Exhibit 10.5
STOCK OPTION GRANT PROGRAM
FOR
NONEMPLOYEE DIRECTORS UNDER THE
PONIARD PHARMACEUTICALS, INC. 2004 INCENTIVE
COMPENSATION PLAN
(as amended June 15, 2005, September 27, 2006
and February 7, 2007)
The following
provisions set forth the terms of the stock option grant program
(the “Program”) for nonemployee directors of Poniard
Pharmaceuticals, Inc. (the “Company”) under the
Company’s 2004 Incentive Compensation Plan (the
“Plan”). The following terms are intended to
supplement, not alter or change, the provisions of the Plan, and in
the event of any inconsistency between the terms contained herein
and in the Plan, the Plan shall govern. All capitalized terms
that are not defined herein shall be as defined in the
Plan.
1.
Eligibility
Each director of
the Company elected or appointed to the Board who is not otherwise
an employee of the Company or any Related Corporation (an
“Eligible Director”) shall be eligible to receive New
Grants and Annual Grants under the Plan, as discussed
below.
2.
New Grants
Each Eligible
Director shall receive a nonqualified stock option to purchase
20,000 shares of Common Stock (“New Grant”) upon such
Eligible Director’s initial election or appointment to the
Board. New Grants shall vest and become exercisable in two
equal installments according to the schedule set forth in Section 4
below.
3.
Annual Grants
Beginning with the
2004 annual meeting of shareholders, each Eligible Director shall
automatically receive a nonqualified stock option to purchase
10,000 shares of Common Stock immediately following each
year’s annual meeting of shareholders (each, an “Annual
Grant”); provided that any Eligible Director who received a
New Grant within five months prior to an annual meeting of
shareholders shall not receive an Annual Grant until the next
year’s annual meeting. Annual Grants shall vest and
become exercisable in two equal installments according to the
schedule set forth in Section 4.
4.
Vesting and Exercisability
Options shall vest and
become exercisable according to the following schedule:
(a)
New Grants
|
Period of Optionee’s Continuous
Service as a Director From
the Date the Option Is Granted
|
|
Portion of Grant
That Is Vested and Exercisable
|
|
|
One
year
|
|
50
|
%
|
|
Two
years
|
|
100
|
%
|
(b)
Annual Grants
|
Period of Optionee’s Continuous
Service as a Director From
the Date the Option Is Granted
|
|
Portion of Grant
That Is Vested and Exercisable
|
|
|
|
|
|
|
|
Upon first annual meeting of shareholders after
grant
|
|
50
|
%
|
|
|
|
|
|
|
Upon second annual meeting of shareholders
after grant
|
|
100
|
%
|
Subject to the
exercisability schedule described above, each option may be
exercised in whole or in part at any time; provided, however, that
an option may not be exercised for less than a reasonable number of
shares at any one time, as determined by the Plan
Administrator.
5.
Option Exercise Price
The exercise price
of an option shall be the fair market value of the Common Stock on
the date of grant.
6.
Manner of Option Exercise
An option shall be
exercised by giving the required notice to the Company, stating the
number of shares of Common Stock w
