Exhibit 10.3

Puma Biotechnology, Inc.

Non-Employee Director Compensation Program

 

(Effective April 27, 2017)

 

Non-employee members of the board of directors (the “Board”) of Puma
Biotechnology, Inc. (the “Company”) shall be eligible to receive cash and equity
compensation as set forth in this Non-Employee Director Compensation Program
(this “Program”).  The cash and equity compensation described in this Program
shall be paid or be made, as applicable, automatically and without further
action of the Board, to each member of the Board who is not an employee of the
Company or any subsidiary of the Company (each, a “Non-Employee Director”) who
may be eligible to receive such cash or equity compensation.  This Program shall
become effective as of the date set forth above.  

 

Cash Compensation

 

Board Service

 

Annual Retainer:

$50,000

Committee Service

 

Audit Committee:

 

Chair Annual Retainer:

$20,000

Committee Member (Non-Chair) Retainer:

$10,000

Compensation Committee:

 

Chair Annual Retainer:

$15,000

Committee Member (Non-Chair) Retainer:

$7,500

Nominating and Corporate Governance Committee:

 

Chair Annual Retainer:

$10,000

Committee Member (Non-Chair) Retainer:

$5,000

 

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Board Service and Committee Service Annual Retainers will be paid or granted (as
applicable) quarterly at the beginning of the applicable calendar quarter.  In
the event that a Non-Employee Director is initially elected or appointed to
serve on the Board (the date of any such initial election or appointment, such
Non-Employee Director’s “Start Date”) on any date other than the first day of a
calendar quarter, such Non-Employee Director shall receive, within 30 days

following such Non-Employee Director’s Start Date, a prorated portion of the
Board Service Annual Retainer and a prorated portion of each applicable
Committee Service Annual Retainer, payable to such Non-Employee Director with
respect to such quarter.    

 

Equity Compensation

 

Non-Employee Directors shall be granted the equity awards described below.  The
awards described below shall be granted under and shall be subject to the terms
and provisions of the Company’s 2011 Incentive Award Plan, as may be amended
from time to time (the “Plan”).  Capitalized terms not otherwise defined below
shall have the meanings ascribed to them in the Plan.  

Initial Option Grant:

Each Non-Employee Director who is initially elected or appointed to serve on the
Board is hereby granted an Option with a value of $700,000 (the “Initial
Grant”).  

 

The number of Shares subject to the Initial Grant will be determined by dividing
the value by the Black-Scholes valuation as of the grant date using a trailing
30-calendar day average closing price for the Company’s common stock through and
including the applicable grant date.

The Initial Grant is hereby granted on the date on which such Non-Employee
Director is initially elected or appointed to serve on the Board (the “Election
Date”), and shall vest with respect to one-third (1/3rd) of the Shares subject
thereto on the first anniversary of the applicable Election Date, and with
respect to an additional 1/36th of the Shares subject thereto on each monthly
anniversary thereafter, subject to continued service through the applicable
vesting date.  Each Initial Grant shall have an exercise price per Share equal
to the Fair Market Value of a Share on the applicable Election Date.

 

 

 

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Annual Option Grant:

Each Non-Employee Director who is serving on the Board as of the date of any
annual shareholder meeting after the effective date of this Program and will
continue to serve as a Non-Employee Director immediately following such meeting,
shall hereby be granted annually an Option with a value of $300,000 (the “Annual
Grant”).  

 

The number of Shares subject to the Annual Grant will be determined by dividing
the value by the Black-Scholes valuation as of the grant date using a trailing
30-calendar day average closing price for the Company’s common stock through and
including the applicable grant date.

 

Each Annual Grant will vest in full on the earlier of the one-year anniversary
of the date of grant and the date of the annual shareholder meeting following
the date of grant, subject to continued service.  Each Annual Grant shall have
an exercise price per Share equal to the Fair Market Value of a Share on the
applicable grant date.

 

Miscellaneous

 

Each Initial Grant and Annual Grant shall be an Option and shall have a maximum
term of ten years from the applicable date of grant.  All applicable terms of
the Plan apply to this Program as if fully set forth herein, and all grants of
awards are hereby subject in all respect to the terms of the Plan.  The grant of
any award under this Program shall be made solely by and subject to the terms
set forth in a written Award Agreement in a form approved by the Board and duly
executed by an executive officer of the Company.

 

Non-Employee Director Award Limit

 

Notwithstanding any provision to the contrary in this Program, the sum of any
cash compensation and the grant date fair value (determined as of the date of
the grant under Financial Accounting Standards Board Accounting Standards
Codification Topic 718, or any successor thereto) of all awards granted under
this Program shall be subject to any limitations imposed under the Plan or any
other applicable agreement, program, policy or plan.

 

Amendment, Modification and Termination

 

This Program may be amended, modified or terminated by the Board in the future
at its sole discretion.  No Non-Employee Director shall have any rights
hereunder, except with respect to any awards actually granted pursuant to the
Program.