Exhibit 10.11


 


FACET
BIOTECH CORPORATION


2008
PERFORMANCE BONUS PROGRAM


 


The following are the terms of the 2008 Performance
Bonus Program approved by the Board of Directors of Facet Biotech Corporation
(the “Company”) on                     ,
2008 (the “Program”). The Program shall be administered by the Compensation
Committee of the Board of Directors of the Company (the “Committee”), and any
interpretation of the provisions of the Program shall be made by the Committee
at its sole discretion.


 


	
  A.

  	
  Purpose 

  



 


1. The terms of the Program have been established to
attract, motivate, retain and reward the Company’s employees, including our
officers, for driving the Company to achieve specified corporate objectives.


 


2. The Program provides for the payment of cash
bonuses based upon the successful achievement of certain goals of the Company’s
business as run by the Company or the Company’s predecessor, PDL  BioPharma, Inc. (“PDL”), during 2008. Payments under the Program are subject
to certain eligibility requirements.


 


3. The Program is largely a continuation of the 2008
performance-based bonus program adopted by PDL on June 6,
2008 as most of the goals of its bonus program related to its biotechnology
operations run by PDL and to be transferred and
operated by the Company after its spin-off from PDL
(the “Biotechnology Business”), with nearly all of PDL’s
employees anticipated to join the Company.


 


	
  B.

  	
  Eligibility 

  



 


1. All of our employees who
were hired prior to October 1, 2008 in the Biotechnology Business, whether
hired by us or by PDL, are eligible to participate in
the Program, provided that they work 20 hours or more per week. Eligible
employees who are assigned to regularly work a schedule of less than
40 hours per week but more than 20 hours per week would be entitled
to a pro rated portion, based on their work schedule but excluding overtime
hours, of the amount of bonus to which they would otherwise receive. Eligible
employees that started their employment with the Biotechnology Business
(whether as operated by us or by PDL) after January 31,
2008 and before October 1, 2008 would be entitled to a pro rated portion
of the amount of bonus which they would otherwise receive.


 


2. In order to receive any bonus that may be paid
out under the Program, eligible employees must also continue to be employed by
the Company at the time bonuses are paid, if any, which we expect would occur
in early 2009. Notwithstanding the foregoing, transition employees whose
employment we terminate or PDL terminated on or after
July 1, 2008 will be eligible to receive bonuses under the Program even if
they are not employed by us at the time bonuses are paid under the Program.
These transition employees would be eligible to receive a pro-rated portion of
the bonus they would have otherwise been eligible for had we or PDL not terminated them prior to the time bonuses are paid.
The pro-ration would be based on the number of whole months of the transition
employee’s service to the Biotechnology Business in 2008 (whether as operated
by us or by PDL), rounded up to the nearest whole
month. Notwithstanding the foregoing, the amounts to be paid under the Program
are not intended to duplicate any payments to be made under the 2008
Performance Bonus Program of PDL and performance
bonuses paid with respect to achievement of specified corporate objectives of
the Biotechnology Business shall only be paid hereunder to the extent such
eligible employee is not similarly eligible under the 2008 Performance Bonus
Program of PDL.


 


	
  C.

  	
  Determination of Bonus Amounts 

  



 


1. The extent to which we
successfully achieve our goals, as determined by our Committee, will determine the amount of the bonus pool
under the Program, subject to the exercise of the discretion of our Committee
to increase, decrease or eliminate the bonus pool under the Program.


 


2. The bonus pool will be allocated among eligible
employees based on each eligible employee’s target bonus, which is equal to a
percentage of the employee’s annual base salary and depends on the salary grade
of the employee, and the eligible employee’s individual performance.


 

















 


3. The primary goal categories under
the Program and their respective weighting are:


 


	
  Category

  	
   

  	
  Weighting

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Goals related to restructuring, financial
  objectives and strategic transactions

  	
   

  	
  30

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Clinical development goals

  	
   

  	
  30

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Research and discovery goals

  	
   

  	
  20

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Collaboration related goals

  	
   

  	
  20

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Total:

  	
   

  	
  100

  	
  %

  



 


4. Our Committee reserves the right, exercisable at
its discretion, to increase, decrease or eliminate the bonuses that could be
paid under the Program and to amend or terminate the Program at any time.