. Tenant may not repair or
maintain the Project on Landlord&#146;s behalf or offset any Rent for any repair or maintenance of the
Project that is undertaken by Tenant.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>8. ALTERATIONS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>8.1 Alterations by Tenant. </B>&#147;Alterations&#148; means any modifications, additions or improvements
to the Premises or Leasehold Improvements made by Tenant during the Term. Alterations do not
include Tenant Improvements made under any Workletter attached to this Lease. Alterations are made
at Tenant&#146;s sole cost and expense, subject to the following:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Consent Required</U>. All Alterations require Landlord&#146;s prior written
consent. If a Design Problem exists, Landlord may withhold its consent in Landlord&#146;s
sole discretion; otherwise, Landlord will not unreasonably withhold its consent. In
either case, Landlord may condition its consent to any item of
Alterations on the
requirement that Tenant remove this item of Alterations upon termination of this
Lease. &#147;Design Problem&#148; means a condition that results, or will result, from
Alterations that are proposed, being performed or have been completed that either:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Does not comply with Laws;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Would require Landlord to incur costs to comply with Laws, or
to incur costs to bring all or any part of the Project into compliance with Laws, unless
Tenant agrees in writing to pay for those costs;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Does not meet or exceed the Building Standard;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(4)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Exceeds the capacity, adversely affects, is incompatible with,
or impairs Landlord&#146;s ability to maintain, operate, alter, modify or improve the Base Building;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(5)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Affects the exterior appearance of the Building or Common Areas;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(6)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Violates any agreement affecting the Project;</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">15
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(7)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Costs more to demolish than Building Standard improvements;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(8)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Violates any insurance regulations or standards for a
fire-resistive office building; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(9)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Locates any equipment, Tenant&#146;s Wiring or Tenant&#146;s Personal
Property on the roof of the Building, in Common Areas or in telecommunications or
electrical closets.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Performance of Alterations.</U> Alterations shall be
performed by Tenant in a good and
workman-like manner according to plans and specifications approved by Landlord,
which approval shall not be unreasonably withheld, conditioned or delayed. All
Alterations shall comply with Law and insurance requirements. Landlord&#146;s designated
contractors must perform Alterations affecting the Base Building or Mechanical
Systems; and, all other work will be performed by qualified contractors that meet
Landlord&#146;s insurance requirements and are otherwise approved by Landlord, which
approval shall not be unreasonably withheld, conditioned or delayed. Promptly after
completing Alterations, Tenant will deliver to Landlord &#147;as-built&#148; CADD plans,
proof of payment, a copy of the recorded notice of completion, and all
unconditional lien releases. Notwithstanding the foregoing, Tenant may make
improvements, additions, installations, decorations and changes to the Premises
which do not create or cause Design Problems, the cost of any one of which must not
exceed $15,000.00, all of which in any twelve-month period must not exceed
$45,000.00, and Tenant delivers to Landlord as-built drawings thereof within 30
days after substantial completion of each such improvement, addition, installation,
decoration or change.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Alterations Fee</U>. Tenant shall reimburse Landlord for reasonable,
out-of-pocket third party costs incurred in connection with review of Tenant&#146;s plans
and construction coordination and inspection of the completed Alterations.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>8.2 Alterations by Landlord</B>. Landlord may make any modifications, additions,
renovations or improvements to the Project that Landlord deems appropriate, provided Landlord uses
commercially reasonable efforts to avoid disrupting Tenant&#146;s business.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>8.3 Liens and Disputes</B>. Tenant will keep title to the Land and Building free of any liens
concerning the Leasehold Improvements, Alterations, or Tenant&#146;s Personal Property, and will
promptly take whatever action is required to have any of these liens released and removed of record
(including, as necessary, posting a bond or other deposit). To the extent legally permitted, each
contract and subcontract for Alterations will provide that no lien attaches to or may be
claimed against the Project other than Tenant&#146;s leasehold interest in the Premises.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>8.4 Leasehold Improvements</B>. The initial Leasehold Improvements will be constructed
by Tenant in accordance with the <U>Work Letter</U> attached hereto as <U>Exhibit&nbsp;C</U>.
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>9.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>INSURANCE</B></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>9.1</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>Tenant&#146;s Insurance.</B></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Tenant&#146;s Coverage</U>. Before taking possession of the Premises for any
purpose (including construction of Tenant Improvements, if any) and during the Term,
Tenant will provide and keep in force the following coverage:</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">16
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Commercial general liability insurance insuring Tenant&#146;s use and occupancy
of the Premises and Common Areas, and covering personal and bodily injury,
death, and damage to others&#146; property of not less than the Liability, Limit.
Each of these policies shall include cross liability and severability of interests
clauses, and be written on an occurrence, and not claims-made, basis. Each
of these policies shall name Landlord, the Building property manager, and
each secured lender of which Landlord has given Tenant notice as an
additional insured (&#147;Additional Insured&#148;).</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Special risk of loss insurance (including standard extended coverage
endorsement perils, leakage from fire protective devices and other water
damage) covering the full replacement cost of the Leasehold Improvements
and Tenant&#146;s Personal Property. Each of these policies shall name Landlord
and each Additional Insured an additional insured to the extent of their
interest in the Leasehold Improvements. Each of these policies shall include
a provision or endorsement in which the insurer waives its right of
subrogation against Landlord and each Additional Insured.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Insurance covering the perils described in (2)&nbsp;for Tenant&#146;s loss of income or
insurable gross profits with a limit not less than $1,000,000. Each of these
policies shall include a provision or endorsement in which the insurer waives
its right of subrogation against Landlord and each Additional Insured.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(4)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If any boiler or machinery is operated in the Premises, boiler and machinery
insurance.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(5)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Insurance required by Law, including workers&#146; compensation insurance.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(6)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Employers liability insurance with limits not less than $1&nbsp;million.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(7)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Insurance covering the Leasehold Improvements and Tenant&#146;s Personal
Property against loss or damage due to earthquake or difference in condition.
Tenant may elect to self-insure this coverage. If Tenant does not elect to
self-insure this coverage, then each of these policies shall name Landlord and
each Additional Insured an additional insured to the extent of their interest in
the Leasehold Improvements.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Insurers and Terms</U>. Each policy required under (a)&nbsp;shall be written with insurance
companies licensed to do business in the state in which the Building is located.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Proof of Insurance</U>. Tenant shall provide Landlord with certificates of insurance or
other reasonable proof that the coverage required under (a)&nbsp;is in effect. Tenant will
provide reasonable proof at least 30&nbsp;days before any policy expires that the expiring
policy will be replaced.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>9.2</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>Landlord&#146;s Insurance.</B></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Landlord&#146;s Coverage</U>. During the Term, Landlord will provide and keep in
force the following coverage:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Commercial general liability insurance.</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">17
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>All risk insurance (including standard extended coverage endorsement perils,
leakage from fire protective devices and other water damage) covering the
full replacement cost of the Project improvements (excepting the Leasehold
Improvements to be insured by Tenant). Each of these policies shall include
a provision or endorsement in which the insurer waives its right of
subrogation against Tenant.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Insurance covering the perils described in (2)&nbsp;for Landlord&#146;s loss of rental
income of insurable gross profits. Each of these policies shall include a
provision or endorsement in which the insurer waives its right of subrogation
against Tenant.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(4)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Boiler and machinery insurance.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(5)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Other insurance that Landlord elects to maintain to the extent
consistent with insurance generally maintained with respect to other commercial building
complexes comparable to the Project.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Terms</U>. Each of the policies required under (a)&nbsp;will have those
limits, deductibles, retentions and other terms that Landlord prudently determines.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>10.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>DAMAGE OR DESTRUCTION</B></TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>10.1 Damage and Repair. </B>If the Leasehold Improvements, Premises or Building is damaged by
fire or other casualty, then the parties will proceed as follows:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Landlord&#146;s Estimates</U>. Landlord will assess the damage to the Project
(but not the Leasehold Improvements) and notify Tenant of Landlord&#146;s reasonable estimate of the
time required to substantially complete repairs and restoration of the Project
(&#147;Repair Estimate&#148;). Landlord will also estimate the time that the Premises will be
untenantable (&#147;Interruption Estimate&#148;). Within 30&nbsp;days after the later of the
casualty, issuance of the Repair Estimate, issuance of the Interruption Estimate, or receipt
of any denial of coverage or reservation of rights from Landlord&#146;s insurer, each party
may terminate the Lease by written notice to the other on the following conditions:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Landlord may elect to terminate, this Lease if either:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(A)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The damage occurs during the last year of
the Term and the Repair Estimate exceeds 20% of Rent for the remaining Term.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(B)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The Repair Estimate exceeds 180&nbsp;days, or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(C)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The repair and restoration is not fully
covered by insurance maintained or required to be maintained by Landlord (subject only to
those deductibles or retentions Landlord elected to maintain) or
Landlord&#146;s insurer denies coverage or reserves its rights on
coverage.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Tenant may elect to terminate this Lease if the Interruption
Estimate exceeds 180&nbsp;days.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If neither party terminates the Lease under (a), then the Lease shall remain in
full force and effect and the parties will proceed as follows:</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">18
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Landlord will repair and restore the Project (but not Leasehold
Improvements) to the condition existing prior to such damage, except for
modifications required by Law. Landlord will perform such work reasonably
promptly, subject to delay for loss adjustment, Tenant Delay and Force
Majeure. Landlord, shall use reasonable efforts to perform such repairs so as
to minimize the interference with Tenant&#146;s business operations.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Tenant will repair and restore the Leasehold Improvements reasonably
promptly to the condition existing prior to such damage, but not less than
then current Building Standards, except for modifications required by Law.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Notwithstanding anything to the contrary contained in this
Lease, if Landlord shall fail, either to complete the restoration and repair of the Premises,
or to restore the same to their condition immediately prior to the fire or other
casualty, within 180&nbsp;days (regardless of any period of delay due to Force
Majeure) from the date of occurrence of the fire or casualty, then, in
either such event, Tenant may terminate this Lease by 10&nbsp;days&#146; prior written notice
to Landlord given no later than 30&nbsp;days after the expiration of the aforesaid 180-day period.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>10.2 Rent Abatement. </B>If as a result of the damage or destruction under &#167;10.1 the Premises are
rendered Untenantable for more than 5 consecutive days, then Tenant&#146;s Base Rent and Additional Rent
for the Untenantable portion of the Premises shall be abated from the 6<SUP style="font-size: 85%; vertical-align: text-top">th </SUP>consecutive
day until the damaged or destroyed portion of the Premises becomes tenantable, but in no case later
than 15&nbsp;days after Landlord completes its required repairs and restoration of the Project. Tenant&#146;s
sole remedy will be the abatement of Base Rent and Additional Rent provided under this &#167;10.2, and
Landlord will not be liable to Tenant for any other amount, including damages to Tenant&#146;s Personal
Property, consequential damages, actual or constructive eviction, or abatement of any other item of
Rent.
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>11.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>INDEMNITY</B></TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>11.1 Claims. </B>&#147;Claims&#148; means any and all liabilities, losses, claims, demands, damages or
expenses that are suffered or incurred by a party, including reasonable attorneys&#146; fees
reasonably incurred by that party in the defense or enforcement of the rights of that party.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>11.2 Tenant&#146;s Indemnity. </B>Landlord shall provide Tenant with prompt written notice of
any Claims and shall cooperate reasonably with Tenant in the performance of Tenant&#146;s obligations
under this section. Tenant shall have the right to assume exclusive control of the defense of
such Claims or, at the option of Tenant, to settle the same.
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Landlord&#146;s Waivers</U>. Landlord waives any Claims against Tenant and its
Affiliates for perils insured or required to be insured by Landlord under subsections (2)&nbsp;and (3)
of &#167;9.2(a), except to the extent caused by the gross negligence or willful misconduct of Tenant or its Affiliates.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Claims Against Landlord</U>. Unless waived by Landlord under (a),
Tenant will indemnify and defend Landlord and its Affiliates and hold each of them harmless
from and against Claims to the extent arising from:</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">19
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Any accident or occurrence on or about the Premises, except to the
extent caused by the negligence or willful misconduct of Landlord or its Affiliates
or its agents, representatives or contractors;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Tenant&#146;s or its Affiliates&#146; negligence or willful misconduct; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Any claim for commission or other compensation by any person other than
the Brokers for services rendered to Tenant in procuring this Lease.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>11.3
Landlord&#146;s Indemnity.</B>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Tenant&#146;s Waivers</U>. Tenant waives any Claims against Landlord and its Affiliates for:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Peril insured or required to be insured by Tenant under
subsections (2), (3)&nbsp;and Section (7)&nbsp;of &#167;9.1 (a), except to the extent caused by the gross
negligence or willful misconduct of Landlord or its Affiliates, or its agents,
representatives or contractors, but in no case including any special or
consequential damages (such as interruption of business, loss of income, or
loss of opportunity); and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Damage caused by any public utility, public work, other tenants
or occupants of the Project, or persons other than Landlord, its Affiliates,
representatives or contractors.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Claims against Tenant</U>. Unless waived by Tenant under (a), Landlord
will indemnify and defend Tenant and its Affiliates and hold each of them harmless from and against
Claims arising from:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Any accident or occurrence on or about the Project (excluding
the Premises), except to the extent caused by the negligence or willful misconduct of Tenant
or its Affiliates or its agents, representatives or contractors;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Landlord&#146;s or its Affiliates&#146; or its agents&#146;, representatives&#146;
or contractors&#146; negligence or willful misconduct; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Any claim for commission or other compensation by any person
other than the Brokers for services rendered to Landlord in procuring this Lease.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>11.4 Affiliates Defined. </B>&#147;Affiliates&#148; means with respect to a party (a)&nbsp;that party&#146;s
partners, co-members and joint venturers, (b)&nbsp;each corporation or other entity that is a
parent or subsidiary of that party, (c)&nbsp;each corporation or other entity that is controlled by or under
common control of a parent of such party, and (d)&nbsp;the directors, officers, employees and agents of
that party and each person or entity described in this &#167;11.4(a-c).
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>11.5 Survival of Waivers, and Indemnities. </B>Landlord&#146;s and Tenant&#146;s waivers and
indemnities under &#167;11.2 and &#167;11.3 will survive the expiration or early termination of this Lease.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.6 Waiver of Consequential Damages. Notwithstanding anything to the contrary
contained in this Lease, neither Landlord nor Tenant is liable to the other under, or in connection
with, this Lease for any consequential damages, and both Landlord and Tenant waive, to the full
extent permitted by law, any claim for consequential damages.
</DIV>

<P align="center" style="font-size: 10pt">20
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>12.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>CONDEMNATION</B></TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>12.1 Taking. </B>&#147;Taking&#148; means acquiring of all or part of the Project for any public or
quasi-public use by exercise of a right of eminent domain or under any other Law, or any sale in
lieu thereof. If a Taking occurs:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The Lease will terminate as of the date of a Taking if substantially all of
the Premises becomes untenantable for substantially all of the remaining Term because
of the Taking.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If the Lease is not terminated under (a), Landlord shall restore or alter the Premises
after the Taking to be tenantable, unless Landlord reasonably determines that it
will be uneconomical to do so, in which case Landlord may terminate the Lease upon 60
days prior written notice to Tenant.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If the Lease is not terminated under (a), more than 20% of the Premises is
untenantable because of the Taking, Tenant cannot operate Tenant&#146;s business for the
Use in the Premises after such Taking, and Landlord is unable to provide Tenant with
comparable premises in the Project within 30&nbsp;days after the Taking, then Tenant may
terminate the Lease upon 60&nbsp;days prior written notice to Landlord.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(d)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If the Lease is not terminated under (a), (b)&nbsp;or (c), the Rent payable by
Tenant will be reduced for the term of the Taking based upon the rentable area of the Premises made
untenantable by the Taking.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>12.2 Awards. </B>Landlord is entitled to the entire award for any claim for a taking of any
interest in this Lease or the Project, without deduction or offset for Tenant&#146;s estate or
interest; however, Tenant may make a claim for relocation expenses and damages to Tenant&#146;s
Personal Property and business to the extent that Tenant&#146;s claim does not reduce Landlord&#146;s award.
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>13.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>TENANT TRANSFERS</B></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>13.1</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>Terms Defined.</B></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Transfer Defined</U>. &#147;Transfer&#148; means any:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Sublease of all or part of the Premises, or assignment,
mortgage, hypothecation or other conveyance of an interest in this Lease;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Use of the Premises by anyone other than Tenant with Tenant&#146;s consent; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Change in Tenant&#146;s form of organization (e.g., a change from a
partnership to limited liability company).</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>13.2 Prohibited Transfers. </B>Tenant may not enter into a Transfer or other agreement to
use or occupy the Premises that provides for rent or other compensation based in whole or in part on
the net income or profits from the business operated in the Premises. Any such Transfers shall be
considered null, void and of no force or effect.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>13.3 Consent Not Required. </B>Tenant may effect a Transfer to a Permitted Transferee
without Landlord&#146;s prior consent, but with notice to Landlord prior to the Permitted Transferee&#146;s
occupancy. &#147;Permitted Transferee&#148; means any person or entity that:
</DIV>

<P align="center" style="font-size: 10pt">21
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Either (1)&nbsp;controls, is controlled by, or is under common control with Tenant (for
purposes hereof, &#147;control&#148; shall mean ownership of not less than 50% of all of the
voting stock or legal and equitable interest in the entity in question), (2)&nbsp;results from
the merger or consolidation of Tenant, or (3)&nbsp;acquires all or substantially all of the
stock and/or assets of Tenant as a going concern;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Has a tangible net worth immediately following the Transfer equal to Tenant&#146;s
tangible net worth immediately before the Transfer; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Will not, by occupying the Premises, cause Landlord to breach any
other lease or other agreement affecting the Project.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>13.4 Consent Required. </B>Each proposed Transfer other than those prohibited under &#167;13.2 or
permitted under &#167;13.3 requires Landlord&#146;s prior consent, in which case the parties will proceed as
follows:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Tenant&#146;s Notice</U>. Tenant shall notify Landlord at least 30&nbsp;days prior to
the proposed Transfer of the name and address of the proposed transferee and the proposed use of
the Premises, and include in the notice the Transfer documents and copies of the
proposed transferee&#146;s balance sheets and income statements (both current and for the past 2&nbsp;years).</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Landlord&#146;s Rights</U>. Within 30&nbsp;days after receipt of Tenant&#146;s complete
notice, Landlord may either:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If the proposed Transfer is either an assignment of this Lease
or sublease of substantially all of the Premises, terminate this Lease as of the proposed
Transfer date;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If the proposed Transfer is a sublease of all of the Premises
or any part of the Premises that will be separately demised and have its own entrance from the
Common Areas, exercise a right of first refusal to sublease such portion of
the Premises at the lesser of (A)&nbsp;the Rent (prorated for subletting part of
the Premises), or (B)&nbsp;the rent payable in the proposed Transfer; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Consent or deny consent to the proposed Transfer, consent not
to be unreasonably withheld if:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(A)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The proposed transferee, in Landlord&#146;s
reasonable opinion, has the financial capacity to meet its obligations under the proposed
Transfer;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(B)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The proposed use is consistent with the Use and
will not cause Landlord to be in breach of any lease or other agreement affecting the
Project;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(C)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The proposed transferee is typical of tenants
that directly lease premises in first-class office buildings;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(D)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The proposed transferee is not an existing
tenant or an Affiliate of an existing tenant, or a party with which Landlord is actively
negotiating to lease space in the Building (or has, in the last 6&nbsp;months, been
actively negotiating to lease space in the Building); and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(E)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Tenant is not in Default under this Lease.</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">22
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Compelling Consent</U>. If Landlord does not consent to a Transfer,
Tenant&#146;s sole remedy against Landlord will be an action for specific performance or
declaratory relief, and Tenant may not terminate this Lease or seek monetary
damages.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If Landlord notifies Tenant of Landlord&#146;s election to terminate this Lease pursuant to this
Section, Tenant shall have the right, by notice to Landlord given within 10&nbsp;days after
receipt by Tenant of Landlord&#146;s notice of termination, to withdraw Tenant&#146;s request to assign or
sublet this Lease, in which event Landlord&#146;s election to terminate shall be rendered null and void.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>13.5 Payments to Landlord. </B>Tenant shall pay Landlord 50% of Transfer receipts that
exceed Tenant&#146;s Rent (on a per square foot basis); after Tenant is reimbursed for Tenant&#146;s reasonable
and customary out-of-pocket costs incurred in the Transfer, including attorneys&#146; fees, Alterations,
and broker commissions. Tenant shall pay Landlord a $2,500 review fee for each proposed Transfer,
excepting those in which Landlord exercises its rights under subsection (1)&nbsp;or (2)&nbsp;of
&#167;13.4(b).
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>13.6 Effect of Transfers. </B>No Transfer releases Tenant or any guarantor of this Lease from
any Lease obligation. Landlord&#146;s acceptance of a payment from any person or entity other than
Tenant that occupies the Premises does not waive Tenant&#146;s obligations under this Article&nbsp;13. If
Tenant is in Default of this Lease, Landlord may proceed against Tenant without exhausting any
remedies against any transferee and may require (by written notice to any transferee) any
transferee to pay Transfer rent owed Tenant directly to Landlord (which Landlord will apply against
Tenant&#146;s Lease obligations). Termination of this Lease for any reason will not result in a merger.
Each sublease will be deemed terminated upon termination of this Lease unless Landlord notifies the
subtenant in writing of Landlord&#146;s election to assume any sublease, in which case the
subtenant shall attorn to Landlord under the executory terms of the sublease.
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>14.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>LANDLORD TRANSFERS</B></TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>14.1 Landlord&#146;s Transfer. </B>Landlord&#146;s right to transfer any interest in the Project or this
Lease is not limited by this Lease. Upon any such transfer, Tenant will attorn to Landlord&#146;s
transferee and Landlord will be released from liability under this Lease, except for any Lease
obligations accruing before the transfer that are not assumed by the transferee.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>14.2 Subordination. </B>This Lease is, and will at all times be, subject and subordinate to
each ground lease, mortgage, deed to secure debt or deed of trust now or later encumbering the
Building, including each renewal, modification, supplement, amendment, consolidation or
replacement thereof (each, an &#147;Encumbrance&#148;); provided, however, that Tenant&#146;s possession of the
Premises will not be disturbed as long as no Event of Default exists. At Landlord&#146;s request,
Tenant will, without charge, promptly execute, acknowledge and deliver to Landlord (or, at Landlord&#146;s
request, the Encumbrance holder) any instrument reasonably necessary to evidence this
subordination. Notwithstanding the foregoing, each Encumbrance holder may unilaterally elect to
subordinate its Encumbrance to this Lease.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>14.3 Attornment. </B>Tenant will automatically attorn to any transferee of Landlord&#146;s interest
in the Project that succeeds Landlord by reason of a termination, foreclosure or enforcement
proceeding of an Encumbrance, or by delivery of a deed in lieu of any foreclosure or
proceeding (a &#147;Successor Landlord&#148;). In this event, the Lease will continue in full force and effect as a
direct lease between the Successor Landlord and Tenant on all of the terms of this Lease, except that the
Successor Landlord shall not be:
</DIV>

<P align="center" style="font-size: 10pt">23
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Liable for any obligation of Landlord under this Lease, or be subject to any
counterclaim, defense or offset accruing before Successor Landlord succeeds to Landlord&#146;s interest
except to the extent such obligation is continuing at the time such Successor Landlord
succeeds to Landlord&#146;s interest or such counterclaim, defense or offset relates to a Landlord default
which is continuing at the time such Successor Landlord succeeds to Landlord&#146;s interest;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Bound by any prepayment of more than one month&#146;s Rent;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;Obligated
to return any Security Deposit not paid over to Successor
Landlord, or
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;Obligated to perform any improvements to the Premises (or provide an allowance therefor).
Upon Successor Landlord&#146;s request, Tenant will, without charge, promptly execute, acknowledge and
deliver to Successor Landlord any instrument reasonably necessary required to evidence such
attornment.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>14.4 Estoppel Certificate. </B>Within 10 business days after receipt of Landlord&#146;s written
request, Tenant (and each guarantor of the Lease) will execute, acknowledge and deliver to
Landlord a certificate upon which Landlord and each existing or prospective Encumbrance holder may
rely confirming the following (or any exceptions to the following):
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;The Commencement Date and Expiration Date;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;The documents that constitute the Lease, and that the Lease is unmodified and in full
force and effect or, if modified, the amendments thereto;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;The date through which Base Rent, Additional Rent, and other Rent has been paid;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;That, to Tenant&#146;s knowledge, neither Landlord nor Tenant is in Default;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;That Landlord has satisfied all Lease obligations to improve the Premises (or provide
Tenant an allowance therefor) and Tenant has accepted the Premises;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;That Tenant solely occupies the Premises or, if not, the names of any sublessee(s) of
Tenant; and
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;Such other matters concerning this Lease or Tenant&#146;s occupancy that Landlord may
reasonably require.
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>15.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>DEFAULT AND REMEDIES</B></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>15.1</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>Tenant&#146;s Default and Remedies.</B></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Tenant will be in &#147;Default&#148; of this Lease if Tenant either:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Fails to pay Rent when due, and the failure continues for 5
business days after Landlord notifies Tenant of this failure under &#167;17.2 (Tenant waiving
any other notice that may be required by Law);</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Fails to perform a non-monetary Lease obligation of Tenant
and the failure continues for 30&nbsp;days after Landlord notifies Tenant of this failure, but:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(A)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>In an emergency Landlord may require Tenant
to perform this obligation in a reasonable time of less than 30&nbsp;days, or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(B)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If it will reasonably take more than 30&nbsp;days
to perform this obligation, then Tenant will have a reasonable time to perform this</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">24
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>obligation, but only if Tenant commences performing this obligation
within 30&nbsp;days after Landlord notifies Tenant of this failure and
thereafter diligently prosecutes such cure to completion;</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Consummates a Transfer that violates Article&nbsp;13;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(4)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Fails, within 20&nbsp;days after it occurs, to discharge any attachment or levy
on Tenant&#146;s interest in this Lease;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(5)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Fails, within 60&nbsp;days after it occurs, to have vacated or dismissed any
appointment of a receiver or trustee of Tenant&#146;s assets (or any Lease
guarantor&#146;s assets), or any voluntary or involuntary bankruptcy or assignment
for the benefit of Tenant&#146;s creditors (or any Lease guarantor&#146;s creditors); or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(6)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Breaches any of the covenants contained in Section&nbsp;5.4.2 of this Lease.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If Tenant is in Default, Landlord may, without prejudice to the exercise of any other
remedy, exercise any remedy available under Law, including those described below:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Landlord may enter the Premises as reasonably required and cure Tenant&#146;s
Default on Tenant&#146;s behalf without releasing Tenant from any Lease
obligation, and Tenant shall reimburse Landlord on demand for all costs of
such cure, plus Landlord&#146;s standard administration fee.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Landlord may terminate this Lease upon notice to Tenant (on a date
specified in the notice) and recover possession of the Premises from Tenant. At
Landlord&#146;s election, either:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(A)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Landlord may recover any Rent unpaid as of the termination date, and
Tenant will remain liable for the payment when due of Rent for the
remaining Term, less the proceeds that Landlord receives in reletting
the Premises, but only after Landlord is reimbursed from these
proceeds for the expenses Landlord incurs to recover possession of
the Premises and relet the Premises.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(B)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>To the extent permitted by applicable law, Landlord may
recover any Rent unpaid as of the termination date, and further recover the
amount by which the present value as of the termination date
(calculated using the then current discount rate of the Federal Reserve
Bank of New York) of the Rent to be paid for the Term remaining
after the termination date (assuming 3% annual increases in
Additional Rent) exceeds the proceeds that Landlord receives in
reletting the Premises, but only after Landlord is reimbursed from
these proceeds for the expenses Landlord incurs to recover possession
of the Premises and relet the Premises.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Landlord may use reasonably necessary force to enter and take possession
of all or any part of the Premises, expel Tenant or any other occupant, and remove
their personal property, and the entry will not constitute a trespass or terminate
the Lease. After regaining possession of the Premises, Landlord may relet the
Premises for Tenant&#146;s account, but Landlord will not be</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">25
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>responsible or liable if Landlord fails to do so or is unable to
collect rent due from any reletting. Tenant will continue to pay Rent due,
less a credit for the proceeds that Landlord receives in reletting the
Premises, but only after Landlord is reimbursed from these proceeds for the
expenses Landlord incurs to recover possession of the Premises and relet the
Premises.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(4)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>For any amounts owed under (1), (2)&nbsp;or (3), Landlord may recover interest at
the lesser of the interest rate permitted under Law or 10% (&#147;Default Rate&#148;)
from the date each amount is due until paid by Tenant.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>15.2</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>Landlord&#146;s Default and Remedies.</B></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Landlord will be in &#147;Default&#148; of this Lease if Landlord fails to perform any
Lease obligation of Landlord and this failure continues for 20&nbsp;days after Tenant notifies
Landlord of such failure, or such longer period of time as is reasonable if more than
20&nbsp;days is reasonably required to perform this obligation if performance commences
within this 20-day period and is diligently prosecuted to completion.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If Landlord is in Default, then Tenant may exercise any remedy available under
Law that is not waived or limited under this Lease, subject to the following:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Tenant may not terminate this Lease due to any Landlord Default
until Tenant notifies each Encumbrance holder and each Encumbrance holder is
provided a reasonable opportunity to gain legal possession of the Project and,
after gaining possession, cure the Default.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Landlord&#146;s liability under this Lease is limited to Landlord&#146;s
interest in the Building.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(3)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>No liability under this Lease is assumed by Landlord&#146;s Affiliates.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>15.4 Enforcement Costs. </B>If Landlord or Tenant brings any action against the other to
enforce or interpret any provision of this Lease (including any claim in a bankruptcy or an
assignment for the benefit of creditors), the prevailing party will be entitled to recover
from the other reasonable costs and attorneys&#146; fees incurred in such action.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>15.5 Jury Trial. </B>Landlord and Tenant each waive trial by jury in any action, proceeding
or counterclaim brought by either party against the other concerning any matter related to this Lease.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>15.6 Force Majeure. </B>&#147;Force Majeure&#148; means any cause or event beyond both Landlord&#146;s
and Tenant&#146;s reasonable control, including any act of God, government act or restriction, labor
disturbance, general shortage of materials or supplies, riot, insurrection, or act of war or terrorism.
Force Majeure excuses a party from performing any non-monetary Lease obligation for a
commercially reasonable time.
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>16.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>SECURITY DEPOSIT</B></TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>16.1 Deposit. </B>Tenant will deposit the Security Deposit with Landlord on execution of this
Lease. Landlord is not required to either segregate the Security Deposit from any other funds
or pay any interest on the Security Deposit. The Security Deposit secures Tenant&#146;s performance of
all Lease obligations. Landlord may apply the Security Deposit against any cost Landlord incurs or
damage Landlord suffers because Tenant fails to perform any Lease obligation, including payment of
Rent. Upon Landlord&#146;s demand, Tenant shall replenish any Security Deposit applied by
</DIV>

<P align="center" style="font-size: 10pt">26
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Landlord. At Tenant&#146;s election, Tenant may provide the Security Deposit in the form of a
letter of credit that is in form, substance and duration reasonably acceptable to Landlord.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>16.2 Refund. </B>After making such payments from the Security Deposit as may be required to cure
any outstanding Default then Landlord will refund the Security Deposit (or any balance remaining)
to Tenant within 60&nbsp;days after the expiration or early termination of the Term and Tenant&#146;s
vacation and surrender of the Premises to Landlord in the condition required by &#167;3.4. If Tenant has
assigned this Lease, Landlord may return the Security Deposit to
either Tenant or the then current
assignee. Landlord&#146;s transfer of the Security Deposit to any
transferee of Landlord&#146;s interest in
the Building relieves Landlord of its obligations under this section, and Tenant will look solely
to Landlord&#146;s transferee for return of the Security Deposit.
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>17.</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>MISCELLANEOUS</B></TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.1 Rules and Regulations. </B>Tenant will comply with the Rules and Regulations attached
as <U>Exhibit&nbsp;B</U>. Landlord may reasonably and in a non-discriminatory manner modify or add to the
Rules and Regulations upon notice to Tenant. If the Rules and Regulations conflict with this
Lease, the Lease shall govern.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.2 Notice. </B>Notice to Landlord must be given to Landlord&#146;s Notice Addresses. Notice to
Tenant must be given to Tenant&#146;s Notice Addresses. By notice to the other, either party may change
its Notice Address. Each notice must be in writing and will be validly given if either: (a)
the notice is personally delivered and receipt is acknowledged in writing; (b)&nbsp;the notice is delivered by
private carrier (e.g., Federal Express) and receipt is acknowledged in writing. If the party to
receive notice refuses to acknowledge its receipt in writing, then notice may be validly given by mailing the
notice first-class, certified or registered mail, postage prepaid, and the notice will be deemed
received by the party 3 business days after the notice&#146;s deposit in the U.S. Mail.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.3 Relocation. </B>Landlord may, upon not less than two years prior written notice (the
&#147;Relocation Notice&#148;), relocate Tenant to new premises (&#147;New Premises&#148;) which are either (i)
elsewhere in the Building; or (ii)&nbsp;within another Landlord-owned building that is within five
miles of the Building; provided that in either event the New Premises is comparably sized and may be
comparably configured for Tenant&#146;s use and, as constructed by Landlord pursuant to the second
immediately succeeding sentence, approved for Tenant&#146;s then existing use by all applicable units of
government, including, without limitation, the Federal Food and Drug Administration. Tenant&#146;s
occupancy of the New Premises is subject to the terms and provisions of this Lease, including,
without limitation, Base Rent payable therefor, except to the extent such provisions are not
applicable to the New Premises. If Landlord elects to relocate Tenant under this &#167;17.3, then
Landlord will, at Landlord&#146;s cost, first construct leasehold improvements in the New Premises of
comparable quality and comparably configured to those existing in the Premises and in
compliance with the requirements of all applicable units of government as aforesaid, move Tenant&#146;s
personal property from the Premises to the New Premises, relocate Tenant&#146;s existing telephone and
computer systems, and replace up to $500 of any in-stock stationery identifying the
Premises. Notwithstanding anything in this Section&nbsp;17.3 to the contrary, Tenant may, in lieu of
relocating to the New Premises, terminate this Lease by giving written notice (the &#147;Termination Notice&#148;) of
such election to Landlord within 90&nbsp;days after the date of the Relocation Notice. If Tenant elects to
terminate this Lease in accordance with the immediately foregoing sentence, the Lease will
terminate on the date that is 60&nbsp;days after the date of the Termination Notice.
</DIV>

<P align="center" style="font-size: 10pt">27
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.4 Building Name. </B>Tenant shall not use the Building&#146;s name or image for any purpose,
other than Tenant&#146;s address. Landlord may change the name of the Building without any obligation
or liability to Tenant.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.5 Entire Agreement. </B>This Lease is deemed integrated and contains all of each party&#146;s
representations, waivers and obligations. The parties may only modify or amend this Lease in a
writing that is fully executed by and delivered to both parties.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.6 Successors. </B>Unless provided to the contrary elsewhere in this Lease, this Lease binds
and inures to the benefit of each party&#146;s heirs, successors and permissible assignees.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.7 No Waiver. </B>A party&#146;s waiver of a breach of this Lease will not be considered a
waiver of any other breach. No custom or practice that develops between the parties will prevent
either party from requiring strict performance of the terms of this Lease. No Lease provision
or act of a party creates any relationship between the parties other than that of landlord and tenant.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.8 Independent Covenants. </B>The covenants of this Lease are independent. A court&#146;s
declaration that any part of this Lease is invalid, void or illegal will not impair or
invalidate the remaining parts of this Lease, which will remain in full force and effect.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.9 Captions. </B>The use of captions, headings, boldface, italics or underlining is for
convenience only, and will not affect the interpretation of this Lease.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.10 Authority. </B>Individuals signing this Lease on behalf of either party represent and
warrant that they are authorized to bind that party.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.11 Applicable Law. </B>This Lease is governed by the Laws of the state in which the
Building is located, without giving effect to its principles of conflict of laws.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.12 Confidentiality. </B>Tenant will not record this Lease or a memorandum of this Lease
without Landlord&#146;s written consent. Tenant will keep the terms of this Lease confidential and,
unless required by Law, regulation, order or requirement of any governmental or quasi-governmental
entity, may not disclose the terms of this Lease to anyone other than Tenant&#146;s Affiliates to the extent
necessary to Tenant&#146;s business.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.13 Reasonableness. </B>Tenant&#146;s sole remedy for any claim against Landlord that Landlord
has unreasonably withheld or unreasonably delayed any consent or approval shall be an action for
injunctive or declaratory relief.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.14 Time. </B>Time is of the essence as to all provisions in this Lease in which time is a factor.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.15 Quiet Enjoyment. </B>So long as Tenant is not in Default, Tenant shall have the right to
peacefully and quietly enjoy the Premises for the Term under the terms of this Lease.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.16 Right to Enter Premises. </B>Landlord may enter the Premises at any reasonable time
and upon reasonable prior notice to inspect the Premises, show the Premises to prospective lenders,
purchasers or, during the final six months of the Scheduled Term, as the same may be extended,
tenants, or perform Landlord&#146;s duties under this Lease. Landlord shall be accompanied during such
entry by a representative of Tenant, which representative Tenant shall make available promptly upon
notice of such entry.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.17 Exhibits. </B>The exhibits attached to this Lease are incorporated herein. If any exhibit
is inconsistent with the terms of this Lease, the provisions of this Lease will govern.
</DIV>

<P align="center" style="font-size: 10pt">28
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>17.18 Parking. </B>Landlord shall provide, at no additional cost to Tenant, parking spaces
based on the ratio of 3.5 space for every 1,000 RSF comprising the Premises for Tenant&#146;s
nonexclusive use. The parking spaces must be available and accessible to Tenant for Tenant&#146;s use
twenty-four (24)&nbsp;hours a day, seven (7)&nbsp;days a week. Tenant&#146;s use of the parking areas will be in
common with other tenants, and is subject to the reasonable rules and regulations uniformly applied.
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>&#091;The balance of this page is intentionally left blank.&#093;</B>
</DIV>


<P align="center" style="font-size: 10pt">29
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Having read and intending to be bound by the terms and provisions thereof, Landlord and
Tenant have executed this Lease as follows.
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">LANDLORD<BR>
<BR>
<BR>
<FONT style="font-variant: SMALL-CAPS">United Healthcare Services, Inc..</FONT><BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ BETH LEAF
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>Its:&nbsp;</TD>
    <TD colspan="2" align="left" style="border-bottom: 1px solid #000000">Beth Leaf, Vice President&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">United Healthcare Services, Inc.&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">TENANT <BR>
<BR>
<FONT style="font-variant: SMALL-CAPS">Novavax, inc.</FONT><BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ ILLEGIBLE
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>Its:&nbsp;</TD>
    <TD colspan="2" align="left" style="border-bottom: 1px solid #000000">PRESIDENT &#038; CEO&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt">30
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>EXHIBIT
A &#151; LOCATION OF PREMISES</B>
</DIV>




<P align="center" style="font-size: 10pt">A-1
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>EXHIBIT B &#151; RULES &#038; REGULATIONS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>1.&nbsp;Landlord&#146;s Entry. </B>Landlord may enter the Premises at all reasonable hours to perform
its obligations under this Lease. During the last 12&nbsp;months of the Term, Landlord may enter
the Premises with reasonable prior notice to Tenant to show the Premises to
prospective tenants.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>2.&nbsp;Right to Exclude. </B>Landlord may require that Tenant, its Affiliates and guests
comply with each reasonable and uniformly enforced security measure that Landlord may establish
as a condition to entry to the Premises, Building or Project. These measures may include submitting
to a search by persons or devices employed by Landlord, presenting an identification card or pass
issued by the government, Landlord, or both, being announced to Tenant and accepted as a visitor by
Tenant, and signing a register on entry and exit. Any person who cannot comply with these
requirements may be excluded from the Project. If Landlord requires a Building pass issued by
Landlord as a condition of entry to the Premises, Building or Project, Landlord will furnish a
Building pass to all persons reasonably designated by Tenant in writing. Landlord may exclude or
expel from the Project any person who, in Landlord&#146;s reasonable opinion, is intoxicated or
under the influence of alcohol or drugs.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>3.&nbsp;Obstructions. </B>Tenant will not cause the Common Areas, or sidewalks or driveways
outside the Building to be obstructed. Landlord may, at Tenant&#146;s expense, remove any such
obstruction without prior notice to Tenant.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>4.&nbsp;Trash. </B>Tenant will properly dispose of all trash in proper receptacles, all at Tenant&#146;s
cost. Tenant may not litter in the Common Areas, or sidewalks or driveways outside the Building.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>5.&nbsp;Public Safety. </B>Tenant will not throw anything out of doors, windows or skylights,
down passageways or over walls. Tenant will not use any fire exits or stairways in the Building
except in case of emergency.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>6.&nbsp;Keys and Locks. </B>Landlord may from time to time install and change locks on
entrances to the Project, Building, Common Areas or Premises, and will provide Tenant a number of
keys to meet Tenant&#146;s reasonable requirements. Additional keys will be furnished by Landlord at
Tenant&#146;s cost. Landlord reserves the right to replace all, or any part of, the lock system in the
Project, including the Premises, with an electronic card access system and to charge Tenant Tenant&#146;s
share of the cost of such system, including, without limitation replacement electronic key
cards. At the end of the Term, Tenant will promptly return to Landlord all keys for the Building and
Premises issued by Landlord to Tenant. Unless Tenant obtains Landlord&#146;s prior written consent, which
consent shall not be unreasonably withheld, conditioned or delayed, Tenant will not add any
locks or change existing locks on any door to the Premises, or in or about the Premises. If with
Landlord&#146;s consent, Tenant installs any lock incompatible with the Building master locking system, Tenant
will: relieve Landlord of each Lease obligation that requires access to each affected area;
indemnify Landlord against any Claim resulting from forced entry to each affected area in an emergency;
and, at the end of the Term, remove each incompatible lock and replace it with a Building Standard
lock at Tenant&#146;s expense.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>7.&nbsp;Aesthetics. </B>Unless Tenant obtains Landlord&#146;s prior written consent (which may be
withheld in Landlord&#146;s sole discretion), Tenant may not:
</DIV>

<P align="center" style="font-size: 10pt">B-1
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Attach any awnings, signs, displays or projections to either the outside walls or
windows of the Building, or to any part of the Premises visible from outside the
Premises;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Hang any non-Building Standard curtains, blinds, shades or screens in any
window or door of the Premises;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Coat or sunscreen the interior or exterior of any windows; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(d)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Place any objects on windowsills.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>8.&nbsp;Signs. </B>Tenant may, at its own expense and with Landlord&#146;s prior written consent
(which consent will not be unreasonably withheld), install Building-standard suite identification
signage. There is no directory signage in the Project. Landlord hereby consents to Tenant&#146;s existing signage.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>9.&nbsp;HVAC Operation. </B>Tenant will not obstruct the HVAC convectors or diffusers, or
adjust or interfere with the HVAC system. Tenant will assist the HVAC system in maintaining
comfort in the Premises by drawing shades, blinds and other window coverings in the Premises as
may be reasonable required. Tenant may not use any method of heating or cooling the Premises
other than that supplied by Landlord.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>10.&nbsp;Plumbing. </B>Tenant will use plumbing fixtures only for the purpose for which they are
constructed. Tenant will reimburse Landlord for any damage caused by Tenant&#146;s misuse of
plumbing fixtures.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>11.&nbsp;Equipment Location. </B>Landlord may specify the location of any of Tenant&#146;s
Business machines, mechanical equipment or other property that are unusually heavy, may damage
the Building, or may cause vibration, noise or annoyance to other tenants. Tenant will reimburse
Landlord for any professional engineering certification or assistance reasonably required to
determine the location of these items.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>12.&nbsp;Bicycles. </B>Tenant may not bring bicycles or other vehicles into the Building or
Premises. Bicycles and other vehicles may only be parked in areas designated by Landlord.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>13.&nbsp;Animals. </B>Tenant may not bring any birds or animals, excepting seeing-eye/assistance
dogs, into the Building or Premises.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>14.&nbsp;Carpet Protection. </B>To protect carpeting in the Premises, Tenant will, at its own
expense, install and maintain pads to protect the carpet under all furniture having castors
other than carpet castors.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>15.&nbsp;Elevators. </B>Reserved.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>16.&nbsp;Moving and Deliveries. </B>Moving of Tenant&#146;s Personal Property and deliveries of
materials and supplies to the Premises must be made during the times and through the entrances and
corridors reasonably designated by Landlord. Moving and deliveries may not be made through any
of the main entrances to the Building without Landlord&#146;s prior permission, which permission shall
not be unreasonably withheld, conditioned or delayed. Any hand truck or other conveyance used in
the Common Areas must be equipped with rubber tires and rubber side guards to prevent damage to
the Building and its property. Tenant will promptly reimburse Landlord for the cost of
repairing any damage to the Building or its property caused by any person making deliveries to the Premises.
</DIV>

<P align="center" style="font-size: 10pt">B-2
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>17.&nbsp;Solicitation.</b> Canvassing, soliciting and peddling in the Building are prohibited and<BR>
Tenant will cooperate in preventing the same.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>18.&nbsp;Food.</b> Only persons approved from time to time by Landlord in its reasonable
discretion may prepare, solicit orders for, sell, serve or distribute food in or around the Project,
excluding any food prepared or served in any kitchen area of the Premises for individual
consumption. Except as may be specified in the Lease or on
construction drawings for the Premises
approved by Landlord, and except for microwave cooking, Tenant will not use the Premises for
dispensing food, or soliciting the orders for sale, serving or distribution of food.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>19.&nbsp;Work Orders. </B>Only authorized representatives of Tenant may request services or
work on behalf of Tenant. Tenant may not request that Building employees perform any work
outside of their duties assigned by Landlord.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>20.&nbsp;Smoking.</b> Neither Tenant nor its Affiliates shall smoke or permit smoking in any
part of the Project in which Landlord, in Landlord&#146;s sole discretion, prohibits smoking. Landlord
may designate the entire Project a no-smoking area, excepting areas in which Landlord, in
Landlord&#146;s sole discretion, permits smoking.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>21.&nbsp;Rules&nbsp;Applied. </B>These Rules and Regulations apply equally to Tenant&#146;s Affiliates
and others permitted by Tenant to access, use or occupy the Premises. Landlord shall apply these
Rules and Regulations in a uniform and non-discriminatory manner to all occupants of the
Project.
</DIV>

<P align="center" style="font-size: 10pt">B-3
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>EXHIBIT C WORK LETTER</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;<U>Defined Terms</U>. Terms capitalized in this Exhibit, but not otherwise defined,
have the meanings ascribed to them in the Lease as if actually set forth in this Exhibit.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;<U>Tenant&#146;s Work</U>. Tenant is responsible for all work (collectively, &#147;Tenant&#146;s
Work&#148;) required to design and construct those improvements identified on attached Attachment I
(the &#147;Leasehold Improvements&#148;) in accordance with the Construction Documents, as defined in Section
4 of this Exhibit. Tenant shall obtain all necessary permits and licenses required in connection
with Tenant&#146;s Work, and shall cause all Tenant&#146;s Work to be completed in accordance with applicable
Laws. Tenant shall pay all cost of Tenant&#146;s Work (subject to reimbursement in accordance with
Section&nbsp;3 hereof) and shall otherwise comply with those provisions of the Lease pertaining to
mechanics&#146; liens.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;<U>Leasehold Allowance</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1
The &#147;Leasehold Allowance&#148; is $58,715. Tenant may use the Leasehold
Allowance for the actual, out-of-pocket hard and soft costs that it incurs in constructing the
Leasehold Improvements (the &#147;Cost of Tenant&#146;s Work&#148;). Tenant is responsible for all Costs of
Tenant&#146;s Work that exceed the Leasehold Allowance. If the Leasehold Allowance is greater than
the Cost of Tenant&#146;s Work, Landlord shall be entitled to retain such difference. Landlord has the
right, upon reasonable prior written notice, to audit Tenant&#146;s books and records regarding the
Costs of Tenant&#146;s Work.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 Landlord shall reimburse Tenant for the Cost of Tenant&#146;s Work within
thirty (30)&nbsp;days after the latest of the following dates:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 2%">A. The date Tenant has commenced doing business in, and is paying Base Rent for,
the entire Premises;
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 2%">B.
The date on which the local unit of government having jurisdiction
over the Premises issues a certificate of occupancy with respect to the entire Premises; or
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 2%">C. The date Landlord has received copies of lien waivers (in form, substance and
amount reasonably acceptable to Landlord) from the general contractor,
and any subcontractor reasonably identified by Landlord, performing Tenant&#146;s Work.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;<U>Preparation of Plans</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1
Tenant shall cause to be prepared a set of design intent drawings (&#147;Design Intent
Drawings&#148;) which will not be for construction but will show the location of all full height
partitions, circulation patterns, electrical/cabling plans based on furniture layout, furniture
plans, finish plans and written specifications for the Premises. Tenant will deliver the Design
Intent Drawings to Landlord as soon as reasonably possible. If Landlord reasonably objects to the
Design Intent Drawings, then Tenant shall submit revised Design Intent Drawings to Landlord as
</DIV>

<P align="center" style="font-size: 10pt">4
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">soon as reasonably possible after objection and Landlord shall approve or disapprove in accordance
with the same procedures.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 Tenant shall, based upon the approved Design Intent Drawings, prepare, or cause to be
prepared, construction documents (&#147;Construction Documents&#148;) for the Leasehold Improvements. The
Construction Documents will be in sufficient scope and detail to
satisfy requirements for (i)&nbsp;obtaining permits for construction of the Leasehold Improvements; (ii)&nbsp;obtaining firm cost
bids for the construction; and (iii)&nbsp;directing the construction of the Leasehold
Improvements. Tenant will submit the Construction Documents to Landlord for Landlord&#146;s
approval as soon as reasonably possible. If Landlord reasonably objects to the Construction
Documents, then Tenant shall submit revised Construction Documents to Landlord within ten (10)
business days after receipt of Landlord&#146;s objection, and Landlord shall approve or disapprove the
revised Construction Documents in accordance with the same procedures
set forth in this Section&nbsp;4.2.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;<U>Selection of Contractors and Subcontractors, Substantial Completion</U> Tenant shall
only use contractors previously approved in writing by Landlord (which approval will not be unreasonably withheld), for Tenant&#146;s Work. Tenant&#146;s Work will reach &#147;Substantial Completion&#148;
on the date that the local unit of government having jurisdiction over the Premises issues its certificate of occupancy for the Premises.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;<U>Change Orders</U>. All changes to the Construction Documents or to the Leasehold
Improvements having a value of $500 or more are subject to the prior written approval of Landlord, which approval will not be unreasonably withheld unless the change (i)&nbsp;materially adversely affects the structural elements of the Building or the
Building systems; (ii)&nbsp;describes a floor plan substantially different from that previously approved by Landlord; or (iii)&nbsp;does
not comply with applicable Laws.
</DIV>

<P align="center" style="font-size: 10pt">B-5
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><U>Attachment I</U></DIV>
<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B>The
Leasehold Improvements</B>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt">&nbsp;C-1&nbsp;
</DIV>



<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.1
<SEQUENCE>3
<FILENAME>w11762exv31w1.htm
<DESCRIPTION>EX-31.1
<TEXT>
<HTML>
<HEAD>
<TITLE>exv31w1</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;31.1</B>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>CERTIFICATIONS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt">I, Dr. Rahul Singhvi, certify that:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>I have reviewed this quarterly report on Form 10-Q of Novavax, Inc.;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Based on my knowledge, this report does not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements made, in light of
the circumstances under which such statements were made, not misleading with respect to the
period covered by this report;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">3.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Based on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the financial condition,
results of operations and cash flows of the registrant as of, and for, the periods
presented in this report;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">4.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The registrant&#146;s other certifying officer and I are responsible for establishing and
maintaining disclosure controls and procedures (as defined in Exchange Act Rules&nbsp;13a-15(e)
and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act
Rules&nbsp;13a-15(f) and 15d-15(f)) for the registrant and have:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that material
information relating to the registrant, including its consolidated subsidiaries, is
made known to us by others within those entities, particularly during the period in
which this report is being prepared;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>designed such internal control over financial reporting, or caused such
internal control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally
accepted accounting principles.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>evaluated the effectiveness of the registrant&#146;s disclosure controls and
procedures and presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures, as of the end of the period covered by this report
based on such evaluation; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">d)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>disclosed in this report any change in the registrant&#146;s internal control over
financial reporting that occurred during the registrant&#146;s most recent fiscal quarter
(the registrant&#146;s fourth fiscal quarter in the case of an annual report) that has
materially affected, or is reasonably likely to materially affect, the registrant&#146;s
internal control over financial reporting; and</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">5.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The registrant&#146;s other certifying officer and I have disclosed, based on our most
recent evaluation of internal control over financial reporting, to the registrant&#146;s
auditors and the audit committee of the registrant&#146;s board of directors (or persons
performing the equivalent functions):</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>all significant deficiencies and material weaknesses in the design or operation
of internal control over financial reporting which are reasonably likely to adversely
affect the registrant&#146;s ability to record, process, summarize and report financial
information; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>any fraud, whether or not material, that involves management or other employees
who have a significant role in the registrant&#146;s internal control over financial
reporting.</TD>
</TR>

</TABLE>
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">Date: August 9, 2005&nbsp;</TD>
    <TD valign="top" style="border-bottom: 1px solid #000000">By:&nbsp;&nbsp;</TD>

<TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/
Dr. Rahul Singhvi
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">President and Chief Executive Officer     &nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt">31
</DIV>

</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.2
<SEQUENCE>4
<FILENAME>w11762exv31w2.htm
<DESCRIPTION>EX-31.2
<TEXT>
<HTML>
<HEAD>
<TITLE>exv31w2</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;31.2</B>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>CERTIFICATIONS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt">I, Dennis W. Genge, certify that:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>I have reviewed this quarterly report on Form 10-Q of Novavax, Inc.;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Based on my knowledge, this report does not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements made, in light of
the circumstances under which such statements were made, not misleading with respect to the
period covered by this report;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">3.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Based on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the financial condition,
results of operations and cash flows of the registrant as of, and for, the periods
presented in this report;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">4.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The registrant&#146;s other certifying officer and I are responsible for establishing and
maintaining disclosure controls and procedures (as defined in Exchange Act Rules&nbsp;13a-15(e)
and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act
Rules&nbsp;13a-15(f) and 15d-15(f)) for the registrant and have:</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that material
information relating to the registrant, including its consolidated subsidiaries, is
made known to us by others within those entities, particularly during the period in
which this report is being prepared;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>designed such internal control over financial reporting, or caused such
internal control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally
accepted accounting principles.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>evaluated the effectiveness of the registrant&#146;s disclosure controls and
procedures and presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures, as of the end of the period covered by this report
based on such evaluation; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">d)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>disclosed in this report any change in the registrant&#146;s internal control over
financial reporting that occurred during the registrant&#146;s most recent fiscal quarter
(the registrant&#146;s fourth fiscal quarter in the case of an annual report) that has
materially affected, or is reasonably likely to materially affect, the registrant&#146;s
internal control over financial reporting; and</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">5.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The registrant&#146;s other certifying officer and I have disclosed, based on our most
recent evaluation of internal control over financial reporting, to the registrant&#146;s
auditors and the audit committee of the registrant&#146;s board of directors (or persons
performing the equivalent functions):</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>all significant deficiencies and material weaknesses in the design or operation
of internal control over financial reporting which are reasonably likely to adversely
affect the registrant&#146;s ability to record, process, summarize and report financial
information; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>any fraud, whether or not material, that involves management or other employees
who have a significant role in the registrant&#146;s internal control over financial
reporting.</TD>
</TR>

</TABLE>
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">Date: August 9, 2005&nbsp;</TD>
    <TD valign="top" style="border-bottom: 1px solid #000000">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/  Dennis W. Genge
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">Vice President and Chief Financial Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt">32
</DIV>

</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.1
<SEQUENCE>5
<FILENAME>w11762exv32w1.htm
<DESCRIPTION>EX-32.1
<TEXT>
<HTML>
<HEAD>
<TITLE>exv32w1</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;32.1</B>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>CERTIFICATION PURSUANT TO<BR>
18 U.S.C. SECTION 1350,<BR>
AS ADOPTED PURSUANT TO<BR>
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In connection with the Quarterly Report of Novavax, Inc. (the &#147;Company&#148;) on Form 10-Q for the
period ended June&nbsp;30, 2005 as filed with the Securities and Exchange Commission on the date hereof
(the &#147;Report&#148;), I, Dr. Rahul Singhvi, President and Chief Executive Officer of the Company, certify,
pursuant to 18 U.S.C. &#167; 1350, as adopted pursuant to &#167; 906 of the Sarbanes-Oxley Act of 2002, that:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The Report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Company.</TD>
</TR>

</TABLE>
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top" style="border-bottom: 1px solid #000000">By:&nbsp;&nbsp;</TD>

<TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Dr. Rahul Singhvi
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD align="left" colspan="2">Dr. Rahul Singhvi&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD align="left" colspan="2">President and Chief Executive Officer<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left">&nbsp;</TD>
    <TD align="left" colspan="3">August 9, 2005&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>


<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt">33
</DIV>

</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.2
<SEQUENCE>6
<FILENAME>w11762exv32w2.htm
<DESCRIPTION>EX-32.2
<TEXT>
<HTML>
<HEAD>
<TITLE>exv32w2</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;32.2</B>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>CERTIFICATION PURSUANT TO<BR>
18 U.S.C. SECTION 1350,<BR>
AS ADOPTED PURSUANT TO<BR>
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In connection with the Quarterly Report of Novavax, Inc. (the &#147;Company&#148;) on Form 10-Q for the
period ended June&nbsp;30, 2005 as filed with the Securities and Exchange Commission on the date hereof
(the &#147;Report&#148;), I, Dennis W. Genge, Vice-President and Chief Financial Officer of the Company,
certify, pursuant to 18 U.S.C. &#167; 1350, as adopted pursuant to &#167; 906 of the Sarbanes-Oxley Act of
2002, that:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The Report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Company.</TD>
</TR>

</TABLE>
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top" style="border-bottom: 1px solid #000000">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/  Dennis W. Genge
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD align="left" colspan="2">Dennis W. Genge&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD align="left" colspan="2">Vice President and<BR>
Chief Financial Officer<BR>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left">&nbsp;</TD>
    <TD align="left" colspan="3">August 9, 2005&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>


<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt">34
</DIV>

</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>7
<FILENAME>w11762w1176277.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 w11762w1176277.gif
M1TE&.#EA<`(9`?<``']_?S\_/]_?WQ\?'[^_OY^?GR\O+Q`0$.[N[E]?7ZZN
MKL_/S][>WH^/CU!04*"@H&!@8&]O;Z^OK_+R\KZ^OOCX^/;V]OW]_?3T]/KZ
M^G=W=_S\_/?W]^KJZO#P\"`@(/O[^Q<7%WY^?IZ>G@\/#\/#P^?GYT='1^;F
MY@<'![>WM^_O[X>'A]O;VP0$!,?'QT]/3WQ\?'U]?=;6UK:VMGM[>]G9V3<W
M-ZNKJP("`L[.SHN+B_/S\SL[.]K:VG-S<P4%!8.#@^+BXLS,S+FYN>#@X%-3
M4PP,#.SL[/7U]?[^_NOKZWEY>;&QL>WM[=75U=34U.3DY%Y>7AL;&X"`@-/3
MTR<G)^GIZ>CHZ+2TM(:&AM?7UZRLK'AX>/'Q\6MK:V1D9.'AX8*"@H&!@8V-
MC9.3DVYN;L+"PJ>GIUI:6I65E9&1D::FILG)R<C(R-#0T+N[NWIZ>IJ:FMW=
MW4%!00T-#;.SL[V]O;R\O$)"0@$!`2LK*\W-S<K*RAT=';6UM:6EI65E94E)
M28Z.CA@8&#`P,-C8V-'1T;JZNJ&AH4M+2W1T=./CX\;&Q@@(")V=G924E&IJ
M:G)R<G5U=2,C(T9&1HB(B*JJJMS<W%%14;*RLHJ*BF)B8DA(2&-C8UA86(F)
MB6UM;9>7ETY.3G%Q<<O+RST]/6EI:9N;FU=75SP\/&=G9PX.#J.CHSX^/E14
M5#DY.0H*"C8V-D!`0)F9F0L+"Y"0D&%A8;BXN$I*2BDI*?GY^0,#`R0D)!H:
M&FAH:)*2DJFIJ9B8F'9V=J2DI**BHG!P<#,S,X6%A1,3$\#`P$-#0UQ<7$5%
M108&!A$1$9R<G&9F9BTM+5)24HR,C$1$1,7%Q:VMK2XN+C4U-5965EM;6UE9
M6104%%U=76QL;$Q,3.7EY=+2TA(2$H2$A`D)"4U-32PL+!D9&9:6EL'!P:BH
MJ,3$Q#0T-"@H*+"PL!45%3$Q,3HZ.B8F)AX>'A86%C@X.#(R,BHJ*B(B(B4E
M)55551P<'"$A(0```/___R'Y!```````+`````!P`AD!``C_`/\)'$BPH,&#
M"!,J7,BPH<.'$"-*G$BQHL6+&#-JW,BQH\>/($.*'$FRI,F3*%.J7,FRI<N7
M,&/*G$FSILV;.'/JW,FSI\^?0(,*'4JTJ-&C2),J7<JTJ=.G4*-*G4JUJM6%
M$Q!HW<JUJ]>O8,.*'4NVK-FS:-.J7<NVK=NW<./*G4NWKMV[>//J->LP@+^_
M@`,+'DRXL.'#B!,K7LRXL>/'D"-+GDRYLN7+F#-KWLRYL^?/BQLN`$VZM.G3
MJ%.K7LVZM>O7L#DO'!V[MNW;N'/KWLV[MV_'LW\+'TZ\N/'CR).3#JZ\N?/G
MT*-+GRY;(6WJV+-KW\Z]>VWFWL.;_Z;4H+RV'./*-P@RP%\:]0W&^9LRZ%&N
MOPTH`78UR9\,1?A1PM]?HPBS!CR`W=!`+'^=\,5@[S6@17OIJ9?&+Y_\14(#
MZ(B@WC?NI1&8,W$4$`,A_E38@"?^]-*`#'\ATX`TLL#7"WD(RB*#BQ\:YXPQ
M!6C@B#\GG`"8+PV4DT8$?WUQ`I+E^+-'&:@<`U@R,_Y%WF#DE9=)#OY\`=\S
M'/X5R"<GP"=@?X%M`PTU^?RE17E=../+G$.*^21\-V!I@#](]C)G>9-$*5Y@
MX/GC"!6X:'(+8&`$`\1?09#SES!TP".!`M<`LX<_77`"CP(*2`!,.X#%(<=?
M>Y!*:A!TE/]**AU`_`"'"K\X4U@JKDJ0BAZ!9($(&7[X$PJI.!BC!R==*,JH
MHX"-(D$(?X42RF#'*G!)!$#`(XRKURKPZ5_@F,&)&'_5P\8>F[[J#RVD7D(%
M+U]84HL_$,C!(&P!_-.`&AW$,,`_CS2`BQ"\%/"$>N/`LL4CEJP`XC]^_17!
M:`((T(T_%%_L#S)/;!*,$\7F0(`2H_P%``&#*=Q`,$70,7#!#:21B0>L^)-*
M!\X(0$1Y(!90`&`'J,..&#3,T,_,Z2PA0@`@<$!("/^`X$`"'JC72[^;Y)"`
M`"X2D36(Q#WS3@EB0,'%$0```)@!_QQ00`:P^$,``'`?\`H#P-C_P@,,?XEQ
MP2!_]3M8O_^V`(W=+ZB70QB_^)/""@X`P(AZE'C\5PYK%,%"`4C(X@\"FJS!
M`#$&(%!!#_XP`@+>_Z13GBP?_(.(/W#OH04QL1?J6J4,TD('NZ2NT<OFK9B1
M6:*#\!&)%A6<XT\W?%10R5\$<("//P(D,/`8D^!R2`X*-/`]*>*[X$\LX>S"
M^A01$(-$!$8DX$0$^.NR#`:A=.$$@(2Y001:H(((W"`7$Y#!*2B@##T4H`T1
M`,4%I-$`!?BC><^+GC^`<(T*-,L?0FL9!*G@!6T,0`!EP%\S.%8Q?T3@`:FX
MPKWB4((Z_".%].,>,2(@@PK`P@I1\,8S_Y`0C=H8#H27&%A[\G"!6A0`$`<X
M``G\(0I-_`4,W&`A8#PF@`P(@X47`\($IJ$H,LS#'^?80#"RH`=_K*QE0_.'
M)N0P,&E$T1FQ\`*`B$`&[ITBBBD`81S]L0\D/,,?!T`$,)3H#RT,(0!1\,$7
MC``%RB6@"%&<8K],0(>O_<63QDD%"I(A)2K`HVUOB]O<#I&"N^5-!<#XRR(Z
MX0\7F``-ABC6$0-SQ&D@X`@$8$$4Z^`/.>"`%SVP``D`4((H'D`/FO.'%2X@
M.EY`XPZC<P"^+)"ZGQF@!2V`W0"BF(,/1.T3><-=W&"3/6]P+P']BH`D2F`'
M8MZC`CZ@!V;`4_^."[#.'Z^@EC=04(-&8"\)6W!!]Q@YA7_HHGR,](4/C."/
M'S2B%3@`#"@3$`4#>-01HZC`*G0AC9P9YFY_&0(R_E*[>800"!@P1P7+L8%_
M[J,>_C`%`HR!!5X($HY_F80X3N@)CVZ,8EM\P`'Z(`E_E*(__RBJ`7SAQP/T
M`P':C`$4D`$%,,4FGAIP@A@&)@0&8.`:(!P(`NSF-D2UD(N7N$`O.K8`1@8F
M#J68@A)TX4:6"2:$?1W80*0@QW3,8P-4%<!`F`18-YX!,&(@P/>8,`%+!$``
M:,"!'>*`U02HU1_]PL$=-BJ`X[PQ,*C\2]X*D`4,<,*5<>N>8'J0@0/_V.`4
MH/W'X73KCQ,&@``#&8TND)"--604``0Y0#0=X`'`9&*M"("&)!C!A=1UH04[
M0`-L!S*`#R`@&.&XP3K3^1H"),$&CNC>$<N1!$'XPPYE>,*#+@,>NP+F&JC`
MQS^*10!(5$`*"_U'>U@(40%CSVU\J$$NDC`I?VQT`ULYAQXD<85_/$%Z)VTK
M4O]"L0(X80%12$)Z%&#?OY`!#G4`@2I^^M<X]NN$64%`Y#;LP@?X@PJ-(,0%
MK,"Q&&N!>P(!01;4EP(59*!81OS'".0P"B`,3!#%B`(Z0`A%*;Z7</[(AB[T
M0&,N)F`$-J!K-_Z!C;\XH`XD*,4,1C`!)O05_ZC^``4-ZGA'(LUA!VWXBP#^
M>(!`-O8';P",+>PPL$L(PQMZN.P/!("`:G06DU;NUSE0L(#2.MC2Q?F!#C:7
M!T>D5IUR*T`",L``V!V@"LKS!QWX44P$C,`'1,CM;O_B#A-@(YC#_$L)R)"!
M3S'3F="\3C4RT&`("&%T>!A!*%*0NFK\8P$_@.TX#U!.!/2@"-88[SK+"PD=
M"$.]O'WG`6H*"CSLTSJ`J45-_S*(9AP``U%8P`6,P59.8&`"WC/P,_XAC0)3
MZ!!I&(`2&`"%?Q#VTI_$-&A9-(`2B.(O!UB`D@.#4G]`H:T#PT<![N``0>2L
M@NK^9P-6.(<.+(`#(_]@<6``ZPD?#(`!+=2BQ6Q\#!"HP8HRU_,I8-$"++OP
M.E\-=V\%7`XNE$#E_O@&"GI`B"T4@,MOQ5@"ZF$!NOIC"("HAS8NX(HTS"\"
M;&C#,OVZ\J'-HP5,*+$_#%&!5,L6,(UMQP5`-(H.Y'O`H!5`O^+6684;+A3_
ML#0HBW..<$PB!2.8PP`^O=JGE^(?IJ;&$^:QARN(8`H7$$,$=N`%>NP2,(8#
M0@-LP%;!=`&?*B/[SP%3APX0PP5[8(2EL/HV!/3#"?^8!6P/`!CO&L`4`N$]
M>5US-W/L`M^[],`HO/$/<11A%\>S3*+*X+P=<``;+&A#)AP0!"'4XFZ\&,+_
M/_+]`TZTP@8N*/`/$M"*+3@B'<IP@`.`88@V;M3N"4B``3XQ@6BDP09ME0.^
M,`"D!!@5IPT\$`%ID`5\D`.-Y0\5Y`_4%PG6APW:P`#,X`#1D`$#4``ED']&
M\A<>F`"1@`*W<$(L`((<DX()T`,OY`\YT`8;0$LKF'\4)5O@4`%EMGJV<0,*
M-P4",`7^(`US$``[D#$9<P..8`8Z@`F`T!Y(*``[<`M_X`\E0%'1(``W0(7^
M,`^`8`-OH`%Z8`MJ\!>L<`B"$`%(>'1_<80",`/(\`Q`B(1HH#(+,"16&(7^
MX(:8Y0]&P`=%(`X:,!]!F"`EX`>-8%!O4`E&$(4&_U1:M0`';&@$;&@<RP`'
M`D`!R^!":Z@+`L`*.[`#_M`.-A`!NL``K-`-Y``%-@`)X\`-I0`F*5`,`."#
M2"B$_F"+`D`#>>`/:)`Q#%"(Y[``,6`Q46@$MX"$;Z`+!H`'1>`#:S`IBP@8
MNO`&?L`&`O`,:&"*`A",`K`)?K",_M`*G^@/GFA2Q`<`O,`&X]<O"0`!7'`'
M]7`(D"!_%+`JTH=N@%$.5$`$30`!_B`,+.(/)$`!>]``":!J!'`"(4``!$`!
MB9`-_A`$7]"0#ID(`:`'$@!`\T``&W,"=4@D#NF0"5`.8M`&?=``5&48"/D7
MO/`#ZM`'!<!C&C"(@/$%0?_@#_SHCP!)!37@DG:P#!HPD@T`&$-)`(@@`BD0
M`MKED$4YD@2@`4;P0=.`!T>`/2-9AVA@)"X`"9;P%T:`"K>1`GA72P.@/O[@
M!_"0#`/0E@,02`3)#U[EE@18!U0U!5?I`F]IERZ)#H?D#WX)&%/`"B3@EKCH
M#VPY`-1BEFZYF'SY%U-`EXC9F!"'#3AEEFBI*%/@`H1`57X0"T=`ER1`EAJ"
MBT=PF#[REAIBF$Z6`\E0@%-``JWY%_`P9?[P#+:)F/5`EFZ)EKRIFOX0`G2I
M/@)X+P1)ET=0!V[I!Y.2`GN`=Y\)&$#@!R[`EL$IFW29#"[`G/X0FF`RFZ_1
MDI3_L)`&,)(C@`W]0`"XJ`VM0%_Z>"CP&9_R.9_T"1V)4I_XF9_ZN9_\"1KW
MV9\`&J`".J`"^I\$>J`(FJ`*.AT&NJ`.^J`0&J'?\9X26J$6>J$8JAD-FJ$<
MVJ$>ZJ$;^J'(00AQ8`FYJ2%,$AC+!!@#P"01L$Q3A(>;X0),8`FHHBB"`0,M
MY#WZ%P"`(Z.2$0%M\R@KFABKX`ZJE9",H:.KD0!M0P?^P*2.X3V7L7@`4`-^
M0`(IVAA:ZD)E^1A."@!9%``QMQ@P<`,&D`!%2ATA*J+&@0?%8`E.<)7.H"LG
M)!@#XP*!U*+<LW@D,`QNQAG7``B6P`"$D`9NI@?/!$(`_T!,#C8`!`!/,-`-
M45`9`E```'`'M#`P?^$(/O471]!&M50."Z!-#J9Z=4H84\2H_E`+<&D:!%``
M8A`.1H"ICJJHHEH+NN(/O'"5!EBFDA$`*P``MH`"IB``>N"K0."HO(".*2"C
M=ZIWDT$`$G"2H-`VY8"6==!@L?"JJ_H7(Q`!"2!90B<=;>JFQ,$'#Y`+TY`"
MBJ`"N+`,=XH&!J`*J#`PT$`#RV``=2@`D$H)13`#+-!'M%`WE^$&@``#YC`%
M,[`%X,`"?Z``1U``+X`++.`"#5">^:<!7?`/03`"T@`+#_<8`N`)A6`+K3`P
M.7`+1)`%YQ`+3(`+..`+^A`,./\0!:8ZKH`A"[CP!ZYP"^?Q`-*P"5D`"76`
MJ6!``UF0":=!`'Z1!4Q0`&>`"^10"Q"K`+6@`32@`E;0#ZSU`[]Z&9<E.4C`
M#=_(#JYP#NN`"U00"\5``VA0#CW0!)K@7KU56M(J&9'J#XM`!```!Q*0"*"2
M!4U@`.:`"(B0"2E`M$8+KN)*KMEQKN@J'*Z0!1X0#O@`!09@!1:P!W@;``Y0
M5_\P!3'P#F/KKP*&J?3@`4>``1MS&7[0!$M@`I30-B$0"7O``090`*C@"#Q0
M"$X;J0!0`)PZ`HM`!F``&0+0`@N``IPP,#<0!D>0"3KP"5#02&5`!5R0`U>0
MLV17!=O_$`BX,`M;,`I-``[^6KV8^@2V,`G)"ZLH$+^%4`#"@`[_X`Y?D+L&
M,`/40`JP``KKL`<98)M.*[:D9@%G8`4"$`\_\``WL`T0@`"%@(%R$`)M8`P)
M8`A_$:W`VA@$T`$HX`'<``!-@`XV\`$U@`UN$`$2(`RD``:"4`0#4+V..ZZ<
MBAV2.[F]<005[`*8P`1%H*?_T`.?.PVBFP*>@`>GJT28Z@_KL`EK@!G.H``A
MX`(/0`9M<PR88`?<5``LX`]"H`K!ZZ3$JUM&0``\8)R.(:VRL`0#HPA;T(46
M\`4J$*4J0`:08''>"Q@5L`9!$`FQT`%ND`#,$`8`$`0W@*G]_\`"AE")I$$`
MBL![C'H`_[`,6\Q-[4`&<[`&T*`.A[R8!6P9`8!)5WFG$/``9B`$68``.9`)
M;+`"TX`)B1`$-LG!T_I'ZM,V$:<+14``F!`!4R`#;U`"D6#(B%S#D(O#%*K#
MR$$$,T`$7N`+<M`'C;`&=TH!C?`"HBL!F#`,2RQ@D"`.G=`)%[!BF`$(+4`$
M*"`-D?`$D-`!Z\`#/5```G`-6_!]OT7&\'!#=?`"YJ:\"T``<[`.`\,*1*`"
M-A`('W`(7+`$KE`)0L`%7I"S*^"07T`%?'`(*]4%&?`,_.`$;.`![H"IB."0
M50BK+82IE,P,\"S/[,!``*`-12`!#/_08*%<&6.[P:5URM0P`S2@/6$0#',P
M"[:@`R_0GG?+/1W,&'NK,@`0<?$``NL0!36`"HV@`']@!2`MTLA\PVRZS,QL
M'$<0`(J`(D!`!WF@IS?@#ZP`#O-P#"D0`'N@"LY``FM]`W&=`B2@"/HP"DC0
M8)>1`ZZ@"'&2`N;P`=E@"GL0`E;@#N:P,09``@8@G#SF"CWP`11P<(]Q`V2:
M#7KJ%T=P`O;01LD`#M+P%]B@"L?PNB%`I@%`"2Z0!\T02$=@)8`)`_IA!0,`
M!)50"7]9&I$-&+KM`@&0`HF]V./0VT"@!WM@#O*A6M]*&78-&"FPUH3@#B10
M";U@"BG0"^;_@"HY8`K-L*O5G8O1_1B3S:)G>0R.(`W-T`M6``3+D`N'A`ZX
M+=Q3$`(&$->1"]9A79^]@`BXE1MB@`-`^M\(KALYG.`,WN`._AL+_N"D<=X2
M7N$6SC'^?>&H(0%1V.$>_N$@'N(B_N$[\`H>[HTACN(CON(?[@]OP.(P'N,R
M'H528`1'D`!2D.,ZON,\?@+/H``KCN(JKN(S#N)&0`U%GN0GWN'>>`-GH.10
M+N)H4`DS3N1,'N4KCH[@T0Y_T@P`T@NSP`NP$`IID#.=%`N.D``,F7\)8.-J
MZ@\]8+CT4`=&$`K_%)P4122$D*8JZ`_58,XGH!_^0`ALG@!'8`34_^)1$0I<
M-U$`$$`3H_,3`E`[#T$`<#,3"?``-!$`##`3!.``/R')&)X0U_$+7.`/6V`"
M_K`&,@`!5:`&6?`.M:``%6`/@@`"3CL!0K,#`S.(F#H$HQ`'?2`*3A!].>VT
M`+``0C.(.8`)0X`]2FH%"O,$!9`,TOII#LKH-N'HD(X`DD[I#F'I-)'IF][I
M,O'IH0X8X&$/6$`(+;`%-S`#@E`%J?`76_`*"M`'.Z`&+>"T0M"6\#`P'"`-
MF"H&>P`(UY`-H_"Z`?#O`_`"`0``YC,`\O$)9]`&HM/4^%&4W),*`S`(;?6@
MVEX3W#X3D>X3DPX1XH[IFCX3G.[IH.X3HO\.'BFP`<!0``T@"AM`"`SP)_Z@
M`!&@`*@P`XW`!4Z;`1DC#`.S!A(`"&W5"S20`4Z`I*"%]`+``1&_`ADC`OY`
M!%]0`\%@-TJZ\7IF`HP6\MF.$R4O$R??$PP`[@VQ\C)![BYO[C&![C*O[A1:
M!1[P!=N``"C@#U4@(OY@`_N@`*$``A@@`TZ+:7EZ"$G05E00#[$`"#^9=]@3
M\2%?!Q5@`EC@!2Z@\1#(\=>.]@LZ\C2Q]C'1]CR1\I5^Z7/?\C+Q\N<>\STQ
M\Q0:!/_0#E;P#Y?@8%"@!GCP#D>@`%+``#X``;DN-&K`J:^``6U%!CH`#"BP
M0IAO-Q&O[`4P!M__T`1M^0*90``E(#3%4AYZYA?8?OIJ_^@F[^TH#_<,(?<Q
M0?>S;_<P@?>WK_>D'ACT`!`)RKE(<,Y?#EBAO+'R1X>2H%F43H1(4)';D03^
M@(`SX,\?B6EF!.GQ&,*(QQ.$#%1,8*Z:+H^%8)U@^<R?+%D>C83P9Z"C1Z!!
MA0XE6M3H4:1)E2XM2N#?4ZA1I4ZE6M7JU7\%(&#EVM7K4W\(OHXE^U7`A[$$
M#)1E^S7!@[9QL09@(-?N5`(.[N[U>@`HU@5,!0\F7-CP8<2)!SOEV_BI5L=W
MPT:F'/5LVK65V[[5W)9NY[)Y04?VZQ&P8M2I5:]FS9KQ:+:087^=/'OO_^6O
M:FU[Y;R;ZV??5T4'CUO:WVE_>Q0L9][<^7()S:,_=QY]>G4%U[,SOZZ=.W3I
MWK-/%X^=/'GJZ;^K!T]=.WKLV]E?'[2$N%?9]ZG6UD\6MU?=^INJ-P&C`J[`
MIX9#L"OCD`M@00@C!&T!":7*;T'^*J3JOZX"A)#`!0]$4$$-IVKPJL#\>;!$
M%EO\:H$AJ`!@1AIKM/%&''/4<4<8"MGQ1R"#O-$?#80T\D@D`8C@@",3""%)
M*(TTP($HJ_QQ@`BLU/+&!-S9\LL@[2#A+Q0]6G&T#*+(P$4V&R,@F=;BE'-.
M.NNT\TX\\]033P=AP^*4`L80JTU"XX)@3T035?]T448;=?31POH<;1$ST&"#
MBD(S+>M02#OU]%-00Q754P<Q"&1&+:("X;6O,&!!*E(B".*0,32UU2M.1]5U
M5UY[]34H/PI@PI]`"K#"'UT*&,`?*PIP=AA'TDC#'VZ"&,!99RO!MH`>-,`6
M!AB<1<:=P1Q$0!<!!"CB'R>JV"6,&R;H@`$+/%B`AW\F.&27?RK8`HE_.@C#
MAP!:<`(J:Z+!0X07GE+"!ARP;:$J'2A^R@2)H[K"*A-,N*."J"K^1P=L)[B*
MAJA4J`H)@"7,]5>88Y9YYCH-X,"#.HI((@`BD]A$Q0X2N"4<01IH0!4AS#G@
MGU,JPB<!5$I(@!("6*C_R```)$@`#17*+5-%!.998`&#XUGEAV!".*,';ZXY
MYAMIPOCD"UC^"42*`(1(8)H'X('@'D.@0@&'#J""HY5&-$F``!3^\0"J))ZJ
MJP)^_T'@@G\`2#`(`AC_QXL-_EF1@W\XL."I)#H79\W',W\*`%0Z/YWR#"(W
ML/33*50"`Z@PV&`#9"I\F6;BBS?^>*,,0&".5)`0((`CK`D%`2`","&`/(I0
MI`$5*F#&GZ6;-N((?R!XP*.J*Z)G1G^F,(1\ILSU8X01:#!A@#+"0>!!>_ZQ
M@`\V3.$%RQB##3HPC'\\(10)*`4"LO&//KRJ*LAH'`(TAP%7[$,2"S@&#/)P
M_P$`]$$5]U"&)YBABPUH[A\$$$:Z,B")5*3B$B18`"Q.,8A<Q*,1+.A$//(2
MA008X16NR]P?U/4/6'"C$H%H1P=@D!4"!,`0>:!#%AYDA%QP0P#2``<G_A&-
M.;@,>6,D8QECICP%$($"S\N$#P9PA3P$@`/LN,`J]-``$!!!',Y8&@N4Y!?S
MH:\`,_(2`/PQCD/00S#FRLP_5M"&+$QC"`^:Q3_80(H^W&,![+A#'A;P@W\<
M8A()6``"VO&/,^S`*BJTX#_^8(M_[.,/H-S$#``PA@Q8P`36(`,Z6KG"4#AK
M`J?0!@Y`\"!/_$,`Q4A#`62@A"SD!1"O"D445'C+`O\`XA_R4$(<^J"`!3RQ
M`%&L0@^8L(0`]$$-_PA"%6CQ#QG\0Q1V$*,9[7E/?#I*>5T`00.>]P`?$&`!
M!0B``/S!#$8\HP&T2$$X%K$TXY3O?/Z((E#8EPL;>,TJ*0J`!^)!(P:DH08Q
MN,(R&I&*?U!@&\AHQ@LT$`=O>$`$DP"#$'[P!`_(0@;,"&-5J!"Z5JIC&!>H
MQ!V\&`E&`,`25[#!&A)`@WS\D@`*@,H#K)$*"KCB'Q'X!Q,4((8"+,(#(\A+
M$YAP@4P@X9H4>LJ#`+``<)Z``UJ(XA/L0`L(!,`'Y,C`+[90`->1`1'US&=A
M#7O8..GB#;UX7@GDH0Y3^*/_&X8`1PG\H8<F1$(&,O"'-EX@#P$HHW,G\,<K
MJ.$1-+R@<]^(@`X(@(=7:+0J'-U`NES(@P5$+AQ7:-P_6A`%!"0!`_?JU[\"
M5H$-F,!@5[&$#?(%6`MH(`:06,`)`("I`AA"$F8@P"3&`(8E`/8?"_C"C%3P
M@#B((!R>L`$PLK+9=ZSC!S]80`VNL(,:!"$KC_G!C!;`U0*TX`PM($,-Z!N!
M*$B"">_@JABZH`43J`RPG#`!81%[80QG>"E`\(,_!N""*<1B"B[PB!]8,06/
MC*,>XQB'1P9P@`'$>`#D.T(W/$((&8^#!#&N`V$D%9Q2H&*V*KS55'BP3@EQ
M0L-+_V9RDWWUX^"8C"H5&%21I6(!$%3(#;5P<I>]_.5%0=G*8[Y/*=>Q+32G
M6<UK9G.;T^P)5;A9SG.FL[/\H88ZYUG/==Y!-_*L@6#M6=!T[@$8!GUH-UMA
M!XAF=)HU<(]&1UK.#YC#B39J)C)GNLPMNA"",L0F#G'%0PL"$8)$5"`2L<G2
ML\6TIEUM&[:6J-,%^K2+0HV542.HU`4ZM8!2[:)54X6CKR;V:.90Y0K-6D"U
M;M&MA=-(4L,E0KWNSZ];%.RI#+O8VZ:,`)`M(67WA]DL<K95<EV@70N(VOJQ
M-HNP+15M<UO>MQE")%AR;WSG6]_[YG>_6=*#7OA;X`,G>/]%J%5PA">\X.-#
M^`F>H7"($YP4KI`VA-9]GW:7Z-U1B?>\/=X61(P)S"/WE!PD=''B9%Q#&X=*
MQS_^\J\HF>0S?]0B3EX7"*F\0BQ_BK8U0,^JE*$L!2@!5+0@"#"P0``$$#K,
M2S0\FD=]3PFX>81T+B&>CQ?3&/@&*4)G.2EW(`-<W8!8/-`Z!+3N'[W]!Q8`
MP(66_6,0"&!"$":Q":K,X`R=(\#IIK*"%5#%`C/H.=\+9QL$V`%D4T$!WR<P
M`0D4?844@$*^#@8;J$M=\W:B^K1QOJ"K1RCKPX8$'C2`AW_`@QH.*,$:1&"&
M"!!`%FJPQ`\DL8D_1.`4;/"!-D#_\04G$$(+QA@%%;SQE`8@0`1=2,0@IL*.
M,P`B%.$R&>^><KJ._0,#:[*<$@30>17L`-)%R(#U+4"Z1X@E"97SP`4FX$7M
M8^X?D;,`]W=A.QYD^2F?N,8N+/!UTLF*9BH`)P"#1-@!3&F&`M@!,+@`8+`=
MT,B\S9O`..D\B_N\$=&+0AD],U$"*U`#,)"$?[""?R"#`N@?(8B]7T`B#N``
M6/B#3[`%':`%/OB''R`"=\B<1/BBR'D!"Z"`&6B!1IB*",`<!="<))`$26"#
M%H@$#8"&L>&"81@&#Y"$&J`&3+!`!M"+%8B!."`&+%@$8[B#$V@`+I@O)R`#
M$1`L=S`!_U"(`57R!AE(A.WR@!J@@E.H`D"(`0!8EQ5P!S20@"XX!0\@`RH0
M@JP0`0%`Q&U`!`2@@*UZBGU@!$@8K-&00`K,Q-2PP!#!0%330$+A0!59@$P@
M`#C0A@U8BP8H`'E8N]CC*EAH05@PA#`0@P2@01LD@K4``&+XAU7PNZNP@!-X
MBB/\!SNX@PM@@@4P.2;H''#8`$P0`M'B!AW00KT0@S@H@$IX`T]0@#E(/G"X
M@#L0@65`A4;H``=`@FTH@&V`@E-B@O^!!`=@!#@``&DH@`C`NW]P`!-@@G\H
MA4M8!$9X#%E(`%`J@C@(`"'CJG^H@4-0`0F*0$V<R-;@1%/S1/]?`\4V$<4`
MD`1,>`IJ@`95+``N6`8'>,5_&($`"(`"T($;.`$M0()S>(5?V(5=/`9!6$&N
MF`!%($;-X8(24((N6(!6@*?.<0`EJ`(:V(<[2(!JA`H!T(LN"`8!:`0$@`(`
MT(#D<X`+.(,N>`-EZ(0[<(!P4$0^\(`'J8$,.(350P`"`(!C$(!#^,A]C((:
M^(<W8`,`&)0":("G\`";^X<]B,0+.`8>@`/]ND2*7,Q-K+J<TTA5(Y-+4Q&L
M\!VI:,&GJ``(E#*H4`((Y(I0\$G_Z00Z2(<%,(5F@(3.88-F^(0Y:`<A.@,+
MC,I_0(),J`1R6((\J(1+8`-.8`,Z&(7_)3@Z,#`!;#"$7ZB$!+B`!R$&.JB&
M%7``MP0`8:B$3-B"IY!.8IB%65B!O7P,OWP*%LB#95B'?YB"`.@$(OB'=/@#
MS&-,^$0,B^0UC*PVR`0VR60URER0$E`'J=B`R%D`"0!&[5L3RKF*#,"7?CD=
M)?""`GT*+\`<#L@R'O@ZU)&_J.`![HL*#,#0JK"`SX0*6R!0S<#$^#Q1HYA/
M=:M/=KO/:\M/86LU!+D`-Z@*)UB7CZL`NAP-F4-1'TT*8W!,T'-1=X/1;)-1
MITO2JW"#%/A1)S6*BNM$JR-2C3-2>$-2)<U2J1"`!5B%E?Q2,`U3,1U3,BU3
M,PT`*R"$,UU3_S9MTY7TAQYP4SF=4S>]`4>04P.H!3K=TS:-`#J(THN<TDSA
M2"TMU"W]M@@)-_T8MQ(IMZHX-P%)M_Y`N>`(/0@A5$/-5&]C$46]#T;5$$>E
M"DCM#TG5#TKU#4M=$$S-U$+=5%G;B@CYU`H)5;R`-ET#5/H4U`VT4H[#4E9-
M4E?5D$XE#EF5$%J5BE'5CU*]CU/=C51%D%7]524-UF2#50@IU@@YUJA(UOM8
M5N)H5MMXU@*)5FEU.@&(`4J0,75=5W9M5W=]5WB5L60X@GBM5WN]UQCS!S_`
M5W[M5WO]@%6``L*P573#U175U5#DU98SDPE8AHW!`15H@EY$!1R`"O\<8()0
MP((E"(*?^P<<^`$-V-"IX(`F6,#GNHH*N(-(?(RI:`'Q\HH)^`61(<(:$`$F
M4`)%8`>\?)"F\X0*R(),`P22>-)/4:3!(-A(-=A)95&,H]*54]B>,Q,$J`,S
M4((&>``+4(56R`3KPP!DF`!->`1HL`0'\D4LH(8:K0IHL`$`.(<9L*`*N*LD
M:`$<N(,96(,JZ`,8:`%5>`0B``$5<`--$(4EJ`!H*`,`:`$)$`<W4`,HF``*
M2(<^N(#!Q8*G>(1;0`)U@(0KF(!K>(>V0@`0^`83D(=7&01?6-FU((.>LC(3
M)=I?05I255I39=J4<]J=@UJM`QL#J`0:N-K_?["&6G!/J;`%3?@!./B''I@`
MKBJ%5*F*/,B<39@%)P``.5@$&GB+#6H&0Z@&`H``%)B"1F"&/@B`"*""5C@%
M)FB"18B`!60`9F"'9IB#9F`'3Z``+6B$FS5&#5"`6W@!56"`5,"Y`&B%2P"'
M"H"!.,``<UB+0HB`".B&?P@&82"SUX7=7I%=9:5=9K7=2L5=K--=CD(``_"`
M9F`"N(@!/R"'?Z"!$:B\$8``)3`&2'2%%>`J':B5JG`K!0B&,?"O?Z`X!2"`
M`5A)"M`<MXJB"%B`[WL0'1"!`E@ZP!H$DLF<!HA33S`9`>A+JG(%!@A/T3D#
M<>`=&!@#4#"#M6#(_[5X2PO&8./1X&[EX&_U8%0%8=$38:E="TA@A0=@`#JX
M@E>P@198@`[8@>>U!6CX!VGX!S.X`"Y(7NC-'`50`E.P7NQEA@=0`"RX@1E@
M!A^(@`E(8O-EX@20@6"(`4F(X@G8!G:HACD`+`!`A$DHA1U0`F4J`$3XWQ[X
M8J@(@"J#`3S@!QM(XZ=8"PIN8S<F'C@F#F\-#G"=#7$5$(Z<@&3B@$F@@2_`
MSO]Z"BR0`@A6@7`8ADD(AI0TA@A8/*IXA"U8@'4Q@06H`$V0@[E=%RBPA1JE
M@050F06(L#9P@@DH@0IXA";0@18PF1=PW`F8&!VX``E0`QQ-Z`M0!C7HW/\G
M@(KN@0H\P`#W;()_:(.GX&AJ:-TBN^!D'I5E#HYF]HUGAHUH[@]R]0H04%#M
MPPJ2=;6?S322+NE0.6G?2.G=6.G1:&G]>.ER_;B<UNE/X>G=\&G;`&K0$.K[
M(.JBGK>C1NI.46K;8.K9<.K.@&KBD.JIYK:JMFH\\8,$T(>BP.K9T&K8X&K-
M\.K@`.NP+K:Q)NLZ`8<J*`,44`2B4&O88.O1<.O*@&O?D.NY?K6ZMNLY680A
M6(9,P(:^EA#`!@W!I@S"W@W#/FQ-0P;%3A1>&(HI6`<>P`">&0J_'HW)[HS*
MCHS+MHW,UFPR$X`\Z&P]H01<&(I.,`47"(09B.S_"$EMS5AMQVCMV7AMV+8R
M;V.`O>,[YFYNYWYNZ(YNZ28`#>B$Z;YN[,[NSO$'.]!N[_[NZU8&[#0HH4"P
M,AB"!O#M#Y%C9Z9C9[7C2\7C_;2+/[@"4I@1&EB","""(7@*'2"\J0B#_OX'
M"9`!`&"!"H/0&JP*(L``E($*8@B#IW"".%@#8!R#=4$%+("$%8@"??P'%9`!
M8,@`<>@"4-@`98@#2(`*0!"%J@"!$1"!.$!$JI@#`!\+/@@#'Z2*)0"ZKO`V
M)[`M(1_R=&$`(C]R)"=R([>M)1_R'7B%)(]R*1?R)I]R`6``?W@#*]]R+N]R
MV]H8\@X*()B%".`&1U#O_V@3T@P<5/D^D[C`!$64@71!`E$P&C7(`@YH`4S`
M!#S@@PVH"TP0T-=Y`P8H@@H0@G=P`A5(@`EX@U*(`@7`3D;`!5!``#?8A490
MAJUBJRRXA`AH76R(@W^```%H`"U8!8_^!Q#X@A;8AS<0@3<8@S>8A"%8A,(Q
M@4]H`QZP@[J`@C\X'2((A"M0@35(("+@`$;`A":P`#_J@#<P!`%H@L#I@#\(
M@PL@@#/8@&2G@0I8A0)X@@J@=@;(`"B@@1:X@!K0/ZX0`&2X!W]]=W^=5WB?
M]WC55WJ_=WX]!Q'H@X&5;/96:?<.5_A6U3:?@$HP&8A%!959!R3[!V4PR`G@
M@?\=X(0!;X`@$(`!;($(2(`&$`1+"(0'&(%.(`-L0(!TSP2X>AT\:P(ON`=:
MJ`&"FH$`N(13@(8/J(!ML(1>0(`(L`4PB(1K6.*G"`=^:+JGB`!2&`)2SX!7
MB(:I>(5#T)P6:`7-@8.B6X``D(!9`(9I\`$#*`/>F80J&X)9H`)R:(!/((<U
MV'@)^(12"`1(.(9_4(0=B(9BJ`$F2(0&R`1+L`08`(#D.P%0F`8L\(-TT`8$
M:((W\(HLH.T].?.C]7<U_T0V-XVO\65G`*6K!8$]P($3D+\5T(!_:`11H`5;
MJ(!"^`=`"($($``Y%X`)Z)P&N`;1"7D1R!P!H((",(/_E,\<+8\"$``#*P"$
M!0```1B!"\`!!R`!<2"#$N1Y$4""#<@#H=\`4]B"4]#AK4*">_`&+E6$8P`!
M@BJ##8B$+/`"S<&$8M`</#B#UUD!9OB'1WB`)WJ*&CB\*V@`'_@'$0"(!IC^
M`2A00(&.?XE&A?!`YM\_10$"=&E@Z%\F``0:"!CT[]$[*00%+!@!\23*E!#\
ML6SI\B7,F#)GTJQI\R;.G#IW\NSYTD#*H$*'$BTJ-,$#HTJ7,H48@$'3J%)/
M$G`P]2K6H`=:&EW`,@`"`]5P-4@ZI!NNH-0T_8#SK\<$$S(B"&A`]4X#!?\"
M/!@!8*2*7D462(`(``'$)*0X_V1[(4-`@1=?$/CI\`U#)01F8A!YT27"@G\5
MVFW@E.EDA']W:@E@QD?=KY.KAD!D@H`%'TE8AG4P#*)=A0AP8)Q4E^G"'6-<
M6*`PU@!JP4<2%G18A$4?B%06Q,3!).12`S)+(@#`N\2!A0@^((PD<(?I2I_R
MY].O;_\^?IA`L_(?BK0_@"D]%2"!51%X8%%;L=355V$QX@`I29%3"`O_X-"`
M#B"D8T8&DN#QCRI>_)/%%RL`<"(:2]3`S@S_%+"`#@3\0\`*6(#QCPDMSG@B
M`#/8(0,-7C3`R`))T*)%*RNH`$`K%JC`R"8L)*&""1`I$\,E?U0`D0K_*$'&
M$$1`E/\.#__PP.,,-L2@Q@5MB-`*5?^X(<,U(*"!$BXB@+)$!6J,,<<+B!'0
MP@XS5+G&)FAP@(<,?RPQ1A",-#"(&":T(<P+%N`1PS46%$;C)AC`EQ^II9IZ
M*JK)#+`J(3'MAR!__\'*WX"S8F6@K;8JZ`^#_H`%U":^/,!`'EMHX\,9"F!2
MP#`9_#,(-"`4HL2,KEP051`FY;HMMT(](L12'7@T*JKEFGLNNC%IH(P`RC3@
M:K=2R1HO4[7R5XJH`.)*+X"[]AJ`!X*(EL`EYAPBYSX0A3$+PP4(H4T:M$#T
MPAC\6GPQQO&ENS'''==WP#^[_H2Q4?.2+)2]60'P017Z6G7_\E7^%N65KS#;
M?#/.$&GL,<\]^QP3R"*[]&K._YB<<\I8`<!2$!SP1\'+12LE,U$T!R`UUEG;
MNO//77N]<=`R$9WST3@G?=72+&%S\*U1:RT4U4-9_3;==5_%]==YZTUJV/!B
M7?;-9T^5-DM'D&/!5?O:?5+<0LV]..21!X7WWI5;WE,L!<0B=M:`VRRX5(2W
M9,064RD.>>-!/2XYZY!3?CGLL?LT-LZ>PPQZ5**WU(VV39V^>.HIK=XZ\6^_
M+CORR=-$^\VVGXQ[4[J[1$>93/UN=_`H#5\\]T4GHCSXE3O#$_,V.T\R]$Q)
M[](!A2UU?=W9G[1]]_7#+$`$]/`2_S[_/.M!""?N0+[.)05KZ5O*^E[""1\H
M!7YTDQ]$Z&>_"5I,``A@P!D(H,$-<K"#'OP@"$,80@UT0H0F/"$*/>@/.Z2P
MA2YLH3)*)X"8=",!=>#<WPHHM0,J)8$OD486C.+`MT'P'Q*D(!*Y9<&Z%8`]
M6/,'8E@W0Y@$X@)?P*'4SH<Q'AK%AS#10+Z$,D2M%?&(23PCK)9(MR9F#8JM
MFZ)+>&&'1X0!BT73XL6X6!0OPH0?H1&CVU#'E9E]Q0.]J-(C<$`,5/QC!Z(X
MB1Q&L0P4=(`3#F##/T1@``.("(V>3,DA5+&J49*RE*8\)2I3J<I5)>,(JWPE
M+&.Y*G_X0?^6MKSE*_,Q"EL8`B:S\$$*5A`/OV51AT73(U'X")-8D`*0K2MC
M@\;QB5V4!00!",(GKO4/#,CA'XT011G248%"_.,;/@CC2>RP!1D`H`8E&$JF
M($($,?QC`SMP'ZQ*\,Y_K*$W6SC#4`K#C@[HY2086$4[*4`4"81!*$]H01O0
M:3$.Y*-_%O79,V!"AB@0H`C((.8=C8DTJ/1'F3')QCZI$DC@#;)J#3+`*ZY1
MEG]8@P1!3$D-\-"6MTR`#F)8Q010`H(8,"`0#)B!//[A@RPX31EGR$`G^@"1
M!N"C`H8H!`!V08,6+<`-+P`!!C31@G\(P`UN^`<6_E"*?[3,!"O_*,([KG"!
M%S2!!P:!B`,$,".3*.,%_]B%"MA1`0"@P`A]8`(B;``1!-Q``$\``PH64((5
MT$"Q)LC",!80&@'PP`--0($&&H"""I%L!A<][=?$L8H!]&`)-QQ9#K.&S*&8
M%&AK<!I$QI@U:/HJ+!8X@3&20@IIQ,!"&`*!)7[P#P^!R`NBTD1!(?*&)@C@
M%I(UQQ`R,0@'%&,5W\!#(3#YCP:(P0W"F`8`TF`+9N#A&$&`01-NL098V,`;
MD_C$$$BQ!E<@@#@%(,`>1"$&.(#!$C6XZS\<((,&?&$$3!!!!!)1@^TF`@`Z
MN($*7+&&>>SB'P@XQ@+.$`DXN`(0X+!$_R9,D(TU%&(!5P/`$%XABFI\(C5Y
M.!G-4*MCCP'A!HY@20]>.S0"RI:D_*FM3#K!P!FM%'LME=M+712+!\R@&1CX
MA#@F@``.4.&1_X!$.D!@``R(X!_%2.D_1K```61B!%S`@"VXL)<68$,018!`
M%!OP!A;4`!@`&$<`;F`+5[BH`:/X!QP>4%PDK.$/VNB%`/Q+`"G@HQ5(8$(`
M$H!@![P!`9H8@3P"8(IH&$(*5FC`7^A29CQ[V`HC4(`7"%#FXG)A$=V,@8L)
MT@1O3%4OK,98CG<L[+R5#V9XM-ALA8)DF<3B$4Q^YI,=]Y4)>.(?(!C#'[@1
MA7_,X18*VP<,8/^`AA4,8Q0`A<0H9$"MD]R!`/@[B0)B,(%X<$$=%%@%!)`P
M50'D(@X*`,`Q/&`'/%RM`-!81G#@X`TA`*()DQF%`/+@@1_@X0L6B(09S*KI
M`N!5KP08P32>``5HW``!DD#U/[X@@+^P&@%7R^U?!#&!&B@C%_^`P0)D\0\C
M6",/%[A%'.2<"V<!>]A&_UJQ3W9L?B4[*,N>R3)PT.3X15MU7[$5!C:AI)-4
M@!@`J,($0($,1EA#O"]8@01>,`,"5($*Z?``QS7[A!@4``2+`$49,I`(,;`!
M"Q00PP@$(`$9J*`%,4`%#C0+D7&350="T((EEK"D`JA#1F0H@8PD@#C_"W`<
M(@*0D35$`(@1B6`$)L`%.5IA@E+((`OB6`,&JDVR8!^]]AU+.LF63J^FI^3I
M,SE"-7`;.=Z^?%:#Z,VV[%(_=2RYZ+9_/L=PCS'=QXOW*/']3!P!!BQ(COB?
M_#Z":`_]\?OD`)QX0`U"`%*RB=1L1E89J0@!4$$NB)`U`S_^^R-^\O,_)^^X
MQCT\P!/D@'X0F0&]G]*82B@(WP-5G?!<7?Y%X%7L7_]5X._YP`#X@PO`P_K5
M3OL%#@*BS:FXPX=07?VYU/U)H`HR!05:H`NZ1#T\00BH`@%01@'&U@$""/;A
M1"PL0B>1D0-J#P2N(!$6Q1N\(!+.Q!M``!#$_\,_9"!L%5.1Z:"YT,$?[580
MSL\0%B$7IH0%'$$2ON#^O`0,8$(4<``7"%E+2-_%4%^W6-])[.!.>!G6>%\7
MWB%*N`$8AB'_A0`$#(%,'``!=F#S?.#GA.#@I(L\_&#.\!8?/F)+$``6"``E
M5J(E7B(F9J(F"@`#;*(F[L`K>*(HCB(I8J(_O$$IIJ(JEB(#(!\<Y00;6HP;
M<@L<&L;&U,'H%8TC0N(CRL@:.9'4N)$4#1`.[A`BAD[';$/IX(PCAH`&P4':
MB$`!;(4!-,`)T``_^`,:&``O"ILOO@T;/5$42<XKXD0L\LLL;DLM$H3'6`$^
MP8PC#L`_^$,AA`$^Y/\`"C@!-_@*`23`/S2!/PA``'3CCGVCUH1C,(YCY)3C
M38P-JO$(1$:D1$XD158DCQB``UBD1FXD1TKD`)!'1U;D0/(,*53/R<3C/T@!
M.:!`/>3!$'3!)?!C`AQ"!RB"0!*DCAEDUB!DT0@C.<($75`B&JP?%.+DL*%#
M$\!C%D902\AC`UB"(OB#.B!"(CC!`01`/Q)`)W1`!XRD45J43F(-3^:,3RXD
M3```#K`*47ZET:5``H0#R:!D2]0#!X@!`+C!#V!E`A``+\B(5[)E^(2EU(PE
MSI0EY#`D`/B`033#6@+FL!6"8')+,Q)`2[A"*["$(@!#-9[`NQ`"!7"C8P;_
M)A,!8T\JY&&>)0U,Q!0T9F@*FP@D@<7L8FN.7V3F#&'>C&$N#F*FY0"LY@V>
M1%'.IHZ=`Q_PBVP*I^W5)L[<ILWDIMTPY%YJ$!NP)G*B5@IT`;WPEA48!'=V
MIW=^)WB&IWB.)WF6IWF>)WJFIWJNYWGN@#(\`'O&9WIZ@BK(IWV*IS]`PGWN
MIWDN&4/:Q-@$9W6BEBE(E60NI1%M(1YVX54-:/CDPT1$`#$"IX,*6PC(`>+D
M"O%90!!LR0LL`"*(PS^\``V<1!2`0BM<0`9(@!8TE`ZP@!TL*/>`08568(#6
MJ+"=`"-H*():#0+D@%V4A07@`Q]40QA]PQ60`1P`_X(,.$$V_`,8C`<*I,02
M8,$+:-"."L4&$!U1<(!>>=@#K%M09``>V$$29$#+*,67HL3G$<!`H$3S_0,2
M;$GW'`^.#MN-WJF.Q8*<S0KQ(0`V9$,IS%03'``QI$083(,`3(*8P$(1,,$_
M$,$EI,0/V,`V8.E0:,&:#L7*0400-,)0_!81W,$M",'4I<2F&@8J4,`OE.A)
MC-5))$%JU*F>CE^>UBIJY<(2P,J?&L`AI((,)$4!Y$,WE8"R_(,-;`(7&(-"
MN<(AE!D%&!,#L($`7"H!<$`!,($DH$`@U``$E$``-(`P=,$VA$&W?JLV;,`@
M:,)?H,`)B`(1F,$OW,$C,/]!:!#`%T#$'*#`/(S!/J#`+XA!&0Q#)$!!%XB!
M835`!D1##.S`!A#$&2`!*"0"*,C`-O0!%3P6*9##/T0`\A6/G>+J:=VJR%Z4
M/O1.@/3J/PP#)3R`$_0``4S#$EQ(*93H!)B!%MQ)/"C&/Z`!FG%!&PC`"9S(
M"DQ##$0#)#B`$"#"B;0+#D!`52PM`%##%L3!%OP%0?Q#)?#`$"Q8EMI!#4!$
M!B#`C:7!`BS"/\@#"'#!)OQ"!?Q!`0!`"Y29(3PL`/R""`2!!33!)3A``8!&
M(NQ"'/R#'8`J]X1LR?8/R29N_Z2`&:P`@:CL"IC"".2"C&2!S4&$)3"!-EA#
M%<#_P#!HP#^<P@^8`I?^`]"^&T1H0`4@0!0X``(00--&0R+L0%7$+@`@0010
M0Z=F[=;V01PT0!2%03-<BR?@@E4D@`[\10^`P"6`0FH00-SZ`+3")@!<83;@
M0`3\+6%D;>'2*N/B:4H(:/CR#SH8:'_8X5)8``A`!`B8I$3A"#0(0<5`1#'8
MPRQX02!XP`LTP#5(P3"80BJ\P_[V[S_`@C@(@?+9A0_<0#-4P2-XP$G@P@UD
M0R)X0"#\PP]`@5T0@3VDPA543"-<R#]$@BJ4P50]P4EX0@#`P`-D;%K810*8
M)/$@;ODFS^+>,/^`4?KVJ((>R!?$;U3\;]TL@1;4CPWK_W#LY+`2@X\56`-_
MJ"^L+($$9T4C7$'=S"D2-_'(CB\77U0LQ``-1X44RV@1)O$7[PT3IW'RY(*(
M3D49F_$*HC$;(YT7UW'_U`$*2T4<R[$$O@L>*\\:![+LW`#D-D4?^W'^"0`8
M#"(AETL>2`$I<,&$0@3Y/C+R'$$B(+(/IZ`BJZ`%7<$JCC(I"P`HEC(F=J(H
MJK(F=N(IHO(HLC(KC_*V>5XE/R$F6Q0WJ/#4='+Q?;($JA$XDB99FJ9NWO(E
MYS+R6`$.]/()0IDG`_,B(T$IO)`U7S,!D!`V;[,)^8,F<#,XIY`U9.A_UL0@
M*[/L?,$8IT0B2[,G,4`OH/.I//_#`/3",,"$+ZY`-5"G/(-/"$#Q4!#?!"Q#
M4.&`"A1#B;(!'>J`(*S"!5B`#)R`7Z&5#+BSW5Q1/W-,/_J#%!`!/V=T\J3`
MC<"-+R-`'9B!$@BI*K1")H11&5S!&L`!-+```CPI#_S"+T.$#Q1!&_Q#$MB!
M-D&$$S3%$!PJ432!,D3%69V$%S34&8/TQA!`"12`.'C"1T,U\NP!(FA%26,#
M';A+4JA`"$PJ2D!!*#+J`6,`-<1!3O^#!D!!!"3!+93H^T+$0_Q#%9N)^SK-
M!#SL(KP'!FA3$G087AU,%2N!\.T";O'`EBPU!H!`!7Q!4*L@'6.U?!``*CP"
M`ZCA&M[_L66#3RUL,DKTJA"`0[".%SK81;(,1`>H`2HPZS^X`AZDPH4%U4DP
M0BL(0"!\@D()`00(PDP/0",P0RY8@@+`0B4$`0/8@P:@P@DXP#H,0`$LP@F8
MP3_L028X`!87P!0H`"D(@B3\PRPXD0.\0C5``2WDPBQ4000@P`ET0C0H1)K.
M\6>;2S_F`!1(PE77]^7T0)6,=DD#RP$\P!5@@PF`PQ6TP`)$`23X]#=0PR9C
M`R!`0!K('TJP02D(@#Z<PE^`PC8``"40!`U0P\[YR3^,P@Q8`@:<P#^L`QL`
M`!8H`@`HPA#8PS_(@"^:`0T@P^B&`W9VG!!\@@\,P3;\[6W<__@_M`"<$&%E
M\[=.6*,_#,`=J%\46K*3RTX*W#4[!_@_<$";80,4_$,?/"E$`$(US,(<A(,1
MY$$Q+%9.*\`+"(!U1P,[;((:"("S`0`<!,$_F`,M5'0G;$$#<,`R_`,T7`(`
M7$$7"``<="5!^&($(`(5_(,W7`'6)M@<S($WT,$?1(*1V\5?;,&=,/F5\\PY
ME[K/T,%\;_DS2ULT%P7[NN\ZHX0)0(,)H+`%&,,,:$`,H'`T5`&OJX$"G$`,
MT`(*-#,;,`$IK`#'44$<4,$&I,:+0`0P),$.U`"?=UZ"#<,DV(`&`(`9O$,9
M3$`S<YP:Q*D$-CFJT\>IKSO'U((ES/\Z1+1S?TR"1(&`;6-`!ER`B"A``]@V
M4T\V#SSL4"@!(^(5%M`IP*-$!?R"F%*VNV],NT?\N>##5B>(+^?*!`QUN(#+
MK(C#Z0J%!PAQ_JD[Q2/SR?<,$!!S0&>\19=\RM,'"8Q2J_RFE<<\Q\`#FF%\
MJUO=J[\\&ID\SOL#86D0(%<Y+@\]N@3"P?,\K]A?6P/]&5T"$"A]3=##6?(F
M9[/$Q%N]?.B#>'%RSS_@STL]$@F`%MC#!^`2V]]2*[4]W*\2+<4]W<>2+'P!
M`)`!9;Y$T1.`$>RWU]?'*[`-&;N\V7N2,!\DR^.F,3_G61;`\GAVX-]'"M`A
M'QO^X9]1XN__Y.(W9^/7#6(N+P!(J,TG_>3;1R'H&U;P5@K4O>N_/NS'ONR[
M_A2XZC"WT>?3#4,:0`+T_M^7?C*?OD[$@L-&<2<+OTY$E^+C_ANA//+[1#44
M9P^/O1`^?TXH/^<S_S#N1-=;?TLXPP_DM?%3OQ;Z@QY@Y#GH00A,1*"1P$A:
MP0"L_T08@/L'0`_40U-.A"RX@/P#A*D#_OP1,N?*D;\!`0+,R^$B@`M_E"CY
MJU4I#R]'#!G6*F=*T3."_D(PE">R!\<0!D)8L>(O10""^!RTRS'R&$=T`<KY
MJZ.*X+EY!%F.O$%"X0""NNC!Y!A@)<<!"QO>''D5:U:M6T<J^/<5_VQ8L6/)
MEC5[]E\!"&C9MG7[U1^"MW/IOA7`E:L!L4KQ]O7[%W!@P8,)%S9\F&`^"G7-
M#B2(=@%!5TB*71ES@@"/*FAN_"-8`$""%00(-`C`@0`?++$(`C!!P`0JT02L
M32#4C,.U(>J2`1!`X(JM`_\&-FA0IP.N(>P($1#PFE*Q*C0F'"$X&\J3N*5(
M8TY08/4`SR(Z%'.B9>2"*J0[;9GFCQ,[?Q\$\"%((,%(`3(!`/#G"($9<@B!
M@"U>PVP!TA+P#3A;$`O,*\8DG$NM"2TT*ZX+-9SKKL'T"HNO!T4<D<0233SQ
MJE!XV!`LQ_R!C"B12`CC'G\6<$`AS_P!+?\!`D8*X*X#%CBFM0+\L6*#'OW)
M`0E8-/F%(!4DZ<^?>`08KK@&M+#$GW*V`<(?`(STQQI`^,FEENM\E"6,N`P8
M";\",L!!O$+F0*J?:JRZ<:0=1+&Q$G_,4,:+*?S!3S_^_#/GB2AZ(`B"!^Z3
MJ37_K$11*PE8W!2L"CF],,-/106KPZM&D&D*.,#$ZD.P0L04UEAEG94P$M01
MU448_1EGI$-@L!%'\4@S(;31"/@B``O<B.(1JP`H0@$?:A#MA7`@(62!7@A:
M8Q`JA2R$.'^,NP,"K,0DB`X%.BC!E^M&V^(,%Q#@SL<X"S`A@7]&$<>?/!2@
M!1Z"U",M!#^@R,7_B13\(2*2(-8X-#^"]@O3/UJ"$`842"4]-$$"5/%V@0]H
MC7#4"STMN:Y04>:TU)'2`<8?9-30JM6O7J45YYQU1A$(,#H8-=>S(O/GG'K\
MJ6<.68#-\;/0?"0H`"%TH8"%D0"XPX%9@$C@A3UTF,0%&L`@B(9AJ-0%$WC^
M"<$?-38!I0%_6$F'E3#'#(4>.U.YKH0#^FFC&03>O.\[`*+!XI]"?*AG@&D$
MX(O/D<ZP1A-_?.'AD"<Z``)1@FPXP9\=XJ!$@"I:6"#@2">UVC]=6DAS5I)7
M9NSDV=U2V78-6R9HF@7T"",/FO?:F?CBC1^,GC(V*#EHLX8VQ092;!A$_^!@
M=>11@/Y6`=*?=J+`ILB1E/2%@WL<\(`)+G2@!P`"`!A"#G^&N&:,*`)X)HI$
M"*`@?'\H0*0+22"2/Q*0/52@@!X($$5_`A`G`.3@"9[10O1TT`:CV0@-#/1'
M'/[QJQU`@R`=,`4!)-"?$`#"&I*8@"!"@0>"],$;_E#=H4`#@!.T[WVHP)GL
M<O>6VO7P++@#HH1VYX\#].$3$Y!(5FKVCYL=#XI1+%X`&+&RYI5E:'HH!`0*
MH0>"'*,;3B&(%090$H8<@P0W(,@\\$&0`;R$("LA2D4(D89*](0J^KB)"Q3Q
MB7X0Q!FRN(<7%0+'<N1A&R$RHRK8EA*&#(`E9/_T1S(H-0\(V&-5_LC)(W=E
M"H+$`QT$V0,_#,"16@#!%5)PAS_<D0^"Z$-;A%BE/TK)$$KDT2JS*L`92--+
M7_X2F,$4YC")20`-=**8R53F,DGC#SLP$YK13*8;+/"/(OHC"!A(Q%::^$0I
M?A.<*'*&'&QW1;(,+9SI5&>L"+E.=[Z3*^,8P">T8H]_Z(*;PX/G/OFI%5/X
M('?F'`LZ^UE0@QX4H0GM2S<5VM`HDF`07NBA0,4RM#VPX1CK4(`&`!`),6PT
M&@H0*21@881K7"(!LEB#2$$1`9&^]*42$*E,85I3F\9TIC=5@`1XBE.9TA2F
M0,VI4&M*5*+B5*=`%>K_48.Z4YOVE*DZO6GP'%K5?C+4JEFE52$6`T2*AF5H
M`4!`#LC9@`<X019;$,3/OA(!*"Q"'5R(``-Z\(\VR`,`8UD"%JKPE2I,0`!E
MJ4`&`'J64ARB+#S``R(R@);`_@,%*S*+$F:@B2O,I0(58$1CQX(!#PS1+.72
MZFC3B572GG9$0%C%\H;X5;"$%0'8T`44S/J/1[""G&%9P2^@H`$5_.,&%N@#
M,?(JEF_8(!\T^(<#?/#8L01!`"U`RRJB4!9/L*$)G4!+<2-[EB#\H`W2,,%;
M@D"`S9)E`U(`;5E$BUKW%L^T[Y5O8#[05="Z]BNP-<`A4L&"!_PC&`<@!F09
M__!9&X@A"Q$@P#_$^@\%%!<L0BB&`!(@CPHXX`T-0$$G1J&"`G"##BLH1`/&
MX`$Z).`7&^#&*0!P@7_(H1"(,$(@QO`$18C@*PGXKR$ZF``C1*(3%B"%)U;Q
M#P!D`0"7>((WHF&*"MR"&?;\2B0:BP(O!.$6T]@`)Z0@`AL8(1<ON`8S9K&`
M943@$1XP0AIB8&(4_R,1?5VO6-H[7SO'*KYWUC-60K&".8?K,4*#FN#^,0Q*
MG+4'!)C&$G#0@%(H=P)FT`(:_A$/$#@8PE_A0AL$$($7!,(!.@``*N:0@4-H
MX!^-N(1O(H"`&/PC#D,0!`#HT(>O```1Y.@@$18!%O\&/(`47U#"#_XQBW^8
M(QA4^,<ML&`/+8]@`9*H@!SZL(-_A`(LQOC*!39`!P!HHP^O0,8[2I$&6VS!
M#1+X`6A*TP9:7$`#KH;U/VS`AC^'I<Y[UC=@"I",?(8%%TIUJE)YNM2G.C6G
M4A4I'4(A<(5'%:D##RK!D;H'8?2TJ!F?N$CW5KQ\*$`)]\;O/_3[CRC(8@3,
M:`*`O0$64(SA"Q08@C>HT&M,BV73G?X'&/(A:CG,80,T0+4U@N$;,R"@`4;N
M0R0(((PJ&CG7_U`$$2`L@Q7M(0EYA<%RD_T/;V"!$S%H`[3S6H!2D$,)IP!+
M)(KP#PFH(Q44(`8CN``-9A3_01/((`,+;!$#=C?`W4J8!-*-3&][W_LK^=[W
MXKGBQ'\C/BPZAKQ8`L``#?EG9RY@+N1''M:W(*`"7ZD`XLS"B$0(80S_L(`T
M:+OA3!!A!*G(PPK&8`LJ>.`1_VC`!1P0"$E44_<6F`:-GY#TK\@A$PE@@N[_
M$8CF8\$88"AR`U;`C&`4_Q\X$$($,N$.L)QA%*MP0`5BD`886(`38#`&`P2A
M\DU$XQ7$H,4BTKSF-N=^$'"&PN05SWC_7\7QA&?RP$+R!O`K*N_R=H85"F``
M.P]J2N84=L$`T8(#XL,35D;%!K#__N__`I"))O`?"M``$?!",`]GVF$)#-`!
M_2$`_TIF"3X+!,W"!C2ANE#&LS20`W,0`+V)ED!0!`>0!"W$!&7%$>0@Y%1P
M)'2E!6.0"9MP0C90!_=-``Q%``WP!R<O""=D"&$E`-H@!E=P"9U0#,<0+30@
M"G5P`);H`R?P"B$O"R5D"T\$"%J-"<&0#.\0#\,""P+F#.=K'&J`,)H(\MH0
M\=Z0,>*P1`8`%YS0#O/0$<<0`0R!")"A/RK1$B\1$S-1$S>1$V&@$#@1%$-1
M%#'1'SAJ%$\1%44Q"%Y``J]IH7SPOR;0$.L"$4<D$"2*$9-0T%CP$7NQ"1'`
MN6+PAR!/B,;0%?%"$!&/$.]M%NFB%A&#%?"`#!O1%ZMQ`/\1@`NH(!6WD1L!
MP!.[$1Q!L13#D1Q/$13X0``8("M.HY?8AE5@$02;<2Z>L3!<``+&:QIUT7D>
MT!K[$?&&((SZ\+VZ80"^8!V/L0?9,!9'T/)*L$1"8/?PD!K]D2*'"`H%4K["
M4!W7T`H7$@@;4@A))!\<P!'!T`*T8'E>8`%PP`9(#@?`8@*``0[^00D(@`PD
MB@^TP-8JDB?9XB(QTKVX)R_@419!4@M%!`C*@`)(,@_!$`&<P1)T[P&08!8(
MP`'P\1]T4@;.(!B&00=<H0.,808"00C$HA&6(`Q``0!FP`(6C"QFX`6^0@`2
MY"R4@`7BDBP*H)IF0`#0`/B^PBW_O\($6```=F`)%F`!SF(&\#&#J&`F+P03
MY`R(?A(H3RL`5J`2W?$JDO'>EO'/Y/$MZ-$O>&$4>,PJ2U(?L6C0\$$6#J&V
M"B`?:"$L/$`(OF`&F.`/@`L!D.`"2*$LP0+>EN`;-*$$P*$(\@H+;$`),``)
M#J$"BN`)+@`*:*``=&`#.F`&G.`?O.`).*L%I$`($``*E"`#HJ#M&$PN%(``
M[J`"5L`0QJL&?&`"\BL5"(`8QJ``"N`"9D`N,N`))*H"#.$2$O,?5F$]5:$(
MEF`&Z.VR3&T^PP&@$"`#*F`".B`,$,`#JF`#$,`60(LR*W.T!L`2-7,D.///
M/'/.0-,M_T03+^H`%/SL'TZS*5/SG`;-`$J!&Y#AOYK@&>SM='YF`58!%Q0,
M/97@$9PO+&P`!Q#!YOX!`0!@#DR!&T1!`53A%[I``1I@#0)A&4`#`?0A$CZ!
M`:IA%5C`Q<9`%O[``3Q!$A@`%HPO`%IAHZS2$-(`#$C@'\Z!$XR-Y.J3&!X@
M/P?A%F2A!60`#-IA!30@`;*!0$,!`9:@&@A@&2:A`6[A%4H@!KYA%E1`$(R@
M#WQC`48@`;CA$:KA%,3@'P:!K7KH0T%4STQTSE!TO52T+5AT*\ZAL`"3*262
M1@?*1O]A$>CA`3B`$OB@$BR`!D;@#69R%\!`"X*ATBZ@!G!,+/^*@0^RH`:^
MP@*>%!@N2P84@)P2($OSX!^:P$O3P,B"0!8"`!;"P$D;`!@NX1],@0'(`"P"
MX`P68!"L$AC(21[^X=7,@#X)(!$6(3_IX!^@8!)DP*Z:`,?6@4"9`0+`8`@$
MX-46XA@F@1SD00*L`1N,80)`550QH0RR(0"2P0NXH!4LTE7/$%;72U9!BU;9
MPE:QP@6ZP,7"0D9Y-=#VD04);05,H0`$8<&R8!1<3@J:H11F0!"D``!>@!]@
MP`$D\Q_^P!J<(`$N+0^L`0"*P0TRP!@4@`&E($O!X0+(P$O70@2`01.JMIJ0
MKA@:8`/B@0&,#ST=C`!@8!T`8`/\H/#_(B"_`+<"3B`_*V$#BF$-).$?A$$9
M%J$"UH!``?<K&`#'[*$"G@`.1,$$TF`'$*$16$`#G@`71)4!BF'`WHT8E&LR
M6S8*7Q:TOB,>C1(.!^,>W(`LEA(U>U8U67`#:M`)O*`A+\"Y-L`&4.`KEN`)
ME&`"&(!Y.2`LG*`,_F$(AD$#W@$#)&`"-&`8AF`(2N#%AH`(^$`#=N`,)``#
M4,'!A$`&8F#E_@$#B&`"!B$.X*`#B``L6``#I'<+UB`,UD`$K,#M_F'`_B$,
M)D$$:D`<SN`,2H&C)H`(ND`,,D`3(-A=_P$0P*(#O*(-NH`*YH``XD`,?$`,
M8F`+**`+J.$,_^2@`R:`"F2@;7<@]%:7=7/0=8<H9H=H9K<K,("`"9"@+'!W
M1G6W1GEQ5&(@!2$/"K[`$L"@"0T!?5EVACFPAH'HAH$HA\^B9@?@$G+V=G?U
M#B>R)\7"`HPWC"^D5:,XH9C"'[*!2'Q!&C:3*!DR`?N"%\SA+W_8B_-1B'V5
MB,O8CS_EC-'XH"Q!&'(``S(@%BPA?DHTCC]RCKF"%=H7+8"89U]D%\/PCS-9
M0\Y`D*U*'K(B%=Q@#VA3%?[`".!8(6/WD;4"!E9UDO-X#,%8DV>Y+A``$E*!
M#IY"EW>9EWO9EW]9EZV`$("9F(O9F!G"'QSIF)>9F7TY#Z)!&'#`$/^R0A\,
M(1!40`+4P!`2@I%3N2A7^2JF@!98JRTH^8M[M:+XD9;7F2X00'8G<!@1KQC%
M<".OP@54H`IN00-0H`W>T9OEV"&SX@0:@2[,68\MV6<QF9T7&BW<V0GC^=[F
MV0GK^2ITS1?XX0)HP9\[4I4#>B2`0`3(^2T,.I;1&:S4F:%3NBP00`6FH9E?
MNIF%&:9G&IB3F:9O^IBCH12$@*)'@A"`PA]@P0\V>@"KN(>NV"R&\`/>V2U(
M6@QE6:6C^A_@@!<ZV:'4R$,:&0N9VAD)P@4T((89PZES<8_3N8^E&JT#V:JS
M:HI[R*AS!ZG+PC]D01V.4$+&N@G!$`,\83[_B:`$LF`Q-($+P`(*XL`2*@`#
MTJ$&AN`?$"$.A`&MJU&MU[JJVCIWWMIVXIHLQ``,+NM"\+H.3?JU!BT%<,RL
M*F`/[J`3..L?1&`"U``1"@`9)B`>_D$#(HWTP,(-+B`,A`$:?)@L2B"LP4([
MR:("[F`LPD&%R6(""/0==)LN;/<MDD!9BILN6G)V)INR&\JR;0>S9T>SQT(N
M-@2TOU"T\\M&>T`=:@L.CH"'PJ`3HN`'9K('YG,(P.'2,+@5WN`5BF`.VL&S
MZ:P#G#<L,NTK>``$-@!Q+B`)LHT"0(`#\IO`&:"X].(".`"X,2"_5X"U)"LL
M)-<+0DX)<-$"8IC!_]."`9`@]##`Q2X`%]T7+/+W'RI``G4@_U9&N[<[H;I[
M=KY[9<*[9,H;!)W2`!@!'&+@OQH`'3I4!1X@@DQ@!!*!2!ML#@"`H,%B$3I`
M!)X[+=3`&(0@`-"@&#!!8L$`#``!<"E@$&"@`)JA`L2`"_IA!Q(@#!P``D+A
M$XKA*VZ`!;R\$VP@%+ZAKRC\*_2"#M3@Z`Q@#!*@`BJ!#+8A#`:`##KAS8$[
M`A9`%ZA!$9S@%UA@&X#A%-*@#2#`#+BA&&```"+@`>1A$Q0A'`)A$U*!`>1A
M#')A`V"`"8;A#T@A$NS@']8"QW7\5;7:#;EZSH1\`HG\'S;!%QZ``?)@"_^T
MP0=*0`$,(1'^80F,81"@`00*X0(2X0+P`!+"H@5]ZRLD0!1LP!>JX`(`0!1*
M``*B(`IJ(,U!XQ]4``_B(!SV`6!UP,ZQX`Z*Z]*S-0K4@`FPF]#_02^6K]6B
M,@8R0!20X01T(!?^@0RN@8/::@'4SA1H@`6L*1?\,Q`@`.#%A`%4??E,`0UN
M[`1>`!3^(0UFX(*O8!M$0`12+UN#7=CMC,=7QL=1!LA'!=F1L*Q/F@4]0!#^
M807VX1)N(2XIX`*_`A6Z(!)TP`9681'R;PRH/K?_H1DVH`E(84)?00>R``8N
M6`N8X=?%@0]B(`(J0!A`XP(L(!)``0'4UM\A``'_W$?C;YL='D`$&M("/&%;
MLZ'PCB[I1"`,M$$%P,'?G;037E[C`3<`U"$&-B`(1N$**.`']-Y]"F`.5#VO
M`J`)S*!N9R#II*`(J($#@B$2AN`-E&L8LGOG>9[8"]'8UVOH&_"\20ZE-P45
M(B@8.J$:X&`"J.$?/($#+N$7_H$%$B`3W@`/.J$+5``'2$'JW&`"/GX$I(4%
MFIL!_Z$,6J`$3@`&)F`$R%C\<Z$2^HH!RV`"7G($,"`7'.`;Q"'G/T&ZQ;\%
M`*+,OP@76.1Z]"*7M@DL)BPH8"U-&14%!E80(:@&"AS_M/R3).B!C6J"^%1(
M\R^ERI4L6[IT"<&?S)DT_VO:O(DSI\Z=/'OZ_`DTJ-"A-0V\/(HTJ=*4"1XL
M?0H5:0`&4:M:I>#`JM:M+0_,3+I`9@"N2#-0.XKB$Z*D*D8I(;M5!:D+<+<V
M85<W:4RB?/OZ_0LXL&";1O,:;FK8\-3$=;$R?MSU*]*P_L9"_K>$KLL,0I2&
MFW!9:1'0H9.2+OUO[^#5K%N[?JVS,.JHB&='76S[J>/<>;W*!"N6M_#AQ`U3
M@XT\N7+8=83*+NZR-G27N*>SW&T]JF]_P"MG_PX>^A)SY9:;/X^^9[)*G]@X
M#Z]2>OCJX+'#1[J]N^7[_/L;1D"5?_\4``%__B`@X$L,O'>??.#1]YU]":J4
MW_]DP4V(889'`9@@@08BJ&%*"P;U''@.?@=A=A)B6.%1E.T78HP8<BB@A_<=
M*..(0)7XW8G9I6C=BA.V^-*+,AXY(0+(*!)`DTX^"6644DY)9956$%)EEEIN
M&:4_/7`)9IA@:@,,,6\P")^/U@$YG9`)$NF2D4C.R1\<O*2'9YYZ^G,#*Q'\
M"6B@@D9@!(_9J3D=F]"Y*2"<+<E)9Z3?J;9GI9:^]D%4!!AJ':+0*5H<H_XY
MRM*+'NBSPC^/X``,&O^DP\)*&X#S#P]?]$!`2G\T(&FO6E%Z:;#"^I4I5)OR
MYVEQH!(G:G^DKO0B`JQ(\4\##X`@"R2C;+`2,K'\HT;_&144\L\FJ@#0TA9A
M_&.'!_]L\0(-53%RQSH9_,/'/U<PXFMVP`X+<,`]%?O4L0TZ==^RPS7+W[,J
M16O`*]=8^X\U)&2QD@*A&/4#'/_T,($)7*"[DA(:[++$,LC\HT`#$?PSP0P6
M9.!$"[O8@(`%5\!LP3](J$%%-A@`,M8&7=S;+W3_"LQTTS,1O)3!:2(,G\+"
M,7R?PRE!S(@#I#A%3B&QXM!`,,O80<D,DN#QCRI>L$RR2@RP\0\@[^210<L1
M6/!##9L(\0HPZ2PBQ0N<<``)$O_00$<:TLQ`P20I=;%`TDH[C7GF4"LE=7C)
M$F<U;UC#I_4_$/\#R3,/,`!+_P=&^(`"`R7\V0TQ:\@!0F$*Q)T2&Z6`D$`#
MYI30LADO>`-`-0S\\(\,__Q!0!!$,)%2%&"(,HR[)--0C.7%+9UY^)=NGE3G
M)E(]7X#AC1Y>Z:8*\@\(IUPR2PO_5*$(2_`C\<D-FJ2$"UZMY!TO(,`D$-"!
M:!2/#W2K`@-$\`\-<*`8!+``'3SR#S>,XA:;*,(_2":!=7B/..`3GPGS1#ZD
MF*]'Z'N0^NJ3E1BY[T*/00`M1-&(E/R`"ZRZ`!-@D`X4C.`?)5@%)W*UC1>D
MQ`*)N%9*AOB/:'APA,(IX0FO:)X4'F6%AVHABEX8H1B&:(;>N4P,EO"4(&B!
M$QU0@/\,0("4"=B"BL.Q(A;O"!LMOH2+G?+BC\"H(C%JB(PP8LP2W+44+&0!
M"O_H0Q22@H&WT9$W=L2C)5>C1Y?P<3J?&T[H<L,^\!!RDJ3,"R<NB<KD9+(E
MFX1.)X7S2=N$\CNC+*4MM^*#.Z5REZNIQBI9TLKBO)(WL9S-++-3RULJ$RH(
M(((HJ`"`:$ISFM2LIC6OB4ULPJ`0V>RF-[]937]H`)SD+"<XQ="*-BR!`;]<
M23"),\S<%!,UQ[1.,I>)3Z30R#\V@@^.8L1.37&*DWY<$R"#),@,W3.?#&7)
M/OO3S_#\,T0!-=9`75G01!VT30EED61<1,.&BC0E#^5/1,'_,U$-5;1@%Q5F
M1C^UT45U=$@?+5)(1]K0DM[GI-]):896&K66PO.ERHIIJ&;ZIIK&Z:8XS:=.
MX</3[/@40T#EG%"'$T_;S+,T]9S.0IN*SZ>&)ZK6F>J$JEJ^JPHGJ[/9:FBZ
M"IVO@E698@4/6:=CU@2A585JY0U;4>/6R\"U.'*=JRWK^IV[0B>O`MKK%ON:
MF[^6)K"0&2QQ"FM84B(V.XHM#F/]X]@]0M8VD@T-91]CV>%@-K-TW*QU.DN<
MS_8GM)H<[6Q*>YG3,B:UPEDM:T?HVNG`=CBRY0]M66E;U.`6,KI-#&]YX]O?
M6BZXT!FN<(I[G^,",[FE6>YCFFN8_^?F)KK2[1=UBV-=WF`7/MIU)W=#XUW&
M@#<OXK4-&5UP@/SJ=[_\[:]__PO@``MXP`0NL($/C.`$$Y@$K%"P@Q$<"V<\
M>,(`]@<)*(SA`[,B!P<^`B\R#.(#.*,6(<ZP"QI<X@D?`0@I;O%^]:#41_%R
MQC2NL8UOC&-44H):%LJQCW\,Y"`+><A\28!2*$/D)"MYR4QN\A6-G!1#&&#*
M5*ZRE:^,Y2QK><M<[K*7OPSF,(MYS&0NLYG/C.8TJWG-;&ZSF]\,YSC+><Y@
MCD%Y[XSG/.MYSWSNLY__#.A`"WK0A"ZTH0^-Z$0K>M&,;K2C'PWI2$MZTI2N
,M*4OC>E,\P(Y(``[
`
end
</TEXT>
</DOCUMENT>
</SUBMISSION>
