Exhibit 10.3

 

NONQUALIFIED STOCK OPTION AGREEMENT

PURSUANT TO THE

ALTIMMUNE, INC. 2017 OMNIBUS INCENTIVE PLAN

 

* * * * *

 

Participant:                                         

 

Grant Date:                                         

 

Per Share Exercise Price: $            

 

Number of Shares of Common Stock subject to this
Option:                                         

 

Vesting schedule: This Option may be exercised with respect to the first 25% of
the shares subject to this Option on the first anniversary date of the Grant
Date and an additional 25% of the shares subject to this Option upon each
subsequent anniversary date thereafter

 

* * * * *

 

THIS NON-QUALIFIED STOCK OPTION AWARD AGREEMENT (this “Agreement”), dated as of
the Grant Date specified above, is entered into by and between Altimmune, Inc.,
a Delaware corporation (the “Company”), and the Participant specified above,
pursuant to the Altimmune, Inc. 2017 Omnibus Incentive Plan, as in effect and as
amended from time to time (the “Plan”), which is administered by the Committee;
and

 

WHEREAS, it has been determined under the Plan that it would be in the best
interests of the Company to grant the non-qualified stock option provided for
herein to the Participant.

 

NOW, THEREFORE, in consideration of the mutual covenants and promises
hereinafter set forth and for other good and valuable consideration, the parties
hereto hereby mutually covenant and agree as follows:

 

1.             Incorporation By Reference; Plan Document Receipt. This Agreement
is subject in all respects to the terms and provisions of the Plan (including,
without limitation, any amendments thereto adopted at any time and from time to
time unless such amendments are expressly intended not to apply to the award
provided hereunder), all of which terms and provisions are made a part of and
incorporated in this Agreement as if they were each expressly set forth herein.
Any capitalized term not defined in this Agreement shall have the same meaning
as is ascribed thereto in the Plan. The Participant hereby acknowledges receipt
of a true copy of the Plan and that the Participant has read the Plan carefully
and fully understands its content. In the event of any conflict between the
terms of this Agreement and the terms of the Plan, the terms of the Plan shall
control. No part of the Option granted hereby is intended to qualify as an
“incentive stock option” under Section 422 of the Code.

 

2.             Grant of Option. The Company hereby grants to the Participant, as
of the Grant Date specified above, a non-qualified stock option (this “Option”)
to acquire from the Company at the Per Share Exercise Price specified above, the
aggregate number of shares of Common Stock specified above (the “Option
Shares”). Except as otherwise provided by the Plan, the Participant agrees and
understands that nothing contained in this Agreement provides, or is intended to
provide, the Participant with any protection against potential future dilution
of the Participant’s interest in the Company for any reason. The Participant
shall have no rights as a stockholder with respect to any shares of Common Stock
covered by this Option unless and until the Participant has become the holder of
record of the shares of Common Stock, and no adjustments shall be made for
dividends in cash or other property, distributions or other rights in respect of
any such shares, except as otherwise specifically provided for in the Plan or
this Agreement.

 

 

 

 

3.             Vesting; Detrimental Activity; Expiration.

 

(a)   Vesting. The Option subject to this grant shall become vested in
accordance with the vesting schedule specified above. All vesting of the Option
granted hereunder shall occur only on the appropriate vesting date specified
above, subject to the Participant’s continued service with the Company or any of
its Subsidiaries through each applicable vesting date. There shall be no
proportionate or partial vesting in the periods prior to each vesting date.

 

(b)        Effect of Detrimental Activity. The provisions of Section 6.3(c)(ii)
of the Plan regarding Detrimental Activity shall apply to the Option. The
Participant acknowledges and agrees that the restrictions herein and in the Plan
regarding Detrimental Activity are necessary for the protection of the business
and goodwill of the Company and its Affiliates, and are considered by the
Participant to be reasonable for such purposes. Without intending to limit the
legal or equitable remedies available in the Plan and in this Agreement, the
Participant acknowledges that engaging in Detrimental Activity will cause the
Company and its Affiliates material irreparable injury for which there is no
adequate remedy at law, that it will not be possible to measure damages for such
injuries precisely and that, in the event of such activity or threat thereof,
the Company shall be entitled, in addition to the remedies provided under the
Plan, to obtain from any court of competent jurisdiction a temporary restraining
order or a preliminary or permanent injunction restraining the Participant from
engaging in Detrimental Activity or such other relief as may be required to
specifically enforce any of the covenants in the Plan and this Agreement without
the necessity of posting a bond, and in the case of a temporary restraining
order or a preliminary injunction, without having to prove special damages.

 

(c)   Expiration. The term of the Option shall be until the tenth anniversary of
the Grant Date, after which time it shall expire (such tenth anniversary date,
the “Expiration Date”), subject to earlier termination in the event of the
Participant’s Termination as specified in the Plan and this Agreement. Upon the
Expiration Date, the Option (whether vested or not) shall automatically be
cancelled for no consideration, shall no longer be exercisable, and shall cease
to be outstanding.

 

4.             Termination. Subject to the terms of the Plan and this Agreement,
the Option, to the extent vested at the time of the Participant’s Termination,
shall remain exercisable as follows:

 

(a)   Termination due to Death or Disability. In the event of the Participant’s
Termination by reason of death or Disability, the vested portion of this Option
shall remain exercisable until the earlier of (i) one year from the date of such
Termination, and (ii) the Expiration Date.

 

(b)   Termination Without Cause. In the event of the Participant’s involuntary
Termination by the Company without Cause, the vested portion of this Option
shall remain exercisable until the earlier of (i) ninety (90) days from the date
of such Termination, and (ii) the Expiration Date.

 

(c)   Voluntary Termination. In the event of the Participant’s voluntary
Termination, the vested portion of this Option shall remain exercisable until
the earlier of (i) thirty (30) days from the date of such Termination, and
(ii) the Expiration Date.

 

(d)   Termination for Cause. In the event of the Participant’s Termination by
the Company for Cause (or in the event of a voluntary Termination by the
Participant after the occurrence of an event that would be grounds for a
Termination for Cause), the Option granted hereunder (whether or not vested)
shall terminate and expire upon such Termination.

 

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(e)   Treatment of Unvested Option upon Termination. Any portion of this Option
that is not vested as of the date of the Participant’s Termination for any
reason shall terminate and expire as of the date of such Termination.

 

5.             Method of Exercise and Payment. Subject to Section 8 hereof, to
the extent that the Option has become vested and exercisable with respect to a
number of shares of Common Stock as provided herein, the Option may thereafter
be exercised by the Participant, in whole or in part, at any time or from time
to time prior to the expiration of the Option as provided herein and in
accordance with Section 6.3 of the Plan, including, without limitation, by the
delivery of any form of exercise notice as may be required by the Committee and
payment in full of the Per Share Exercise Price multiplied by the number of
shares of Common Stock underlying the portion of the Option exercised.

 

6.             Non-transferability. The Option, and any rights and interests
with respect thereto, issued under this Agreement and the Plan shall not, prior
to vesting, be sold, exchanged, Transferred, assigned or otherwise disposed of
in any way by the Participant (or any beneficiary(ies) of the Participant),
other than by testamentary disposition by the Participant or the laws of descent
and distribution. Notwithstanding the foregoing, the Committee may, in its sole
discretion, permit the Option to be Transferred to a Family Member for no value,
provided that such Transfer shall only be valid upon execution of a written
instrument in form and substance acceptable to the Committee in its sole
discretion evidencing such Transfer and the transferee’s acceptance thereof
signed by the Participant and the transferee, and provided, further, that the
Option may not be subsequently Transferred otherwise than by will or by the laws
of descent and distribution or to another Family Member (as permitted by the
Committee in its sole discretion) in accordance with the terms of the Plan and
this Agreement, and shall remain subject to the terms of the Plan and this
Agreement. Any attempt to sell, exchange, Transfer, assign, pledge, encumber or
otherwise dispose of or hypothecate in any way the Option, or the levy of any
execution, attachment or similar legal process upon the Option, contrary to the
terms and provisions of this Agreement and/or the Plan shall be null and void
and without legal force or effect.

 

7.             Governing Law. All questions concerning the construction,
validity and interpretation of this Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware, without regard
to choice of law principles (whether of the State of Delaware or otherwise) that
would result in the application of the law of any other jurisdiction.

 

8.             Withholding of Tax. The Company or any Affiliate shall have the
power and the right to deduct or withhold, require the Participant to remit to
the Company or such Affiliate, or make any other arrangements as it considers
appropriate to ensure that it has received, an amount sufficient to satisfy any
federal, state, local and foreign taxes of any kind (including, but not limited
to, the Participant’s FICA and SDI obligations) which the Company, in its sole
discretion, deems necessary to be withheld or remitted to comply with the Code
and/or any other applicable law, rule or regulation with respect to the Option
and, if the Participant fails to do so, the Company may otherwise refuse to
issue or Transfer any shares of Common Stock otherwise required to be issued
pursuant to this Agreement.

 

9.             Recoupment Policy. The Participant acknowledges and agrees that
this Option (including any shares of Common Stock issued upon exercise thereof)
shall be subject to the terms and provisions of any “clawback” or recoupment
policy that may be adopted by the Company or its Affiliates from time to time or
as may be required by any applicable law (including, without limitation, the
Dodd-Frank Wall Street Reform and Consumer Protection Act and implementing rules
and regulations thereunder).

 

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10.          Notices. Any notice or communication given hereunder shall be in
writing and shall be deemed to have been duly given: (i) when delivered in
person; (ii) two (2) days after being sent by United States mail; or (iii) on
the first business day following the date of deposit if delivered by a
nationally recognized overnight delivery service, in each case, to the
appropriate party at the address set forth below (or such other address as the
party may from time to time specify):

 

If to the Company, to:

 

Altimmune, Inc.
19 Firstfield Road, Suite 200

Gaithersburg, MD 20878
Attention: Chief Executive Officer

 

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

 

Proskauer Rose LLP
One International Place
Boston, MA 02110
Attention: Ori Solomon, Esq.

 

If to the Participant, to the address on file with the Company.

 

11.          No Right to Employment. Nothing contained in this Agreement shall
affect the right of the Company or any of its Affiliates to terminate the
Participant’s employment at any time, with or without Cause, or shall be deemed
to create any rights to employment or continued employment. The rights and
obligations arising under this Agreement are not intended to and do not affect
the Participant’s employment relationship that otherwise exists between the
Participant and the Company or any of its Affiliates, whether such employment
relationship is at will or defined by an employment contract. Moreover, this
Agreement is not intended to and does not amend any existing employment contract
between the Participant and the Company or any of its Affiliates; to the extent
there is a conflict between this Agreement and such an employment contract, the
employment contract shall govern and take priority.

 

12.          Data Protection. By executing this Agreement, the Participant
hereby consents to the holding and processing of personal information provided
by the Participant to the Company, any Affiliate thereof, trustee or third party
service provider, for all purposes relating to the operation of the Plan. These
include, but are not limited to: (i) administering and maintaining Participant
records; (ii) providing information to the Company, its Affiliates, trustees of
any employee benefit trust, registrars, brokers or third party administrators of
the Plan; (iii) providing information to future purchasers or merger partners of
the Company or any Affiliate thereof, or the business in which the Participant
works; and (iv) transferring information about the Participant to any country or
territory that may not provide the same protection for the information as the
Participant’s home country.

 

13.        Market Stand-Off. If requested by the Company, any Affiliate or the
lead underwriter of any public offering of the shares of Common Stock (the “Lead
Underwriter”), the Participant shall irrevocably agree not to sell, contract to
sell, grant any option to purchase, transfer the economic risk of ownership in,
make any short sale of, pledge or otherwise Transfer or dispose of, any interest
in any shares of Common Stock or any securities convertible into, derivative of,
or exchangeable or exercisable for shares of Common Stock, or any other rights
to purchase or acquire shares of Common Stock (except shares of Common Stock
included in such public offering or acquired on the public market after such
offering) during such period of time following the effective date of a
registration statement of the Company filed under the Securities Act that the
Lead Underwriter shall specify (the “Lock-up Period”). The Participant shall
further agree to sign such documents as may be requested by the Lead
Underwriter, the Company or any Affiliate to effect the foregoing and agree that
the Company or an Affiliate may impose stop transfer instructions with respect
to shares of Common Stock acquired pursuant to an Award until the end of such
Lock-up Period.

 

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14.           Compliance with Laws. The issuance of this Option (and the shares
of Common Stock upon exercise of this Option) pursuant to this Agreement shall
be subject to, and shall comply with, any applicable requirements of any foreign
and U.S. federal and state securities laws, rules and regulations (including,
without limitation, the provisions of the Securities Act, the Exchange Act and
in each case any respective rules and regulations promulgated thereunder) and
any other law or regulation applicable thereto. The Company shall not be
obligated to issue this Option or any of the shares of Common Stock pursuant to
this Agreement if any such issuance would violate any such requirements.

 

15.           Section 409A. Notwithstanding anything herein or in the Plan to
the contrary, the Option is intended to be exempt from the applicable
requirements of Section 409A of the Code and shall be limited, construed and
interpreted in accordance with such intent.

 

16.           Binding Agreement; Assignment. This Agreement shall inure to the
benefit of, be binding upon, and be enforceable by the Company and its
successors and assigns. The Participant shall not assign any part of this
Agreement without the prior express written consent of the Company.

 

17.           Headings. The titles and headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be a part of this Agreement.

 

18.           Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
shall constitute one and the same instrument.

 

19.           Severability. The invalidity or unenforceability of any provisions
of this Agreement in any jurisdiction shall not affect the validity, legality or
enforceability of the remainder of this Agreement in such jurisdiction or the
validity, legality or enforceability of any provision of this Agreement in any
other jurisdiction, it being intended that all rights and obligations of the
parties hereunder shall be enforceable to the fullest extent permitted by law.

 

20.           Entire Agreement; Amendment. This Agreement, together with the
Plan, contains the entire agreement between the parties hereto with respect to
the subject matter contained herein, and supersedes all prior agreements or
prior understandings, whether written or oral, between the parties relating to
such subject matter. The Committee shall have the right, in its sole discretion,
to modify or amend this Agreement from time to time in accordance with and as
provided in the Plan. This Agreement may also be modified or amended by a
writing signed by both the Company and the Participant. The Company shall give
written notice to the Participant of any such modification or amendment of this
Agreement as soon as practicable after the adoption thereof.

 

21.           Mode of Communications. The Participant agrees, to the fullest
extent permitted by applicable law, in lieu of receiving documents in paper
format, to accept electronic delivery of any documents that the Company or any
of its Affiliates may deliver in connection with this Option grant and any other
grants offered by the Company or its Affiliates, including, without limitation,
prospectuses, grant notifications, account statements, annual or quarterly
reports, and other communications. Electronic delivery of a document may be made
via the Company’s email system or by reference to a location on the Company’s
intranet or website or the online brokerage account system.

 

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22.           Acquired Rights. The Participant acknowledges and agrees that:
(a) the Company may terminate or amend the Plan at any time; (b) the award of
the Option made under this Agreement is completely independent of any other
award or grant and is made at the sole discretion of the Company; (c) no past
grants or awards (including, without limitation, the Option awarded hereunder)
give the Participant any right to any grants or awards in the future whatsoever;
and (d) any benefits granted under this Agreement are not part of the
Participant’s ordinary salary, and shall not be considered as part of such
salary in the event of severance, redundancy or resignation.

 

 

 

[Remainder of Page Intentionally Left Blank]

 

 

 

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

 

  ALTIMMUNE, INC.               By:     Name:     Title:             PARTICIPANT
          Name:         Social Security Number:  

 

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