Exhibit 10.1

 

KALOBIOS PHARMACEUTICALS, INC.
2012 EQUITY INCENTIVE PLAN
NOTICE OF STOCK UNIT AWARD

 

You have been granted Stock Units representing shares of common stock of
KaloBios Pharmaceuticals, Inc. (the “Company”) on the following terms:

 

Name of Recipient:

«Name»

 

 

Total Number of Stock Units Granted:

«TotalUnits»

 

 

Date of Grant:

«DateGrant»

 

 

Vesting Commencement Date:

«VestDay»

 

 

Vesting Schedule:

The first «CliffPercent»% of the Stock Units subject to this award will vest
when you complete «CliffPeriod» months of continuous Service (as defined in the
Plan) after the Vesting Commencement Date. [Thereafter, an additional
«IncrementPercent»% of the Stock Units subject to this award will vest when you
complete each additional «IncrementPeriod»-month period of continuous Service.]
[If the Company is subject to a “Change in Control” (as defined in the Plan)
before your Service terminates, then, to the extent the Stock Units have not yet
become vested, they will vest with respect to 100% of the unvested shares
immediately prior to consummation of the Change in Control.](1)

 

You and the Company agree that these Stock Units are granted under and governed
by the terms and conditions of the Company’s 2012 Equity Incentive Plan (the
“Plan”) and the Stock Unit Agreement, both of which are attached to, and made a
part of, this document.

 

You further agree to accept by email all documents relating to the Plan or this
award (including, without limitation, prospectuses required by the Securities
and Exchange Commission) and all other documents that the Company is required to
deliver to its security holders (including, without limitation, annual reports
and proxy statements).  You also agree that the Company may deliver these
documents by posting them on a website maintained by the Company or by a third
party under contract with the Company.  If the Company posts these documents on
a website, it will notify you by email.

 

You further agree to comply with the Company’s Insider Trading Policy when
selling shares of the Company’s common stock.

 

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(1)  For outside directors only.

 

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RECIPIENT

 

KALOBIOS PHARMACEUTICALS, INC.

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

 

Title:

 

 

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KALOBIOS PHARMACEUTICALS, INC.
2012 EQUITY INCENTIVE PLAN

 

STOCK UNIT AGREEMENT

 

Grant of Stock Units

 

Subject to all of the terms and conditions set forth in the Notice of Stock Unit
Award, this Stock Unit Agreement (the “Agreement”) and the Plan, the Company has
granted to you the number of Stock Units set forth in the Notice of Stock Unit
Award.

 

All capitalized terms used in this Agreement shall have the meanings assigned to
them in this Agreement, the Notice of Stock Unit Award or the Plan.

 

 

 

Payment for Stock Units

 

No payment is required for the Stock Units that you are receiving.

 

 

 

Vesting

 

The Stock Units vest in accordance with the vesting schedule set forth in the
Notice of Stock Unit Award. No additional Stock Units will vest after your
Service has terminated for any reason.

 

 

 

Forfeiture

 

If your Service terminates for any reason, then your Stock Units will be
forfeited to the extent that they have not vested before the termination date
and do not vest as a result of the termination of your Service. This means that
any Stock Units that have not vested under this Agreement will be cancelled
immediately. You will not receive any payment for Stock Units that are
forfeited. The Company determines when your Service terminates for all purposes
of your Stock Units.

 

 

 

Leaves of Absence and Part-Time Work

 

For purposes of this award, your Service does not terminate when you go on a
military leave, a sick leave or another bona fide leave of absence, if the leave
was approved by the Company in writing and if continued crediting of Service is
required by applicable law, the Company’s leave of absence policy, or the terms
of your leave. However, your Service terminates when the approved leave ends,
unless you immediately return to active work.

 

 

 

 

 

If you go on a leave of absence, then the vesting schedule specified in the
Notice of Stock Unit Award may be adjusted in accordance with the Company’s
leave of absence policy or the terms of your leave. If you commence working on a
part-time basis, the Company may adjust the vesting schedule so that the rate of
vesting is commensurate with your reduced work schedule.

 

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Settlement of Stock Units

 

Each Stock Unit will be settled on the first Permissible Trading Day that occurs
on or after the day when the Stock Unit vests. However, each Stock Unit must be
settled not later than March 15th of the calendar year following the calendar
year in which the Stock Unit vests.

 

At the time of settlement, you will receive one Common Share for each vested
Stock Unit. But the Company, at its sole discretion, may substitute an
equivalent amount of cash if the distribution of stock is not reasonably
practicable due to the requirements of applicable law. The amount of cash will
be determined on the basis of the market value of a Common Share at the time of
settlement.

 

No fractional shares will be issued upon settlement.

 

 

 

“Permissible Trading Day”

 

“Permissible Trading Day” means a day that satisfies each of the following
requirements:

 

·      The Nasdaq Global Market is open for trading on that day;

 

·      You are permitted to sell Common Shares on that day without incurring
liability under Section 16(b) of the Securities Exchange Act of 1934, as
amended;

 

·      Either (a) you are not in possession of material non-public information
that would make it illegal for you to sell Common Shares on that day under
Rule 10b-5 of the Securities and Exchange Commission or (b) Rule 10b5-1 of the
Securities and Exchange Commission is applicable;

 

·      Under the Company’s Insider Trading Policy, you are permitted to sell
Company Shares on that day; and

 

·      You are not prohibited from Company Shares on that day by a written
agreement between you and the Company or a third party.

 

 

 

Section 409A

 

This paragraph applies only if the Company determines that you are a “specified
employee,” as defined in the regulations under Code Section 409A at the time of
your “separation from service,” as defined in Treasury Regulation
Section 1.409A-1(h) and it is determined that settlement of these Stock Units is
not exempt from Code Section 409A. If this paragraph applies, and the event
triggering settlement is your “separation from service,” then any Stock Units
that otherwise would have been settled during the first six months following
your “separation from service” will instead be settled on the first business day
following the earlier of (i) the six-month anniversary of your separation from
service or (ii) your death.

 

Each installment of Stock Units that vests is hereby designated as a separate
payment for purposes of Code Section 409A.

 

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Nature of Stock Units

 

Your Stock Units are mere bookkeeping entries. They represent only the Company’s
unfunded and unsecured promise to issue Common Shares (or distribute cash) on a
future date. As a holder of Stock Units, you have no rights other than the
rights of a general creditor of the Company.

 

 

 

No Voting Rights or Dividends

 

Your Stock Units carry neither voting rights nor rights to cash dividends. You
have no rights as a stockholder of the Company unless and until your Stock Units
are settled by issuing Common Shares.

 

 

 

Stock Units Nontransferable

 

You may not sell, transfer, assign, pledge or otherwise dispose of any Stock
Units. For instance, you may not use your Stock Units as security for a loan.

 

 

 

Beneficiary Designation

 

You may dispose of your Stock Units in a written beneficiary designation. A
beneficiary designation must be filed with the Company on the proper form. It
will be recognized only if it has been received at the Company’s headquarters
before your death. If you file no beneficiary designation or if none of your
designated beneficiaries survives you, then your estate will receive any vested
Stock Units that you hold at the time of your death.

 

 

 

Withholding Taxes

 

No stock certificates (or their electronic equivalent) or cash will be
distributed to you unless you have made arrangements satisfactory to the Company
for the payment of any withholding taxes that are due as a result of the vesting
or settlement of your Stock Units. If withholding obligations apply, you may
satisfy these withholding obligations by paying cash to the Company. At the
discretion of the Company, these arrangements may also include (a) payment from
the proceeds of the sale of shares through a Company-approved broker,
(b) withholding Common Shares that otherwise would be issued to you when the
Stock Units are settled with a fair market value no greater than the minimum
amount required to be withheld by law, (c) surrendering Common Shares that you
previously acquired with a fair market value no greater than the minimum amount
required to be withheld by law, or (d) withholding cash from other compensation.
The fair market value of withheld or surrendered Common Shares, determined as of
the date when taxes otherwise would have been withheld in cash, will be applied
to the withholding taxes.

 

To the extent you fail to make satisfactory arrangements for the payment of any
required withholding taxes, you will permanently forfeit the applicable Stock
Units.

 

 

 

Restrictions on Resale

 

You agree not to sell any shares at a time when applicable laws, Company
policies or an agreement between the Company and its underwriters prohibit a
sale. This restriction will apply as long as your Service continues and for such
period of time after the termination of your Service as the Company may specify.

 

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Retention Rights

 

Your award or this Agreement does not give you the right to be retained by the
Company, a Parent, Subsidiary, or an Affiliate in any capacity. The Company and
its Parents, Subsidiaries, and Affiliates reserve the right to terminate your
Service at any time, with or without cause.

 

 

 

Adjustments

 

In the event of a stock split, a stock dividend or a similar change in Company
stock, the number of your Stock Units will be adjusted accordingly, as the
Company may determine pursuant to the Plan.

 

 

 

Effect of Significant Corporate Transactions

 

If the Company is a party to a merger, consolidation, or certain change in
control transactions, then your Stock Units will be subject to the applicable
provisions of Article 9 of the Plan, provided that any action taken must either
(a) preserve the exemption of your Stock Units from Code Section 409A or
(b) comply with Code Section 409A.

 

 

 

Recoupment Policy

 

This award, and the Common Shares acquired upon settlement of this award, shall
be subject to any Company recoupment or clawback policy in effect from time to
time.

 

 

 

Applicable Law

 

This Agreement will be interpreted and enforced under the laws of the State of
Delaware (without regard to its choice-of-law provisions).

 

 

 

The Plan and Other Agreements

 

The text of the Plan is incorporated in this Agreement by reference.

 

The Plan, this Agreement and the Notice of Stock Unit Award constitute the
entire understanding between you and the Company regarding this award. Any prior
agreements, commitments or negotiations concerning this award are superseded.
This Agreement may be amended only by another written agreement between the
parties.

 

BY SIGNING THE COVER SHEET OF THIS AGREEMENT, YOU AGREE TO ALL OF THE
TERMS AND CONDITIONS DESCRIBED ABOVE AND IN THE PLAN.

 

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