exv10w19



 





Exhibit 10.19




AMENDED AND RESTATED




CADENCE PHARMACEUTICALS, INC.




DIRECTOR COMPENSATION POLICY




Effective August 29, 2007




     Non-employee members of the board of directors (the “Board”) of Cadence Pharmaceuticals, Inc.
(the “Company”) shall be eligible to receive cash and equity compensation commencing on the first
date upon which the Company is subject to the reporting requirements of Section 13 or 15(d)(2) of
the Exchange Act (the “Public Trading Date”) as set forth in this Director Compensation Policy.
The cash compensation and option grants described in this Director Compensation Policy 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 parent or subsidiary of the
Company (each, an “Independent Director”) who may be eligible to receive such cash compensation or
options, unless such Independent Director declines the receipt of such cash compensation or options
by written notice to the Company. This Director Compensation Policy shall remain in effect until
it is revised or rescinded by further action of the Board. All share numbers set forth in this
policy give effect to the reverse stock split to be implemented by the Company in connection with
its initial public offering.



     1. Cash Compensation.



          Each Independent Director shall be eligible to receive an annual retainer of $30,000 for
service on the Board. In addition, an Independent Director serving as:




               (i) chairman of the Audit Committee shall be eligible to receive an additional annual retainer
of $17,500 for such service;



               (ii) members (other than the chairman) of the Audit Committee shall be eligible to receive an
additional annual retainer of $6,000 for such service;



               (iii) chairman of the Compensation Committee shall be eligible to receive an additional annual
retainer of $10,000 for such service;



               (iv) members (other than the chairman) of the Compensation Committee shall be eligible to
receive an additional annual retainer of $5,000 for such service;



               (iv) chairman of the Nominating/Corporate Governance Committee shall be eligible to receive an
annual retainer of $7,500 for such service; and



               (vi) members (other than the chairman) of the Nominating/Corporate Governance Committee shall
be eligible to receive an annual retainer of $3,000 for such service.



          The annual retainers shall be paid by the Company in quarterly installments or more frequently
as deemed advisable by the officers of the Company for administrative or other reasons.




     2. Equity Compensation. The options described below shall be granted under and shall
be subject to the terms and provisions of the Company’s 2006 Equity Incentive Award Plan (the “2006
Plan”) and shall be granted subject to the execution and delivery of option agreements, including
attached



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exhibits, in substantially the same forms previously approved by the Board, setting forth the
vesting schedule applicable to such options and such other terms as may be required by the 2006
Plan.



          (a) Initial Options. A person who was initially elected or appointed to the Board
less than twelve (12) months prior to the Public Trading Date or who is initially elected or
appointed to the Board following the Public Trading Date, and who was or is an Independent Director
at the time of such initial election or appointment, shall be eligible to receive a non-qualified
stock option to purchase 25,000 shares of common stock (subject to adjustment as provided in the
2006 Plan) on the later of the Public Trading Date and the date of such initial election or
appointment (each, an “Initial Option”).




          (b) Subsequent Options. A person who is an Independent Director automatically shall
be eligible to receive a non-qualified stock option to purchase 12,500 shares of common stock
(subject to adjustment as provided in the 2006 Plan) on the date of each annual meeting of the
Company’s stockholders after the Public Trading Date. An Independent Director elected for the
first time to the Board at an annual meeting of stockholders shall only receive an Initial Option
in connection with such election, and shall not receive a Subsequent Option on the date of such
meeting as well. The option grants described in this clause shall be referred to as “Subsequent
Options.”




          (c) Termination of Employment of Employee Directors. Members of the Board who are
employees of the Company or any parent or subsidiary of the Company who subsequently terminate
their employment with the Company and any parent or subsidiary of the Company and remain on the
Board will not receive an Initial Option grant pursuant to clause 2(a) above, but to the extent
that they are otherwise eligible, will be eligible to receive, after termination from employment
with the Company and any parent or subsidiary of the Company, Subsequent Options as described in
clause 2(b) above.




          (d) Terms of Options Granted to Independent Directors.




               (i) Exercise Price. The per share exercise price of each option granted to an
Independent Director shall equal 100% of the Fair Market Value (as defined in the 2006 Plan) of a
share of common stock on the date the option is granted.



               (ii) Vesting. Initial Options granted to Independent Directors shall become
exercisable in thirty-six equal monthly installments of 1/36 of the shares subject to such option
on the first day of each calendar month following the date of the Initial Option grant, such that
each Initial Option shall be 100% vested on the first day of the 36th month following
the date of grant, subject to the director’s continuing service on the Board through such dates.
Subsequent Options granted to Independent Directors shall become vested in twelve equal monthly
installments of 1/12 of the shares subject to such option on the first day of each calendar month
following the date of the Subsequent Option Grant, subject to a director’s continuing service on
the Board through such dates. The term of each option granted to an Independent Director shall be
ten years from the date the option is granted. No portion of an option which is unexercisable at
the time of an Independent Director’s termination of membership on the Board shall thereafter
become exercisable.




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