Exhibit 10.37

 

KALOBIOS PHARMACEUTICALS, INC.
 2012 EQUITY INCENTIVE PLAN

NOTICE OF STOCK OPTION GRANT

 

You have been granted the following option to purchase shares of the common stock of KaloBios Pharmaceuticals, Inc. (the “Company”):

 

	
Name of Optionee:
    	
 
    	
<<Name>>
    
	
 
    	
 
    	
 
    
	
Total   Number of Shares:
    	
 
    	
<<Shares>>
    
	
 
    	
 
    	
 
    
	
Type   of Option:
    	
 
    	
Nonstatutory   Stock Option
    
	
 
    	
 
    	
 
    
	
Exercise   Price per Share:
    	
 
    	
<<$0.00>>
    
	
 
    	
 
    	
 
    
	
Date of Grant:
    	
 
    	
<<Date>>
    
	
 
    	
 
    	
 
    
	
Vesting Commencement Date:
    	
 
    	
<<Vesting Date>>
    
	
 
    	
 
    	
 
    
	
Vesting Schedule:
    	
 
    	
This option vests and becomes exercisable with respect to   1/36th of the shares subject to this   option when you complete each month of “Service” (as defined in   the Plan) from the Vesting Commencement Date. If the Company is subject to a   “Change in Control” (as defined in the Plan) before your Service terminates,   then, to the extent the option has not yet become vested and exercisable, the   option will vest and become exercisable with respect to 100% of the unvested   shares immediately prior to consummation of the Change in Control.
    
	
 
    	
 
    	
 
    
	
Expiration   Date:
    	
 
    	
<<Date>>.   This option expires earlier if your Service terminates earlier, as described   in the Stock Option Agreement, and may terminate earlier in connection with   certain corporate transactions as described in Article 9 of the Plan.
    


 

You and the Company agree that this option is granted under and governed by the terms and conditions of the Company’s 2012 Equity Incentive Plan (the “Plan”) and the Stock Option 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 option (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 Securities Trading Policy when selling shares of the Company’s common stock.

 

	
OPTIONEE
    	
 
    	
KALOBIOS   PHARMACEUTICALS, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    


 











 

KALOBIOS PHARMACEUTICALS, INC.
 2012 EQUITY INCENTIVE PLAN

 

STOCK OPTION AGREEMENT

 

	
Grant   of Option
    	
 
    	
Subject   to all of the terms and conditions set forth in the Notice of Stock Option   Grant, this Stock Option Agreement (the “Agreement”) and the Plan, the   Company has granted you an option to purchase up to the total number of   shares specified in the Notice of Stock Option Grant at the exercise price   indicated in the Notice of Stock Option Grant.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
All   capitalized terms used in this Agreement shall have the meanings assigned to   them in this Agreement, the Notice of Stock Option Grant or the Plan.
    
	
 
    	
 
    	
 
    
	
Tax   Treatment
    	
 
    	
This   option is intended to be a nonstatutory stock option, as provided in the   Notice of Stock Option Grant.
    
	
 
    	
 
    	
 
    
	
Vesting
    	
 
    	
This   option vests and becomes exercisable in accordance with the vesting schedule   set forth in the Notice of Stock Option Grant.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
In   no event will this option vest or become exercisable for additional shares   after your Service has terminated for any reason.
    
	
 
    	
 
    	
 
    
	
Term
    	
 
    	
This   option expires in any event at the close of business at Company headquarters   on the day before the 10th anniversary of the Date of   Grant, as shown in the Notice of Stock Option Grant. (This option will expire   earlier if your Service terminates, as described below, and this option may   be terminated earlier as provided in Article 9 of the Plan.)
    
	
 
    	
 
    	
 
    
	
Termination   of Service
    	
 
    	
If   your Service terminates for any reason, this option will expire immediately   to the extent the option is unvested as of your termination date and does not   vest as a result of your termination of Service. The Company determines when   your Service terminates for all purposes of this option.
    
	
 
    	
 
    	
 
    
	
Regular   Termination
    	
 
    	
If   your Service terminates for any reason except death or total and permanent   disability, then this option, to the extent vested as of your termination   date, will expire at the close of business at Company headquarters on the   date 12 months after your termination date.
    
	
 
    	
 
    	
 
    
	
Death
    	
 
    	
If   you die before your Service terminates, then this option will expire at the   close of business at Company headquarters on the date 12 months after the   date of death.
    
	
 
    	
 
    	
 
    
	
Disability
    	
 
    	
If   your Service terminates because of your total and permanent disability, then   this option will expire at the close of business at Company
    


 

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headquarters   on the date 12 months after your termination date.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
For   all purposes under this Agreement, “total and permanent disability” means   that you are unable to engage in any substantial gainful activity by reason   of any medically determinable physical or mental impairment which can be   expected to result in death or which has lasted, or can be expected to last,   for a continuous period of not less than one year.
    
	
 
    	
 
    	
 
    
	
Leaves   of Absence and Part-Time Work [consider whether to delete   this para]
    	
 
    	
For   purposes of this option, 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; provided, however, if reemployment upon expiration of the   approved leave is not guaranteed by statute or contract, then any incentive   stock option shall cease to be treated as such and shall instead be treated   as a nonstatutory stock option beginning six months following the first day   of such leave.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
If   you go on a leave of absence, then the vesting schedule specified in the   Notice of Stock Option Grant 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.
    
	
 
    	
 
    	
 
    
	
Restrictions   on Exercise
    	
 
    	
The   Company will not permit you to exercise this option if the issuance of shares   at that time would violate any law or regulation.
    
	
 
    	
 
    	
 
    
	
Notice   of Exercise
    	
 
    	
When   you wish to exercise this option, you must notify the Company by filing the   proper “Notice of Exercise” form at the address given on the form or, if the   Company has designated a brokerage firm to administer the Plan, you must   notify such brokerage firm in the manner such brokerage firm requires. Your   notice must specify how many shares you wish to purchase. The notice will be   effective when the Company receives it.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
However,   if you wish to exercise this option by executing a same-day sale (as   described below), you must follow the instructions of the Company and the   broker who will execute the sale.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
If   someone else wants to exercise this option after your death, that person must   prove to the Company’s satisfaction that he or she is entitled to do so.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
You   may only exercise your option for whole shares.
    
	
 
    	
 
    	
 
    
	
Form of   Payment
    	
 
    	
When   you submit your notice of exercise, you must include payment of the option   exercise price for the shares that you are purchasing. To the extent   permitted by applicable law, payment may be made in one (or a combination of   two or more) of the following forms:
    


 

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·                  By delivering to the   Company your personal check, a cashier’s check or a money order, or arranging   for a wire transfer.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
·                  By delivering to the   Company certificates for shares of Company stock that you own, along with any   forms needed to effect a transfer of those shares to the Company. The value   of the shares, determined as of the effective date of the option exercise,   will be applied to the option exercise price. Instead of surrendering shares   of Company stock, you may attest to the ownership of those shares on a form   provided by the Company and have the same number of shares subtracted from   the option shares issued to you.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
·                  By giving to a securities   broker approved by the Company irrevocable directions to sell all or part of   your option shares and to deliver to the Company, from the sale proceeds, an   amount sufficient to pay the option exercise price and any withholding taxes.   (The balance of the sale proceeds, if any, will be delivered to you.) The   directions must be given in accordance with the instructions of the Company   and the broker. This exercise method is sometimes called a “same-day sale.”
    
	
 
    	
 
    	
 
    
	
Withholding   Taxes
    	
 
    	
You   will not be allowed to exercise this option unless you make arrangements   acceptable to the Company to pay applicable withholding taxes (if any) that   may be due as a result of the option exercise. These arrangements include   payment in cash. With the Company’s consent, these arrangements may also   include (a) payment from the proceeds of the sale of shares through a   Company-approved broker, (b) withholding shares of Company stock that   otherwise would be issued to you when you exercise this option with a fair   market value no greater than the minimum amount required to be withheld by   law, (c) surrendering 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 shares, determined as of the date when taxes   otherwise would have been withheld in cash, will be applied to the   withholding taxes.
    
	
 
    	
 
    	
 
    
	
Restrictions   on Resale
    	
 
    	
You   agree not to sell any option 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.
    
	
 
    	
 
    	
 
    
	
Transfer   of Option
    	
 
    	
Prior   to your death, only you may exercise this option. You cannot transfer or   assign this option. For instance, you may not sell this option or use it as   security for a loan. If you attempt to do any of these things, this option   will immediately become invalid. You may, however, dispose of this option in   your will or by means of a written beneficiary designation; provided,   however, that your beneficiary or a representative of your estate acknowledges   and agrees in writing in a form reasonably acceptable to the Company, to be   bound by the provisions of this Agreement and the Plan as
    


 

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if   such beneficiary of the estate were you.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Regardless   of any marital property settlement agreement, the Company is not obligated to   honor a notice of exercise from your former spouse, nor is the Company   obligated to recognize your former spouse’s interest in your option in any   other way.
    
	
 
    	
 
    	
 
    
	
Retention   Rights
    	
 
    	
Your   option or this Agreement does not give you the right to be retained by the   Company, a Parent, Subsidiary, or an Affiliate in any capacity.
    
	
 
    	
 
    	
 
    
	
Stockholder   Rights
    	
 
    	
You,   or your estate or heirs, have no rights as a stockholder of the Company until   you have exercised this option by giving the required notice to the Company,   paying the exercise price, and satisfying any applicable withholding taxes.   No adjustments are made for dividends or other rights if the applicable   record date occurs before you exercise this option, except as described in   the Plan.
    
	
 
    	
 
    	
 
    
	
Recoupment   Policy
    	
 
    	
This   option, and the shares acquired upon exercise of this option, shall be   subject to any Company recoupment policy in effect from time to time.
    
	
 
    	
 
    	
 
    
	
Adjustments
    	
 
    	
In   the event of a stock split, a stock dividend or a similar change in Company   stock, the number of shares covered by this option and the exercise price per   share will be adjusted pursuant to the applicable provisions of   Article 9 of the Plan.
    
	
 
    	
 
    	
 
    
	
Effect   of Significant Corporate Transactions
    	
 
    	
If   the Company is a party to a merger, consolidation, or certain change in   control transactions, then this option will be subject to the applicable   provisions of Article 9 of the Plan.
    
	
 
    	
 
    	
 
    
	
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.

 

This   Plan, this Agreement and the Notice of Stock Option Grant constitute the   entire understanding between you and the Company regarding this option. Any   prior agreements, commitments or negotiations concerning this option 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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