SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934

Filed by Registrant [X]

Filed by Party other than the Registrant [  ]

Check the appropriate box:

NOVAVAX, INC.

(Name of Person(s) Filing Proxy Statement if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

NOVAVAX, INC.

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

      NOTICE IS HEREBY GIVEN that the Annual Meeting of the Stockholders of Novavax, Inc., a Delaware corporation (the “Company”), will be held on Wednesday, May 8, 2002 at 10:00 a.m. at the Four Seasons Hotel, 2800 Pennsylvania Avenue, N.W., Washington, D.C. (the “Meeting”) for the purpose of considering and voting upon the following matters:

      The Board of Directors has no knowledge of any other business to be transacted at the Meeting.

      The Board of Directors has fixed the close of business on Friday, March 15, 2002 as the record date for the determination of stockholders entitled to notice of and to vote at the Meeting and at any adjournments thereof.

      A copy of the Company’s Annual Report to Stockholders for the year ended December 31, 2001, which contains financial statements and other information of interest to stockholders, accompanies this Notice and the attached Proxy Statement.

April 10, 2002

WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE PROMPTLY VOTE VIA THE INTERNET OR TELEPHONE AS PER THE INSTRUCTIONS ON THE ENCLOSED PROXY CARD OR COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY IN THE ACCOMPANYING ENVELOPE. NO POSTAGE NEED BE AFFIXED IF THE PROXY IS MAILED IN THE UNITED STATES.

NOVAVAX, INC.

8320 Guilford Road

PROXY STATEMENT

      This Proxy Statement is furnished in connection with the solicitation of proxies by the Board of Directors of Novavax, Inc. (“Novavax” or the “Company”) for use at the Annual Meeting of Stockholders to be held on Wednesday, May 8, 2002 at 10:00 a.m. at the Four Seasons Hotel, 2800 Pennsylvania Avenue, N.W., Washington, D.C., and at any adjournments thereof (the “Meeting”). The Notice of Meeting, this Proxy Statement, the enclosed proxy and the Company’s Annual Report to Stockholders for the year ended December 31, 2001 are being mailed to stockholders on or about April 10, 2002.

VOTING PROCEDURE AND QUORUM

      The close of business on March 15, 2002 (the “Record Date”) has been fixed as the record date to determine stockholders entitled to receive notice of and to vote at the Meeting. The only class of stock of the Company entitled to vote at the Meeting is its common stock, $.01 par value (the “Common Stock”). Only the record holders of shares of the Common Stock at the close of business on the Record Date may vote at the Meeting. On the Record Date, there were 23,915,343 shares of Common Stock outstanding and entitled to be voted at the Meeting. Each share entitles the holder to one vote on each of the matters to be voted upon at the Meeting. You may vote by mail, internet or telephone as directed by the enclosed proxy card.

      All properly executed proxies will be voted in accordance with the instructions of the stockholder. If no contrary instructions have been indicated, the proxies will be voted in favor of proposals 1, 2 and 3 set forth in the accompanying Notice of Meeting. The Board of Directors knows of no other matters to be presented for consideration at the Meeting. Stockholders may revoke proxies at any time before they are exercised at the Meeting by (a) signing and submitting a later-dated proxy to the Secretary of the Company, (b) written notice of revocation delivered to the Secretary of the Company or (c) voting in person at the Meeting. Attendance at the Meeting will not itself be deemed to revoke a proxy unless the stockholder gives affirmative notice at the Meeting that the stockholder intends to revoke the proxy and vote in person.

      The presence in person or by proxy of a majority of the shares of Common Stock outstanding on the Record Date is required to constitute a quorum at the Annual Meeting. If a quorum is not present, the stockholders entitled to vote who are present in person or represented by proxy at the Meeting have the power to adjourn the Meeting from time to time, without notice other than an announcement at the Meeting, until a quorum is present. At any adjourned Meeting at which a quorum is present, any business may be transacted that might have been transacted at the Meeting as originally notified. Abstentions and broker non-votes will count in determining whether a quorum is present at the Annual Meeting. A broker non-vote occurs if a broker or other nominee does not have discretionary authority and has not received instructions with respect to a particular item.

PROPOSAL ONE — ELECTION OF DIRECTORS

      Pursuant to the Company’s Amended and Restated Certificate of Incorporation, the Company’s Board of Directors may consist of no fewer than three directors with the specific number to be authorized by the Board of Directors from time to time at its discretion. The Board of Directors is currently authorized to consist of nine members through the Meeting and eight thereafter. The members of the Company’s Board of Directors are divided into three classes, designated Class I, Class II and Class III, each serving staggered three-year terms. The terms of the Class I directors expire at this Meeting. The terms of the Class II and Class III directors will expire at the 2003 and 2004 Annual Meetings of Stockholders, respectively. A director of any class who is elected by the Board of Directors to fill a vacancy resulting from an increase in the number of directors holds office for the remaining term of the class to which he is elected. A director who is elected by the Board to fill a vacancy arising in any other manner holds office for the remaining term of his predecessor. Directors elected by the stockholders at an annual meeting to succeed those whose terms expire are of the same class as the directors they succeed and are elected for a term to expire at the third annual meeting of stockholders after their election and until their successors are duly elected and qualified. Directors elected by the Board to fill vacancies or newly created directorships are to be assigned to classes by the Board so as to ensure, as nearly as possible, that each class consists of one-third of the total number of members of the Board. However, no existing director may be reclassified from one class to another and therefore the number of directors in each class may become temporarily imbalanced.

      Two directors are to be elected at this Meeting to fill the terms of the Class I directors that expire at this Meeting. The Board of Directors has designated Denis M. O’Donnell, M.D. and Ronald H. Walker, as nominees for reelection as Class I directors of the Company at this Meeting. If elected to be Class I directors, such nominees will serve until the expiration of their terms at the Annual Meeting of Stockholders in 2005 and until their successors are elected and qualified. Dr. O’Donnell and Mr. Walker are currently directors of the Company and have consented to being named in this Proxy Statement and to serve if elected. The Board of Directors has no reason to believe that any of the nominees will be unable to serve if elected. If any nominee becomes unavailable to serve as a director, the persons named as proxies in the accompanying proxy may vote the proxy for a substitute nominee.

      The election of directors requires the affirmative vote of a plurality of the shares of Common Stock present or represented by proxy and entitled to vote at the Meeting. Accordingly, abstentions and broker non-votes will not have any effect on the election of a director.

      THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE ELECTION OF THE NOMINEES.

Members of the Board of Directors

      The following table provides certain information with respect to the directors of the Company. Comparable information regarding the executive officers of the Company is provided in the Company’s Annual Report on Form 10-K.

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Nominees for Class I Director

Directors Continuing as Class II Directors

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Directors Continuing as Class III Directors

      There are no family relationships among any of the directors of Novavax.

Board and Committee Meetings

      The Board of Directors met six times and acted by unanimous written consent once during 2001. Each of the directors attended at least 75% of the meetings of the Board of Directors and the committees on which they served.

      The Board of Directors of Novavax has four standing committees: an Executive Committee, a Compensation and Stock Option Committee (the “Compensation Committee”), an Audit Committee and a Nominating Committee. The Executive Committee, whose members are Dr. O’Donnell (Chairman) and Messrs. Evans, Kelly, McManus and Spears, has the authority to exercise the powers of the Board of Directors between Board meetings. The Compensation Committee, whose members are Messrs. Evans (Chairman), Marsh, McManus and Walker, reviews and recommends salaries and other compensatory benefits for the executive officers of Novavax and grants stock options to key employees of Novavax and its subsidiaries. The Audit Committee, whose members are Messrs. McManus (Chairman) and Evans and Dr. Lazarus, meets with the Company’s independent public accountants to discuss the scope and results of their examination, reviews the financial statements contained in the Company’s Forms 10-Q and 10-K before filing with the SEC, reviews the adequacy of the Company’s accounting and control systems and considers any issues raised by its members, the independent public accountants and the Company’s staff or management. The Nominating Committee, whose members are Dr. Lazarus (Chairman), Mr. Kelly, Dr. O’Donnell and Mr. Walker, reviews the qualifications and nominations of directors. Stockholders who wish to propose qualified candidates to serve as directors of the Company may do so in accordance with the procedures set forth in the Company’s By-laws in writing to the attention of the Secretary of the Company at the address set forth on the first page of this Proxy Statement.

      During 2001, the Audit Committee met four times and acted by unanimous consent once. The Compensation Committee met six times. The Executive Committee met three times and acted by unanimous consent once. The Nominating Committee did not meet.

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Director Compensation

      The Compensation Committee recommended, and the full Board of Directors adopted, a new compensation policy by which each director not employed by Novavax receives an annual retainer of $7,500, and an additional $1,000 for each non-telephonic meeting of the Board of Directors he attends and $750 for each telephonic meeting. In addition, each committee member not employed by Novavax receives $100 per committee meeting attended, except that the Chairman of each committee receives $500 per committee meeting attended. No other cash compensation is paid to the directors for their services to the Company as directors. For information relating to shares of the Company owned by each of the directors, see “Beneficial Ownership of Stock.” For information concerning the compensation of directors who are also officers of the Company, see the Summary Compensation Table.

      Stock Option Plan. Directors of Novavax are eligible to participate in the Company’s 1995 Stock Option Plan adopted by the Board of Directors and approved by the stockholders of Novavax on September 13, 1995, as amended (the “Plan”). In addition, directors of Novavax who were not employees of Novavax or any subsidiary of Novavax were eligible to participate in the 1995 Director Stock Option Plan of Novavax adopted by the Board of Directors and approved by the stockholders of Novavax on September 13, 1995 (the “Director Plan”). The Director Plan provided for the issuance of up to 500,000 shares of Novavax Common Stock upon the exercise of stock options granted under the Director Plan, all of which have been granted. There will be no future grants made under the Director Plan. On May 9, 2001, all directors of Novavax who were not employees of Novavax were granted options to purchase 15,000 shares of Novavax Common Stock under the 1995 Stock Option Plan at an exercise price of $8.80 per share. All such options are exercisable in full beginning on the date which is six months after the date of grant and the option exercise price per share is equal to the fair market value of a share of Novavax Common Stock on May 9, 2001. On May 9, 2001, Mr. Spears and Dr. O’Donnell were granted options to purchase 125,000 and 75,000 shares of Novavax Common Stock, respectively, under the 1995 Stock Option Plan at an exercise price of $8.80 per share. Such options are exercisable as to one-third of the shares on each of the first three anniversaries of the date of grant and the option exercise price per share is equal to the fair market value of a share of Novavax Common Stock on the date of grant. On June 28, 2001, Mr. Spears and Dr. O’Donnell were each granted options to purchase 106,136 shares of Novavax Common Stock under the 1995 Stock Option Plan at an exercise price of $9.34. Such options are exercisable as to one-third of the shares on each of the first three anniversaries of May 9, 2001 and the option exercise price is equal to the fair market value of a share of Novavax Common Stock on the date of grant. Options are not transferable except by will or by the laws of descent and distribution. The 1995 Stock Option Plan is administered by the Compensation Committee under delegation by the Board of Directors.

Compensation Committee Interlocks and Insider Participation

      Messrs. Evans, Marsh and McManus served on the Compensation Committee during 2001. No executive officer of the Company is, or during 2001 was, a member of the board of directors or compensation committee of any entity that has one or more executive officers serving as a member of the Company’s Board of Directors.

Section 16(a) Beneficial Ownership Reporting Compliance

      Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the Company’s directors, executive officers and holders of more than 10% of the Company’s Common Stock to file with the Securities and Exchange Commission and the NASDAQ National Market initial reports of ownership and reports of changes in ownership of Common Stock and other equity securities of the Company. Based solely on a review of the copies of such reports furnished to the Company or written representations that no other reports were required, the Company believes that during 2001 its officers, directors and holders of more than 10% of the Company’s Common Stock complied with all Section 16(a) filing requirements.

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Certain Relationships and Related Transactions

      In October, 2000, the Company entered in an Agreement and Plan of Merger by and among the Company, The Fielding Pharmaceutical Company (“Fielding”), each of the existing stockholders of Fielding and a wholly-owned subsidiary of the Company, which provided for the merger of Fielding with and into that wholly-owned subsidiary. The transaction was closed in December, 2000. William E. Georges was an officer, director and stockholder of Fielding at the time of the closing and is now the Vice President Operations of the wholly-owned subsidiary as well as a director of the Company. The Fielding stockholders received cash and shares of Company Common Stock in exchange for shares of common stock of Fielding. In addition, in January, 2002, the Fielding stockholders received an additional $5.0 million in Company Common Stock as an earnout payment. Mr. Georges received approximately 34.5% of this earnout amount.

      In addition, Mr. Georges owns fifty percent of the membership interests in GPG Enterprises L.L.C., which owns the facility in Missouri at which Fielding is based. We paid GPG Enterprises L.L.C. rent payments for the use of this facility totaling approximately $128,000 during fiscal 2001.

REPORT OF THE COMPENSATION COMMITTEE

Executive Compensation Policies

      The Compensation and Stock Option Committee of the Board of Directors (the “Committee”) is composed of four non-employee directors and is responsible for the development and administration of the Company’s executive compensation policies and programs, subject to review and approval by the full Board of Directors. The Committee reviews and recommends to the Board for its approval the salaries and incentive compensation for the executive officers of the Company and grants stock options to executives and other key employees of the Company and its subsidiaries.

      The objectives of the Company’s executive compensation program are to: (i) support the achievement of the strategic goals and objectives of the Company; (ii) attract and retain key executives critical to the success of the Company; and (iii) align the executive officers’ interests with the success of the Company. The Company’s executive compensation program currently consists of base salary, annual cash incentive compensation and long-term incentive compensation in the form of stock options.

Cash Compensation

      The Committee’s policy is to set base salary levels for each of the Company’s executive officers based on a review of compensation for competitive positions in the market, the executives’ job skills and experience, and judgments as to past and future contributions of the executives to the Company’s success. The corporations whose compensation practices have been studied are not limited to the peer group listed in the stock performance chart, but include the full range of companies with which the Company competes for executive talent. The annual cash incentive compensation is designed to tie annual awards to Company and individual executive performance. The Committee considers a number of factors in determining whether annual incentive awards should be paid, including the achievement by the Company of approved budgets, new product introductions and progress in the development of new products, and the achievement by the executives of their individual assigned objectives. In considering individual performance, as contrasted to Company performance, the Committee relies more on subjective evaluations of executive performance than on quantitative data or objective criteria.

Stock-Based Compensation

      The Company seeks to provide its executives with opportunities for substantially higher compensation through stock option awards. The Committee believes that stock ownership by executive officers is important in aligning management and stockholder interests for the long-term enhancement of stockholder value. In selecting executives eligible to receive option grants and determining the amount of such grants, the Committee evaluates a variety of factors including (i) the job level of the executive, (ii) option grants

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Chief Executive Officer Compensation

      John A. Spears was elected President and Chief Executive Officer of the Company effective May, 1999. Pursuant to his employment contract, the Board of Directors conducted an annual review of Mr. Spears’ base salary and determined to increase his base salary by 10% in 2001. The criteria used to evaluate Mr. Spears’ salary included, among other things, the compensation packages of executive officers of comparable companies of similar size in the pharmaceutical industry and the Company’s progress in achieving the goals of the Board of Directors concerning product development, achieving regulatory approval of product candidates and equity financings. Mr. Spears was given a performance bonus to reflect his achievement of certain specified goals. On May 9, 2001 and June 28, 2001, the Board granted Mr. Spears options to purchase 125,000 and 106,136 shares of the Company’s Common Stock, respectively, under the terms of the Company’s 1995 Stock Option Plan. These options have an exercise price equal to the fair market value of the Company’s Common Stock on the date of grant and vest in equal one-third increments on the first three anniversaries of May 9, 2001.

Tax Considerations

      Section 162(m) of the Code generally disallows a tax deduction to public companies for compensation over $1,000,000 paid to its Chief Executive Officer or its four other most highly compensated executive officers. Qualifying performance-based compensation will not be subject to the deduction limit if certain requirements are met. In 2001, no compensation paid by the Company was nondeductible as a result of the $1,000,000 limitation. Furthermore, the Committee believes that, given the general range of salaries and bonuses for executive officers of the Company, the $1,000,000 threshold of Section 162(m) will not be reached by any executive officer of the Company in the foreseeable future. Accordingly, the Committee has not formulated a policy to address non-qualifying compensation.

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REPORT OF THE AUDIT COMMITTEE

      The following is the report of the Audit Committee with respect to the Company’s audited financial statements for the fiscal year ended December 31, 2001.

      The Audit Committee has reviewed and discussed the Company’s audited financial statements with management. The Audit Committee has discussed with Ernst & Young LLP, the Company’s independent accountants, the matters required to be discussed by Statement of Auditing Standards No. 61, “Communication with Audit Committees,” as currently in effect, which includes, among other items, matters related to the conduct of the audit of the Company’s financial statements. The Audit Committee meets with the independent auditors, with and without management present, to discuss the results of their examinations, their evaluations of the Company’s internal controls, and the overall quality of the Company’s financial reporting. The Audit Committee has also received written disclosures and the letter from Ernst & Young LLP required by the Independence Standards Board which relates to the accountant’s independence from the Company and its related entities, and has discussed with Ernst & Young LLP their independence from the Company and has considered the compatibility of the accountants’ provision of information technology services, even though no information technology services were actually provided by Ernst & Young LLP in fiscal 2001, and other non-audit services with maintaining the accountants’ independence.

      The Audit Committee acts pursuant to the Audit Committee Charter. Each of the members of the Audit Committee qualifies as an “independent” director as defined in Rule 4200(a)(15) of the National Association of Securities Dealers’ listing standards.

      Based on the review and discussions referred to above, the Audit Committee recommended to the Company’s Board of Directors, and the Board has approved, that the Company’s audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2001. The Audit Committee and the Board have also recommended, subject to stockholder approval, the selection of the Company’s independent auditors.

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PROPOSAL TWO — AMENDMENT TO THE COMPANY’S STOCK OPTION PLAN

      The Board of Directors has approved two amendments to the Company’s 1995 Stock Option Plan (the “Plan”) that would increase the maximum number of shares of Novavax Common Stock available to be awarded under the Plan by 2,000,000 shares from 6,000,000 shares to a total of 8,000,000 shares. Specifically, the amendment replaces the number “6,000,000” in Section 4 of the Plan with the number “8,000,000.” This Amendment is subject to stockholder approval at the Meeting.

      The Board of Directors and the Compensation Committee of the Board of Directors believe that it is important to have equity-based incentives available to attract and retain qualified employees and to promote the success of the business of the Company by aligning employee and stockholder interests. The Company has used stock options as an integral element of its overall compensation program for key employees. Accordingly, the Plan is important in attracting and retaining employees in today’s competitive labor market, which is essential to the Company’s long-term growth and success The Board of Directors believes that the proposed increase in shares available under the Plan is necessary to ensure that the Company can continue to offer competitive levels of stock-based compensation to new and existing employees. In addition, the Company’s Director Stock Option Plan no longer has any shares reserved for grant to directors. The Company intends not to replace the Director Plan, but rather to grant periodic options to directors from the Plan.

      Set forth below is a summary of certain provisions of the Plan and a brief and general description of the U.S. Federal income tax treatment applicable to the receipt of stock options under the Plan. The text of the Plan, as amended, is set forth in Appendix A to this proxy statement, and the new language of the proposed amendment that is the subject of this Proposal No. 2 is set forth in bold type in Section 4 of the Plan. The following is intended to be a summary, and does not purport to be a complete statement, of the principal terms of the Plan, as amended. This summary is subject to and qualified in its entirety by reference to Appendix A.

      General. The Plan was adopted by the Board of Directors and approved by the stockholders in September, 1995 and will terminate in 2005. The Plan was amended by resolution of the Board of Directors adopted in March, 1998 and approved by the stockholders in May, 1998 to increase the number of shares as to which options may be granted from 4,000,000 to 4,400,000. The Plan was again amended by resolution of the Board of Directors adopted in March, 2000 and approved by the stockholders in May, 2000 to increase the number of shares as to which options may be granted from 4,400,000 to 6,000,000. Options granted under the Plan may be either incentive stock options (“ISOs”) within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”) or options that do not meet the requirements for incentive stock option treatment (“nonstatutory stock options” or “NSOs”). Options for a total of 2,034,015 shares were granted under the Plan to option holders of IGI, Inc. in conjunction with IGI’s spinoff of Novavax in December, 1995 (the “Spinoff Options”) as further described below. In June, 2001, the Board of Directors amended the Plan to increase the number of shares as to which options may be granted from 6,000,000 to 7,500,000, pending stockholder approval of Proposal Two at this Meeting. The Board met again in March, 2002 and amended the Plan a second time, authorizing the issuance of an additional 500,000 shares under the Plan subject to stockholder approval. In sum, the total increase in the number shares pending stockholder approval at this Meeting is from 6,000,000 to 8,000,000. Since June, 2001, the Board has granted options to purchase all of the shares remaining before the amendment and options to purchase 740,707 shares of the 2,000,000 additional authorized shares, subject to such stockholder approval. If the stockholders approve Proposal Two, the balance of shares available to be awarded under the Plan will increase from zero shares to 1,259,293 shares.

      Administration. The Plan is administered by the Compensation Committee under delegation by the Board of Directors. The Compensation Committee has the authority to select the individuals to whom options are granted and to determine the terms of each option, including the number of shares covered by each option, the option exercise price, when the options become vested or exercisable, and whether the options will be ISOs or NSOs.

      Eligibility. All directors, employees and officers of, or consultants or advisors to, Novavax and its subsidiaries are eligible to receive options under the Plan, but only employees of Novavax and its subsidiaries are entitled to receive incentive stock options. The number of individuals receiving stock options will vary from

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      Exercise Price. The exercise price for an ISO cannot be less than 100% of the fair market value of the Common Stock on the date of grant. In the case of ISOs granted to an employee who owns more than 10% of the Common Stock at the time of grant, the exercise price per share may not be less than 110% of such fair market value. There is no minimum exercise price for NSOs although the Compensation Committee has generally set the exercise price at the market value of the Common Stock on the date of grant. Options can be exercised by paying the exercise price in cash, in shares of Novavax Common Stock then held by the optionee, which have been held for at least six months, or by a combination of cash and Novavax Common Stock.

      Vesting and Termination. The vesting schedule of options granted under the Plan is at the discretion of the Compensation Committee. Except for the Spinoff Options, options granted under the Plan to officers and employees of Novavax have generally vested and become exercisable in three or four equal installments over a period of three to four years from the date of grant. Options granted to directors have generally vested and become exercisable in one installment six months from the date of grant. Options granted under the Plan must terminate no later than ten years from the date of grant and no ISO granted to a person who owns more than 10% of the Common Stock at the time of grant may be exercised more than five years following the date of grant. All options granted to date have been exercisable for a period of ten years from the grant date. If not terminated sooner by the original terms of the option grant or extended by action of the Compensation Committee, options granted to employees terminate three months after termination of employment for any reason except that in the case of termination due to death or disability options terminate one year from the date of death or termination due to disability.

      Change in Control. Unless otherwise provided in the underlying option agreement, in the event of a consolidation, merger, combination or reorganization or sale of all or substantially all the assets of the Company, or in the event of a dissolution of the Company, the Board of Directors of the Company or any corporation assuming the Company’s obligations, shall take one of the following actions with respect to then outstanding options: (i) provide that such options be assumed or equivalent options be substituted by the acquiring or succeeding corporation subject to Section 424 (a) of the Code, (ii) provide that all unexercised options will terminate immediately prior to the consummation of such transaction unless exercised by the optionee within a specified period following the date of notice to the optionee, (iii) in the event of a consolidation, merger, combination or reorganization under the terms of which holders of the Common Stock of the Company will receive upon consummation thereof a cash payment for each share surrendered in the merger (the “Merger Price”), make or provide for a cash payment to the optionees equal to the differences between (a) the Merger Price times the number of shares of Common Stock subject to such outstanding options (to the extent then exercisable at prices not in excess of the Merger Price) and (b) the aggregate exercise price of all such outstanding options in exchange for the termination of such options, and (iv) provide that all or any outstanding options shall become exercisable in full immediately prior to such event. The majority of the option agreements granted under the Plan have provided for full acceleration of vesting in the event of a consolidation, merger, combination or reorganization or sale of all or substantially all the assets of the Company.

      Transferability. Options may not be transferred voluntarily or involuntarily except pursuant to the laws of descent and distribution, except that NSOs may be transferred pursuant to a qualified domestic relations order (as defined in SEC Rule 16b-3), and options may be exercised during the optionee’s lifetime only by the optionee.

      Spinoff Options. The Plan authorized the grant of options under the Plan to all persons who held options to purchase IGI Common Stock as of the date of IGI’s distribution of its Novavax stock to IGI’s stockholders which occurred on December 12, 1995. These holders included both employees of IGI who transferred their employment to Novavax and employees of IGI who remained with IGI. These Spinoff Options were granted on substantially similar terms to the corresponding options to purchase IGI Common Stock held by such holders, including the rate at which the options vest and the expiration date of such options, with two exceptions. First, the number of shares of Novavax Common Stock underlying the Spinoff Options, as

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      Federal Income Tax Consequences to the Optionee. In general, taxable income is recognized with respect to an ISO only upon the sale of Common Stock acquired through the exercise of the ISO (“ISO Stock”) and not in connection with its grant or exercise. However, the exercise of an ISO may subject the optionee to the alternative minimum tax. The tax consequences of selling ISO Stock will vary with the length of time that the optionee has owned the ISO Stock at the time it is sold. If the optionee sells ISO Stock after having owned it for the greater of (a) two years from the date the option was granted (the “Grant Date”) and (b) one year from the date the option was exercised (the “Exercise Date”), then the optionee will recognize long term capital gain in an amount equal to the excess of the amount realized by the optionee on the sale price of the ISO Stock over the exercise price. If the optionee sells ISO Stock for more than the exercise price prior to having owned it for at least two years from the Grant Date and one year from the Exercise Date (a “Disqualifying Disposition”), then all or a portion of the gain recognized by the optionee will be ordinary compensation income and the remaining gain, if any, will be a capital gain. Any capital gain realized by the optionee from the sale of ISO Stock will be a long-term capital gain if the optionee has held the ISO Stock for more than one year prior to the date of sale. If a optionee sells ISO stock for less than the exercise price, then the optionee will recognize capital loss equal to the excess of the exercise price over the sale price of the ISO Stock. This capital loss will be a long-term capital loss if the participant has held the ISO Stock for more than one year to the date of sale.

      As with ISOs, the grant of NSOs does not result in the recognition of taxable income to the optionee. However, the exercise of an NSO results in the recognition of ordinary income to the optionee in the amount by which the fair market value of the Common Stock acquired through the exercise of the NSO (“NSO Stock”) on the Exercise Date exceeds the exercise price. Because of this tax consequence, NSOs are typically exercised simultaneously with the sale of the NSO Stock. If the NSO stock is not sold upon exercise, the optionee acquires a tax basis in the NSO Stock equal to the effective fair market value of the stock on the day of exercise (i.e., the exercise price plus any income recognized upon the exercise of the option). The sale of NSO Stock generally will result in the recognition of capital gain or loss in an equal amount to the excess of the sale price of the NSO Stock over the optionee’s tax basis in the NSO Stock. This capital gain or loss will be a long-term gain or loss if the optionee has held the NSO Stock for more than one year prior to the date of the sale and any such capital gain may be eligible for the lowest capital gains rate if held for more than a year.

      Federal Income Tax Consequences to the Company. The grant and exercise of ISOs and NSOs has no direct tax consequences to the Company. The Company generally will be entitled to a business-expense deduction with respect to any ordinary income recognized by an optionee, including income that results from the exercise of an NSO or a Disqualifying Disposition of an ISO. Any such deduction will be subject to the limitations of Section 162(m) of the Code. The Company has a statutory obligation to withhold appropriate income taxes from the ordinary income that is realized from the exercise of NSOs. The Plan provides that an optionee must pay the necessary withholding taxes to the Company at the time of exercise.

      The foregoing is only a summary of the effect of federal income taxation upon the optionee and the Company with respect to options granted under the Plan. It does not purport to be complete and does not

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New Plan Benefits

      Future option grants, if any, that will be made to eligible participants in the Plan are subject to the discretion of the Compensation Committee and, therefore, are not determinable at this time. The Company expects that each award will be made at an exercise price equal to the market value of the Company’s common stock on the day of grant. The value of each such award depends on the market value of the Company’s common stock on the day of exercise and therefore cannot be determined or estimated at this time. The market value of the Company’s Common Stock on March 15, 2002 was $10.07 per share.

      The following table represents the number of options which have been granted pursuant to the increased pool of shares, subject to stockholder approval, since the first Board vote in June, 2001 approving the first amendment. A total of 740,707 additional options have been granted pursuant to the proposed amendments to the Plan.

      Approval of the amendments to the Plan require the affirmative vote of a majority of the shares of Common Stock present or represented by proxy and entitled to vote at the Annual Meeting. Abstentions and broker non-votes will not be counted as shares voting on such matter and accordingly will have no effect on the approval of Proposal Two.

      THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE AMENDMENTS TO THE PLAN.

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PROPOSAL THREE — RATIFICATION OF APPOINTMENT OF AUDITORS

Independent Public Accountants

      On July 18, 2000, the Company dismissed PricewaterhouseCoopers LLP as its independent certified public accountants. The Board of Directors participated in and approved the decision to change independent accountants. The report of PricewaterhouseCoopers LLP on the financial statements for the two fiscal years ended December 31, 1999 and through July 18, 2000 contained no adverse opinion or disclaimer of opinion and was not qualified or modified as to uncertainty, audit scope or accounting principle. In connection with its audits for the two fiscal years ended December 31, 1999 and through July 18, 2000, there were no disagreements with PricewaterhouseCoopers LLP on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements if not resolved to the satisfaction of PricewaterhouseCoopers LLP would have caused them to make reference thereto in their report on the financial statements for such year. During the two fiscal years ended December 31, 1999 and through July 18, 2000, there were no reportable events (as defined in Regulation S-K Item 304(a)(1)(v)).

      On September 19, 2000, the Company engaged Ernst & Young LLP to act as the Company’s independent certified public accountants. The Company did not consult with Ernst & Young LLP during the Company’s two most recent fiscal years and any subsequent interim period prior to engaging them regarding matters that were or should have been subject to Statement on Auditing Standard No. 50 or any subject matter of a disagreement or reportable event with the Company’s former accountant.

      The Board of Directors has selected Ernst & Young LLP as the independent auditor of the Company for the fiscal year ending December 31, 2002, subject to ratification by stockholders at the Meeting.

Audit Fees

      The aggregate fees billed by Ernst & Young LLP for professional services rendered for the audit of the Company’s annual financial statements for fiscal year 2001 and the reviews of the financial statements included within the Company’s Forms 10-Q during fiscal year 2001 were approximately $98,000.

Financial Information Systems Design and Implementation Fees

      Ernst & Young LLP did not provide the Company with any professional services in connection with financial information systems design and implementation for fiscal year 2001.

All Other Fees

      The aggregate fees billed by Ernst & Young LLP for professional services other than audit fees were approximately $84,000. Services for such other fees included advice with respect to taxes, preparation of tax returns and services with respect to SEC registration statements.

      If this proposal is not approved at the Meeting, the Board of Directors will reconsider this selection. A representative of Ernst & Young is expected to be present at the Meeting to respond to appropriate questions and to make a statement if he so desires.

      The affirmative vote of the holders of a majority of the shares of Common Stock cast is required for the ratification of the appointment of Ernst & Young LLP as independent auditors of the Company. Abstentions and broker non-votes will not be counted as shares voting on such matter and accordingly will have no effect on the approval of Proposal Three.

      THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP AS THE COMPANY’S INDEPENDENT AUDITORS FOR FISCAL YEAR 2002.

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BENEFICIAL OWNERSHIP OF COMMON STOCK

      The following table sets forth information as of March 15, 2002 with respect to the beneficial ownership of shares of Common Stock by (i) each person known to the Company to beneficially own more than 5% of the outstanding shares of Common Stock, (ii) the current directors of the Company, (iii) the Chief Executive Officer and the other named executive officers of the Company during 2001 as identified in the “Summary Compensation Table” below, and (iv) all current directors and executive officers of the Company as a group. Unless otherwise noted, the persons named in the table have sole voting and investment power with respect to all shares of Common Stock shown as beneficially owned by them.

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15

EXECUTIVE COMPENSATION

Summary of Compensation

      The following table sets forth the cash and non-cash compensation paid during each of the last three fiscal years to the Company’s Chief Executive Officer and the four other most highly compensated executive officers of the Company who received compensation in excess of $100,000 during fiscal 2001 for services provided to the Company (collectively, the “Named Executive Officers”).

Summary Compensation Table

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Stock Options

      The following tables summarize option grants and exercises during 2001 to or by the Named Executive Officers, and the value of the options held by such persons at the end of 2001. No SARs were granted or exercised during 2001. All options listed below were granted at an exercise price equal to the fair market value of the stock on the date of grant.

Option Grants in Last Fiscal Year

Aggregate Option Exercises in Last Fiscal Year and Fiscal Year-End Option Value

Employment Contracts

      The Company has entered into an employment agreement with Mr. Spears pursuant to which he receives a base annual salary of $275,000, during the period of his employment with the Company. Mr. Spears is employed for successive one-year periods which are automatically renewed unless advance notice of termination is given by either party 30 days in advance of such renewal. Mr. Spears is also entitled to receive a performance bonus based on achieving goals established by the Board of Directors. Mr. Spears has agreed to maintain the confidentiality of the Company’s proprietary information and that all work product discovered or developed by him in the course of employment with the Company will belong to the Company. In addition, Mr. Spears has agreed not to compete with the Company for a period of one year following the termination of his employment. In the event the Company terminates Mr. Spears without cause, the Company has agreed to pay Mr. Spears severance in an amount equal to one year’s base salary.

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      The Company has entered into an employment agreement with Dr. Wright pursuant to which Dr. Wright receives a base annual salary of $205,000 during the period of his employment with the Company. In addition to any bonus awarded at the discretion of the Compensation Committee, Dr. Wright participates in a bonus program established for the Company’s Biologics Division under which 5% of the annual revenues received by the Biologics Division, up to a maximum of $100,000, is available to be allocated as bonuses by Dr. Wright to himself and the other employees of the Biologics Division. Dr. Wright is also eligible to receive his pro rata portion of $5,000 for each patent application assigned to the Company on which he is a named inventor. Dr. Wright is employed for a term ending June, 2002. Dr. Wright has agreed to maintain the confidentiality of the Company’s proprietary information and that all work product discovered or developed by him in the course of employment with the Company will belong to the Company. In addition, Dr. Wright has agreed not to compete with the Company for a period of two years following the termination of his employment. In the event the Company terminates Dr. Wright without cause, the Company has agreed to pay Dr. Wright severance in an amount equal to two years’ base salary.

      The Company has entered into employment agreements with Mr. Mirto and Mr. Genge pursuant to which they receive a base salary of $215,000 and $165,000, respectively, during the period of their employment with the Company. In addition, they are entitled to participate in the Company’s bonus program, if any. They have agreed to maintain the confidentiality of the Company’s proprietary information and all work product discovered or developed by them in the course of employment will belong to the Company. In addition, they have agreed not to compete with the Company within the United States or interfere or solicit the Company’s contractual relationships for a period of one year following the termination of their employment. In the event of a termination without cause, the Company has agreed, in addition to any unpaid bonus with respect to the prior year and any accrued vacation pay, to pay severance in an amount equal to one year’s salary, plus a pro-rated performance bonus based upon the previous year’s bonus amount.

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Comparative Stock Performance

      The graph below compares the cumulative total stockholder return on the Common Stock of the Company for the last five fiscal years, with the cumulative total return on the NASDAQ Composite Index and a peer group over the same period (assuming the investment of $100 in the Company’s Common Stock, the NASDAQ Composite Index and the peer group on December 31, 1996, and reinvestment of all dividends). The Company’s peer group consists of the Company, Aquila Biopharmaceuticals, Inc., Cellegy Pharmaceuticals, Inc, Columbia Laboratories, Inc. and Noven Pharmaceuticals, Inc.

      This section is not “soliciting material,” is not deemed “filed” with the Securities Exchange Commission and is not to be incorporated by reference in any filing of the Company under the Securities Act, or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing

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ADDITIONAL INFORMATION

Transaction of Other Business

      The Board of Directors knows of no other business that will be presented for consideration at the Meeting other than that described above. If any other business should come before the Meeting, however, it is the intention of the persons named in the enclosed proxy to vote, or otherwise act, in accordance with their best judgment on such matters.

Solicitations

      The Company will bear the cost of soliciting proxies. In addition to solicitations by mail, the Company’s directors, officers and regular employees may, without additional remuneration, solicit proxies by telephone, telegraph, facsimile and personal interviews. The Company will also request brokerage houses, custodians, nominees and fiduciaries to forward copies of the proxy material to those persons for whom they hold shares and request instructions for voting the proxies. The Company will reimburse such brokerage houses and other persons for their reasonable expenses in connection with this distribution.

Stockholder Proposals for 2003 Annual Meeting

      Any proposal that a stockholder intends to present at the 2003 Annual Meeting of Stockholders must be submitted to the Secretary of the Company at its offices, 8320 Guilford Road, Columbia, MD 21046, no later than December 11, 2002 in order to be considered for inclusion in the Proxy Statement relating to that meeting.

      THE BOARD OF DIRECTORS HOPES THAT STOCKHOLDERS WILL ATTEND THE MEETING. WHETHER OR NOT YOU PLAN TO ATTEND, YOU ARE URGED TO COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY IN THE ACCOMPANYING ENVELOPE. PROMPT RESPONSE WILL GREATLY FACILITATE ARRANGEMENTS FOR THE MEETING AND YOUR COOPERATION IS APPRECIATED. STOCKHOLDERS WHO ATTEND THE MEETING MAY VOTE THEIR STOCK PERSONALLY EVEN THOUGH THEY HAVE SENT IN THEIR PROXIES.

April 10, 2002

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Appendix A

NOVAVAX, INC.

1995 STOCK OPTION PLAN, AS AMENDED

      The purpose of this plan (the “Plan”) is to secure for Novavax, Inc. (the “Company”) and its stockholders the benefits arising from capital stock ownership by employees, officers and directors of, and consultants or advisors to, the Company and its parent and subsidiary corporations who are expected to contribute to the Company’s future growth and success. Except where the context otherwise requires, the term “Company” shall include the parent and all present and future subsidiaries of the Company as defined in Sections 424 (e) and 424(f) of the Internal Revenue Code of 1986, as amended or replaced from time to time (the “Code”). Those provisions of the Plan which make express reference to Section 422 shall apply only to Incentive Stock Options (as that term is defined in the Plan).

      (a) Types of Options. Options granted pursuant to the Plan may be either incentive stock options (“Incentive Stock Options”) meeting the requirements of Section 422 of the Code or Non-Statutory Options which are not intended to meet the requirements of Section 422 of the Code (“Non-Statutory Options”).

      (b) Administration.

      (c) Applicability of Rule 16b-3. Those provisions of the Plan which make express reference to Rule 16b-3 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or any successor rule (“Rule 16b-3”), or which are required in order for certain option transactions to qualify for exemption under Rule 16b-3, shall apply only to such persons as are required to file reports under Section 16(a) of the Exchange Act (a “Reporting Person”).

      (a) General. Except as set forth in Section 3(c), options may be granted only to persons who are, at the time of grant, employees, officers or directors of, or consultants or advisors to, the Company; provided, that the class of employees to whom Incentive Stock Options may be granted shall be limited to employees of the Company. A person who has been granted an option may, if he or she is otherwise eligible, be granted additional options if the Board of Directors shall so determine.

      (b) Grant of Options to Directors and Officers After Exchange Act Registration. From and after the registration of the Common Stock of the Company under the Exchange Act, the selection of a director or an officer (as the terms “director” and “officer” are defined for purposes of Rule 16b-3) as a recipient of an option, the timing of the option grant, the exercise price of the option and the number of shares subject to the option shall be determined either (i) by the Board of Directors, of which all members shall be “disinterested persons” (as hereinafter defined), or (ii) by two or more directors having full authority to act in the matter, each of whom shall be a “disinterested person.” For the purposes of the Plan, a director shall be deemed to be a “disinterested person” only if such person qualifies as a “disinterested person” within the meaning of Rule 16b-3, as such term is interpreted from time to time.

      (c) Grant of Options to Holders of IGI, Inc. Options. In connection with the distribution by IGI, Inc. (“IGI”) on a pro rata basis in the form of a dividend (the “Distribution”) to its stockholders of all of the outstanding shares of Common Stock of the Company held by IGI, the Board of Directors may authorize the grant of options to purchase Common Stock (“Spinoff Options”) to all holders of options to purchase shares of common stock, $.01 par value, of IGI (“IGI Common Stock”) as of the date of the Distribution. Such holders include both employees of IGI who will transfer to the Company and employees of IGI who will remain with IGI. The Spinoff Options may be granted to such holders on substantially similar terms to the corresponding options to purchase IGI Common Stock held by such holders, including the rate at which the options vest and the expiration date of such options, with two exceptions. First, the number of shares of Common Stock under the Spinoff Options compared to their IGI counterparts will reflect the distribution of one share of Common Stock for each share of IGI Common Stock. Second, the exercise prices of the Spinoff Options are to be determined by multiplying the exercise price of the related IGI option by a fraction, the numerator of which shall equal the product of the Company’s outstanding shares multiplied by the fair market value of Common Stock (which shall equal the weighted average of the last reported price per share of Novavax Common Stock on the American Stock Exchange on the 20 trading days immediately following the date of the Distribution) (the “Company Market Capitalization”), and the denominator which shall equal the sum of (a) the product of IGI’s outstanding shares multiplied by the fair market value of IGI Common Stock (which shall equal the weighted average of the last reported price per share of IGI Common Stock on the American Stock Exchange on the 20 trading days immediately following the date of the Distribution) and (b) the Company Market Capitalization.

      Subject to adjustment as provided in Section 15 below, the maximum number of shares of Common Stock which may be issued and sold under the Plan is 8,000,000 shares. If an option granted under the Plan shall expire or terminate for any reason without having been exercised in full, the unpurchased shares subject to such option shall again be available for subsequent option grants under the Plan. If shares issued upon exercise of an option under the Plan are tendered to the Company in payment of the exercise price of an option granted under the Plan, such tendered shares shall again be available for subsequent option grants under the Plan; provided, that in no event shall such shares be made available for issuance to Reporting Persons or pursuant to exercise of Incentive Stock Options.

      As a condition to the grant of an option under the Plan, each recipient of an option shall execute an option agreement in such form not inconsistent with the Plan as may be approved by the Board of Directors. Such option agreements may differ among recipients.

      (a) General. Subject to Section 3(b), the purchase price per share of stock deliverable upon the exercise of an option shall be determined by the Board of Directors, provided, however, that in the case of an Incentive Stock Option, the exercise price shall not be less than 100% of the fair market value of such stock, as determined by the Board of Directors, at the time of grant of such option, or less than 110% of such fair market value in the case of options described in Section 11(b).

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      (b) Payment of Purchase Price. Options granted under the Plan may provide for the payment of the exercise price by delivery of cash or a check to the order of the Company in an amount equal to the exercise price of such options, or, to the extent provided in the applicable option agreement, (i) by delivery to the Company of shares of Common Stock of the Company already owned by the optionee having a fair market value equal in amount to the exercise price of the options being exercised or (ii) by any other means (including, without limitation, by delivery of a promissory note of the optionee payable on such terms as are specified by the Board of Directors) which the Board of Directors determines are consistent with the purpose of the Plan and with applicable laws and regulations (including, without limitation, the provisions of Regulation T promulgated by the Federal Reserve Board). The fair market value of any shares of the Company’s Common Stock or other non-cash consideration which may be delivered upon exercise of an option shall be determined by the Board of Directors.

      Each option and all rights thereunder shall expire on such date as shall be set forth in the applicable option agreement, except that, in the case of an Incentive Stock Option, such date shall not be later than ten years after the date on which the option is granted and, in all cases, options shall be subject to earlier termination as provided in the Plan.

      Each option granted under the Plan shall be exercisable either in full or in installments at such time or times during such period and subject to such conditions as shall be set forth in the agreement evidencing such option, subject to the provisions of the Plan.

      Options shall not be assignable or transferable by the person to whom they are granted, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the life of the optionee, shall be exercisable only by the optionee; provided, however, that Non-Statutory Options may be transferred pursuant to a qualified domestic relations order (as defined in Rule 16b-3) or as otherwise expressly permitted in the agreement evidencing any such Non-Statutory Option.

      Except as provided in Section 11(d) with respect to Incentive Stock Options, and subject to the provisions of the Plan, the Board of Directors shall determine the period of time during which an optionee may exercise an option following (i) the termination of the optionee’s employment or other relationship with the Company or (ii) the death or disability of the optionee. Such periods shall be set forth in the agreement evidencing such option.

      Options granted under the Plan which are intended to be Incentive Stock Options shall be subject to the following additional terms and conditions:

      (a) Express Designation. All Incentive Stock Options granted under the Plan shall, at the time of grant, be specifically designated as such in the option agreement covering such Incentive Stock Options.

      (b) 10% Stockholder. If any employee to whom an Incentive Stock Option is to be granted under the Plan is, at the time of the grant of such option, the owner of stock possessing more than 10% of the total combined voting power of all classes of stock of the Company (after taking into account the attribution of stock ownership rules of Section 424(d) of the Code), then the following special provisions shall be applicable to the Incentive Stock Option granted to such individual:

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      (c) Dollar Limitation. For so long as the Code shall so provide, options granted to any employee under the Plan (and any other incentive stock option plans of the Company) which are intended to constitute Incentive Stock Options shall not constitute Incentive Stock Options to the extent that such options, in the aggregate, become exercisable for the first time in any one calendar year for shares of Common Stock with an aggregate fair market value (determined as of the respective date or dates of grant) of more than $100,000.

      (d) Termination of Employment, Death or Disability. No Incentive Stock Option may be exercised unless, at the time of such exercise, the optionee is, and has been continuously since the date of grant of his or her option, employed by the Company, except that:

For all purposes of the Plan and any option granted hereunder, “employment” shall be defined in accordance with the provisions of Section 1.421-7(h) of the Income Tax Regulations (or any successor regulations). Notwithstanding the foregoing provisions, no Incentive Stock Option may be exercised after its expiration date.

      (a) Additional Option Provisions. The Board of Directors may, in its sole discretion, include additional provisions in option agreements covering options granted under the Plan, including without limitation restrictions on transfer, repurchase rights, commitments to pay cash bonuses, to make, arrange for or guaranty loans or to transfer other property to optionees upon exercise of options, or such other provisions as shall be determined by the Board of Directors; provided that such additional provisions shall not be inconsistent with any other term or condition of the Plan and such additional provisions shall not cause any Incentive Stock Option granted under the Plan to fail to qualify as an Incentive Stock Option within the meaning of Section 422 of the Code.

      (b) Acceleration or Extension of Exercise Dates. The Board of Directors may, in its sole discretion, (i) accelerate the date or dates on which all or any particular option or options granted under the Plan may be exercised or (ii) extend the dates during which all, or any particular, option or options granted under the Plan may be exercised.

      (a) Investment Representations. The Company may require any person to whom an option is granted, as a condition of exercising such option, to give written assurances in substance and form satisfactory to the Company to the effect that such person is acquiring the Common Stock subject to the option for his or her own account for investment and not with any present intention of selling or otherwise distributing the same, and to such other effects as the Company deems necessary or appropriate in order to comply with federal and

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      (b) Compliance With Securities Laws. Each option shall be subject to the requirement that if, at any time, counsel to the Company shall determine that the listing, registration or qualification of the shares subject to such option upon any securities exchange or under any state or federal law, or the consent or approval of any governmental or regulatory body, or that the disclosure of non-public information or the satisfaction of any other condition is necessary as a condition of, or in connection with, the issuance or purchase of shares thereunder, such option may not be exercised, in whole or in part, unless such listing, registration, qualification, consent or approval, or satisfaction of such condition shall have been effected or obtained on conditions acceptable to the Board of Directors. Nothing herein shall be deemed to require the Company to apply for or to obtain such listing, registration or qualification, or to satisfy such condition.

      The holder of an option shall have no rights as a stockholder with respect to any shares covered by the option (including, without limitation, any rights to receive dividends or non-cash distributions with respect to such shares) until the date of issue of a stock certificate to him or her for such shares. No adjustment shall be made for dividends or other rights for which the record date is prior to the date such stock certificate is issued.

      (a) If (i) the outstanding shares of Common Stock are (A) exchanged for a different number or kind of shares or other securities of the Company or (B) increased or decreased as a result of any recapitalization, reclassification, stock dividend, stock split or reverse stock split or (ii) additional shares or new or different shares or other securities of the Company or other non-cash assets are distributed with respect to such shares of Common Stock or other securities, an appropriate and proportionate adjustment shall be made in (x) the maximum number and kind of shares reserved for issuance under the Plan, (y) the number and kind of shares or other securities subject to any then outstanding options under the Plan, and (z) the price for each share subject to any then outstanding options under the Plan, without changing the aggregate purchase price as to which such options remain exercisable. Notwithstanding the foregoing, no adjustment shall be made pursuant to this Section 15 if such adjustment would cause the Plan to fail to comply with Section 422 of the Code.

      (b) Any adjustments under this Section 15 will be made by the Board of Directors, whose determination as to what adjustments, if any, will be made and the extent thereof will be final, binding and conclusive. No fractional shares will be issued under the Plan on account of any such adjustments.

      (a) General. In the event of a consolidation, merger, combination or reorganization or sale of all or substantially all of the assets of the Company in which outstanding shares of Common Stock are exchanged for securities, cash or other property of any other corporation or business entity or in the event of a liquidation of the Company, the Board of Directors of the Company, or the board of directors of any corporation assuming the obligations of the Company, shall take any one or more of the following actions, as to outstanding options: (i) provide that such options shall be assumed, or equivalent options shall be substituted, by the acquiring or succeeding corporation (or an affiliate thereof), provided that any such options substituted for Incentive Stock Options shall meet the requirements of Section 424(a) of the Code, (ii) upon written notice to the optionees, provide that all unexercised options will terminate immediately prior to the consummation of such transaction unless exercised by the optionee within a specified period following the date of such notice, (iii) in the event of a consolidation, merger, combination or reorganization under the terms of which holders of the Common Stock of the Company will receive upon consummation thereof a cash payment for each share surrendered in the merger (the “Merger Price”), make or provide for a cash payment to the optionees equal to the difference between (A) the Merger Price times the number of shares of Common Stock subject to such outstanding options (to the extent then exercisable at prices not in excess of the Merger Price) and (B) the aggregate

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      (b) Substitute Options. The Company may grant options under the Plan in substitution for options held by employees of another corporation who become employees of the Company, of a subsidiary of the Company, as the result of a merger, consolidation, combination or reorganization of the employing corporation with the Company or a subsidiary of the Company, or as a result of the acquisition by the Company, or one of its subsidiaries, of property or stock of the employing corporation. The Company may direct that substitute options be granted on such terms and conditions as the Board of Directors considers appropriate in the circumstances.

      Nothing contained in the Plan or in any option shall confer upon any optionee any right with respect to the continuation of his or her employment by the Company or interfere in any way with the right of the Company at any time to terminate such employment or to increase or decrease the compensation of the optionee.

      Except as to plans which by their terms include such amounts as compensation, the amount of any compensation deemed to be received by an employee as a result of the exercise of an option or the sale of shares received upon such exercise will not constitute compensation with respect to which any other employee benefits of such employees are determined, including, without limitation, benefits under any bonus, pension, profit-sharing, life insurance or salary continuation plan, except as otherwise specifically determined by the Board of Directors.

      (a) The Board of Directors may at any time, and from time to time, modify or amend the Plan in any respect, except that if at any time the approval of the stockholders of the Company is required under Section 422 of the Code or any successor provision with respect to Incentive Stock Options, or under Rule 16b-3 (if then applicable), the Board of Directors may not effect such modification or amendment without such approval.

      (b) The termination or any modification or amendment of the Plan shall not, without the consent of an optionee, affect his or her rights under an option previously granted to him or her. With the consent of the optionee affected, the Board of Directors may amend outstanding option agreements in a manner not inconsistent with the Plan. The Board of Directors shall have the right to amend or modify (i) the terms and provisions of the Plan and of any outstanding Incentive Stock Options granted under the Plan to the extent necessary to qualify any or all such options for such favorable federal income tax treatment (including deferral of taxation upon exercise) as may be afforded incentive stock options under Section 422 of the Code and (ii) the terms and provisions of the Plan and of any outstanding option to the extent necessary to ensure the qualification of the Plan under Rule 16b-3 (if then applicable).

      (a) The Company shall have the right to deduct from payments of any kind otherwise due to the optionee any federal, state or local taxes of any kind required by law to be withheld with respect to any shares issued upon exercise of options under the Plan. Subject to the prior approval of the Company, which may be withheld by the Company in its sole discretion, the optionee may elect to satisfy such obligations, in whole or in part, (i) by causing the Company to withhold shares of Common Stock otherwise issuable pursuant to the exercise of an option or (ii) by delivering to the Company shares of Common Stock already owned by the optionee. The shares so delivered or withheld shall have a fair market value equal to such withholding obligation. The fair market value of the shares used to satisfy such withholding obligation shall be determined by the Company as of the date that the amount of tax to be withheld is to be determined. An optionee who has

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      (b) Notwithstanding the foregoing, in the case of a Reporting Person, no election to use shares for the payment of withholding taxes shall be effective unless made in compliance with any applicable requirements of Rule 16b-3 (unless it is intended that the transaction not qualify for exemption under Rule 16b-3).

      The Board of Directors shall have the authority to effect, at any time and from time to time, with the consent of the affected optionees, (i) the cancellation of any or all outstanding options under the Plan and the grant in substitution therefor of new options under the Plan covering the same or different numbers of shares of Common Stock and having an option exercise price per share which may be lower or higher than the exercise price per share of the cancelled options or (ii) the amendment of the terms of any and all outstanding options under the Plan to provide an option exercise price per share which is higher or lower than the then-current exercise price per share of such outstanding options.

      (a) Effective Date. The Plan shall become effective when adopted by the Board of Directors, but no option granted under the Plan shall become exercisable unless and until the Plan shall have been approved by the Company’s stockholders. If such stockholder approval is not obtained within twelve months after the date of the Board’s adoption of the Plan, options previously granted under the Plan shall not vest and shall terminate and no options shall be granted thereafter. Amendments to the Plan not requiring stockholder approval shall become effective when adopted by the Board of Directors; amendments requiring stockholder approval (as provided in Section 19) shall become effective when adopted by the Board of Directors, but no option granted after the date of such amendment shall become exercisable (to the extent that such amendment to the Plan was required to enable the Company to grant such option to a particular person) unless and until such amendment shall have been approved by the Company’s stockholders. If such stockholder approval is not obtained within twelve months of the Board’s adoption of such amendment, any options granted on or after the date of such amendment shall terminate to the extent that such amendment was required to enable the Company to grant such option to a particular optionee. Subject to this limitation, options may be granted under the Plan at any time after the effective date and before the date fixed for termination of the Plan.

      (b) Termination. Unless sooner terminated in accordance with Section 16, the Plan shall terminate upon the close of business on the day next preceding the tenth anniversary of the date of its adoption by the Board of Directors. Options outstanding on such date shall continue to have force and effect in accordance with the provisions of the instruments evidencing such options.

      The Board of Directors may, without amending the Plan, modify awards or options granted to participants who are foreign nationals or employed outside the United States to recognize differences in laws, rules, regulations or customs of such foreign jurisdictions with respect to tax, securities, currency, employee benefit or other matters.

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NOVAVAX, INC.

C/O EQUISERVE
P.O. BOX 43068
PROVIDENCE, RI 02940

Do not return your Proxy Card if you are voting by Telephone or Internet

PROXY

NOVAVAX, INC.
Annual Meeting of Stockholders
MAY 8, 2002

THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS

     The undersigned stockholder of Novavax, Inc. hereby appoints John A. Spears, Dennis W. Genge and Ann McGeehan and each of them, attorneys, agents and proxies, with the power of substitution to each, to vote all shares of Common Stock that the undersigned is entitled to vote at the Annual Meeting of Stockholders of Novavax, Inc., to be held at the Four Seasons Hotel, 2800 Pennsylvania Avenue, N.W., Washington, D.C., on May 8, 2002 at 10:00 a.m., and any adjournments thereof.

     The shares represented by this proxy will be voted as directed by the undersigned. IF NO CONTRARY INSTRUCTIONS ARE INDICATED, THIS PROXY WILL BE VOTED FOR (1) THE ELECTION OF EACH OF THE NOMINEES NAMED IN THIS PROXY FOR CLASS I DIRECTOR, (2) APPROVAL OF THE AMENDMENTS TO THE 1995 NOVAVAX, INC. STOCK OPTION PLAN INCREASING THE TOTAL AUTHORIZED SHARES BY 2,000,000 SHARES FROM 6,000,000 SHARES TO 8,000,000 SHARES, (3) RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP AS AUDITORS FOR FISCAL YEAR 2002, AND (4) IN THE DISCRETION OF THE PROXYHOLDER, ANY OTHER MATTERS WHICH MAY PROPERLY COME BEFORE THE MEETING.

PLEASE VOTE, DATE AND SIGN ON REVERSE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.

Please date and sign this Proxy and return it promptly, whether or not you expect to attend the meeting. You may nevertheless vote in person if you do attend. If you plan to attend, please mark the box on the reverse side. Please sign exactly as your name is printed on the reverse side. When signing as attorney-in-fact, executor, administrator, trustee or guardian, please give full title as such. If stock is held in joint names, all named stockholders should sign.