Exhibit 10.46

 

NON-QUALIFIED STOCK OPTION AGREEMENT

 

225,000 SHARES OF COMMON STOCK,

 

 

$.0001 PAR VALUE PER SHARE

 

SYNTA PHARMACEUTICALS CORP.

 

December 8, 2014

 

As of December 8, 2014 (the “Grant Date”), Synta Pharmaceuticals Corp. (the
“Company”), a Delaware corporation, grants to Marc Schneebaum (the
“Participant”) the right and option (the “Option”) to purchase up to 225,000
shares of the common stock, $.0001 par value per share, of the Company (the
“Shares”) at a purchase price of $2.85 per share (the “Purchase Price”) on the
terms and conditions and subject to all the limitations set forth in this
Agreement.  For the purpose of this Agreement, the initial vesting date shall be
December 8, 2015 (“Initial Vesting Date”).

 

SYNTA PHARMACEUTICALS CORP.

 

 

By:

/s/ Anne Whitaker

 

 

Anne Whitaker

 

 

President and Chief Executive Officer

 

 

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1.                                      GRANT OF OPTION.

 

The Company hereby grants to the Participant, as of the Grant Date, the right
and option to purchase all or any part of the aggregate number of Shares set
forth on the signed cover page of this Agreement, on the terms and conditions
and subject to all the limitations set forth herein, under United States
securities and tax laws. Except as expressly provided in this Agreement, no
issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of the
Shares.  Except as expressly provided in this Agreement, no adjustments shall be
made for dividends paid in cash or in property (including without limitation,
securities) of the Company.

 

2.                                      PURCHASE PRICE.

 

The purchase price of the Shares covered by the Option shall be the Purchase
Price set forth on the cover page of this Agreement, subject to adjustment, as
provided in Section 9 of this Agreement, in the event of a stock split, reverse
stock split or other events affecting the holders of Shares.  Payment shall be
made in accordance with Section 5 of this Agreement.

 

3.                                      EXERCISABILITY OF OPTION.

 

Subject to the terms and conditions set forth in this Agreement, the Option
granted hereby shall become exercisable in cumulative installments of (i) 25% of
the Shares on the Initial Vesting Date, and (ii) 6.25% of the Shares on the last
day of each successive three-month period thereafter.  Notwithstanding the
foregoing, the Option shall become vested and exercisable in accordance with the
terms and conditions set forth in Sections 9B and C hereof and upon termination
by the Company of the Participant without cause or by the Participant for good
reason as set forth in the Severance and Change of Control Agreement between the
Company and the Participant dated November 24, 2014 (the “Severance Agreement”).

 

4.                                      TERM OF OPTION.

 

The Option shall terminate ten years from the date of this Agreement, but shall
be subject to earlier termination as provided herein.

 

If the Participant ceases to be an employee, or consultant of the Company or any
parent or subsidiary, direct or indirect, of the Company (an “Affiliate”) (for
any reason other than the death or permanent and total disability as defined in
Section 22(e)(3) of the United States Internal Revenue Code of 1986, as amended
(the “Code”) of the Participant (a “Disability”) or termination of the
Participant for “cause” (as defined in the Participant’s Severance Agreement),
the Option may be exercised, if it has not previously terminated, within three
months after the date the Participant ceases to be an employee or consultant of
the Company or of an Affiliate, or within the originally prescribed term of the
Option, whichever is earlier, but may not be exercised thereafter.  In such
event, the Option shall be exercisable only to the extent that the Option has
become exercisable and is in effect at the date of such cessation of service.

 

Notwithstanding the foregoing, in the event of the Participant’s Disability or
death within three months after the termination of service, the Participant or
the deceased Participant’s legal representatives and/or any person or persons
who acquired the Participant’s rights to the Option by will or by the laws of
descent and distribution (the “Participant’s Survivors”) may exercise the Option
within one year after the date of the Participant’s termination of service, but
in no event after the date of expiration of the term of the Option.

 

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In the event the Participant’s service is terminated by the Company or by an
Affiliate for “cause” (as defined in the Participant’s Severance Agreement), the
Participant’s right to exercise any unexercised portion of the Option shall
cease immediately as of the time the Participant is notified his or her service
is terminated for “cause,” and the Option shall thereupon terminate. 
Notwithstanding anything herein to the contrary, if subsequent to the
Participant’s termination, but prior to the exercise of the Option, the Board of
Directors of the Company determines that, either prior or subsequent to the
Participant’s termination, the Participant engaged in conduct which would
constitute “cause”, then the Participant shall immediately cease to have any
right to exercise the Option and the Option shall thereupon terminate.

 

In the event of the Disability of the Participant, the Option shall be
exercisable within one year after the Participant’s termination of service or,
if earlier, within the term originally prescribed by the Option.  In such event,
the Option shall be exercisable:

 

(a)                                 to the extent that the Option has become
exercisable but has not been exercised as of the date of Disability; and

 

(b)                                 in the event rights to exercise the Option
accrue periodically, to the extent of a pro rata portion through the date of
Disability of any additional vesting rights that would have accrued on the next
vesting date had the Participant not become Disabled.  The proration shall be
based upon the number of days accrued in the current vesting period prior to the
date of Disability.

 

The Board of Directors of the Company or, if applicable, a committee of the
Board of Directors, shall make the determination both of whether a Disability
has occurred and the date of its occurrence (unless a procedure for such
determination is set forth in another agreement between the Company and such
Participant, in which case such procedure shall be used for such determination).
If requested, the Participant shall be examined by a physician selected or
approved by the Board of Directors of the Company or, if applicable, a committee
of the Board of Directors, the cost of which examination shall be paid for by
the Company.

 

In the event of the death of the Participant while an employee or consultant of
the Company or of an Affiliate, the Option shall be exercisable by the
Participant’s Survivors within one year after the date of death of the
Participant or, if earlier, within the originally prescribed term of the
Option.  In such event, the Option shall be exercisable:

 

(x)                                 to the extent that the Option has become
exercisable but has not been exercised as of the date of death; and

 

(y)                                 in the event rights to exercise the Option
accrue periodically, to the extent of a pro rata portion through the date of
death of any additional vesting rights that would have accrued on the next
vesting date had the Participant not died.  The proration shall be based upon
the number of days accrued in the current vesting period prior to the
Participant’s date of death.

 

5.                                      METHOD OF EXERCISING OPTION.

 

Subject to the terms and conditions of this Agreement, the Option may be
exercised by written notice to the Company or its designee, in substantially the
form prescribed by the Company or its designee together with provision for
payment of the full Purchase Price in accordance with this Section 5 for the
Shares as to which the Option is being exercised.  Such notice shall state the
number of Shares with respect to which the Option is being exercised and shall
be signed by the person

 

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exercising the Option.  Payment of the purchase price for such Shares shall be
made (a) in United States dollars in cash or by check, or (b) at the discretion
of the Board of Directors of the Company or, if applicable, a committee of the
Board of Directors, through delivery of shares of common stock of the Company
having a Fair Market Value (as defined below) equal as of the date of the
exercise to the cash exercise price of the Option and held for at least six
months, or (c) at the discretion of the Board of Directors of the Company or, if
applicable, a committee of the Board of Directors, by having the Company retain
from the shares otherwise issuable upon exercise of the Option, a number of
shares having a Fair Market Value equal as of the date of exercise to the
exercise price of the Option, or (d) at the discretion of the Board of Directors
of the Company or, if applicable, a committee of the Board of Directors, by
delivery of the grantee’s personal recourse note, bearing interest payable not
less than annually at no less than 100% of the applicable Federal rate, as
defined in Section 1274(d) of the Code, or (e) in accordance with a cashless
exercise program established with a securities brokerage firm previously
approved by the Company, or (f) at the discretion of the Board of Directors of
the Company or, if applicable, a committee of the Board of Directors, by any
combination of (a), (b), (c) (d) and (e) above or (g) at the discretion of the
Board of Directors of the Company or, if applicable, a committee of the Board of
Directors, payment of such other lawful consideration as the Board of Directors
of the Company or, if applicable, a committee of the Board of Directors may
determine.

 

For purposes of this Agreement, Fair Market Value of a Share of common stock
means:

 

(1)                                 If the common stock of the Company is listed
on a national securities exchange or traded in the over-the-counter market and
sales prices are regularly reported for the common stock, the closing or last
price of the common stock on the composite tape or other comparable reporting
system for the trading day on the applicable date and if such applicable date is
not a trading day, the last market trading day prior to such date;

 

(2)                                 If the common stock of the Company is not
traded on a national securities exchange but is traded on the over-the-counter
market, if sales prices are not regularly reported for the common stock for the
trading day referred to in clause (1), and if bid and asked prices for the
common stock are regularly reported, the mean between the bid and the asked
price for the common stock at the close of trading in the over-the-counter
market for the trading day on which common stock was traded on the applicable
date and if such applicable date is not a trading day, the last market trading
day prior to such date; and

 

(3)                                 If the common stock is neither listed on a
national securities exchange nor traded in the over-the-counter market, such
value as the Board of Directors of the Company, in good faith, shall determine.

 

The Company shall deliver such Shares as soon as practicable after the notice
shall be received, provided, however, that the Company may delay issuance of
such Shares until completion of any action or obtaining of any consent, which
the Company deems necessary under any applicable law (including, without
limitation, state securities or “blue sky” laws).  The Shares as to which the
Option shall have been so exercised shall be registered in the Company’s share
register in the name of the person so exercising the Option (or, if the Option
shall be exercised by the Participant and if the Participant shall so request in
the notice exercising the Option, shall be registered in the Company’s share
register in the name of the Participant and another person jointly, with right
of survivorship) and shall be delivered as provided above to or upon the written
order of the person exercising the Option.  In the event the Option shall be
exercised, pursuant to Section 4 hereof, by any person other than the
Participant, such notice shall be accompanied by appropriate proof of the right
of such person to exercise the Option.  All Shares that shall be purchased upon
the exercise of the Option as provided herein shall be fully paid and
nonassessable.

 

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6.                                      PARTIAL EXERCISE.

 

Exercise of the Option to the extent above stated may be made in part at any
time and from time to time within the above limits, except that no fractional
share shall be issued pursuant to the Option.

 

7.                                      NON-ASSIGNABILITY.

 

The Option shall not be transferable by the Participant otherwise than by will
or by the laws of descent and distribution or pursuant to a qualified domestic
relations order as defined by the Code or Title I of the Employee Retirement
Income Security Act or the rules thereunder.  However, the Participant, with the
approval of the Administrator, may transfer the Option for no consideration to
or for the benefit of the Participant’s Immediate Family (including, without
limitation, to a trust for the benefit of the Participant’s Immediate Family or
to a partnership or limited liability company for one or more members of the
Participant’s Immediate Family), subject to such limits as the Administrator may
establish, and the transferee shall remain subject to all the terms and
conditions applicable to the Option prior to such transfer and each such
transferee shall so acknowledge in writing as a condition precedent to the
effectiveness of such transfer.  Except as provided in the previous sentence,
the Option shall be exercisable, during the Participant’s lifetime, only by the
Participant (or, in the event of legal incapacity or incompetency, by the
Participant’s guardian or representative) and shall not be assigned, pledged or
hypothecated in any way (whether by operation of law or otherwise) and shall not
be subject to execution, attachment or similar process.  Any attempted transfer,
assignment, pledge, hypothecation or other disposition of the Option or of any
rights granted hereunder contrary to the provisions of this Section 7, or the
levy of any attachment or similar process upon the Option shall be null and
void.  The term “Immediate Family” shall mean the Participant’s spouse, former
spouse, parents, children, stepchildren, adoptive relationships, sisters,
brothers, nieces, nephews and grandchildren (and, for this purpose, shall also
include the Participant).

 

8.                                      NO RIGHTS AS STOCKHOLDER UNTIL EXERCISE.

 

The Participant shall have no rights as a stockholder with respect to Shares
subject to this Agreement until registration of the Shares in the Company’s
share register in the name of the Participant.  Except as is expressly provided
in this Agreement with respect to certain changes in the capitalization of the
Company, no adjustment shall be made for dividends or similar rights for which
the record date is prior to the date of such registration.

 

9.                                      ADJUSTMENTS.

 

Upon the occurrence of any of the following events, the Participant’s rights
with respect to the Option, except to the extent previously exercised shall be
adjusted as hereinafter provided:

 

A.                                    Stock Dividends and Stock Splits.  If
(i) shares of common stock of the Company shall be subdivided or combined into a
greater or smaller number of shares or if the Company shall issue any shares of
common stock as a stock dividend on its outstanding common stock, 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, the Shares deliverable upon the exercise of the Option shall be
appropriately increased or decreased proportionately, and appropriate
adjustments shall be made including, in the Purchase Price per Share to reflect
such events.

 

B.                                    Corporate Transactions.  If the Company is
to be consolidated with or acquired by another entity in a merger, sale of all
or substantially all of the Company’s assets other than a

 

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transaction to merely change the state of incorporation (a “Corporate
Transaction”), the Board of Directors of the Company or, if applicable, a
committee of the Board of Directors or the board of directors of any entity
assuming the obligations of the Company hereunder (the “Successor Board”),
shall, as to the unexercised portion of the Option, either (i) make appropriate
provision for the continuation of the Option by substituting on an equitable
basis for the Shares either the consideration payable with respect to the
outstanding shares of common stock in connection with the Corporate Transaction
or securities of any successor or acquiring entity; or (ii) upon written notice
to the Participant, provide that the Option must be exercised, within a
specified number of days of the date of such notice, at the end of which period
the Option shall terminate (the Option shall for purposes of this clause (ii) be
made fully vested and exercisable immediately prior to its termination); or
(iii) terminate the Option in exchange for a cash payment equal to the excess of
the Fair Market Value of the Shares over the Purchase Price thereof (the Option
shall for purposes of this clause (iii) be made fully vested and immediately
exercisable immediately prior to its termination).

 

C.                                    [RESERVED.]

 

D.                                    Recapitalization or Reorganization.  In
the event of a recapitalization or reorganization of the Company other than a
Corporate Transaction pursuant to which securities of the Company or of another
corporation are issued with respect to the outstanding shares of common stock of
the Company, the Participant upon exercising the Option after the
recapitalization or the reorganization shall be entitled to receive for the
purchase price paid upon such exercise the number of replacement securities
which would have been received if the Option had been exercised prior to such
recapitalization or reorganization.

 

E.                                     Dissolution or Liquidation of the
Company.  Upon the dissolution or liquidation of the Company, the Option will
terminate and become null and void; provided, however, that if the rights of the
Participant or the Participant’s Survivors have not otherwise terminated and
expired, the Participant or the Participant’s Survivors will have the right
immediately prior to such dissolution or liquidation to exercise the Option to
the extent that the Option is exercisable as of the date immediately prior to
such dissolution or liquidation.

 

10.                               TAXES.

 

The Participant acknowledges that upon exercise of the Option the Participant
will be deemed to have taxable income measured by the difference between the
then fair market value of the Shares received upon exercise and the price paid
for such Shares pursuant to this Agreement.  The Participant acknowledges that
any income or other taxes due from him or her with respect to the Option or the
Shares issuable pursuant to the Option shall be the Participant’s
responsibility.

 

The Participant agrees that the Company may withhold from the Participant’s
remuneration, if any, the minimum statutory amount of federal, state and local
withholding taxes attributable to such amount that is considered compensation
includable in such person’s gross income.  At the Company’s discretion, the
amount required to be withheld may be withheld in cash from such remuneration,
or in kind from the Shares otherwise deliverable to the Participant on exercise
of the Option.  The Fair Market Value of the Shares to be withheld shall be
determined as of the most recent practicable date prior to the date of
exercise.  The Participant further agrees that, if the Company does not withhold
an amount from the Participant’s remuneration sufficient to satisfy the
Company’s income tax withholding obligation, the Participant will reimburse the
Company on demand, in cash, for the amount under-withheld.

 

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11.                               PURCHASE FOR INVESTMENT.

 

Unless the offering and sale of the Shares to be issued upon the particular
exercise of the Option shall have been effectively registered under the
Securities Act of 1933, as now in force or hereafter amended (the “1933 Act”),
the Company shall be under no obligation to issue the Shares covered by such
exercise unless and until the following conditions have been fulfilled:

 

(a)                                 The person(s) who exercise the Option shall
warrant to the Company, at the time of such exercise, that such person(s) are
acquiring such Shares for their own respective accounts, for investment, and not
with a view to, or for sale in connection with, the distribution of any such
Shares, in which event the person(s) acquiring such Shares shall be bound by the
provisions of the following legend which shall be endorsed upon the
certificate(s) evidencing the Shares issued pursuant to such exercise:

 

“The shares represented by this certificate have been taken for investment and
they may not be sold or otherwise transferred by any person, including a
pledgee, unless (1) either (a) a Registration Statement with respect to such
shares shall be effective under the Securities Act of 1933, as amended, or
(b) the Company shall have received an opinion of counsel satisfactory to it
that an exemption from registration under such Act is then available, and
(2) there shall have been compliance with all applicable state securities laws”;
and

 

(b)                                 If the Company so requires, the Company
shall have received an opinion of its counsel that the Shares may be issued upon
such particular exercise in compliance with the 1933 Act without registration
thereunder.  Without limiting the generality of the foregoing, the Company may
delay issuance of the Shares until completion of any action or obtaining of any
consent, which the Company deems necessary under any applicable law (including
without limitation state securities or “blue sky” laws).

 

12.                               RESTRICTIONS ON TRANSFER OF SHARES.

 

12.1                        The Shares acquired by the Participant pursuant to
the exercise of the Option granted hereby shall not be transferred by the
Participant except as permitted herein.

 

12.2                        If, in connection with a registration statement
filed by the Company pursuant to the 1933 Act, the Company or its underwriter so
requests, the Participant will agree not to sell any Shares for a period not to
exceed 210 days following the effectiveness of such registration.

 

12.3                        The Participant acknowledges and agrees that neither
the Company, its shareholders nor its directors and officers, has any duty or
obligation to disclose to the Participant any material information regarding the
business of the Company or affecting the value of the Shares before, at the time
of, or following a termination of service of the Participant by the Company,
including, without limitation, any information concerning plans for the Company
to make a public offering of its securities or to be acquired by or merged with
or into another firm or entity.

 

13.                               NO OBLIGATION TO MAINTAIN RELATIONSHIP.

 

The Company is not by the Option obligated to continue the Participant as an
employee or consultant of the Company or of an Affiliate.  The Participant
acknowledges:  (i) that the grant of the Option is discretionary in nature and
is a one-time benefit which does not create any contractual or other right to
receive future grants of options, or benefits in lieu of options; (ii) that all
determinations with respect to any such future grants, including, but not
limited to, the times when options shall be

 

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granted, the number of shares subject to each option, the option price, and the
time or times when each option shall be exercisable, will be at the sole
discretion of the Company; (iii) that the value of the Option is an
extraordinary item of compensation which is outside the scope of the
Participant’s employment contract, if any; (iv) that the Participant’s
participation in this Agreement is voluntary; and (v) that the Option is not
part of normal or expected compensation for purposes of calculating any
severance, resignation, redundancy, end of service payments, bonuses,
long-service awards, pension or retirement benefits or similar payments.

 

14.                               NOTICES.

 

Any notices required or permitted by the terms of this Agreement shall be given
by recognized courier service, facsimile, registered or certified mail, return
receipt requested, addressed as follows:

 

If to the Company:

 

Synta Pharmaceuticals Corp.

45 Hartwell Avenue

Lexington, MA 02421

Attention: Stock Plan Administrator

 

If to the Participant, the Participant’s Company email address or the mailing
address provided to the Company on the Participant’s application or resume, or
to such other address or addresses of which notice in the same manner has
previously been given.  Any such notice shall be deemed to have been given upon
the earlier of receipt, one business day following delivery to a recognized
courier service or three business days following mailing by registered or
certified mail.

 

15.                               GOVERNING LAW.

 

This Agreement shall be construed and enforced in accordance with the law of the
State of Delaware, without giving effect to the conflict of law principles
thereof.  For the purpose of litigating any dispute that arises under this
Agreement, the parties hereby consent to exclusive jurisdiction in the
Commonwealth of Massachusetts and agree that such litigation shall be conducted
in the courts of Middlesex County, Massachusetts or the federal courts of the
United States for the District of Massachusetts.

 

16.                               BENEFIT OF AGREEMENT.

 

Subject to the provisions hereof, this Agreement shall be for the benefit of and
shall be binding upon the heirs, executors, administrators, successors and
assigns of the parties hereto.

 

17.                               ENTIRE AGREEMENT.

 

This Agreement together with the Severance Agreement embodies the entire
agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior oral or written agreements and
understandings relating to the subject matter hereof.  No statement,
representation, warranty, covenant or agreement not expressly set forth in this
Agreement shall affect or be used to interpret, change or restrict, the express
terms and provisions of this Agreement.

 

18.                               MODIFICATIONS AND AMENDMENTS.

 

The terms and provisions of this Agreement may be modified or amended by the
Company in a manner which is not adverse to the Participant, including, without
limitation, to the extent necessary

 

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to qualify the shares issuable upon exercise of the Option for listing on any
national securities exchange or quotation in any national automated quotation
system of securities dealers.  Any modification or amendment of this Agreement
shall not, without the consent of the Participant, adversely affect his rights
under the Option, including but not limited to pursuant to Section 409A of the
Code.

 

19.                               WAIVERS AND CONSENTS.

 

The terms and provisions of this Agreement may be waived, or consent for the
departure therefrom granted, only by written document executed by the party
entitled to the benefits of such terms or provisions.  No such waiver or consent
shall be deemed to be or shall constitute a waiver or consent with respect to
any other terms or provisions of this Agreement, whether or not similar.  Each
such waiver or consent shall be effective only in the specific instance and for
the purpose for which it was given, and shall not constitute a continuing waiver
or consent.

 

20.                               DATA PRIVACY.

 

By entering into this Agreement, the Participant:  (i) authorizes the Company
and each Affiliate, and any agent of the Company or any Affiliate administering
this Agreement or providing recordkeeping services, to disclose to the Company
or any of its Affiliates such information and data as the Company or any such
Affiliate shall request in order to facilitate the grant of options and the
administration of this Agreement; and (ii) authorizes the Company and each
Affiliate to store and transmit such information in electronic form for the
purposes set forth in this Agreement.

 

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