Exhibit 10.36

 

THERAVANCE, INC. 2004 EQUITY INCENTIVE PLAN
 NOTICE OF RESTRICTED STOCK AWARD

 

You have been granted restricted shares of Common Stock of Theravance, Inc. (the “Company”) on the following terms:

 

Name of Recipient:                                                                                                                                       «Name»

 

Total Number of Shares Granted:                                                             «TotalShares»

 

Date of Grant:                                                                                                                                                                 «DateGrant»

 

Vesting Schedule:

 

Vesting of the shares is dependent upon achievement of both the performance-based conditions and service-based conditions set forth below, both of which must be satisfied in order for the shares to vest.

 

Performance-Based Conditions

 

Upon achievement of any one of the performance targets set forth below on or prior to its deadline, the performance-based conditions will be achieved.  The performance target will not be deemed achieved unless and until the Compensation Committee of the Board of Directors certifies in writing that it has been achieved.  Minutes of a Compensation Committee meeting or an action by unanimous written consent with resolutions approving achievement constitute written certification.

 

	
Performance Target
    	
 
    	
Deadline for Achieving Performance Target
    
	
«Performance Target #1»
    	
 
    	
«Deadline Date»
    
	
«Performance Target #2»
    	
 
    	
«Deadline Date»
    
	
«Performance Target #3»
    	
 
    	
«Deadline Date»
    


 

Service-Based Conditions

 

Subject to achievement of the performance-based conditions described above, the service-based conditions will be satisfied and the shares granted under this award will vest in equal quarterly installments over approximately four years as follows: «InitialPercentage»% on «InitialVestDate»; «SubsequentPercentage»% on «SecondVestDate»; and an additional «SubsequentPercentage»% on the final day of each 3-month period thereafter (each, a “Vesting Date”), provided that you remain in continuous service as an employee or consultant of the Company, a Parent, a Subsidiary or an Affiliate (“Service”) through such Vesting Date.  Notwithstanding the foregoing, vesting of the shares will be delayed until the performance-based conditions are achieved, at which point the shares that would have vested on the Vesting Date(s) prior to achievement of the performance-based conditions will vest in a lump sum on the Vesting Date immediately following Compensation Committee certification of the

 











 

achievement of the performance target, provided that you remain in continuous Service through such Vesting Date.

 

You and the Company agree that these shares are granted under and governed by the terms and conditions of the Theravance, Inc. 2004 Equity Incentive Plan (the “Plan”) and of the Agreement that is attached to and made a part of this document.  Capitalized terms not defined herein have the meaning ascribed to such terms in the Plan.

 

You further agree that the Company may deliver 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 web site maintained by the Company or by a third party under contract with the Company.  If the Company posts these documents on a web site, it will notify you by email.

 

You agree to cover the applicable withholding taxes as set forth more fully herein.

 

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THERAVANCE, INC. 2004 EQUITY INCENTIVE PLAN:
 RESTRICTED STOCK AGREEMENT

 

	
Payment   for Shares
    	
 
    	
The   shares have been awarded to you in consideration of your past service to the   Company and no payment is required for the shares that you are receiving,   except for satisfying any withholding taxes that may be due as a result of   the grant of this award or the vesting or transfer of the shares.
    
	
 
    	
 
    	
 
    
	
Transfer
    	
 
    	
On   the terms and conditions set forth in the Notice of Restricted Stock Award   and this Agreement, the Company agrees to transfer to you the number of   shares of its Common Stock set forth in the Notice of Restricted Stock Award.
    
	
 
    	
 
    	
 
    
	
Vesting
    	
 
    	
The   shares will vest as shown in the Notice of Restricted Stock Award.

 

The   shares are eligible for vesting acceleration under the Company’s Change in   Control Severance Plan and 2009 Change in Control Severance Plan (each, a   “Severance Plan”) to the extent you are eligible to participate in either   such Severance Plan.

 

No   additional shares vest after your Service has terminated for any reason,   except as set forth in the Notice of Restricted Stock Award, in this   Agreement or, to the extent you are eligible to participate in a Severance   Plan, in a Severance Plan.

 

It   is intended that vesting in the shares is commensurate with a full-time work   schedule. For possible adjustments that may be made by the Company, see the   Section below entitled “Leaves of Absence and Part-Time Work.”
    
	
 
    	
 
    	
 
    
	
Shares   Restricted
    	
 
    	
Unvested   shares will be considered “Restricted Shares.”

 

You   may not sell, transfer, pledge or otherwise dispose of any Restricted Shares   without the written consent of the Company, except as provided in the next   sentence. You may transfer Restricted Shares to your spouse, children or   grandchildren or to a trust established by you for the benefit of yourself or   your spouse, children or grandchildren. However, a transferee of Restricted   Shares must agree in writing on a form prescribed by the Company to be bound   by all provisions of this Agreement.
    
	
 
    	
 
    	
 
    
	
Forfeiture
    	
 
    	
If   your Service terminates for any reason, then your shares 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 the Restricted Shares will revert to the Company. You receive no   payment for Restricted Shares that are forfeited. The Company determines when   your Service terminates for this purpose.

 

In   addition, even if your Service has not terminated, if the performance target   set forth in the Notice of Restricted Stock Award is not achieved prior to   its deadline, then the shares will be forfeited on the date of the   Compensation Committee certification described in the Notice of Restricted   Stock Award.
    
	
 
    	
 
    	
 
    
	
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. If   your leave of absence (other than a military leave) lasts for more than 6   months, then vesting will be suspended on the day that is 6 months and 1 day   after the leave of absence began. Vesting will resume effective as of the   second vesting date after you return from leave of absence provided you have   worked at least one day during that vesting period.

 

In   the case of all leaves, your Service terminates when the approved leave ends,   unless you immediately return to active work.

 

If   you and the Company agree to a reduction in your scheduled work hours, then   the Company reserves the right to modify the rate at which the shares vest,   so that the rate of vesting is commensurate with your reduced work schedule.   Any such adjustment shall be consistent with the Company’s policies for   part-time or reduced work schedules or shall be pursuant to the terms of an   agreement between you and the Company pertaining to your reduced work   schedule.

 

The   Company shall not be required to adjust any vesting schedule pursuant to this   subsection.
    
	
 
    	
 
    	
 
    
	
Stock   Certificates
    	
 
    	
The   Restricted Shares are issued in book-entry form, registered in your name, and   held in escrow at the Company’s designated brokerage pending the date on which   shares vest. After shares vest, the Company will release from escrow the   number of shares of Common Stock representing your vested shares, registered   in your name or in the name of your legal representatives, beneficiaries or   heirs, as the case may be.
    
	
 
    	
 
    	
 
    
	
Voting   Rights
    	
 
    	
You   may vote your shares even before they vest.
    
	
 
    	
 
    	
 
    
	
Dividend   Rights
    	
 
    	
Any   cash dividends distributed with respect to Restricted Shares shall be subject   to the same terms and conditions as apply to the Restricted Shares to which   they relate and shall be paid to you (less all applicable withholding taxes)   promptly upon vesting.
    
	
 
    	
 
    	
 
    
	
Withholding   Taxes
    	
 
    	
No   shares will be released to you unless you have made arrangements
    


 

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acceptable   to the Company to pay any withholding taxes that may be due as a result of   this award or the vesting of the shares. Prior to the relevant taxable event,   you shall pay or make adequate arrangements satisfactory to the Company to   satisfy all withholding obligations for applicable taxes.

 

At   your discretion, these arrangements may include (a) payment in cash, (b) payment   from the proceeds of the sale of shares through a Company-approved broker or   (c) withholding shares of Company stock that otherwise would be released to   you upon vesting with a fair market value not in excess of the amount   necessary to satisfy the minimum withholding amount, provided that the   Company, acting through the Board of Directors or Compensation Committee, may   provide prospectively that it no longer authorizes (c) withholding of shares.

 

If   the Company satisfies the obligation for taxes by withholding a number of   shares of Common Stock as described above, you will be deemed to have   received the full number of shares released from restrictions, including the   number of shares withheld to satisfy tax withholding obligations, and the   fair market value of these shares, determined as of the date when taxes   otherwise would have been withheld in cash, will be applied to the   withholding taxes.

 

You   acknowledge that the proceeds of a sale pursuant to (b) above or withholding   pursuant to (c) above may not be sufficient to satisfy your withholding   obligations. To the extent the proceeds from such sale are insufficient to   cover the taxes due, the Company may in its discretion withhold the balance   of all applicable taxes legally payable by you from your wages or other cash   compensation paid to you by the Company.
    
	
 
    	
 
    	
 
    
	
Restrictions   on Resale
    	
 
    	
You   agree not to sell any shares at a time when applicable laws, regulations,   Company policies (including the Company’s Insider Trading Policy, a copy of   which can be found on the Company’s intranet) 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.
    
	
 
    	
 
    	
 
    
	
No   Retention Rights
    	
 
    	
Your   award or this Agreement does not give you the right to be employed or   retained by the Company, a Parent, a Subsidiary or an Affiliate in any   capacity. The Company and its Parent, Subsidiaries and Affiliates reserve the   right to terminate your Service at any time, with or without cause.
    
	
 
    	
 
    	
 
    
	
Additional   or Exchanged Securities and
    	
 
    	
In   the event of a merger or consolidation of the Company with or into another   entity, any other corporate reorganization, a stock split, the declaration of   a stock dividend, the declaration of an extraordinary dividend payable in a   form other than stock, a spin-off, a
    


 

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Property
    	
 
    	
recapitalization   or a similar transaction affecting the Company’s outstanding Common Stock,   any securities or other property (including cash or cash equivalents) that   are by reason of such transaction exchanged for, or distributed with respect   to, any Restricted Shares shall be subject to the same terms and conditions   (including, without limitation, vesting and forfeiture) as are applicable to   the Restricted Shares under this Agreement and the Plan. Appropriate adjustments   to reflect the exchange or distribution of such securities or property shall   be made to the number and/or class of the Restricted Shares.
    
	
 
    	
 
    	
 
    
	
Applicable   Law
    	
 
    	
This   Agreement will be interpreted and enforced under the laws of the State of   Delaware (without regard to Delaware choice-of-law provisions).
    
	
 
    	
 
    	
 
    
	
The   Plan and Other Agreements
    	
 
    	
The   text of the Plan is incorporated in this Agreement by reference.

 

This   Agreement and the Plan 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 ACCEPTING THIS RESTRICTED STOCK AWARD, YOU AGREE TO ALL OF THE
 TERMS AND CONDITIONS DESCRIBED ABOVE AND IN THE PLAN.

 

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