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                              EMPLOYMENT AGREEMENT

       AGREEMENT (the "Employment Agreement" or this "Agreement") effective as
of March 5, 1999, between Novavax, Inc., a Delaware corporation having its
principal office at 8320 Guilford Road, Columbia, Maryland 21046 (the "Company")
and Richard J. Harwood ("Employee") residing at 3219 Adams Court North,
Bensalem, Pennsylvania 19020.

       The Company and Employee hereby agree as follows:

       1. Employment. The Company hereby employs Employee and Employee hereby
accepts employment 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.)
Employee warrants 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 of or his performance under this Agreement.

       2. Duties. Employee shall devote his full business time to the
performance of services as Vice President--Pharmaceutical Product Development or
such other senior management services as may from time to time be designated by
the Company's Chief Executive Officer or the Board of Directors. During the term
of this Agreement, Employee's services shall be completely exclusive to the
Company and he shall devote his entire business time, attention and energies to
the business of the Company and the duties to which the Company shall assign him
from time to time. Notwithstanding the foregoing, Employee may serve on the
board of directors of civic and charitable organizations during his employment
and may serve on the board of directors of one or two noncompeting business
entities, provided that his time devoted to such entities is during non-business
hours or on vacation days. Employee agrees to perform his services faithfully
and to the best of his ability and to carry out the policies and directives of
the Company. Employee agrees to take no action which is in bad faith and
prejudicial to the interests of the Company during his employment hereunder.
Employee shall be based in Columbia, Maryland but he may be required from time
to time to perform duties hereunder for reasonably short periods of time outside
said area.

       Notwithstanding the foregoing paragraph, Employee shall be entitled to
engage in teaching and consulting services for third parties with the prior
consent of the Chief Executive Officer of the Company, provided, however, that
such services shall not interfere with the satisfactory performance of his
duties hereunder and shall not exceed 20 days per year. The provisions of this
Agreement including, without limitation, Sections 8, 9, 10 and 11 shall continue
to apply with respect to such teaching and consulting services.

       3. Term. The term of this Agreement shall be one year beginning on March
5, 1999 and ending March 4, 2000, provided, however, that this Agreement shall
be automatically extended for periods of one year after such date, unless and
until the Company or Employee shall have delivered to the other written notice
of its or his election to terminate this Agreement as of March 4, 2000, or as of
the end of any such one-year extension period, such notice to be delivered at
least 30 days prior to the date of termination (the "Term").

       4. Compensation.

              (a) Base Compensation. For all Employee's services and covenants
under this Agreement, the Company shall pay Employee an initial annual salary of
$168,000 subject to annual review by the Board of Directors of the Company and
payable in accordance with the Company's payroll policy as constituted from time
to time. To the extent Employee's engagement in teaching


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or consulting services as permitted by Section 2 above require him to be absent
from work or to work less than a full day, Employee's salary shall be reduced
proportionately.

              (b) Stock Options. Employee shall be entitled to receive stock
options to purchase 25,000 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 date of grant. The options will be subject to an Incentive Stock Option
Agreement (and, to the extent required by the Internal Revenue Code, a
Non-Statutory Stock Option Agreement) and shall vest as to one-third of the
shares on each of the first three anniversaries of the date of grant.

              (c) Bonus Program. During the Term, the Employee shall be entitled
to participate in a bonus program, if any, maintained from time to time by the
Company for the benefit of senior executives and other employees of the Company
under which award payments, if any, are based on performance criteria and
milestones to be mutually determined by the Employee and the Company.

              (d) Patent Assignment Bonus. Employee shall be entitled to receive
a bonus of $5,000 for each patent application in which Employee is listed as the
inventor that is assigned to the Company. If such patent application lists more
than one inventor, the amount of the bonus to Employee shall be reduced
proportionately.

       5. Reimbursable Expenses.

              (a) Employee shall be entitled to reimbursement for reasonable
expenses incurred by Employee in connection with the performance of his duties
hereunder upon receipt of vouchers therefor in accordance with such procedures
as the Company has heretofore or may hereafter establish.

              (b) Employee shall be entitled to reimbursement for reasonable
expenses incurred by Employee in connection with his attendance at scientific
meetings and professional seminars outside the Company, provided, however, that
in each instance Employee will obtain the prior consent of the Chief Executive
Officer of the Company.

       6. Employee Benefits.

              (a) Employee shall be entitled to three weeks of paid vacation
time during the first year of his employment by the Company, calculated on a
calendar year basis in accordance with Company policies in effect from time to
time. Thereafter, Employee shall be entitled to three weeks of vacation plus one
day for each year of Employee's employment after the first year, up to a maximum
of four weeks per year.

              (b) Employee shall be entitled to participate in all group
insurance programs, stock option plans or other fringe benefit plans which the
Company may now or hereafter in its sole and absolute discretion make available
generally to its employees, but the Company shall not be required to establish
any such program or plan.

       7. Termination of Employment. Notwithstanding any other provision of this
Agreement, Employee's employment may be terminated:

              (a) By the Company, in the event of Employee's willful failure or
refusal to perform in all material respects the services required of him hereby,
after a specific written warning with regard thereto, which shall include a
statement of corrective actions and a 30 day period for the Employee to respond
and implement such actions, has been given to Employee by the Chief Executive
Officer of the Company or its Board of Directors, his willful failure or refusal
to carry out any proper direction by the Chief Executive Officer or the Board of
Directors with respect to the services to be


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rendered by him hereunder or the manner of rendering such services, his willful
misconduct in the performance of his duties hereunder or his commission of a
felony involving moral turpitude;

              (b) By the Company, upon 30 days' notice to Employee, if he should
be prevented by illness, accident or other disability (mental or physical) from
discharging his duties hereunder for one or more periods totalling three months
during any twelve-month period;

              (c) By the Company, without cause, or by Employee with "Good
Reason" (as hereinafter defined), provided that if Employee's employment is
terminated pursuant to this Section 7(c), Employee shall be entitled to receive
his then current salary as set forth in Section 4(a) above, but not a
performance bonus, for one year from the date of termination, payable in
accordance with the Company's payroll policy as constituted from time to time,
together with any accrued vacation pay at his then current salary and in the
amounts set forth in Section 4(a) above. The Employee shall be entitled to
terminate his employment for "Good Reason" if his responsibilities and authority
are reduced or diluted in any material way (other than for cause) without his
consent or if he is relocated to another Company office or facility more than 50
miles from Columbia, Maryland without his consent.

              (d) By Employee, upon 30 days' notice to the Company, whereupon
Employee shall be entitled to receive his then current salary as set forth in
Section 4(a) above, but not a performance bonus, through the date of
termination, together with any accrued vacation pay at his then current salary.

              (e) By the event of Employee's death during the term of his
employment; whereupon the Company's obligation to pay further compensation
hereunder shall cease forthwith, except that Employee'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.

       8. All Business to be Property of the Company; Assignment of Intellectual
Property.

              (a) Employee 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 Employee for the
Company is and shall be the exclusive property of the Company, and (where
applicable) shall be payable directly to the Company.

              (b) Employee 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 research, information, procedures, developments, all
inventions and improvements whether patentable or nonpatentable, patents and
applications therefor, trademarks and applications therefor, copyrights and
applications therefor, programs, trade secrets, plans, methods, and all other
data and know-how (herein sometimes "Intellectual Property") made, conceived,
developed and/or acquired by him solely or jointly with others during the period
of his employment with the Company, which are either (i) made, conceived,
developed or acquired during regular business hours or on the premises of, or
using properties of, the Company or in the regular scope of Employee's
employment by the Company or (ii) if related to the Company's business, whether
or not made, conceived, developed or acquired during regular business hours or
on the premises of, or using properties of, the Company or in the regular scope
of Employee's employment by the Company.

       9. Confidentiality. Except as necessary in performance of services for
the Company or if required by law and except for such information that becomes
generally available to the public through no fault of Employee, Employee shall
not, either during the period of his employment with


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the Company or thereafter, use for his own benefit or disclose to or use for the
benefit of any person outside the Company, any information concerning any
Intellectual Property, or other confidential or proprietary information of the
Company, including without limitation, any of the materials listed in Section
8(a), whether Employee has such information in his memory or 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, not to
be removed from the premises or custody of the Company without in each instance
first obtaining authorization of the Company, which authorization may be revoked
by the Company at any time. Upon the termination of Employee's employment in any
manner or for any reason, Employee 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 Employee shall not thereafter retain
or deliver to any other person any of the foregoing or any summary or memorandum
thereof.

       10. Non-Competition Covenant. As the Employee is being 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 Employee recognizes that the Company
would be substantially injured by Employee competing with the Company, Employee
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 or as it may be
constituted at any time during the term of this Agreement; provided, however,
that Employee may own 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.

       Employee and the Company are of the belief that the period of time and
the area herein specified are reasonable in view of the nature of the business
in which the Company is engaged and proposes to engage, the state of its
business development and Employee's knowledge of this business. However, if such
period or such area should be adjudged unreasonable in any judicial proceeding,
then the period of time shall be reduced by such number of months or such area
shall be reduced by elimination of such portion of such area, or both, as are
deemed unreasonable, so that this covenant may be enforced in such area and
during such period of time as is adjudged to be reasonable.

       11. Non-Solicitation Agreement. Employee 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 for a period of one year
thereafter solicit, entice away or interfere with the Company's contractual
relationships with any customer, officer or employee of the Company.

       12. Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been given upon the earlier of actual
receipt or three days after having been mailed by first class mail, postage
prepaid, or twenty-four hours after having been sent by Federal Express or
similar overnight delivery services, as follows: (a) if to Employee, at the
address shown at the head of this Agreement, or to such other person(s) or
address(es) as Employee shall have furnished to the Company in writing; and (b)
if to the Company, at the address shown at the head of this Agreement,
Attention: President, with a copy to David A. White, White & McDermott, P.C., 65
William Street, Wellesley, Massachusetts 02481, or to such other person(s) or
address(es) as the Company shall have furnished to the Employee in writing.

       13. Assignability. In the event that the Company shall be merged with, or
consolidated into, any other corporation, or in the event that it shall sell and
transfer substantially all of its assets to another corporation, the terms of
this Agreement shall inure to the benefit of, and be assumed by,


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the corporation resulting from such merger or consolidation, or to which the
Company's assets shall be sold and transferred. This Agreement shall not be
assignable by Employee, but it shall be binding upon, and to the extent provided
in Section 7 shall inure to the benefit of, his heirs, executors, administrators
and legal representatives.

       14. Entire Agreement. This Agreement contains the entire agreement
between the Company and Employee 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.

       15. Equitable Relief. Employee recognizes and agrees that the Company's
remedy at law for any breach of the provisions of Sections 8, 9, 10 or 11 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
Employee 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 Employee
which such parties may have under this Agreement or applicable law.

       16. 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 Employee.

       17. 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.

       18. 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.

       19. Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the law of the State of Delaware, without regard to
the principles of conflict of law thereof.

       20. Resolution of Disputes. With the exception of proceedings for
equitable relief brought pursuant to Section 15 of this Agreement or any stock
option agreement, any disputes arising under or in connection with this
Agreement or any stock option 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 held in Baltimore,
Maryland, in accordance with the rules and procedures of the American
Arbitration Association. All costs, fees and expenses, including reasonable
attorney fees, of any arbitration or equitable relief proceeding in connection
with this Agreement shall be borne by, and be the obligation of, the Company. In
no event shall the Employee be required to reimburse the Company for any of the
costs and expenses incurred by the Company relating to any arbitration. The
obligation of the Company under this Section 20 shall survive the termination
for any reason of the Term (whether such termination is by the Company or by the
Employee).

       21. Indemnification. The Employee shall be entitled to liability and
expense indemnification to the fullest extent permitted by the Company's current
By-laws and Certificate of Incorporation, whether or not the same are
subsequently amended.


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       22. Survivorship. The respective rights and obligations of the parties to
this Agreement shall survive any termination of this Agreement or the Employee's
employment hereunder for any reason to the extent necessary to the intended
preservation of such rights and obligations.

       IN WITNESS WHEREOF, the parties have executed or caused to be executed
this Agreement as of the date first above written.

                                  NOVAVAX, INC.

[SEAL]

                                  By:
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                                     John A. Spears, President


                                  ----------------------------------------------
                                  Richard J. Harwood








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