AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Exhibit 10.2
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement (this “Agreement”) is dated as of August 2,
1007, originally effective November 9, 2005, between Novavax, Inc., a Delaware corporation having
its principal office at 0000 Xxxxxxx Xxxxxx Xxxxx, Xxxxxxxxx, XX 00000, and Xxxxx Xxxxxxx, an
individual with a mailing address of 00000 Xxxxxxxxx Xxxxx, Xxxxxxx, XX 00000 (“Executive”). This
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 President and Chief Executive Officer 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 to the performance of services as President and Chief Executive Officer 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 Board of Directors. During the Term, Executive’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 which the Company shall assign
to him from time to time. 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
of any company whose products do not compete with those of the Company and 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. Executive shall be based at the Company’s headquarters, currently
in Malvern Pennsylvania, and he also will 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 August 10, 2005 and
continuing until September 1, 2009, unless earlier terminated pursuant to Section 7 hereof (the
“Term”) and shall be renewable 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.
4. Compensation.
(a) Base Compensation. For all Executive’s services and covenants under this Agreement, the
Company shall pay Executive an annual salary, which is $350,00 per year as of this Amendment and
Restatement, and the Board of Directors will review and consider for increase annually based on the
Executive’s and the Company’s performance. Executive’s salary and benefits will be 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. The Company agrees to pay the Executive a performance and incentive bonus
in respect of Executive’s employment with the Company each year, in an amount determined by the
Board of Directors (or any committee of the Board of Directors authorized to make that
determination) to be appropriate based upon Executive’s and the Company’s achievement of certain
specified goals, with a maximum bonus of 100%, 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 shall
be paid out partly in cash and partly in shares of restricted stock, in the discretion of the Board
of Directors. Such bonus shall be paid no later than two and one-half months following the year
for which the bonus applies.
(c) Stock Awards. Executive will be eligible for additional stock awards based upon
performance subject to the approval of 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 for executive officers as the Company has heretofore or may
hereafter establish.
6. Benefits. (a) Executive shall be entitled to five weeks of paid vacation time per year
starting from January 1, 2006, calculated and administered in accordance with Company policies for
executive officers 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.
(b) Executive shall be entitled to participate in the Company’s Change of Control Severance
Benefit Plan adopted August 10, 2005.
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
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duties hereunder for one or more periods totaling three consecutive months during any
twelve-month period;
(iii) By the Executive with “Good Reason”, as defined in Section 7(c) below, within 30 days of
the occurrence or commencement of such Good Reason; and
(iv) 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 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 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 (b)(i), (ii) and (iii) above, which warning shall include a
statement of corrective actions and a 30 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.
(c) “Good Reason” shall mean the Company’s material reduction or diminution of Executive’s
responsibilities and authority, other than for Cause, without his consent.
8. Separation Pay.
(a) 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 an amount equal to the
Separation Pay as defined in Section 8(b) below, upon the occurrence of the applicable Separation
Event, as defined in Section 8(c) below, but in no case later than two and one-half months
following the year in which the Separation Event occurs. Separation Pay shall each be payable in
accordance with the Company’s payroll policy as constituted from time to time, and 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 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.
(b) “Separation Pay” shall mean a lump sum amount equal to twelve (12) months of Executive’s
then effective salary.
(c) “Separation Event” shall mean:
(i) the Company’s termination of Executive’s employment by the Company without Cause, during
the Term; and
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(ii) the termination of Executive’s employment by the Executive for Good Reason.
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 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
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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
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 twelve months following
termination of employment.
Executive 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 Executive’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.
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 or interfere in any manner 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 Xxxxx X. Xxxxx, Esq.,
White White & Van Etten, LLP, 00 Xxxxxxxxx Xxxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000, or to such
other person(s) or address(es) as the Company shall have furnished to Executive in writing.
14. Assignability. In the event of a change of control (as defined in the Company’s Change of
Control Severance Benefit Plan adopted August 10, 2005), 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 Severance Benefit Plan adopted August 10, 2005). 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.
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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. Executive also acknowledges that the
Non-Disclosure and Non-Competition Agreement he signed upon becoming an employee remains in full
force and effect despite the changes in his employment status with the Company.
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.
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 Delaware, without regard to the principles of conflict of
laws thereof.
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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. Indemnification; Insurance. The Executive shall be entitled to liability and expense
indemnification and reimbursement to the fullest extent permitted by the Company’s current By-laws
and Certificate of Incorporation, whether or not the same are subsequently amended. During the
Term, the Company will use commercially reasonable efforts to maintain in effect directors’ and
officers’ liability insurance no less favorable to Executive than that in effect as of the date of
this Agreement.
23. 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] |
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| By: | /s/ Xxxx Xxxxxxx
|
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| Chairman of the Board of Directors | ||||||||
| /s/ Xxxxx Xxxxxxx | ||||||||
| Xxxxx Xxxxxxx | ||||||||
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