exv10w3



 





Exhibit 10.3




AMENDED AND RESTATED

EMPLOYMENT AGREEMENT




     This Amended and Restated Employment Agreement (this “Agreement”) is dated as of August 2,
2007, originally effective July 2, 2007, between Novavax, Inc., a Delaware corporation (the
“Company”) having its principal office at 9920 Belward Campus Drive, Rockville, MD 20850 and Len
Stigliano, an individual with a mailing address of 685 Wyndrise Drive, Blue Bell, PA 19422
(“Executive”). The Agreement is being amended and restated to provide for certain required
changes.



     The Company and Executive hereby agree as follows:




	1.	 	Employment. The Company hereby employs Executive and Executive hereby accepts employment as
Vice President and Chief Financial Officer and Treasurer upon the terms and conditions
hereinafter set forth. As used throughout this Agreement, “Company” shall mean and include any
and all of its present and future subsidiaries and any and all subsidiaries of a subsidiary.
Executive warrants and represents that he is free to enter into and perform this Agreement and
is not subject to any employment, confidentiality, non-competition or other agreement which
prohibits, restricts, or would be breached by either his acceptance or his performance of this
Agreement.
	 
	2.	 	Duties. During the Term (as hereinafter defined), Executive shall devote his full business
time, attention and energies to the performance of services as Vice President, Chief Financial
Officer and Treasurer of Novavax, Inc., performing such services, assuming such
responsibilities and exercising such authority as are set forth in the Bylaws of the Company
for such offices and assuming such other duties and responsibilities as prescribed by the
President and Chief Executive Officer (the “CEO”) and Board of Directors. Executive agrees to
perform his services faithfully and to the best of his ability and to carry out the policies
and directives of the Company. Notwithstanding the foregoing, it shall not be a violation of
this Agreement for the Executive to serve as a director, trustee, officer, or consultant to a
charitable or non-profit entity; provided that such service does not adversely affect
Executive’s ability to perform his obligations hereunder. Executive agrees to take no action
which is in bad faith and prejudicial to the interests of the Company during his employment
hereunder. Notwithstanding the location where Executive shall be based, as set forth in this
Agreement, he also may be required from time to time to perform duties hereunder for
reasonably short periods of time outside of said area.
	 
	3.	 	Term. The term of this Agreement shall be for the period beginning on July 2, 2007 and
continuing until July 1, 2008, unless earlier terminated pursuant to Section 7 hereof (the
“Term”) and shall be renewable annually on the terms set forth herein upon agreement of the
Company and Executive of the term of such renewal and the initial base compensation applicable
to the renewal term. The parties acknowledge that the employment hereunder is employment at
will.




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	4.	 	Compensation






	 	(a)	 	Base Compensation. For all Executive’s services and covenants under this
Agreement, the Company shall pay Executive at an annual rate of $250,000, subject to
review by the CEO of the Company and the Board of Directors (or any committee of the
Board of Directors authorized to review and evaluate executive compensation) when
compensation is reviewed after the completion of the audit with respect to the 2007
fiscal year (in accordance with the management processes), and each fiscal year
thereafter and payable in accordance with the Company’s payroll policy as constituted
from time to time. The Company may withhold from any amounts payable under this
Agreement all required federal, state, city or other taxes and all other deductions as
may be required pursuant to any law or government regulation or ruling.
	 
	 	(b)	 	Bonus Program. Executive shall be eligible to participate in the Company’s
performance and incentive bonus program applicable to senior executives. Eligibility
for bonuses and amounts to be paid each year are determined by the President and CEO
and the Board of Directors (or any committee of the Board of Directors authorized to
make that determination) based on the Company’s and Executive’s performance. Under the
existing bonus program, Executive would be eligible for a maximum bonus of 40%, or any
other percentage determined by the Board of Directors, of Executive’s base salary
during the year to which the bonus relates. The bonus may be paid out partly in cash
and partly in shares of restricted stock at the discretion of the Board of Directors.
Any bonus paid in 2007 will be prorated. The time spent as Interim CFO will be
included in calculation of the prorated bonus for 2007. Such bonus shall be paid no
later than two and one-half months following the year for which the bonus applies.
	 
	 	(c)	 	Stock Awards. Subject to approval by the Board of Directors (or any committee
of the Board of Directors authorized to make that determination), the Company will
grant Executive (a) stock options to purchase 225,000 shares of the Company’s Common
Stock ($.01 par value) at an exercise price equal to the closing price of the Company’s
Common Stock on the later of Executive’s date of hire or the date of such Board of
Directors’ approval. This stock award will vest as to one-third of the options on each
of the first three (3) anniversaries of Executive’s date of employment.
	 
	 	 	 	Executive will be eligible for additional stock awards based upon performance
subject to the approval of the President and CEO and the Board of Directors.






	5.	 	Reimbursable Expenses. Executive shall be entitled to reimbursement for reasonable expenses
incurred by him in connection with the performance of his duties hereunder in accordance with
such procedures and policies as the Company has heretofore or may hereafter establish. In
addition, the Company will reimburse Executive for transportation and lodging expenses
incurred in his commute from Blue Bell, PA to Rockville, MD. The Company agrees to reimburse
up to $25,000 per year during the initial Term and, if the Agreement is so renewed, during
each year of the first two renewal periods. In addition to the reimbursable expenses, the
Company shall reimburse Executive for an
additional amount (the “Gross-Up Payment”) equal to the state and federal income taxes
imposed on the reimbursable expenses (exclusive of any income taxes which may be imposed on
the Gross-Up Payment).





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	6.	 	Benefits.






	 	(a)	 	Executive shall be entitled to four weeks of paid vacation time calculated and
administered in accordance with Company policies in effect from time to time. The
Executive shall be entitled to all other benefits associated with normal full time
employment in accordance with Company policies. A copy of the Company’s current
benefits plans are attached hereto.
	 
	 	(b)	 	Subject to the approval of the Board of Directors, Executive shall be entitled
to participate in the Company’s Amended and Restated Change of Control Severance
Benefit Plan, as amended July 26, 2006 (the “Change of Control Plan”).






	7.	 	Termination of Employment.






	 	(a)	 	Notwithstanding any other provision of this Agreement, Executive’s employment
may be terminated, without such action constituting a breach of this Agreement:






	 	(i)	 	By the Company, for “Cause,” as defined in Section 7(b) below;
	 
	 	(ii)	 	By the Company, upon 30 days’ notice to Executive, if he should
be prevented by illness, accident or other disability (mental or physical) from
discharging his duties hereunder for one or more periods totaling three
consecutive months during any twelve-month period;
	 
	 	(iii)	 	By the event of Executive’s death during the Term.






	 	(b)	 	“Cause” shall mean (i) Executive’s willful failure or refusal to perform in all
material respects the services required of him hereby, (ii) Executive’s willful failure
or refusal to carry out any proper and material direction by the President and CEO or
Board of Directors with respect to the services to be rendered by him hereunder or the
manner of rendering such services, (iii) Executive’s willful misconduct or gross
negligence in the performance of his duties hereunder, (iv) Executive’s commission of
an act of fraud, embezzlement or theft or a felony involving moral turpitude, (v)
Executive’s use or disclosure of Confidential Information (as defined in Section 10 of
this Agreement), other than for the benefit of the Company in the course of rendering
services to the Company or (vi) Executive’s engagement in any activity prohibited by
Section 11 of this Agreement. For purposes of this Section 7, the Company shall be
required to provide Executive a specific written warning with regard to any occurrence
of subsections 7(b) (i), (ii) and (iii) above, which warning shall include a statement
of corrective actions and a 15 day period for the Executive to respond to and implement
such actions, prior to any termination of employment by the Company pursuant to Section
7(a) (i) above.





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	8.	 	Separation Pay. Subject to Executive’s execution and delivery to the Company of the
Company’s standard form of Separation and Release Agreement, the Company shall pay Executive a
lump sum amount equal to six months of Executive’s then effective salary (the “Separation
Pay”), upon the Company’s termination of Executive’s employment by the Company without Cause,
during the Term. Such Separation Pay shall be made no later than two and one-half months
following the year in which the Termination of Employment occurred. Separation Pay shall be
subject to withholding of all applicable federal, state and local taxes and any other
deductions required by applicable law. In the event of Executive’s termination pursuant to
Section 7(a)(ii), the Company’s obligation to pay further compensation hereunder shall cease
after the expiration of the 30 day notice. In the event of Executive’s death, the Company’s
obligation to pay further compensation hereunder shall cease forthwith, except that
Executive’s legal representative shall be entitled to receive his fixed compensation for the
period up to the last day of the month in which such death shall have occurred.
	 
	9.	 	All Business to be Property of the Company; Assignment of Intellectual Property.






	 	(a)	 	Executive agrees that any and all presently existing business of the Company
and all business developed by him or any other employee of the Company including
without limitation all contracts, fees, commissions, compensation, records, customer or
client lists, agreements and any other incident of any business developed, earned or
carried on by Executive for the Company is and shall be the exclusive property of the
Company, and (where applicable) shall be payable directly to the Company.
	 
	 	(b)	 	Executive hereby acknowledges that any plan, method, data, know-how, research,
information, procedure, development, invention, improvement, modification, discovery,
design, process, work of authorship, documentation, formula, technique, trade secret or
intellectual property right whatsoever or any interest therein whether patentable or
non-patentable, patents and applications therefor, trademarks and applications therefor
or copyrights and applications therefor (herein sometimes collectively referred to as
“Intellectual Property”) made, conceived, created, invested, developed, reduced to
practice and/or acquired by Executive solely or jointly with others during the Term is
the sole and exclusive property of the Company, as work for hire, and that he has no
personal right in any such Intellectual Property. Executive hereby grants to the
Company (without any separate remuneration or compensation other than that received by
him from time to time in the course of his employment) his entire right, title and
interest throughout the world in and to, all Intellectual Property, which is made,
conceived, created, invested, developed, reduced to practice and/or acquired by him
solely or jointly with others during the Term.






	10.	 	Confidentiality. Executive acknowledges his obligation of confidentiality with respect to all
proprietary, confidential and non-public information of the Company, including all
Intellectual Property. Executive shall not, either during the Term or thereafter, use for any
purpose other than the furtherance of the Company’s business, or disclose to any person other
than a person with a need to know such confidential, proprietary or non-public information for
the furtherance of the Company’s business who is obligated to maintain





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	 	 	the confidentiality of such information, any information concerning any Intellectual
Property, or other confidential, proprietary or non-public information of the Company,
whether Executive has such information in his memory or such information is embodied in
writing or other tangible form. All originals and copies of any of the foregoing, however
and whenever produced, shall be the sole property of the Company. Upon the termination of
Executive’s employment in any manner or for any reason, Executive shall promptly surrender
to the Company all copies of any of the foregoing, together with any documents, materials,
data, information and equipment belonging to or relating to the Company’s business and in
his possession, custody or control, and Executive shall not thereafter retain or deliver to
any other person any of the foregoing or any summary or memorandum thereof.   
	 
	11.	 	Non-Competition Covenant. As the Executive has been granted options to purchase stock in the
Company and as such has a financial interest in the success of the Company’s business and as
Executive recognizes that the Company would be substantially injured by Executive competing
with the Company, Executive agrees and warrants that within the United States, he will not,
unless acting with the Company’s express prior written consent, directly or indirectly, while
an employee of the Company and during the Non-Competition Period, as defined below, own,
operate, join, control, participate in, or be connected as an officer, director, employee,
partner, stockholder, consultant or otherwise, with any business or entity which competes with
the business of the Company (or its successors or assigns) as such business is now constituted
(currently defined as a human vaccine development business) or as it may be constituted at any
time during the Term of this Agreement; provided, however, that Executive may own, and
exercise rights with respect to, less than one percent of the equity of a publicly traded
company. The “Non-Competition Period” shall be a period of one year following termination of
employment.
	 
	12.	 	Non-Solicitation Agreement. Executive agrees and covenants that he will not, unless acting
with the Company’s express written consent, directly or indirectly, during the Term of this
Agreement or during the Non-Competition Period (as defined in Section 11 above) solicit,
entice or attempt to entice away any customer, officer, employee, consultant, proposed
customer, vendor, supplier, proposed vendor or supplier or person or entity or person
providing or proposed to provide research and/or development services to, on behalf of or with
the Company. Executive agrees and covenants that he will not, unless acting with the
Company’s express written consent, directly or indirectly, during the Term of this Agreement
or thereafter interfere with the Company’s relationships or proposed relationships with any
customer, officer, employee, consultant, proposed customer, vendor, supplier, proposed vendor
or supplier or person or entity or person providing or proposed to provide research and/or
development services to, on behalf of or with the Company.
	 
	13.	 	Notices. All notices and other communications hereunder shall be in writing and shall be
deemed to have been given on actual receipt after having been delivered by hand, mailed by
first class mail, postage prepaid, or sent by Federal Express or similar overnight delivery
services, as follows: (a) if to Executive, at the address shown at the head of this Agreement,
or to such other person(s) or address(es) as Executive shall have furnished to the Company in
writing and, if to the Company, to it at the address set forth in the
preamble hereto with a copy to Jennifer Miller, Esq., Ballard Spahr Andrews & Ingersoll LLP,
1735 Market Street, 51st Floor, Philadelphia, PA 19103, or to such other
person(s) or address(es) as the Company shall have furnished to Executive in writing.





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	14.	 	Assignability. In the event of a change of control (as defined in the Company’s Change of
Control Plan), the terms of this Agreement shall inure to the benefit of, and be assumed by,
the acquiring person (as defined in the Company’s Change of Control Plan). This Agreement
shall not be assignable by Executive, but it shall be binding upon, and to the extent provided
in Section 8 shall inure to the benefit of, his heirs, executors, administrators and legal
representatives.
	 
	15.	 	Entire Agreement. This Agreement contains the entire agreement between the Company and
Executive with respect to the subject matter hereof and there have been no oral or other prior
agreements of any kind whatsoever as a condition precedent or inducement to the signing of
this Agreement or otherwise concerning this Agreement or the subject matter hereof.
Notwithstanding the foregoing, Executive acknowledges that he is required as a condition to
continued employment, to comply at all times, with the Company’s policies affecting employees,
including the Company’s published Code of Ethics, as in effect from time to time.
	 
	16.	 	Equitable Relief. Executive recognizes and agrees that the Company’s remedy at law for any
breach of the provisions of Sections 9, 10, 11 or 12 hereof would be inadequate, and he agrees
that for breach of such provisions, the Company shall, in addition to such other remedies as
may be available to it at law or in equity or as provided in this Agreement, be entitled to
injunctive relief and to enforce its rights by an action for specific performance. Should
Executive engage in any activities prohibited by this Agreement, he agrees to pay over to the
Company all compensation, remuneration or monies or property of any sort received in
connection with such activities; such payment shall not impair any rights or remedies of the
Company or obligations or liabilities of Executive which such parties may have under this
Agreement or applicable law.
	 
	17.	 	Amendments. This Agreement may not be amended, nor shall any change, waiver, modification,
consent or discharge be effected except by written instrument executed by the Company and
Executive.
	 
	18.	 	Severability. If any part of any term or provision of this Agreement shall be held or deemed
to be invalid, inoperative or unenforceable to any extent by a court of competent
jurisdiction, such circumstances shall in no way affect any other term or provision of this
Agreement, the application of such term or provision in any other circumstances, or the
validity or enforceability of this Agreement. Executive agrees that the restrictions set
forth in Sections 11 and 12 above (including, but not limited to, the geographical scope and
time period of restrictions) are fair and reasonable and are reasonably required for the
protection of the interests of the Company and its affiliates. In the event that any
provision of Section 11 or 12 relating to time period and/or areas of restriction shall be
declared by a court of competent jurisdiction to exceed the maximum time period or areas such
court deems reasonable and enforceable, said time period and/or areas of restriction shall be
deemed to become and thereafter be the maximum time period and/or areas which such court deems
reasonable and enforceable.





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	19.	 	Paragraph Headings. The paragraph headings used in this Agreement are included solely for
convenience and shall not affect, or be used in connection with, the interpretation hereof.
	 
	20.	 	Governing Law. This Agreement shall be governed by and construed and enforced in accordance
with the law of the State of Maryland, without regard to the principles of conflict of laws
thereof.
	 
	21.	 	Resolution of Disputes. With the exception of proceedings for equitable relief brought
pursuant to Section 16 of this Agreement, any disputes arising under or in connection with
this Agreement including, without limitation, any assertion by any party hereto that the other
party has breached any provision of this Agreement, shall be resolved by arbitration, to be
conducted in Philadelphia, Pennsylvania, in accordance with the rules and procedures of the
American Arbitration Association. The parties shall bear equally the cost of such arbitration,
excluding attorneys’ fees and disbursements which shall be borne solely by the party incurring
the same; provided, however, that if the arbitrator rules in favor of Executive, Company shall
be solely responsible for the payment of all costs, fees and expenses (including without
limitation Executive’s reasonable attorneys’ fees and disbursements) of such arbitration. The
provisions of this Section 21 shall survive the termination for any reason of the Term
(whether such termination is by the Company, by Executive or upon the expiration of the Term).
	 
	22.	 	Survival. Sections 8 through 21 shall survive the expiration or earlier termination of this
Agreement, for the period and to the extent specified therein.
	 
	 	 	IN WITNESS WHEREOF, the parties have executed or caused to be executed under seal this
Agreement as of the date first above written.





	 	 	 	 	 	 	 
	 

	 	 	 	NOVAVAX,
	 	 INC.
	 
	 	 	 	 	 	 
	[SEAL]

	 	 	 	By:
	 	/s/ Rahul Singhvi
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Rahul Singhvi
	 

	 	 	 	Title:
	 	President of Commercial Operations
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	/s/ Len Stigliano
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Len Stigliano







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